The Liberalization of Food Marketing in Sub-Saharan Africa

Pekka Seppala

No 295362, WIDER Working Papers from United Nations University, World Institute for Development Economic Research (UNU-WIDER)

Abstract: Liberalization of food marketings has been implemented as a part of structural adjustment programmes in Sub-Saharan Africa. In this study we assess the i) the aims of the reform policy, ii) the implementation of specific reform measures, iii) the politics of reform, and iv) the impacts of reform.The study highlights the diversity in initial circumstances: during the end of 1970s, state governed marketing boards and cooperatives marketed food crops in most countries but state intervention was generally limited to certain key crops and, on these crops, the level of intervention was further limited by actual policies on crop collection coverage. Pre-reform policies were directed by the aims of nation building and food security and, for this purpose, provided subsidies for both producers and consumers. These subsidies, together with the high costs of marketing operations, caused huge financial problems to governments.Marketing reforms have been implemented at the levels of pricing policies, institutional set-up and macro-economic environment. Several governments embarked on liberalization policies with doubts but during recent years, even the most hesitant countries have also implemented reforms. In certain countries, the liberalization of key food crops touched a delicate political issue with complex vested interests. Behind the debate of cheap food for urban consumers existed a whole range of factors like the patrimonial linkages of marketing boards, regional politics, and the interests of large-scale millers and estate producers. In the economic liberalization debate, political issues are largely simplified and marketing boards are crudely evaluated in terms of economic efficiency.The study compares countries which always relied on private food marketing to countries which liberalized food marketing in 1992 and those still retaining state interventions. The data shows that best growth rates for the production of key food crops are in the countries with more liberal food marketing regimes. However, differences within country groups are significant. Variations can partly be explained by the nature of key crops, with rice subjected to import competition while tubers and plantains are not affected by competition. Maize production in eastern and southern Africa has been the focus of a detailed case-study because of the complexity of its extreme politization.Marketing reform has had relatively little impact on food production which is still growing slower than the population in Sub-Saharan Africa. Its major impact has been the diminished demands on fiscal balance. As liberalization releases government resources for other uses, these should be directed to measures to increase agricultural production: land reforms, input subsidies and the construction of feeder roads. Marketing, milling and consumer support of food crops should be targeted to the crops that are mainly consumed by the poor.

Keywords: International; Development (search for similar items in EconPapers)
Pages: 81
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Persistent link: https://EconPapers.repec.org/RePEc:ags:widerw:295362

DOI: 10.22004/ag.econ.295362

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