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ArticleAchieving food security and industrial development in Malawi: Are export restrictions the solution? 2018
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No results found.Restrictions on staple or cash crop exports are frequently imposed in developing countries to promote food security or industrial development. By diverting production to local markets, these policies tend to reduce prices and increase domestic supply of food or intermediate inputs in the short term, to the benefit of consumers or manufacturers, which make them attractive to policymakers. However, in the long term, export restrictions discourage agricultural production, which may ultimately negate the short-term gains. This study assesses the economy-wide effects of Malawi’s long-term maize export ban, which was only recently lifted, and a proposed oilseed export levy intended to improve food security and support local processing industries, respectively. We find that maize export bans only benefit the urban non-poor, while poor farmers’ incomes and maize consumption levels decline in the longer run. The oilseed export levy also fails to achieve its long run objectives: even when tax revenues are used to further subsidize food processors, their gains in value-addition are outweighed by declining agricultural value-addition. More generally, these results show that while export restrictions may have the desired outcomes in the short run, production responses may render the policies ineffective in the medium to long run. Ultimately, such restrictive policies reinforce a subsistence approach to agriculture, which is inconsistent with the stated economic transformation goals of many Sub-Saharan African countries. -
Book (stand-alone)Assessing the policy environment for cash crops in Malawi: what could hinder the achievement of the National Export Strategy objectives? 2017
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No results found.This paper examines the main issues affecting producers of export crops in Malawi that could compromise the attainment of the National Export Strategy (NES) 2013-2018 targets. The analysis assesses the level of policy support to the major export crops (cotton, groundnuts, sugar, tea and tobacco) for the period 2005-2013, by calculating the Nominal Rate of Protection (NRP), the Nominal Rate of Assistance (NRA) and the Market Development Gap (MDG) indicators for producers and by analysing public e xpenditure targeting the aforementioned commodities. The results show that trade and market policies resulted in disincentives of -15 percent on average for cash crop producers mainly due to poor infrastructure, lack of competition, weak enforcement and/or inefficiency of producer price policies, and limited budgetary support to cash crops value chain development. The analysis offers further evidence to guide the prioritization of policies and investments in view of fully attaining the NES objec tives, including facilitation of farmers’ access to markets, promotion of a more competitive environment for agri-business, and development of a transparent market information system. -
DocumentContribution of Tea Production and Exports to Food Security, Rural Development and Smallholder Welfare in Selected Producing Countries 2015
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No results found.The World Food Summit in 1996 reinforced a multidimensional approach to food security: “Food security exists when all people, at all times, have physical and economic access to sufficient, safe and nutritious food that meets their dietary needs and food preferences for an active and healthy life”. In as far as how international trade contributed to food security, the summit concluded that an important way was by accelerating national income growth. As incomes grew, the fraction spent on food dec lined and the chances of falling into food insecurity decreased. Trade contributed to income growth in a number of ways: enabling countries to reap the benefits of comparative advantage; provide opportunities for production expansion; and greater transfer of capital and expertise, particularly through foreign investment. Export growth allowed firms to expand beyond the respective domestic markets and reap the benefits of economies of scale. Exposure to foreign competition also helped in removing inefficiencies and gaining exposure to ideas, knowledge and new technologies. In the case of tea, production and exports generate foreign exchange and employment and provide a material base for national economic growth. In particular, they make significant contributions to food security by helping to cover food import bills. In 2011, tea export earnings paid for 51 percent and 71 percent of Kenya and Sri Lanka’s food import bills, respectively. Therefore, monitoring and analysing international tea trade is critical for policy makers involved with food security, trade and rural development in developing countries.
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