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Prospects for Commercial Agriculture in the Guinea Savannah Zone and Beyond Public Disclosure Authorized Public Disclosure Authorized

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Prospects for Commercial Agriculture in the Guinea Savannah Zone and Beyond Public Disclosure Authorized Public Disclosure Authorized 49046 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Agriculture andRuralAgriculture Development DIRECTIONS INDEVELOPMENT the GuineaSavannah Zone andBeyond Prospects forCommercialProspects Agriculture in Awakening Africa’s Awakening Sleeping Giant Awakening Africa’s Sleeping Giant Awakening Africa’s Sleeping Giant Prospects for Commercial Agriculture in the Guinea Savannah Zone and Beyond © 2009 The International Bank for Reconstruction and Development / The World Bank 1818 H Street, NW Washington, DC 20433 Telephone 202-473-1000 Internet www.worldbank.org E-mail [email protected] All rights reserved. 1 2 3 4 :: 12 11 10 09 This volume is a product of the staff of the International Bank for Reconstruction and Development / The World Bank. The findings, interpretations, and conclusions expressed in this volume do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The bound- aries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Rights and Permissions The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The International Bank for Reconstruction and Development / The World Bank encourages dissemination of its work and will normally grant permission to reproduce portions of the work promptly. For permission to photocopy or reprint any part of this work, please send a request with complete information to the Copyright Clearance Center Inc., 222 Rosewood Drive, Danvers, MA 01923, USA; telephone: 978-750-8400; fax: 978-750-4470; Internet: www.copyright.com. All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2422; e-mail: [email protected]. ISBN: 978-0-8213-7941-7 eISBN: 978-0-8213-7942-4 DOI: 10.1596/978-0-8213-7941-7 Cover photo: © FAO / Alessandra Benedetti. Cataloging-in-Publication data for this title is available from the Library of Congress. Contents Acknowledgments ix Abbreviations xi Executive Summary 1 Looking Backward: The Experiences of Brazil’s Cerrado and Northeast Thailand 3 Looking Forward: Factors Affecting Agricultural Competitiveness in the African Guinea Savannah 5 Potential Social Impacts of Agricultural Commercialization 7 Potential Environmental Impacts of Agricultural Commercialization 11 Bright Prospects for Commercial Agriculture in the African Guinea Savannah 12 Constraints to Be Overcome 14 Needed Interventions: Policy Reforms, Scaled-Up Investments, and Strengthened Institutions 16 The Road Ahead 21 Chapter 1 Introduction and Objectives 23 Study Objectives 24 v vi Contents Study Context: The Reemergence of Agriculture in the Development Agenda 29 Study Design: A Case Study Approach with Comparability 31 Defining Key Concepts: Comparative Advantage and Competitiveness 34 Notes 39 Chapter 2 Past Experience: Asia and Latin America vs. Sub-Saharan Africa 41 Brazil and Thailand 41 Sub-Saharan Africa 50 Notes 54 Chapter 3 Outlook for Commercial Agriculture in Sub-Saharan Africa 57 Global Outlook for the Studied Commodities 57 International Trade Policies 61 Domestic and Regional Markets 64 Note 69 Chapter 4 Commodity-Specific Competitiveness Analysis 71 Cassava 80 Cotton 81 Maize 82 Rice 84 Soybeans 84 Sugar 85 Summary of Value Chain Results 86 Notes 88 Chapter 5 Factors Affecting the Competitiveness of African Agriculture 89 Policy Environment 89 Technology 98 Infrastructure 112 Irrigation 117 Institutions 120 Human Capital 131 Notes 135 Contents vii Chapter 6 Potential Social and Environmental Impacts of Commercial Agriculture 137 Potential Social Impacts 137 Potential Environmental Impacts 163 Notes 173 Chapter 7 Conclusions and Recommendations: Opportunities and Challenges 175 Bright Prospects for Commercial Agriculture in the Guinea Savannah Zone 175 Constraints to Be Overcome 178 Needed Interventions: Policies, Investments, and Institutional Development 181 Final Thoughts 192 Note 194 Appendix A List of CCAA Background Reports 195 References 199 Index 211 Boxes 1.1 Characteristics of Africa’s Guinea Savannah Zone 25 1.2 Comparative Advantage, Efficiency, and Competitiveness 35 5.1 The Cerrado Soybean Revolution: A Many-Faceted Technology 102 5.2 Road Freight Transport Costs Are Higher in Africa Than in Asia 117 5.3 Reducing Risk in Smallholder Cotton Production Systems 126 Figures 1.1 Extent of the Guinea Savannah Zone in Sub-Saharan Africa 27 2.1 The Cerrado Region of Brazil 43 2.2 Extent of the Guinea Savannah Zone Equivalent in Thailand 46 3.1 International Commodity Price Projections, 2005–2018 61 4.1 Composition of Farm-Level Shipment Values 73 viii Contents 5.1 Net Taxation of Agriculture, CCAA Case Study Countries 90 5.2 Macroeconomic Scores of CCAA Case Study Countries, 1985–2007 92 5.3 Nominal Rates of Assistance, CCAA Case Study Countries 99 5.4 Decomposition of Production Growth, CCAA Selected Commodities 100 5.5 Yield Indices for the Selected Commodities 101 5.6 Agricultural R&D Spending, Brazil and Nigeria 108 5.7 Wholesale Maize Prices, Southern Africa, 1994–2003 122 Tables 3.1 Market Prospects for CCAA Target Commodities 65 4.1 Competitiveness Indicators from Value Chain Analysis: Cassava (2007) 74 4.2 Competitiveness Indicators from Value Chain Analysis: Cotton (2007) 75 4.3 Competitiveness Indicators from Value Chain Analysis: Maize (2007) 76 4.4 Competitiveness Indicators from Value Chain Analysis: Rice (2007) 77 4.5 Competitiveness Indicators from Value Chain Analysis: Soybeans (2007) 78 4.6 Competitiveness Indicators from Value Chain Analysis: Sugar (2007) 79 5.1 Travel Time to Towns of 5,000 or More Inhabitants, CCAA Case Study Countries 113 5.2 Current and Potentially Irrigated Area, Mozambique, Nigeria, and Zambia 119 Acknowledgments This report is one of several outputs of the study on Competitive Commercial Agriculture for Africa (CCAA). The CCAA study was a col- laborative effort involving researchers from many organizations, working under the guidance of a team made up of staff from the Sustainable Development Network (SDN) of the World Bank and the Investment Center (TCIS) of the United Nations (UN) Food and Agriculture Organ - ization (FAO). Funding for the study was provided by the government of Italy, Ministry of Foreign Affairs, Directorate General for Development Cooperation (through the Italian Special Contribution to the FAO Trust Fund for Food Security and Food Safety); the World Bank; FAO; the United Kingdom (U.K.) Department for International Development (DFID); and the Canadian International Development Association (CIDA). The World Bank staff who contributed to the overall CCAA study included Michael Morris (Task Team Leader), Hans Binswanger, Sergio Margulis, Loraine Ronchi, Chris Jackson, Derek Byerlee, Paula Savanti, Rob Townsend, Malick Antoine, Paavo Eliste, Eduardo da Souza, Pedro Arlindo, Lucas Akapa, Azra Lodi, Hawanty Page, and Patrice Sade. The FAO staff included Turi Fileccia, Claudio Gregorio, Guy Evers, Merritt Cluff, Holger Matthey, Jennifer Nyberg, Adam Prakash, Nancy Morgan, Gregoire Tallard, Abdolreza Abbassian, Conception Calpe, Peter Thoenes, and Marianne El Metni. ix x Acknowledgments This synthesis report draws extensively on about 30 background papers and notes prepared by the following authors: John Keyser (Consultant, Lusaka, Zambia); Rudy van Gent (Agridev, Lusaka, Zambia); Colin Poulton, Geoff Tyler, Andrew Dorward, Peter Hazell, Jonathan Kydd, and Mike Stockbridge (Centre for Development, Environment and Policy, School of Oriental and African Studies, University of London); Pasquale De Muro, Elisabetta Martone, Lucia Lombardo, Lucia Russo, Sara Gorgoni, and Laura Silici Riccardo Bocci (Roma Tre University, Rome); Benchaphun Ekasingh, Chapika Sangkapitux, Jirawan Kitchaicharoen, and Pornsiri Suebpongsang (Chiang Mai University, Chiang Mai, Thailand); Geraldo Sant’Ana de Camargo Barros, Lucilio Rogério Aparecido Alves, Humberto Francisco Spolador, Mauro Osaki, Daniela Bacchi Bartholomeu, Andreia Cristina De Oliveira Adami, Simone Fioritti Silva, Guilherme Bellotti de Melo, and Matheus Henrique Scaglica P. de Almeida (University of São Paulo, Brazil); Aderibigbe Olomola (Nigeria Institute of Social and Eco - nomic Research, Ibadan); and Peter Coughlin (AgriConsultants, Maputo, Mozambique). Jeff Lecksell of the World Bank Map Design Unit prepared the maps, based on information provided by Zhe Guo and Stanley Wood of the International Food Policy Research Institute (IFPRI). Preparation of this CCAA synthesis report was coordinated by a small team comprising Michael Morris, Hans Binswanger, Derek Byerlee, and Paula Savanti (World Bank) and John Staatz (Michigan State University). Abbreviations AET Agricultural education and training ALRO Agricultural Land Reform Office (Thailand) BAAC Bank for Agriculture and Agricultural Cooperatives (Thailand) CAADP Comprehensive Africa Agricultural Development Pro gramme CCAA Competitive Commercial Agriculture for Africa CDC Commonwealth Development Corporation CIAT Centro Internacional de Agricultura Tropical (International Center for Tropical Agriculture)
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