Regional Agricultural Policy:What Lessons for Africa’s CAADP from Europe’s CAP?

Strategic positioning of South African agriculture
in dynamic global markets
Presented by:
Stephanie van der
Walt

One of the most profound challenges that we face as a community
of nations is to understand better the emerging socio-economic
forces and forms of globalisation, to shape them to serve our needs
and to respond effectively to their deleterious consequences
– Kofi Annan, former UN Secretary-General
(1998)

Global Prevalence of Food Insecurity 2013
Source: Maplecroft, Food Security Risk Index, published 2012

Agriculture in African Economies
• Agriculture accounts for:
– 30% of sub-Saharan national GDP on
average;
– 40%-80% of export value;
– 70-80% of employment opportunities;
– 75% of rural livelihoods;
– 66% of manufactured goods
* Figures exclude RSA and large mining countries, Source: The Oxford Companion to the Economics
of Africa – Why agriculture remains the key to sub-Saharan Africa’s development, 2012

Food Production: Africa compared to the World
(1960-2001) and other Developing Regions
(1961-2011)
Source: FAOSTAT, 1995, via GRID-Arendal, UNEP Source: FAOSTAT, 2013, via Frankema, Africa &
The Green Revolution: A Global Historical
Perspective, 2013, Wageningen University

Why did Africa’s
productivity decline?

Governance Deficit & Regulatory Failure:
Africa’s Highway to Hunger
• Marketing Boards and Prohibition of
Private Trade:
– Stated goal: To insulate farmers from
price fluctuations by mandating the sale of
commodities to the government at a
predetermined price.
– Real outcome: Used as a tool to raise
government revenue by purchasing farm
products at a price below market value
and reselling for profit to local consumers
and/or export markets.
• Mandatory Collectivisation:
– Stated goal: To create economies of
scale while preventing unequitable
distribution of gains.
– Real outcome: Steep declines in
agricultural output and high investment of
public funds with little return, resulting in
budget deficits and lack of funding for
basic services, like health, sanitation and
energy on farms. High levels of
involuntary resettlement occurred,
resulting in social unrest in some areas.
• Protectionism:
– Stated goal: To stimulate domestic
industrialisation by safeguarding locally
produced products and infant industries
from cross-border competition.
– Real outcome: Tariffs imposed to
generate public revenue; NTMs used to
protect state-owned monopolies,
concentrating benefits of industrialisation.
• Marxist Land Distribution:
– Stated goal: To promote equal access to
land and other resources.
– Real outcome: Private production
declined to subsistence levels. Every rural
person that wanted to eat had to farm,
thus locking in labour and preventing
development of robust manufacturing and
service sectors necessary for economic
restructuring.

What about Market Failure?

“The colour of the cat doesn’t matter; any
cat that catches mice is a good cat”
– Deng Xiaoping, Restore Agricultural Production-Speech
7 July 1962
The “Black Cat-White Cat”
Cocktail, served at the Red
Capital Club in Beijing, China

“Mousers” versus “Fat Cats”

Pathways to Food
Security:
(1) Increasing staple crop
yields;
(2) Reconciling the needs of
communities with
conservation efforts;
(3) Recognising the importance
of private enterprise and
free trade for sustainable
rural livelihoods;
(4) Diversifying out of major
cereals to accommodate a
wider array of products and
producers;
(5) Making economic policies
and regulations that are
sensitive to agricultural
realities; and
(6) Improving food quality and
nutrition.
Source: IFPRI, Millions Fed: Proven Success in Agricultural
Development, 2009

Right to Food ǂ Food Security
Regional recognition of the
right to food
Regional experience of food
security
Source: FAOSTAT, via Rabbinge, Food First
Conference 2012, Florida, USA
• South America:
– Art 12, Protocol of San
Salvador (1 May 1988)
• Asia:
– None
• Africa:
– Implicit: Arts, 4, 16 & 22,
Banjul Charter (1979)
confirmed by African
Commission (2001)
– Art 14, Children’s Charter
(1990)
– Art. 15, Maputo Protocol
(2003)

Human development
requires more than
conferring rights upon
communities. It requires an
environment where such
rights are both understood
and accessible within a
system that offers
protection and remedies to
violations of those rights –
whether they be socio-
economic, contractual,
property-related or
administrative in nature.
– UNU-WIDER, 2011
In this age of unprecedented
global wealth, many people
across the world continue to
face food shortages and
hunger. The international
community has focused on
humanitarian assistance and
economic development to
deliver food to people who
need it, but the food
insecurity crisis has myriad
causes, chief among them a
lack of good governance and
breakdown in the rule of law.
– American Bar Association, The
Nexus between Rule of Law and
Food Security, 2011

Regional Governance &
Agricultural Policy

The Comprehensive Africa
Agriculture Development
Programme (CAADP)

CAADP Pillars
• Pillars of priority investment:
– Pillar 1: Land and water managements
(natural resource conservation).
– Pillar 2: Rural infrastructure and trade-related
capacities for improved market access.
– Pillar 3: Increasing food supplies and reducing
hanger (availability, access and utility of food).
– Pillar 4: Agricultural research, technology
dissemination, and adoption.

Components of Agricultural for Food Security

A Note on Production
• Agricultural production, poverty, and food security are
intrinsically linked for several reasons:
– Agricultural production for subsistence as well as for market is
the main source of income for the rural population.
– Traditional African staples are non-tradable, and cannot be
purchased on international markets (local demand needs local
supply).
– Low functionality of international food markets in many African
countries (high transaction costs, little transparency re price and
supply, lack of credit and liquidity, import fluctuations, political
intervention)
– Low foreign currency earning limit participation in global markets
to alleviate shortfalls.
– Capacity constraints (financial, human resources, logistics and
planning) hamper delivery of food aid to isolated communities

World War II and the European
Food Crisis
Death toll and economic setback of WWII:
Death Toll (1000s) Economic Setback
Austria 525 1886
France 505 1891
Netherlands 250 1912
Germany 6 363 1908
Italy 355 1909
Belgium 82 1924
Denmark 42 1936

Milestones for European
Agriculture
• 1957: The Treaty of Rome Creates the European Economic
Community (EEC).
• 1962: The Common Agricultural Policy (CAP) is born.
• 1970-80: Supply management.
• 1992: The CAP shifts from market support to producer
support
• 2000: The scope of the CAP is widened to include rural
development
• 2003: CAP reform cuts the link between subsidies and
production
• 2007: EU farming population doubles.
• 2013-13: A new CAP reform to strengthen the economic and
ecological competitiveness.

What made the CAP succeed?
• Rule of law.
• Robust institutional backing.
• Few, clearly defined objectives linked to
available resources.
• Reliable data.
• Continuous monitoring & evaluation.
• Responsive reforms.

Thank You

Regional Agricultural Policy:What Lessons for Africa’s CAADP from Europe’s CAP?

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