Distortions to Agricultural Incentives in Africa: Results from 17 Country Studies

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Distortions to Agricultural Incentives in Africa: Results from 17 Country Studies Will Masters Purdue University www.agecon.purdue.edu/staff/masters CSAE Conference on Economic Development in Africa March 20, 2007 Views expressed are the authors’ alone and not necessarily those of the World Bank, its Executive Directors, or its Trust Funders

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Distortions to Agricultural Incentives in Africa: Results from 17 Country Studies. Will Masters Purdue University www.agecon.purdue.edu/staff/masters. CSAE Conference on Economic Development in Africa March 20, 2007 - PowerPoint PPT Presentation

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Page 1: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Distortions to Agricultural Incentives in Africa: Results from 17 Country Studies

Will MastersPurdue University

www.agecon.purdue.edu/staff/masters

CSAE Conference on Economic Development in Africa March 20, 2007

Views expressed are the authors’ alone and not necessarily those of the World Bank, its Executive Directors, or its Trust Funders (esp. UK and Dutch)

Page 2: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Distortions to Agricultural Incentives in Africa

• A project led by Kym Anderson at the World Bank– to estimate incidence on farmers, processors & consumers– for >70 countries, all major farm products, 1955-2005– with country specialists using a common methodology – of all policies potentially subject to “stroke of the pen”

reform:• taxes/subsidies and other trade restrictions• parastatal firms and protected monopolies• not infrastructure, technology or institutions

• Project staff: – Kym Anderson (WB Project Director)– Ernesto Valenzuela, Marianne Kurzweil (WB staff)– Jo Swinnen (coordinator/editor for Eur. Transition Econs) – Alberto Valdes (coordinator/editor for Latin America)– Will Masters (coordinator/editor for Africa)

Page 3: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Authors of the African country studies

Cameroon:E. Bamou & W.A. Masters Cote d’Ivoire:P. AbbottEgypt: J.H. Cassing, S. Nassar & G. SiamEthiopia: S. Rashid M. Assefa & G. Ayele Ghana: J. Brooks and A. CroppenstedtKenya: A. Winter-Nelson & G. Argwings-KodhekMadagascar:F.M. RakotondrazakaMorocco: T. Roe & M.R. Doukkali

Mozambique: C. Arndt, X. Cicera & A. AlfieriNigeria: P. WalkenhorstSenegal: W.A. MastersSouth Africa: L. Edwards, J. Kirsten & N. VinkSudan: H. Faki & A. Taha AhmedTanzania: O. Morrissey & V. LeyaroUganda:A. Matthews & J. OpolotZambia: D. Ndlela & P. RobinsonZimbabwe: P. Robinson & D. Ndlela

Page 4: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Motivation: Trade policies have changed but still costly

Import-weighted average applied tariffs by level of processing and national income

1988-90 1995-97 2002-04

Reproduced from K. Anderson et al., “Methodology for Measuring Distortions to Agricultural Incentives,” revised 13 September 2006, available online at www.worldbank.edu/agdistortions.

0.38

0.68

0.75

1.89

Ag./Other

2.86

8.59

Page 5: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Motivation: Exchange reforms have had a large effect

Reproduced from K. Anderson et al., “Methodology for Measuring Distortions to Agricultural Incentives,” revised 13 September 2006, available online at www.worldbank.edu/agdistortions.

Black market exchange rate premia, weighted average across 59 developing and transition countries, by region, 1960 to 1993 (percent)

Page 6: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Motivation: Opportunity costs have changed

Source: K. Anderson (2006), “Reducing Distortions to Agricultural Incentives: Progress, Pitfalls and Prospects.” <www.worldbank.org/agdistortions>. Data shown are an index of export prices in US dollars for all major traded agricultural products, deflated by the MUV index which is the unit value of manufactures exported from France, Germany, Japan, UK and US, with weights based on those countries’ exports to developing countries.

Index of real international food prices, 1900 to 2005 (1977-79 =100)

Page 7: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Methodology: Calculating tariff-equivalent distortions

• trade distortions– infer the value of NTBs from price comparisons, between

• domestic prices (farmgate, retail or wholesale), and• border prices (unit values or price observations), minus• competitive margins (after “stroke of the pen” reforms)

– or, use observed value of tariffs, taxes and subsidies

• other subsidies/taxes (default is zero)– taxes/subsidies on production, marketing or consumption– taxes/subsidies on inputs, weighted by cost share at undistorted

prices

• exchange rate effects – official exchange rate– parallel exchange rate plus share of transactions in parallel market – or product-specific exchange rate if a multiple rate system is used

Page 8: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Methodology: Aggregation for policy analysis

• Within countries, all aggregates are value-weighted• Across countries, will see:

– simple averages (for political economy analyses)– value-weighted averages (for economic analyses)

• Key measures are:– NRAA = Nominal Rate of Assistance for primary agric (farming)

– NRAP = Nominal Rate of Assistance for agric processing

– CTE = Consumer Tax Equivalent for purchasers

– NRAM = Nominal Rate of Assistance on all importables

– NRAX = Nominal Rate of Assistance on all exportables

• For this summary, will focus on:– anti-farm bias as measured by aggregate NRAA

– anti-trade bias as measured by NRAM relative to NRAX

Page 9: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Methodology: Price transmission along marketing chain

• To what degree would policy reform change farm prices?– previous studies usually assume full transmission to farm prices

(= marketing services are elastically supplied at a fixed margin)

– at the other extreme, there could be no price transmission to farms

(= farm production is elastically supplied at a fixed reservation price)

• We allow country authors to specify their own estimates, for:– transmission from wholesale to farmgate (θ), and also

– tax incidence between sellers (λ) and buyers (1 – λ)

• Default value is equi-proportional transmission– some authors use their own judgment or econometric estimates

Page 10: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Methodology: Examples of price transmission

Influence of price transmission on the incidence of a 33% import tariff for a processed good whose primary product is nontradable

Full(all margins are fixed)

None(farm price is fixed)

(distribution cost is fixed)

(all sectors)Equi-proportionalPrice transmission:

Tax/subsidy measures: NRAA =farmer, NRAP =processor, CTE =consumer

Page 11: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Preliminary Results:Anti-farm* and anti-trade** bias in Africa

Average Protection (Taxation) of Agricultural Production for 16 African Countries, by Trade Status, 1961-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1961

1963

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

Importables

All Products

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

*Anti-farm bias is measured by the “All Products” line** Anti-trade bias is the gap between “Importables” and “Exportables”

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Page 12: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Average Protection (Taxation) of Agricultural Production in Africa, 1961-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1961

1963

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

Simple Ave. of 16 countries*

Weighted Ave. excl. Nigeria

Weighted Ave. excl. South Afr.

* with error bars showing the standard deviation in each

Africa’s anti-farm bias varies, but clearly worsens then improves over time

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

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Page 13: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Average Protection (Taxation) of Exportable Agriculture in Africa, 1961-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1961

1963

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

Simple Ave. of 16 countries*

Weighted Ave. excl. Nigeria

Weighted Ave. excl. South Afr.

* with error bars showing the standard deviation in each

Africa’s export taxes account for mostof the level and trend in its anti-farm bias

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

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Page 14: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Average Protection (Taxation) of Importable Agriculture in Africa, 1961-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1961

1963

1965

1967

1969

1971

1973

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

Simple Ave. of 16 countries*

Weighted Ave. excl. Nigeria

Weighted Ave. excl. South Afr.

* with error bars showing the standard deviation in each

(1.48 in 1987)

Africa’s import policies vary widely

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

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Page 15: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Summary of the evidence

• Agricultural trade policy has taxed farmers

– increasingly from 1961 to 1977 period, from 15 up to 40%;

– then at a reduced rate after 1987, back down to 15-20%

• Taxation increased sharply over 1960s and 1970s

– a doubling of export taxation, from 25 to 50%

– elimination of import protection, from 20% to <0

• Taxation has since been reduced just as much

– much lower export taxes, to well below 25%

– a period of high import protection in the 1980s

Page 16: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Summary of the evidence (continued)

• Import policy varies more than export taxes– across countries

• suggesting political-economy differences

– over time within countries • possibly stabilizing domestic prices

– across crops within countries• so welfare cost of distortion may have fallen by less

than the decrease in average protection

Page 17: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Behind these data, stories from the country case studies

• Real policies and the reform process– Reforms had large effect, but slowly and with reversals

• Export taxes– often set a fixed local price; taxes vary with world price– taxation may be needed for revenue and redistribution– have been reduced but not eliminated over time

• Import restrictions– sometimes stabilize some prices, but…– rarely stabilize prices for remote rural producers– have sometimes been significant revenue sources

Page 18: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Implications for policy

• Successful reforms typically switch instruments– away from state trading, QRs and specific tariffs

– towards more transparent taxes (ad-valorem and VAT)

• Border reforms leave weak domestic markets– High transport costs and lack of spatial integration

– High credit costs and lack of temporal integration

– Thin input markets and limited flow of new technology

– Demographic and health constraints on human capital

• After policy reform, a big agenda for project aid– to raise agricultural productivity, education and health

Page 19: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Further information:

• www.worldbank.org/agdistortions

[email protected]

Page 20: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Annex of country datafor 16 African Countries

• Chapter drafts will be available soon

www.worldbank.org/agdistortions• Results shown here are:

– for primary products (not processed)– by country, in alphabetical order:

Cameroon, Cote d’Ivoire, Egypt, Ethiopia, Ghana, Kenya, Madagascar, Mozambique, Nigeria, Senegal, South Africa, Sudan, Tanzania, Uganda, Zambia, Zimbabwe

Page 21: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Cameroon: an early reformer?

Average Protection (Taxation) of Agricultural Production in Cameroon, 1961-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: noneExportables: cocoa, coffee, wood, bananas

Page 22: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Cote d’Ivoire: consistent export taxesAverage Protection (Taxation) of Agricultural Production in

Cote d'Ivoire, 1961-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: riceExportables: cocoa, coffee, cotton

Page 23: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Egypt: episodes of import protectionAverage Protection (Taxation) of Agricultural Production in

Egypt, 1960-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1.25

1.50

1.75

2.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

(2.04 in 1987)

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: maize, wheat, sugarExportables: cotton, rice

Page 24: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Average Protection (Taxation) of Agricultural Production in Ethiopia, 1981-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Ethiopia: steady reformer?

Importables: noneExportables: coffee, hides and skins,

chat, oilseeds and pulses

Page 25: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Ghana: an extreme caseAverage Protection (Taxation) of Agricultural Production in

Ghana, 1961-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1.25

1.50

1.75

2.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

(6.9 in 1983)

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: rice, maize Exportables: cocoa,

groundnuts

Page 26: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Average Protection (Taxation) of Agricultural Production inKenya, 1960-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Kenya: episodic reformer?

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: rice, maize Exportables: cocoa, groundnuts

Page 27: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Madagascar: now pro-ag. but still anti-tradeAverage Protection (Taxation) of Agricultural Production in

Madagascar, 1960-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: rice, sugar Exportables: vanilla, coffee,

cocoa, cloves, pepper, sugar

Page 28: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Mozambique: from anti-agriculture to anti-trade?Average Protection (Taxation) of Agricultural Production in

Mozambique, 1975-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: maize (in South), beans, groundnuts, rice, sugar (to 1982)

Exportables: maize (in North), tobacco, cotton, cashew, sugar (after 1982)

Page 29: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Nigeria: now neutral?Average Protection (Taxation) of Agricultural Production in

Nigeria, 1961-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1.25

1.50

1.75

2.00

2.25

2.50

2.75

3.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: maize, rice, sorghum, cassava millet, yams

Exportables: cocoa, groundnuts, palm oil

Page 30: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Average Protection (Taxation) of Agricultural Production in South Africa, 1960-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

South Africa: from anti-trade to neutral?

Importables: poultry, mutton, beefExportables: maize, wheat, grapes,

apples, oranges, sugar

Page 31: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Senegal: successful reforms?Average Protection (Taxation) of Agricultural Production in

Senegal, 1961-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1.25

1.50

1.75

2.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importable: riceExportable: groundnuts

Page 32: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Sudan: a recent reformerAverage Protection (Taxation) of Agricultural Production in

Sudan, 1961-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: wheat, sugarExportables: cotton, sorghum, millet,

groundnut, gum arabic, livestock

Page 33: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Average Protection (Taxation) of Agricultural Production in Tanzania, 1976-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Tanzania: consistently anti-agriculture?

Importables: maize, rice, wheat, sugarExportables: coffee, tea, cotton, tobacco,

beans, cashews, sisal, pyrethrum

Page 34: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Uganda: still protecting importables?Average Protection (Taxation) of Agricultural Production in

Uganda, 1961-2004

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1.25

1.50

1.75

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Importables: rice plus maize (some years)

Exportables: coffee, cotton +maize (some years)

Page 35: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Average Protection (Taxation) of Agricultural Production inZambia, 1960-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Zambia: episodic reformer?

Importables: wheat, rice plus maize, sorghum and soybeans (in some years)

Exportables: tobacco, cotton, groundnuts plus maize, sorghum and soybeans (some years)

Page 36: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Average Protection (Taxation) of Agricultural Production in Zimbabwe, 1960-2005

-1.00

-0.75

-0.50

-0.25

0.00

0.25

0.50

0.75

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Importables

Total

Exportables

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Zimbabwe: increasingly anti-agriculture?

Importables: wheat plus maize, soyabeans, and sorghum (some years)

Exportables: tobacco, cotton, groundnuts plus maize, soyabeans and sorghum (some years)

Page 37: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Cameroon, crop by crop

-1.00

-0.80

-0.60

-0.40

-0.20

0.00

0.20

0.40

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Cocoa

Coffee

Wood

Protection (Taxation) of Agricultural Production By Crop in Cameroon, 1961-2004

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Page 38: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Cote d’Ivoire, crop by crop

-1.00

-0.80

-0.60

-0.40

-0.20

0.00

0.20

0.40

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Cocoa

Coffee

Rice

Protection (Taxation) of Agricultural Production By Crop in Cote d'Ivoire, 1961-2004

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Page 39: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Egypt, crop by crop

-1.00

-0.50

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Cotton

Rice

Maize

Wheat

Sugar

Milk

Meat

Protection (Taxation) of Agricultural Production By Crop in Egypt, 1960-2005

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Page 40: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

-1.00

-0.80

-0.60

-0.40

-0.20

0.00

0.20

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Chat

Coffee

Hides and Skins

Oilseeds

Pulses

Protection (Taxation) of Agricultural Production By Crop in Ethiopia, 1981-2004

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Ethiopia, crop by crop

Page 41: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Ghana, crop by crop

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Groundnuts

Cocoa

Maize

Rice

Protection (Taxation) of Agricultural Production By Crop in Ghana, 1960-2005

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Page 42: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

-1.00

-0.50

0.00

0.50

1.00

1.50

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

MaizeWheatCoffeeTeaSugarVegetables (tradable)

Protection (Taxation) of Agricultural Production By Crop in Kenya, 1960-2004

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Kenya, crop by crop

Page 43: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Madagascar, crop by crop

-1.00

-0.80

-0.60

-0.40

-0.20

0.00

0.20

0.40

0.60

0.80

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Cocoa Pepper

Cloves Vanilla

Coffee Sugar

Maize Rice

Protection (Taxation) of Agricultural Production By Crop in Madagascar, 1960-2005

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Page 44: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

-1.00

-0.50

0.00

0.50

1.00

1.50

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

BeansSugarCashewnutsCottonMaize SouthMaize CentreMaize NorthTobacco (V)Rice

Protection (Taxation) of Agricultural Production By Crop in Mozambique, 1975-2004

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Mozambique, crop by crop

Page 45: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Nigeria, crop by crop

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Cassava CocoaGroundnuts MaizeMillet PalmoilRice SorghumYams Cotton

Protection (Taxation) of Agricultural Production By Crop in Nigeria, 1961-2004

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Page 46: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

-1.00

-0.50

0.00

0.50

1.00

1.50

2.00

2.50

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Beef Poultry

Mutton Apples

Oranges Sugar

Wheat Yellow Maize

White Maize Sunflowers

Protection (Taxation) of Agricultural Production By Crop in S.Africa, 1960-2005

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

South Africa, crop by crop

Page 47: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Sudan, crop by crop

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

SorghumSesameGroundnutsCottonSheepCattleGoatsMilletWheatSugar

Protection (Taxation) of Agricultural Production By Crop in Sudan, 1960-2004

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Page 48: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

-1.00

-0.50

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Wheat

Sugar

Rice

Maize

Tobacco

Cotton

Coffee

Protection (Taxation) of Agricultural Production By Crop in Tanzania, 1976-2004

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Tanzania, crop by crop

Page 49: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

Uganda, crop by crop

-1.00

-0.50

0.00

0.50

1.00

1.50

2.00

2.50

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Coffee

Cotton

Maize

Rice

Protection (Taxation) of Agricultural Production By Crop in Uganda, 1961-2004

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Page 50: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

-1.00

-0.80

-0.60

-0.40

-0.20

0.00

0.20

0.40

0.60

0.80

1.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Maize Sorghum

Wheat Rice

Groundnuts Soybeans

Cotton Tobacco

Protection (Taxation) of Agricultural Production By Crop in Zambia, 1960-2005

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Zambia, crop by crop

Page 51: Distortions to  Agricultural Incentives in Africa:  Results from 17 Country Studies

-1.00

-0.50

0.00

0.50

1.00

1.50

2.00

2.50

3.00

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

Maize

Sorghum

Wheat

Groundnuts

Soybeans

Cotton

Tobacco

Protection (Taxation) of Agricultural Production By Crop in Zimbabwe, 1960-2005

Source: Preliminary results from K. Anderson and W.A. Masters (2007), Distortions to Agricultural Incentives in Africa. Washington, DC: The World Bank. (Online at www.worldbank.org/agdistortions.)

Zimbabwe, crop by crop