Input Subsidy Programs  in Sub-Saharan Africa         T.S. Jayne, Michigan State University                              P...
Context for this seminar• 10 years ago, input subsidy programs (ISPs) were  out of favor – very few in Sub-Saharan Africa•...
How did ISPs go from “bust” in early2000s to “boom” in 2013?  1. HIPC  2. Shift from conditionality to budget support  3. ...
4 questions1. There is a role for ISPs in most SSA countries: true or   false2. Do you feel that ISPs in most SSA countrie...
4 questions1. There is a role for ISPs in most SSA countries:     true: 69%2. Do you feel that ISPs in most SSA countries ...
4 questions1. There is a role for ISPs in most SSA countries:     true: 69%2. Do you feel that ISPs in most SSA countries ...
4 questions3. What should be the primary rationale for input subsidy   programs:      A: Increasing food supplies / food s...
4 questions3. What should be the primary rationale for input subsidy   programs:      A: Increasing food supplies / self-s...
4 questions4. Do you feel that ISPs in SSA should be:     A: Scaled up?     B: Are at about the right level of expenditure...
4 questions4. Do you feel that ISPs in SSA should be:     A: Scaled up? 8%     B: Are at about the right level of expendit...
Emerging consensus of     workshop participants1. Spending a large share of the ag   budget on ISPs may not be the   most ...
Emerging consensus of      workshop participants2. ISPs are a powerful tool to   quickly raise food production….3. But if ...
Emerging consensus of    workshop participants4. Focus on making inputs   profitable / sustainable use:Profitable use = ma...
Variation in farmers’ efficiency of fertilizer use on maize,                  Agroecological Zone IIa, Zambia             ...
Emerging consensus of     workshop participants4.   Focus on making inputs profitable /     sustainable use:Profitable use...
Public spending on agriculture, 201016                Other                 9%                                 FISP       ...
Public spending on agriculture, 201017                Other                 9%                                 FISP     In...
Public spending on agriculture, 201018                Other                 9%                                 FISP       ...
Public spending on agriculture, 201019           Other            9%• Seed improvement• Farm extension /  training program...
Question:• Given that ISPs will continue, what  concrete guidance can be identified to  improve their effectiveness?      ...
Proposal 1: Raise publicinvestment in agronomic researchand extension programs to enablefarmers to use fertilizer moreeffi...
Proposal 2: Reconsidertargeting guidelines to achievemore equitable developmentimpacts
23FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area           ...
24FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area           ...
25FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area           ...
26FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area           ...
27FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area           ...
28           Farm size                      Kgs maize              (ha)                          per kg                   ...
Proposal 2: reconsider targetingguidelines and monitoring
Conclusions              30
Conclusions1. ISPs would be more effective if adequate   resources were allocated to complementary   public investments2. ...
Indaba Agricultural Policy Research Institute
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Input Subsidy Programs in Sub-Saharan Africa by Thom Jayne

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IFPRI Policy Seminar "Input Subsidy Programs in Developing Countries
What Works, What Doesn’t, and Why?" presentation by Professor Thomas Jayne, Michigan State University on 18 April 2013.

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  • -transition to textbox is another rational for targeting larger farmers is to raise national maize production and put downward pressure on retail maize prices but …
  • Input Subsidy Programs in Sub-Saharan Africa by Thom Jayne

    1. 1. Input Subsidy Programs in Sub-Saharan Africa T.S. Jayne, Michigan State University Policy Seminar IFPRI, Washington DC 1 April 18, 2013
    2. 2. Context for this seminar• 10 years ago, input subsidy programs (ISPs) were out of favor – very few in Sub-Saharan Africa• ISP expenditures is SSA now account for over US$2.0 billion per year• How did we get to where we are now in 2013? 2
    3. 3. How did ISPs go from “bust” in early2000s to “boom” in 2013? 1. HIPC 2. Shift from conditionality to budget support 3. Malawi miracle -- “…simply by ignoring the experts” 4. Rise in global food prices since 2007 5. Shift in WB position – support for “smart” subsidy programs• WB and other basket donors now financing most of 3 the 7 countries with the biggest ISPs in SSA
    4. 4. 4 questions1. There is a role for ISPs in most SSA countries: true or false2. Do you feel that ISPs in most SSA countries need: A: no changes to design B: small tweaks C: major reforms/improvements D: should be discontinued 4
    5. 5. 4 questions1. There is a role for ISPs in most SSA countries: true: 69%2. Do you feel that ISPs in most SSA countries need: A: no changes to design B: small tweaks C: major reforms/improvements D: should be discontinued 5
    6. 6. 4 questions1. There is a role for ISPs in most SSA countries: true: 69%2. Do you feel that ISPs in most SSA countries need: A: no changes to design: 0% B: small tweaks: 4% C: major reforms/improvements: 81% D: should be discontinued: 15% 6
    7. 7. 4 questions3. What should be the primary rationale for input subsidy programs: A: Increasing food supplies / food self-sufficiency B: Poverty reduction C: Dynamic economic growth D: Others 7
    8. 8. 4 questions3. What should be the primary rationale for input subsidy programs: A: Increasing food supplies / self-sufficiency: 27% B: Poverty reduction: 12% C: Dynamic economic growth: 38% D: Other: 23% 8
    9. 9. 4 questions4. Do you feel that ISPs in SSA should be: A: Scaled up? B: Are at about the right level of expenditure C: Should be downsized 9
    10. 10. 4 questions4. Do you feel that ISPs in SSA should be: A: Scaled up? 8% B: Are at about the right level of expenditure: 0% C: Should be downsized: 92% 10
    11. 11. Emerging consensus of workshop participants1. Spending a large share of the ag budget on ISPs may not be the most effective way to promote the welfare of it citizens, but it is a highly demonstrable way to do so.
    12. 12. Emerging consensus of workshop participants2. ISPs are a powerful tool to quickly raise food production….3. But if they account for too large a share of agricultural spending, they can crowd out other public investments required for sustainable development
    13. 13. Emerging consensus of workshop participants4. Focus on making inputs profitable / sustainable use:Profitable use = major drivers: crop response rates output price input prices
    14. 14. Variation in farmers’ efficiency of fertilizer use on maize, Agroecological Zone IIa, Zambia 5 4 Percent of farms 3 2 1 0 0 5 10 15 20 25 30 35 Marginal product (kgs / kg nitrogen)Note: Zone IIa is a relatively high-potential zone suitable for intensive maize production
    15. 15. Emerging consensus of workshop participants4. Focus on making inputs profitable / sustainable use:Profitable use = major drivers: crop response rates output price input prices…..Underlying investments in R&D,extension programs, infrastructure, etc.
    16. 16. Public spending on agriculture, 201016 Other 9% FISP 30% FRA 61% Source: Min. Finance Yellow book Indaba Agricultural Policy Research Institute
    17. 17. Public spending on agriculture, 201017 Other 9% FISP Input subsidy 30% FRA program 61% Source: Min. Finance Yellow book Indaba Agricultural Policy Research Institute
    18. 18. Public spending on agriculture, 201018 Other 9% FISP maize Input subsidy 30% marketing FRA board and program 61% price supports Source: Min. Finance Yellow book Indaba Agricultural Policy Research Institute
    19. 19. Public spending on agriculture, 201019 Other 9%• Seed improvement• Farm extension / training programs FISP• Irrigation systems• Responding to 30% FRA climate change• Policy analysis 61%• Rural electrification• Road-rail-port infrastructure• Land grant university system Source: Min. Finance Yellow book Indaba Agricultural Policy Research Institute
    20. 20. Question:• Given that ISPs will continue, what concrete guidance can be identified to improve their effectiveness? 20
    21. 21. Proposal 1: Raise publicinvestment in agronomic researchand extension programs to enablefarmers to use fertilizer moreefficiently
    22. 22. Proposal 2: Reconsidertargeting guidelines to achievemore equitable developmentimpacts
    23. 23. 23FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area Number of % of farms % of kg of FISP % of Expectedcultivated farms farmers fertilizer farmers maize sales(maize + all receiving received per expecting (kg/farmother crops) FISP farm to sell household) fertilizer household maize (A) (B) (C) (D) (E) (F)0-0.99 ha 616,867 41.9%1-1.99 ha 489,937 33.3%2-4.99 ha 315,459 21.4%5-9.99 ha 42,332 2.9%10-20 ha 6,626 0.5%Total 1,471,221 100%Source: MACO/CSO Crop Forecast Survey, 2010/11
    24. 24. 24FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area Number of % of farms % of kg of FISP % of Expectedcultivated farms farmers fertilizer farmers maize sales(maize + all receiving received per expecting (kg/farmother crops) FISP farm to sell household) fertilizer household maize (A) (B) (C) (D) (E) (F)0-0.99 ha 616,867 41.9% 14.3%1-1.99 ha 489,937 33.3% 30.6%2-4.99 ha 315,459 21.4% 45.1%5-9.99 ha 42,332 2.9% 58.5%10-20 ha 6,626 0.5% 52.6%Total 1,471,221 100% 28.6%Source: MACO/CSO Crop Forecast Survey, 2010/11
    25. 25. 25FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area Number of % of farms % of kg of FISP % of Expectedcultivated farms farmers fertilizer farmers maize sales(maize + all receiving received per expecting (kg/farmother crops) FISP farm to sell household) fertilizer household maize (A) (B) (C) (D) (E) (F)0-0.99 ha 616,867 41.9% 14.3% 24.11-1.99 ha 489,937 33.3% 30.6% 69.32-4.99 ha 315,459 21.4% 45.1% 139.75-9.99 ha 42,332 2.9% 58.5% 309.710-20 ha 6,626 0.5% 52.6% 345.6Total 1,471,221 100% 28.6% 77.1Source: MACO/CSO Crop Forecast Survey, 2010/11
    26. 26. 26FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area Number of % of farms % of kg of FISP % of Expectedcultivated farms farmers fertilizer farmers maize sales(maize + all receiving received per expecting (kg/farmother crops) FISP farm to sell household) fertilizer household maize (A) (B) (C) (D) (E) (F)0-0.99 ha 616,867 41.9% 14.3% 24.1 22.21-1.99 ha 489,937 33.3% 30.6% 69.3 47.72-4.99 ha 315,459 21.4% 45.1% 139.7 64.05-9.99 ha 42,332 2.9% 58.5% 309.7 82.110-20 ha 6,626 0.5% 52.6% 345.6 86.8Total 1,471,221 100% 28.6% 77.1 42.7Source: MACO/CSO Crop Forecast Survey, 2010/11
    27. 27. 27FISP fertiliser received (2010/11 crop season) and expectedmaize sales, 2011, by farm size categoryTotal area Number of % of farms % of kg of FISP % of Expectedcultivated farms farmers fertilizer farmers maize sales(maize + all receiving received per expecting (kg/farmother crops) FISP farm to sell household) fertilizer household maize (A) (B) (C) (D) (E) (F)0-0.99 ha 616,867 41.9% 14.3% 24.1 22.2 1351-1.99 ha 489,937 33.3% 30.6% 69.3 47.7 6092-4.99 ha 315,459 21.4% 45.1% 139.7 64.0 1,7295-9.99 ha 42,332 2.9% 58.5% 309.7 82.1 6,61310-20 ha 6,626 0.5% 52.6% 345.6 86.8 15,144Total 1,471,221 100% 28.6% 77.1 42.7 950Source: MACO/CSO Crop Forecast Survey, 2010/11
    28. 28. 28 Farm size Kgs maize (ha) per kg fertilizer 0-0.99 3.73 1-1.99 3.48 2-4.99 3.52 5-9.99 3.68 10-20 3.46Sources: Burke et al. (2012a), Ricker-Gilbert et al.
    29. 29. Proposal 2: reconsider targetingguidelines and monitoring
    30. 30. Conclusions 30
    31. 31. Conclusions1. ISPs would be more effective if adequate resources were allocated to complementary public investments2. More balanced public expenditure patterns could more effectively promote national policy objectives3. There are concrete steps for improving ISP effectiveness4. Q for group discussion: how to communicate 31 these messages effectively to governments?
    32. 32. Indaba Agricultural Policy Research Institute

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