SERA Policy Brief: Rules-Based Transparent System for Emergency Food Imports

Tanzania imports large quantities of basic food staples such as palm oil, rice, sugar, and wheat and occasionally has large imports of maize. While imports are needed to meet local demand, they often disrupt domestic markets when quantities imported exceed market requirements or when large imports are authorized by the Government but not anticipated by the private sector. This can lead to price volatility and increased risks for producers, traders, and stockholders. A more transparent and predictable staple foods import policy could encourage increased development of the staple food crops sectors, provide additional tariff revenue to Government, and reduce market uncertainty. It would also reduce the need for ad hoc policy decisions that can lead to regional trade disputes, and provide a more stable market environment for the commodity exchange that is currently being developed.

One of the challenges of implementing an effective staple foods import policy is the difficulty of controlling illegal imports that enter Tanzania from neighbouring countries and through major Tanzanian sea ports. They are illegal in the sense that they don’t have import permits as required, and they don’t pay the import tariff. The magnitude of these illegal imports is unknown, but they can be estimated by comparing the reported exports to Tanzania from other countries to the imports reported by Tanzania. For example, exports of rice to Tanzania reported by all exporting countries were two to three times as large as imports reported by Tanzania during 2011-2015. That suggests that large imports were unrecorded, but even that may underestimate actual imports because some exports going to neighbouring countries actually get diverted to Tanzania. A similar situation existed for sugar, with exports to Tanzania being reported as about twice as large as imports reported by Tanzania (Table 1). Other staple food crops showed less divergence between reported exports and reported imports.

Controlling illegal imports is difficult because Tanzania has long and porous land borders with neighbouring countries and a long coast which allows easy access for small quantities of food staples. Illegal imports also enter the mainland Tanzanian market through other channels, including transit goods that remain in country and improperly labelled imports that are not detected by customs. However, large quantities of illegal imports are also reported to enter through Tanzania’s major sea ports. The loss in tariff revenue from illegal imports is substantial and could provide funding for upgrading customs as well as general budget support. The loss of tariff revenue from rice was approximately 60 million USD per year during 2011-2015 based on the difference between reported exports and reported imports, and the loss of tariff revenue on sugar was approximately 62 million USD per year over the same period. If only one-half of this tariff revenue could be collected in the future, it would be a substantial contribution to the Tanzanian budget.

Tanzania has higher import tariffs on food staples than many of its neighbouring countries and that creates incentives to import staple food crops into neighbouring countries and sell them in the Tanzanian market without paying the tariff. Kenya, for example, has a 35 percent tariff on rice imported from Pakistan while Tanzania has an import tariff of 75 percent. That provides incentives for Kenyan traders to import at the lower tariff and sell in Tanzania. Zanzibar also has a lower import tariff of 12.5% on rice compared to the mainland and that encourages traders to import more than is required for Zanzibar’s consumption and sell the surplus on the mainland. The approximate magnitude of these surplus imports in Zanzibar can be estimated and have been as much as 30,000 tons of rice per year beyond the quantities required to meet domestic demand in Zanzibar.

With such large tariff differentials and the relative ease with which illegal imports can enter by land and sea, it is very difficult to control illegal imports from neighbouring countries. In response to this situation, the Government of the United Republic of Tanzania (GoT) has often relied on quantitative controls and occasional bans on imports of rice and sugar (The Citizen, March 15, 2016) in an effort to control illegal imports. Quantitative controls are implemented by restricting the issuing of import permits; however, Tanzania has not been very effective in monitoring and controlling illegal imports. In some cases, import permits were issued for a specified quantity but actual imports exceeded the quantities authorized. This occurred in 2013 when duty-free rice imports were authorized, but the actual imports were much larger than the quantities authorized and the imports disrupted the domestic market causing prices to fall sharply. There are also reports of import permits being issued for larger quantities than required to balance the market (The Daily News, February 19, 2016) which also disrupts local markets. The longer term consequences of such disruptions are to cause greater price volatility and greater uncertainty for producers and other stakeholders and, therefore, less investment.

A staple food import policy that relies on established tariffs would be less disruptive to domestic markets, generate greater tariff revenue to Government, and would operate automatically under normal market conditions. It would also be more compatible with policies of the East Africa Community and less likely to create regional trade disputes. However, in order for such a policy to operate effectively, it would be necessary to control illegal imports. Some illegal imports would continue, but more effective monitoring and enforcement of staple foods import policies and tariffs could reduce illegal imports especially through major sea ports.

SERA Policy Brief: Food Basket Costs in Tanzania

Food is the largest expenditure item for the typical Tanzanian household and accounts for significantly more than half of total expenditures for the poorest. Consequently, food prices and food costs are very important to consumers and to the Government of the United Republic of Tanzania (GOT) as it addresses food security concerns. Since the typical diet and food prices vary greatly across Tanzania, it is important to consider the cost of the entire food basket in each region in order to fully understand the implications for food security. The SERA Policy Project and the Economic Research Service of the U.S. Department of Agriculture worked closely with the Department of Food Security and the Department of Policy and Planning of the Ministry of Agriculture, Food Security, and Cooperatives to develop and pilot a comprehensive and systematic approach to measuring food costs. This approach is referred to as the Food Basket Methodology (FBM), and it is used to measure the monthly costs of the typical food basket.

This Policy Brief explains the Food Basket Methodology and provides estimates of the monthly food basket costs from January 2011 to July 2015 for 21 regions in Tanzania and considers the implications for food security. Food basket costs can be used to provide early warning of regional food cost increases, but they can also provide valuable insights into broader food security issues by showing how prices of individual food items affect overall food basket costs and how food prices are related within a region and between regions. This information can be used to assess the impact of a particular food price increase on food basket costs. For example, maize is the main food staple in Tanzania accounting for about 40% of total calories in the typical diet; but it accounts for only 14.5% of the cost of the typical food basket and less than 8% of the food basket cost in Dar es Salaam. Consequently, an increase in maize prices has less of an impact on food costs and food security than implied by its calorie share or market visibility. Such detailed knowledge of food basket costs can contribute to better understanding of food security in Tanzania and lead to better policy decisions and better targeting of food assistance by identifying vulnerable regions and their consumption patterns.

SERA Policy Brief: Policy Options for Food Security, Agricultural Growth, and Poverty Reduction in Tanzania

Tanzania has a unique opportunity to improve food security by increasing agricultural growth and rural incomes through exports of food crops to the East Africa region. Tanzania has an abundance of natural resources that can be used to increase food crops production, and it faces a regional market that is food deficit and expected to remain food deficit for the foreseeable future. Tanzania’s exports will depend mostly on its ability to increase production and access regional markets. Enabling policies are essential for Tanzania to achieve its export potential both in order to provide incentives to farmers to increase production and in order to maintain access to regional export markets. These policies should focus on private sector-led growth, encouraging exports, and allowing market forces to guide the economy. Key policy areas include policies to: Increase Food Crops Production, Encourage Exports of Food Crops, Improve Systems to Identify Food Insecure and Vulnerable Groups, Hold Adequate Food Grain Reserves for Emergencies, and Establish a Transparent Rules-Based System for Emergency Food Imports. If Tanzania can make the right policy choices in these key areas, it can expect to improve long-term food security, experience more rapid growth in the agricultural sector, and reduce rural poverty.

SERA World Bank Policy Brief: The Effects of Gender on Maize Production and Marketing in Southern Tanzania

Maize is grown by an estimated 80% of farmers in Tanzania and about 20% of those farmers are in female-headed households. Most of these females were widowed or divorced and are disadvantaged compared to male-headed households with respect to knowledge of production practices, land holdings, use of improved inputs, yields, and prices received for marketed maize. Better understanding of these female maize farmers and their characteristics and endowments could help Government, NGOs, and donors provide better services such as extension, access to inputs, and information on marketing and business practices with the objective of raising incomes and reducing poverty. Higher incomes would also contribute to increased food security among this vulnerable segment of the rural population.

The USAID-funded Tanzania SERA Policy Project and the Finance & Markets Global Practice of the World Bank Group engaged TNS Social Research in Nairobi, Kenya, to survey 600 male and 600 female maize farmers in four regions of southern Tanzania’s maize producing regions. The results of that survey are presented in this report along with recommendations of how to better support female maize farmers. The findings may have implications for female farmers producing other crops in Tanzania who face similar circumstances and for female farmers throughout the region.

SERA Policy Brief: Time to Re-think the Food Crops Export Ban

Tanzania has a unique opportunity to become a major exporter of food crops, especially maize and rice, to the eastern Africa region. It has fertile and abundant crop land to expand production, a transport advantage over countries to the south, and the region has growing import demand. This export opportunity has been hampered in the past by the periodic use of export bans to address food security concerns. However, new research done under the SERA Project of the USAID Feed the Future Initiative has shown that the export bans are not effective at ensuring food security, controlling food prices, or preventing exports. It is now time to re-think the food crops export ban as a way of dealing with food security concerns and to focus on expanding exports to raise incomes of farmers. New programs will also be needed to deal with food security.

Land Tenure Dynamics in Peri-Urban Zambia

Peri-urban growth in Zambia faces particular challenges due to the interface of state and customary land administration systems with different stakeholders using land under leasehold and customary tenure regimes. The lack of structures to document these landholdings, share information, or resolve disputes between state and customary institutions presents risks to realizing sustainable development in peri-urban areas. This brief presents recent illustrations based on news media accounts of customary and state institutional overlap, planning and service delivery gaps, conversion of customary to leasehold land tenure, risks to public lands, and an inadequate land information system each of which contributes to peri-urban tenure insecurity. It concludes by identifying opportunities for protecting the rights of peri-urban customary smallholders and new urban settlers, promoting economic growth, reducing conflict, and improving resource management through the following four areas of work and twelve actions/recommendations, many of which are already conceptualized by the Government of the Republic of Zambia, but require additional support to be realized. These recommendations include:

Establish the current status of peri-urban land by: 1) developing an empirical understanding of peri-urban land tenure dynamics through targeted research; and, 2) documenting and making accessible state and customary land tenure information.

Recognize and protect existing rights by: 1) strengthening the recognition of the rights of existing peri-urban smallholders and residents of informal settlement; 2) protecting remaining public lands in peri-urban areas; and, 3) upgrading and planning informal settlements.

Respect and build on the technical capacities of government and the local legitimacy of customary institutions to improve rural/urban land governance by: 1) clarifying the role of chiefs in customary land under statutory tenure; 2) developing improved guidelines for consultation and consent around land conversion; 3) creating communication channels among councils and traditional leaders on land management; and, 4) developing and training local land tribunals composed of government and customary authorities.

Develop a Land Policy and associated legislation that integrate land administration and land use planning by: 1) ensuring the Land Policy addresses the issue of land rights in peri-urban areas; 2) designing legislation that can address challenges at the urban/rural interface; and, 3) bringing peri-urban and rural areas into the national planning process, while respecting the roles of all stakeholders and legitimate leaders.

LMDA Success Story: Signing contracts guarantees and protects farmers’ rights

Increasing farmers’ awareness on types of contracts used in the management of agricultural lands

Photo by: USAID/Feed the Future
Tajikistan Land Market Development

Contracts are crucial to success in the agricultural sector. Ms. Safarova Shahbonu, head of dehkan farm Zuhal, noted that “the harvest was very low this year as the seeds and mineral fertilizers were not of good quality. Since I did not have a signed contract with the supplier of seeds and fertilizers, but rather a verbal agreement, I could not stake a claim and protect my rights.”

Since farmers do not know what types of agriculture-specific contracts exist or how to formally sign them, they can face misunderstandings in most cases, and at worst deceit. Through grantee training organizations, the Feed the Future Tajikistan Land Market Development Activity informs farmers on the benefits of written contracts, as well as provides resources to support their use.

Mr. Burgut Abdulvohidov, tashabbuskor from the Vahdat jamoat of Vakhsh district, was aware of this issue and invited LMDA grantee public organization Mahbuba to organize a training on types of contracts used in the agricultural sector. Twenty five farmers from the jamoat participated in the training, which provided information on the types of contracts available for agricultural deals. After the training, the farmers realized the importance of signing written contracts and were empowered to utilize them.

Ms. Shahbonu Safarova, head of dehkan farm Zuhal, was one of the first training participants to execute a written contract, with support from a legal aid center lawyer. The contract outlines the rights and responsibilities of both parties, preventing any possible misunderstandings and protecting her interests.

“Having participated in the training, I understand the importance of written contracts in the agricultural sector. From now on, I will carry out all my agricultural activities by signing a written contract, thus preventing a violation of my rights.” — Ms. Shahbonu Safarova, head of dehkan farm Zuhal

After taking part in these trainings, farmers are now aware of how to execute contracts for any agricultural activity in which they are interested. Moreover, the Feed the Future Tajikistan Land Market Development Activity printed and distributed a brochure containing information on the types of contracts used in the management of agricultural lands, complete with contract templates. By providing access to information and templates, as well as the advantages and disadvantages of each type of contract, the Feed the Future Tajikistan Land Market Development Activity empowers land users to execute formal written contracts and protect their land use rights.

TGCC Infographic: Zambia, Customary Land Rights, and USAID

National governments increasingly recognize the importance of legal recognition and documentation of customary rights. With hundreds of millions of unregistered land claims globally, rapid and robust approaches are needed to document and administer communal and household rights in the long-term. USAID’s Tenure and Global Climate Change (TGCC) Program piloted customary land documentation processes in Zambia that relied on local knowledge and the use of low cost mobile applications to secure tenure (MAST).

TGCC Infographic: Ghana, Tenure, and USAID

In Ghana, cocoa is a major contributor to smallholder livelihoods and export earnings, but is also a major driver of deforestation. The Government of Ghana wants to more than double cocoa output by 2026 to increase farmer incomes and export earnings while also reducing greenhouse gas emissions from the cocoa landscape. A large expanse of cocoa land is experiencing productivity decline. Small growers who once carved out cocoa farms from old growth forests now suffer due to diminished remaining forests. Replacing old and unproductive cocoa trees can increase cocoa productivity while reducing deforestation, but tenure insecurity impedes replanting of trees, and even farmers with tenure security often lack financial resources to rehabilitate. Through its Tenure and Global Climate Change (TGCC) program, USAID partnered with a licensed cocoa buying company, ECOM, and a major chocolate brand, Hershey’s, to pilot tenure strengthening activities and access to finance to promote sustainable cocoa cultivation and decrease land use pressure on remaining forests.

TGCC Infographic: Vietnam, Coastal Zone Management and USAID

Vietnam looks to the sea for livelihoods and economic growth. With 9 million people living in coastal areas, many of which rely on the protection of seawall systems and mangrove forest, Vietnam has a high degree of vulnerability to coastal erosion, storm surge, and sea level rise. In this coastal landscape, there is a complex mix of uses from gleaning a variety of aquatic resources, to small-scale fisheries, to aquaculture, and clam farming. At times, there can be conflicts between these differing uses. The Government of Vietnam has a number of policies and laws related to coastal zone management that address this important resource and, in 2016, added a Coastal Forest Decree to improve the consistency of coastal forest management, including mangrove forests. In support of this decree, USAID, partnering with the Ministry of Agriculture and Rural Development (MARD), piloted participatory coastal spatial planning and mangrove co-management processes to inform coastal zone management, as well as to support vulnerable livelihoods in the face of economic and environmental changes.