Rural Income Generation and Diversification - A Case Study ... - Doria

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22 1992 consumer and transportation prices liberalised but minimum maize producer price remained principal marketing agents appointed a severe drought in Zambia 1993 termination of maize transport subsidies 20 % tariff on wheat imports minimum maize producer prices set increasing interest rates due to liberalisation of financial markets → slow emergence of private trade → government interventions continued high inflation → real producer prices decreased 1994 export ban on maize and maize meal minimum maize prices abolished privatisation of oil mills, National Milling Company, cotton, sugar and milk industries 1994-1996 1995 ZCF's bankruptcy Food Reserve Agency (FRA) established → underpriced state sales of fertilisers Zambia joined WTO 1996 agricultural sector investment programme initiated partial removal of binding export restrictions 1997 FRA distributes fertilisers on credit government states: liberalisation accomplished, but direct and indirect interventions still continue, e.g. high inflation, interest rates and exchange rates, also heavy taxation on agricultural producers 1998 FRA importing maize privatisation of seed and fertiliser industries 1999 preparation of a new National Agricultural Policy government contracts private firms to distribute fertilisers 2001 severe drought 2002 50 % subsidy on fertilisers free input delivery to the poorest Sources: Wood and Schula(1987), Mickels-Kokwe (1997), Wichern et al. (1999), Jayne et al. (2002) Seshamani (1998) aptly described the situation of a smallholder farmer after the reforms: The main victim of the inadequate national response from private agents has been the small farmer. While he waited for his produce to be collected (information regarding policy changes not having seeped through to him), it was mostly not collected. Since there had been guaranteed and prompt state collection earlier, he had not set up any storage facilities. The lack of storage facilities now made him desperate. His desperation was aggravated by his enhanced cash requirements since, with the introduction of user charges in health and education, he had to make allocations to school and health fees, which he never did before. Also, since the agents did not come to him to purchase his produce, he had to go to the market centres to sell them.
This was not easy in view of lack of transport to reach the markets. And when he did reach the markets, he found them to be buyers’ markets where the prices were not in his favour. Well-located maize sellers benefitted from the reforms. There was also crop diversification during the post-reform era, and new economic opportunities arose for smallholders. In particular, cotton, tobacco and paprika emerged in more accessible areas of the country, whereas in the remote areas traditional food crops such as cassava, groundnuts and sweet potato expanded in terms of land area and production (Zulu et al. 2000). The production trends for the two main staple crops are illustrated in Figure 1. volume of production tn 2 000 000 1 800 000 1 600 000 1 400 000 1 200 000 1 000 000 800 000 600 000 400 000 200 000 0 1986 1988 1990 1992 1994 Figure 1. Production trends in food staples in Zambia. Source: FAOSTAT 2006 According to Deininger and Olinto (2000), the liberalisation had only a minor impact on agricultural productivity in Zambia. Their analysis from the mid-1990s indicated that the supply response of the rural producers to the policy changes had been limited. Three main conclusions were drawn. First, unreliable input delivery and poor access were more important factors decreasing their use than the actual prices. Secondly, the lack of long-term credit facilities was a barrier to the ownership of productive assets such as work oxen, which would have increased efficiency and productivity. Thirdly, the constraints facing smallholders were related to market access and non-obtainable inputs rather than to the poor provision of education and advisory services. 1996 year 1998 2000 2002 maize 23 cassava
Page 1 and 2: Kaisa Karttunen Rural Income Genera
Page 3 and 4: University of Helsinki Department o
Page 5 and 6: CONTENTS 1. Introduction ..........
Page 7 and 8: Table 6. Percentages of income from
Page 9: WFP World Food Programme WHO World
Page 12 and 13: 12 man 2002). These include income-
Page 14 and 15: 14 The following questions were for
Page 16 and 17: 16 of household comsumption is also
Page 18 and 19: 18 Zambian farmers fall into three
Page 20 and 21: 20 impact on rural poverty. Startin
Page 24 and 25: 24 The Government of Zambia (GRZ) i
Page 26 and 27: 26 inadequate monitoring of the act
Page 28 and 29: 28 Distributor Scheme was fully in
Page 30 and 31: 30 as tobacco and cotton the out-gr
Page 32 and 33: 32 households were directly afflict
Page 34 and 35: 34 If it had no control over the m
Page 36: 36 According to the AHM, a househol
Page 39 and 40: icultural economy was opened up to
Page 41 and 42: Similar concerns were shared by Tay
Page 43 and 44: order to reduce income variablity.
Page 45 and 46: of infrastructure development, the
Page 47 and 48: which implies that diversification
Page 49 and 50: Haggblade et al. (2002) argue that
Page 51 and 52: In many cases the processing of the
Page 53 and 54: 4.9 Rural income diversification in
Page 55 and 56: Table 3. Rural income-diversificati
Page 57 and 58: 1990s - made the farmers reluctant
Page 59 and 60: In addition to asset endowments and
Page 61 and 62: 5.1.2 The 2003 dataset The second s
Page 63 and 64: clarifying some concepts and assess
Page 65 and 66: 5.2 Methods The theoretical grounds
Page 67 and 68: able random variables not explicitl
Page 69 and 70: Incshare 25 or Inclevel 26 = β0 +
Page 71: 5.2.4 Choosing the estimation metho
Page 74 and 75:
74 Both cash and in-kind income wer
Page 76 and 77:
76 Share of income 100 90 80 70 60
Page 78 and 79:
78 The households considered market
Page 80 and 81:
80 The proportion of income generat
Page 82 and 83:
82 The seasonality effect was clear
Page 84 and 85:
84 Since a lack of money was given
Page 86 and 87:
86 % of income 100 90 80 70 60 50 4
Page 88 and 89:
88 100 90 80 70 60 50 40 30 20 10 0
Page 90 and 91:
90 6.1.7 Grouping households accord
Page 92 and 93:
92 number of adult members, was cri
Page 94 and 95:
94 more likely to use fertilisers a
Page 96 and 97:
96 holds. According to the responde
Page 98 and 99:
98 The following process was follow
Page 100 and 101:
100 6.1.9 The results of the econom
Page 102 and 103:
102 The categorisation of household
Page 104 and 105:
104 Table 20. Determinants of the s
Page 106 and 107:
106 In some cases the former househ
Page 108 and 109:
108 indicated thus an opposite tren
Page 110 and 111:
110 The Simpson diversification ind
Page 112 and 113:
112 tares - the difference being st
Page 114 and 115:
114 which brought more purchasing p
Page 116 and 117:
116 diversification index. Block an
Page 118 and 119:
118 evidence that households had no
Page 120 and 121:
120 such as piecework and forest la
Page 122 and 123:
122 7.2 Changes in the households b
Page 124 and 125:
124 lower soil fertility, and the l
Page 126 and 127:
126 8. Conclusions and recommendati
Page 128 and 129:
128 Rural non-farm activities are l
Page 130 and 131:
130 Politiikkamuutosten seurauksena
Page 132 and 133:
132 References Abdulai, A. & CroleR
Page 134 and 135:
134 CSO. 1997. Living Conditions Mo
Page 136 and 137:
136 Ellis, F., Kutengele, M. & Nyas
Page 138 and 139:
138 Heltberg, R. (mimeo) 2001. Comm
Page 140 and 141:
140 Lanjouw, J.O. & Lanjouw, P. 200
Page 142 and 143:
142 Ruotsi, J., Lindberg, O., Seger
Page 144 and 145:
144 Zulu, B., Nijhoff, J.J., Jayne,
Page 146 and 147:
146 Annex 2. The theoretical framew
Page 148 and 149:
148 1,050 millimetres, while in the
Page 150 and 151:
150 Annex 4. Schedule of the field
Page 152 and 153:
152 Annex 5. Three household cases
Page 154 and 155:
154 In the 1970s and 1980s, and eve
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Rural Income Generation and Diversification - A Case Study ... - Doria

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