TRADE IN AGRICULTURE TRADE IN AGRICULTURE IN THE EAC: IN THE EAC: IMPLICATIONS ON IMPLICATIONS ON FOOD SECURITY AND FOOD SECURITY AND RURAL LIVELIHOOD IN RURAL LIVELIHOOD IN TANZANIATANZANIA

Monica A. HangiMonica A. Hangi

Economic and Social Research Economic and Social Research Foundation (ESRF)Foundation (ESRF)

INTRODUCTIONINTRODUCTION 1st phase: Political economy of trade policy

making; 2nd phase: The agricultural sector and its

importance to Tanzania’s economy and its social set up

Overall Objective: The study aims to provide new and valuable insights based on the analysis of the past and current patterns of regional trade in agriculture and their impact on food security and rural livelihood in Tanzania

..CONT..CONTOn top of this study’s contribution to the

regional and national policies that can connect results of regional trade in agriculture with improvements in food security and rural livelihoods in Tanzania, the study also aims at:

Analyzing recent trends in regional trade in agriculture; and on food security and rural livelihood; and

Examining the relationship between regional trade in agriculture and food security and rural livelihood in Tanzania.

TANZANIAN AGRICULTURAL TANZANIAN AGRICULTURAL SECTORSECTOR The sector serves as the major source of food

in the country; with an employment of approximately 74 percent of the entire population.

Agriculture in Tanzania is dominated by smallholder farmers (farm sizes between 0.9 to 3.2 hectares)

By 2008, agriculture economic activities grew by 4.6 percent (compared to 4.0 percent in 2007)

In 2007/08, production of the main produced food crop (Maize) increased by 7.66 percent; and the main cash crop (Cotton) increased by 53.7 percent

REGIONAL TRADE IN REGIONAL TRADE IN AGRICULTUREAGRICULTURE

Imports: Trade among EAC member states increased

by 13 percent in 2007 (Even with GFC, trade among members continued to increase – esp. Kenya & Uganda) AND an increase of 92.8 percent was reached by 2008

However, Tanzania’s share of imports to EAC declined by 13.4 percent in 2007 and further by 2008

WHY?

..CONT..CONTExports: Generally, all EAC member states registered

an increase in export values by 2008. Tanzania share of exports to EAC increased to

USD 315.5 mill in 2008, compared to USD 172.8 mill in 2007 – which is an increase of approximately 82.6 percent

Tanzania has registered high export values with Kenya (USD 235 mill) by 2008 BUT has registered low export values with Burundi (of USD 19.5 mill from USD 41.5 mill in 2007)

TANZANIA’S SHARE OF TRADE TANZANIA’S SHARE OF TRADE WITH EACWITH EAC

Item

Share of Export to: 2000 2001 2002 2003 2004 2005 2006 2007

Kenya 68.8 73.3 68.3 81.7 79.1 71.5 77.6 58.4

Uganda 18.2 10.6 10.6 10.8 11.1 18.8 17.0 11.1

Burundi 9.1 11.8 13.6 4.9 7.1 6.9 3.1 24.0

Rwanda 3.9 4.4 7.5 2.7 2.8 2.8 2.4 6.5

Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Share of Import from:

Kenya 94.2 94.6 97.2 92.5 94.3 96.6 97.5 94.0

Uganda 5.7 5.3 2.8 6.6 5.6 3.3 2.4 6.0

Burundi 0.0 0.1 0.0 0.3 0.0 0.2 0.0 0.0

Rwanda 0.1 0.0 0.0 0.6 0.1 0.0 0.1 0.0

Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

FOOD SECURITY TRENDS IN FOOD SECURITY TRENDS IN TANZANIATANZANIA

Food self-sufficiency (production and provision) at whatever time

By 2009, across 15 regions in TZ, there were more than 1.5 mill food insecure people (spread over 63 districts)

Most Households in Tanzania consume 2-3 meals per day; with few percentages of people having fewer meals than usual: overall 25.1 percent and 24.5 percent from rural population

CURRENT ESTIMATED FOOD CURRENT ESTIMATED FOOD SECURITY CONDITIONS IN SECURITY CONDITIONS IN TANZANIATANZANIA

TRADE AND FOOD TRADE AND FOOD SECURITYSECURITYCross border trade has an impact on food

security in the following ways: Expanding markets – ensuring provision Allows consumption of good which at times

are not produced within the borders Creation of employment – affording

consumption

RURAL LIVELIHOOD TRENDS IN RURAL LIVELIHOOD TRENDS IN TZTZ Livelihoods, especially in developing

countries, are aligned with production capacities of food and cash crops. And, livestock as well.

In Tanzania, 78 livelihood zones have been distinguished.

TANZANIA LIVELIHOOD TANZANIA LIVELIHOOD ZONESZONES

INFORMAL CROSS BORDER INFORMAL CROSS BORDER TRADE IN EACTRADE IN EAC

Informal trade in EAC mainly occurs through unofficial channels established around formal ones at border townships and deep seas.

On the Tanzania-Kenya border, informal trade occurs at Namanga and Sirari; While on the Tanzania-Uganda border, informal trade occurs mainly at the Mutukula, Bukoba and Kyaka border points.

Reasons for informal trade in EAC includes: road blocks and presence of rigid, time consuming bureaucratic procedures.

INFORMAL TRADE BETWEEN TZ INFORMAL TRADE BETWEEN TZ AND ITS NEIGHBORSAND ITS NEIGHBORS

Informal trade between TZ and its neighboring countries has been found to be significant, involving exchange of large volumes of goods.

Agricultural food commodities; mainly maize, rice, beans, sugar, wheat flour and root crops;

Industrial manufactures; toiletries, beer and spirits, cooking fats/oils, soft drinks, textiles (both new and used), construction materials, salt, electronics, petroleum products and car and bicycle parts;

Forest resources; charcoal and timber; and Water resources, which included all kinds of

fish species and prawns.

FOOD PRODUCTION IN FOOD PRODUCTION IN EACEAC

Wheat Maize Millet Cassava Beans RiceBurundi 1 17 1 99 31 6Kenya 11 79 2 14 10 1Rwanda 2 10 98 23 3Uganda 1 42 23 196 17 3Tanzania 3 79 5 164 8 18

TANZANIA KENYA UGANDA BURUNDI RWANDAProduct

MT Product

MT Product MT Product MT Product MT

Cattle meat

248,695 Cow milk

4,230,000

Plantain 9,231,000

Banana 1,600,000

Plantain 2,600,000

Banana 3,500,000

Cattle meat

396,520 Cassava 4,456,000

S/Potatoes

873,663 Potatoes 1,200,000

Cassava

6,600,000

Maize 2,928,793

S/Potatoes

670,000 Beans (Dry)

205,196 Beans (Dry)

280,000

Maize 3,659,000

Beans 427,996 Cattle meat

106,044 Vegetable

250,000 S/Potatoes

800,000

Rice(Paddy)

1,341,835

Banana 1,186,740

Cow milk

735,000 Cassava 558,557 Cassava 800,000

ANALYSIS-FOOD SECURITY & ANALYSIS-FOOD SECURITY & RURAL LIVELIHOOD IN TANZANIARURAL LIVELIHOOD IN TANZANIA

Food Insecurity in Tanzania is mainly due to: Economic reasons: lack of food security

knowledge; lack of market knowledge; low food production; poverty; food trade barriers; price volatility; low investment in the agric sector.

Environmental and Ecological reasons: environmental degradation; natural hazards; high dependency in rain; poor storage and food handling methods.

Infrastructure problems

..CONT..CONT Political and Institutional reasons:

inappropriate agric and trade policies; weak institutions; insufficient agricultural development efforts.

Social reasons: Diseases among farmers, traders and workers (HIV/AIDS); unemployment; unequal distribution of resources; high population growth (as compared to food production); gender inequality; lack of security and stability.

SYNTHESISSYNTHESISHow important is cross border trade in

understanding food security and rural livelihood in EAC?

Consider: Regional Trade in Food Staple

Agricultural Development

Long-term Poverty Reduction and Food Security

Also, food purchase in deficit zones assists in food availability and reduces prices for food staples

CONCLUSIONCONCLUSION EAC is characterized by food insecurity conditions,

especially in Kenya and in some parts of Tanzania, Uganda, Rwanda and Burundi. It however doesn’t imply that the entire region is food insecure.

Cross-border trade (especially on agricultural products) within EAC has proved to improve the conditions of food production and food availability in member countries.

Improved rural livelihoods are a result of a number of factors. Among those factors, the issue of trade features in.

Hence, in order to improve food security conditions as well as experiencing rural development in Tanzania, Cross-Border Trade should be encouraged.