BANKING ON HUNGER: FOOD SECURITY IN ZIMBABWE

Southern Africa Report
SAR, Vol 9, No 3, January 1994
Page 20
"Zimbabwe"


BANKING ON HUNGER:
FOOD SECURITY IN ZIMBABWE


BY COLIN STONEMAN AND CAROL THOMPSON

Colin Stoneman is at the University of York. Carol Thompson is at the University of Southern California and is currently living and working in Harare.

In the 1980s Zimbabwe achieved what was widely described as an "agricultural miracle" in the sphere of food security, setting an example for a continent where such security was more often receding. This success was not accidental and owed little to market forces. It was planned (although, of course, it could have been planned better). Unfortunately, this erstwhile success story has been under some threat from structural adjustment programmes that have sprung from Zimbabwe's increasing entanglement with international financial institutions (see, inter alia, Lionel Cliffe, "Were They Pushed or Did They Jump? Zimbabwe and the World Bank," SAR, 6, no. 4, March 1991), an issue this article seeks to address.

Planning food security

After independence in 1980 the new government followed a policy of promoting small-scale farmers in the communal areas while maintaining incentive prices and easy availability of credit for the large-scale commercial farmers (LSCF) sector. The former, now nearly a million in number, occupy 42% of the total land area, generally in the worst regions, where little land is arable and rainfall is at best erratic; the latter number about 4,500 and still control 11.5 million hectares (about 30% of the land, but including over 50% of the arable land).

Agricultural extension services to the communal areas expanded considerably, with assistance for improved seeds, and increased use of fertilizers and irrigation. For example over 90% of all Zimbabwean farmers now use hybrid maize seed which has been continuously developed in the country since the 1930s. The Grain Marketing Board (GMB) increased the number of depots to over 100 by 1985 to facilitate distribution of inputs and collection of harvests; previously a smaller number had serviced the commercial farms almost exclusively. Credit was also made available for the first time in the communal lands (even if not to the extent needed). Real expenditure per capita on health and education increased, providing rural health clinics and primary education throughout the communal areas.

With these improved services the communal farmers produced about 60% of the marketed maize by 1986, and over 50% of the cotton, both up from below 10 per cent before independence. The growth rate of peasant production of maize over the 1980s was 9.0%, with the yield per hectare rising 6.7%, while comparable figures for cotton were 26.5% and 1.3%. (During this period there was also a modest redistribution of land, with about 54,000 peasant families being resettled, on mostly marginal land, and with the LSCF area reduced from about 39% to the present total of about 30%.)

At the same time, the LSCFs gradually reduced their maize hectarage, diversifying into cash crops, primarily tobacco, but also horticulture, making the country one of the top cut flower producers within four years. (The LSCFs also produced about three- quarters of the country's demand for wheat, and milk and beef were produced in quantities sufficient to allow exports where markets were available.) Despite this shift, Zimbabwe, at the aggregate level and with the expansion of peasant production highlighted above, managed to confirm its food self-sufficiency, building up a stockpile of maize of between one and two years' supply from which it was able to export grain to neighbouring countries most years, usually funded by those countries' aid programmes.

During this period, the country's Grain Marketing Board (GMB) administered a guaranteed price for maize that was on average 12% above world market prices; this policy produced surpluses which could not usually be exported except at a loss, but the maintenance of a stockpile amounting to about a year's supply was deemed necessary for reasons of food security. As the GMB was required to sell to urban maize millers at a fixed price that enabled them to make a profit whilst keeping prices to the consumers low, it incurred deficits that had to be covered by government. It also had to carry the costs of the stockpile, of a widening collection and depot programme aimed at helping distant producers, and maintained a "pan-seasonal" and "pan-territorial" pricing policy, the former an implicit subsidy to grain millers, the latter to distant producers.

Dumping

There have been constraints on this planning process, of course. As a signatory of the Lome Convention, Zimbabwe benefits from guaranteed markets in the EC for sugar and beef. The down side of these advantages is that Zimbabwe, like other primary producers, has had to accept the closure of the European (and the US) market to dairy products, maize, soybeans and the like. Even worse, it has found its external markets ruined by dumping. It has been estimated that in the late 1980s the world maize price was depressed by about 40% by subsidized sales of both EC and US maize. The consequence has been a continuous forcing of commercial farmers out of maize production in Zimbabwe as government was obliged to keep guaranteed prices down so as to avoid unsaleable surpluses.

It is worth tracing the interactions of this situation with Zimbabwe's food security, GMB deficits, and peasant incomes. As seen, maize is mainly produced by the small farmers. This means - because of the unreliable soils and climates in the communal areas - that, with reasonable incentives to communal farmers, Zimbabwe is likely to be faced with over-production of maize from the communal areas in good rainfall years, while food security cannot be guaranteed in drought years without paying much higher prices to keep commercial farmers in maize production. Thus, as long as the world market is distorted by EC and US dumping and similar actions, the price that Zimbabwe has to pay for food security is over-production, a large stockpile, and GMB deficits. Ironically, it is also vulnerable to the charge that, in its efforts to contain the costs imposed on it by rich country dumping on the world market, it has sometimes even contributed to lower peasant incomes and reduced food security!

Problems of liberalisation

Self-evidently, this is a difficult tightrope to walk. The problem is, however, that otherwise valid criticisms of aspects of the structure of government subsidies to maize production and marketing have been wrongly used as part of a frontal assault on intervention as such, and on the GMB's strategic role in maintaining food security and peasant incomes. (Note, too, that this assault occurs despite the admission by even its most ideologically-motivated "free-market" critics that the GMB has, on balance, been operated quite efficiently.)

Yet the fact remains that an undermining of the GMB's strategic role was a major contributory factor to the crisis of 1992 which required huge imports of grains - amounting to some 2.5 million tons in all - for the first time in several decades. Although it is too simple to state (as some commentators have done) that the World Bank ordered the GMB to sell off its maize stockpile just before the drought began, there is no doubt that it was under pressure to meet the schedule of deficit reduction in order to break even in 1995, and this meant closure of depots, downward pressure on guaranteed prices, and a halving of the stockpile through export sales.

It was in just this context that the 1992 drought strikingly confirmed the importance of the GMB. First, it worked highly efficiently, importing maize and distributing it throughout the country. The 74 surviving collection depots were used in the drought for distribution of food for supplementary feeding, and will now be expanded rather than suffering further closures as seemed likely before the drought. According to Richard Amyot, the executive director of the Commercial Grain Producers Association, their role will be widened to provide a decentralized network for agricultural inputs, banking and credit, while also providing facilities to small businesses.

Further, the board is seen as important for food availability - to make sure that hoarding by traders cannot occur, and to distribute inputs and collect grain in the remotest areas where private traders may not find it profitable to operate. Thus the drought has prompted some needed sensible reforms to the GMB's strategic role, whereas the whole role had been under threat before the drought exposed the dangers of such a course. Although the World Bank continues to be critical of the GMB's "development" goals (as contrasted with its commercial role) the drought has demonstrated the desirability of providing food security through a policy of strategic grain reserves, market stabilization and extension of depots. Government therefore wants to continue subsidizing the GMB, despite the pressures from the structural adjustment programme.

There is a second issue. As seen, a major constraint on a risk-free, efficient operation of the GMB's maize strategy has been the insecurity of food production in most communal areas. This derives from the poorer average soil fertility, the lower and more variable rainfall, and the higher risk aversion of people with poor resources and prospects. A more effective food security policy would therefore have to be based on production in reliably watered areas, guaranteeing a steady income to the producers. and this, in turn, will require significant land redistribution. And this is something which is, in principle, achievable - given the underutilization of much commercial farmland (even the World Bank calculates that the LCSF cultivate only about half of their arable land) - without affecting either export earnings (tobacco occupies only 70,000 hectares or 0.6% of commercial farmland), or the LSCF role in food security (maize occupies about 100,000 hectares, under 1% of the area).

But will it be allowed?

Zimbabwe's decision in 1990 to adopt a structural adjustment programme resulted in a number of consequences for food security. As seen, the experience of the 1992 drought has already persuaded many in Zimbabwe, including some in government, that a larger stockpile is needed if the high costs of importing are to be avoided; this implies acceptance of the necessity to subsidize the GMB or whatever institution has to maintain the stockpile, although originally government, following World bank nostrums, seemed determined to rely on the market almost entirely.

Will the logic of structural adjustment nonetheless reimpose itself in this sphere - both directly and indirectly - as the apparent lessons of the drought fade from memory? And what about devaluation, which can raise the profitability of export crops but also the costs of imported inputs (such as insecticides). On balance, commercial farmers will benefit from this, but those producing food for the domestic market or for their own consumption, may face higher import costs and lower domestic prices (even dumped food imports), so further harming the food security situation. Moreover, removal of subsidies on food widens disparities, as poorer families suffer most.

Structural adjustment also requires a restriction of government expenditure, a clear disincentive to even the modest degree of redistribution of land - so potentially important, in general terms, for the reasons mentioned above - that was heralded in the government's new land act of 1992. This is true both because of the cost of land acquisition, and also - even more importantly - because of the cost of development of the acquired land (including cheap credit for resettled farmers) so that the potentiality of the land is not lost through undercapitalization. And does the relatively active role for government that this process would seem to envisage also seem unlikely to be readily implemented in a time of "economic reform" and enforced liberalization?

* * *

In sum, food security - defined as accessibility to an adequate food supply for everyone - was generally achieved by Zimbabwe in the 1980s. According to UNICEF (1993) the rate of malnutrition of children in Zimbabwe in 1990 was the lowest in sub-Sahara Africa. There is evidence, however, that this favourable trend has already been reversed. To reverse it again will require an ever more effective programme of land redistribution and a relaxation of structural adjustment policies.