Sunday, 25 August 2019

Boosting productivity: promoting private input markets and creating the correct incentives for input uptake

Among the key drivers for enhancing productivity of staple food crops are policy incentives and measures that foster higher input use by farmers. The focus must be placed on encouraging private initiatives and market-based schemes, while public agencies can play an important direct role in seed research and development, as well as catalyzing privately-led commercial seed production and distribution. At the initial stages of input market development, the public sector can also lower the cost of inputs to producers by subsidizing private bulk purchases and providing tax incentives for private input networks and dealers. Another critical public role is to enforce the quality controls on fertilizers and seeds.
On the other hand, direct fertilizer or seed subsidies by the government to farmers have rarely worked; they are unsustainable and subject to leakages (including smuggling across borders) and have very low impact apart from a temporary boost to production. Far more seriously, direct input subsidies tend to discourage the emergence of viable and private provision of inputs to producers. Fertilizer subsidy programmed, often used by governments, have rarely been successful. For example, Nigeria tried a fertilizer input subsidy, only to abandon it as unworkable, leaky and inefficient. Instead, Nigeria turned to indirect support for input uptake by facilitating access to credit. There are, however, noteworthy experiences with targeted subsidies taking place in East Africa (Rwanda, Malawi) that could be replicated in West Africa.
Providing credit to increase input use has many advantages, not least of which is the flexibility it offers producers in choosing the optimal fertilizer management for their situation, depending on the production system as well as the state of soil fertility. In Benin, the Project de Gestation Integrate DE la Production ET eds Provocateurs (GIPD) offers a successful case of an integrated fertilizer programmer which combines organic and mineral fertilizer techniques to deal with depleted soil fertility resulting from previous excessive fertilizer applications.
Increasing the use of inputs is only the first step to enhancing productivity. The latter also requires facilitating improved access to appropriate technologies and equipment by small scale farmers and small and medium enterprises. This in turn requires various interventions and supportive measures that include subsidized credit and investments for targeted productive assets and solving the land tenure constraints which block investment opportunities for small scale producers, including women, and reduce access to credit. Better access to input, equipment and technologies combined with technical and managerial training (through training centers, farmer field schools) all combine to improved returns to labor. These measures must be integrated with value chain or sectoral development strategies.
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