Megatrends transforming Tanzania s agri-food systems: Towards inclusive economic transformation?

Transcription

1 Megatrends transforming Tanzania s agri-food systems: Towards inclusive economic transformation? T.S. Jayne, Milu Muyanga, Kwame Yeboah, Ayala Wineman, Lulama Traub Presentation at Third Annual Agricultural Policy Conference, Ministry of Agriculture, Livestock and Fisheries Dar es Salaam, Tanzania, 2 March, 2017

2 Five inter-related trends 2

3 Five inter-related trends population growth 3

4 Five inter-related trends population growth growth in food demand 4

5 Five inter-related trends population growth Labor force exit from farming growth in food demand 5

6 Five inter-related trends Rise of investor farmers / changing farm sizes population growth Labor force exit from farming growth in food demand 6

7 Five inter-related trends Rising land scarcity Rise of investor farmers / changing farm sizes population growth Labor force exit from farming growth in food demand 7

8 Five inter-related trends Rising land scarcity Rise of investor farmers / changing farm and market structure population growth Labor force exit from farming growth in food demand 8

9 Africa s rapid population growth Billions of people Rest of world Sub-Saharan Africa

10 Sub-Saharan Africa: only region of world where rural population continues to rise past Total Rural Population (millions) China India Sub-Saharan Africa Other South Asia South-East Asia Source: UN

11 Five inter-related trends Rising land scarcity Rise of investor farmers / changing farm and market structure population growth Labor force exit from farming growth in food demand 11

12 SSA Total Food Imports from 7 to 40 billion USD ( ) Tanzania food imports from 150 to 640 million USD ( ) (intra SSA trade from 1 to 10 billion USD) USD Billions SSA Imports from non-ssa SSA's imports from SSA

13 Net cereal exports, Sub-Saharan Africa Sub-saharan Africa Millions of Tonnes Year MAIZE WHEAT RICE TOTAL Source: FAOSTAT, 2016

14 Net cereal exports, East Africa Region East Africa Millions of Tonnes Year Maize Wheat Rice Total NX Source: FAOSTAT, 2016

15 Five inter-related trends Rising land scarcity Rise of investor farmers / changing farm and market structure population growth Labor force exit from farming growth in food demand 15

16 Employment trends

17 Farming remains largest single employer of workforce 60 Sectoral employment shares of total jobs in FTE 54 % of total jobs in FTE Ghana (2012/13) Nigeria (2012/13) Rwanda (2010/11) Tanzania (2012/13) Uganda (2011/12) Zambia (2012) Farming Off-farm AFS Non-farm

18 Farming remains largest single employer of workforce 60 Sectoral employment shares of total jobs in FTE 54 % of total jobs in FTE Ghana (2012/13) Nigeria (2012/13) Rwanda (2010/11) Tanzania (2012/13) Uganda (2011/12) Zambia (2012) Farming Off-farm AFS Non-farm

19 Off-farm AFS jobs largely in commerce -- less than 5% of all jobs are in agro-processing

20 Five inter-related trends Rising land scarcity Rise of investor farmers / changing farm and market structure population growth Labor force exit from farming growth in food demand 20

21 Table 1: Changes in farm structure in Tanzania ( ), National Panel Surveys Number of farms (% of total) % growth in number of farms between initial and latest year % of total operated land on farms between ha Farm size ha 5,454,961 (92.8) 6,151,035 (91.4) ha 300,511 (5.1) 406,947 (6.0) ha 77,668 (1.3) 109,960 (1.6) ha 45,700 (0.7) 64,588 (0.9) Total 5,878,840 (100%) 6,732,530 (100%)

22 % of National Landholdings held by Urban Households 35% 32.7% 30% 26.8% 25% 22.0% 22.0% 20% 18.3% 16.8% 15% 10% 11.2% 10.9% 11.8% 5% 0% / /2014 Ghana Kenya Malawi Rwanda Tanzania Zambia Source: Demographic and Health Surveys, various years between

23 % of National Landholdings held by Urban Households 35% 32.7% 30% 26.8% 25% 22.0% 22.0% 20% 18.3% 16.8% 15% 10% 11.2% 10.9% 11.8% 5% 0% / Source: 2013/2014 DHS Ghana Kenya Malawi Rwanda Tanzania Zambia

24 Five inter-related trends Rising land scarcity Rise of investor farmers / changing farm and market structure population growth Labor force exit from farming growth in food demand 24

25 Output and factor price indices, northern Tanzania Price index (2008/9=100) Agricultural wage (TSH/day) Land rental rate (TSH/ha) Maize (TSH/kg) /9 2010/ /13 25

26 Output and factor price indices, western Tanzania 300 Adjusted price (2008/9=100) Agricultural wage (TSH/day) Land rental rate (TSH/ha) Maize (TSH/kg) /9 2010/ /13 26

27 Output and factor price indices, rural Malawi, Adjusted price (2004=100) Rental rate (MWK/ha) Agricultural wage (MWK/day) MWK/kg urea MWK/kg maize Sources: IHS for land and wages; FEWSNET for urea and maize

28 Five inter-related trends Rising land scarcity Rise of investor farmers / changing farm and market structure population growth Labor force exit from farming growth in food demand 28

29 29

30 Share of labor force in farming is declining most rapidly where agricultural productivity growth is highest Source: Yeboah and Jayne, 2016

31 Non-farm labor productivity growth linked to lagged agricultural productivity growth

32 Table 1. Factors associated with changes in proportion of labor force in farming, 11-country annual pooled data, Fixed effect model (i) Log lag labor productivity in agriculture * ** (-2.15) (-2.77) Log lag labor productivity in non-agriculture (-0.23) (-1.89) Other covariates Index of governance (lagged) (-0.45) (1.06) Time trend *** (-4.62) (-0.96) Population density (-1.51) (-1.89) Road density (-0.21) Constant ** (-3.07) (0.20) (ii) Number of observations Number of Countries Adjusted/Overall R-square Time period

33 Conclusions 1. Goal of INDUSTRIALIZATION in Tanzania will require inclusive agricultural productivity growth! 2. Performance of farm sector will continue to exert major influence on job growth in overall economy Multiplier effects Ag productivity growth influences pace of labor force exit out of farming Labor productivity in broader economy 3. What will ag sector look like in era of rising land prices, youth exit out of farming, rise of medium-scale farms?

34 Conclusions 4. Strategies that raise productivity and profitability of farming is critical to expanding employment opportunities and improving youth livelihoods

35 Non-farm labor productivity growth linked to lagged agricultural productivity growth

36 Conclusions 4. Strategies that raise productivity and profitability of farming: Agricultural R&D and extension systems Improved seed + fertilizer: crucial but incomplete Farm management best practices Well resourced public agricultural institutions Basic education, soft skills Inspiration Policy/enabling environment to attract private investment Bottom line: goal of INDUSTRIALIZATION in Tanzania will require inclusive agricultural productivity growth!

37 Thank You 37

38 Farming remains key source of new jobs but largest source of new FTE jobs come from non-farm sector 100 Sectoral shares in new FTE jobs created 80 % of new FTE jobs from sector Ghana ( ) Nigeria ( ) Rwanda ( ) Tanzania ( ) Zambia ( ) -40 Farming Off-farm AFS Non-farm