Policy makers in West Africa are primarily bent on achieving food self-sufficiency through total substitution of imports with domestic production for key commodities (placing more emphasis on rice) - this is to help minimize/avoid drainage of foreign exchange. In this regard, minds have been narrowly focused on levying of various taxes (tariffs among others) thereby burdening consumers with huge consumption taxes. In as much as this goes against their food security rights through access and affordability, this initiative increases producers' welfare through increased incomes (depending on the degree of price transmission among the key price regulars (wholesalers, retailers, and farmers)). A key and most annoying issue in the midst of these developments is that, in as much as outputs may increase following this initiative, post harvest losses increase as well due to limited storage facilities and difficulty in accessing markets (as production is primarily concentered in remote areas) amongst others (not forgetting quality flaws with local rice), thereby hindering achievement of the goal for which such tariffs on imports are levied. Consumer welfare is reduced, producer welfare is (ceteris paribus) enhanced/increased, yet goal not achieved due to structural challenges......What should be the way forward?
David, there is a need for a new approach to address challenges which i term complex. This approach "Systems Thinking"
“Systems thinking” is a scientific approach involving the art of interconnected thinking and a set of tools to deal with complexity, ambiguity and the integration of mental models into systems structures. It suggests moving away from the information stage; that is seeing single elements and events, to revelation knowledge; that is seeing the processes in which they inter-related. The systems thinking approach provides insights into the structure and behavioural patterns of organisations. These help to reveal the root causes of challenges, plan the future, reduce risk, anticipate delays, and prevent unintended consequences. Systems thinking gives rise to a new art of thinking required in business, management and finance as well the technical aspects of managing economic development and challenges facing the performance of agriculture in Africa. Agricultural stakeholders and organizations are often counselled to develop strategic alliances that can address changing demand and sustained the environments while improving the quality of life of both consumers and producers. A systemic approach to strategic agricultural management implies that the natural and human environments make up a holistic system; comprising of individual components that are interrelated, affecting each other and therefore the whole. This helps to build a competitive advantage over traditional approaches which can lead to long-term above-average returns for relevant stakeholders in the entire system.
Interesting! I think I really like the "Systems Thinking" concept Kwamina, but can you kindly use that approach to suggest a way forward on the most appropriate way to tackle the rice complex in Ghana (in terms of import substitution, addressing structural challenges, and enhancing both consumer and producer welfare)?
yes David, by using a systemic approach, one can test the possible outcomes of different systemic interventions by observing what would happen to the system as a whole when a particular strategy or combinations of strategies are implemented: that is, before any time or money is invested in actual implementation. For Africa and the other world to leave beyond complex challenges which results in famine, pestilence, war and terrorism, we need to go past the information stage to revelation knowledge and systems thinking ensures that.
Oh ok, I think I get it now...thanks so much my brother...Your point is well noted and very much appreciated
I think that these issues cannot be simply placed in a simple hierarchy because, as some of the other answers have indicated, everything is inter-related. Import substitution is intimately linked to food security and thus social welfare, but it is more than that as it can also lead to greater self-sufficiency and local entrepreneurial (farming in this case) development.
Thanks a lot Christopher for the opinion shared. Your point is well noted and very much appreciated.
David,
Of course everything is related, but that may not solve your issue. It only points to the different dimensions that may need to be addressed.
I suspect that taxes on consumption do not accrue to the producer. The taxing authority, traders and successful rent seekers are probably the true beneficiaries. This could be verified by examining the production response.
May I suggest that one solution is the evolution of strong, autonomous, efficient and economical cooperatives that support production, procurement, processing and marketing of commodities. (See India: The Dairy Revolution, World Bank OED)
Tom carter
Yes, I agree with Tom
It's worth looking at a whole range of alternatives, including cooperatives. I agree also on the point made about who benefits from taxation. Again, there are alternatives here in terms of financing which include the support of different types of private foundations.
Chris Bryant
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