10 July 2009
Maputo — The United States Agency for International Development (USAID) on Friday launched in Maputo a new agro-business programme, AgriFUTURO, intended to improve the competitiveness of Mozambican private sector agriculture.
The programme is costed at 20 million US dollars for four years and will be focused on districts that lie on the Nacala and Beira rail corridors in the north and centre of the country. The programme will be run by a consortium of four partners led by the US research and consulting firm, ABT Associates.
An AgriFUTURO document states that the programme will increase competitiveness "by strengthening targeted agricultural value chains" and "will build on market demand assessments conducted for each value chain".
The purpose of these assessments is to identify the constraints preventing farmers from meeting demand. AgriFUTURO promises that, based on the analysis of these constraints, it will "work with participants along the entire value chain to improve the sector's ability to increase income and market efficiency".
The nine value chains identified are for maize, groundnuts, soybeans, pineapples, bananas, mangoes, cashew nuts, sesame and forestry.
USAID has, however, learned nothing from the past. The leaflet on cashews identifies as one of the constraints the export tax on raw cashews, and repeats the myth peddled by the World Bank in the 1990s that this tax "reduces income to small producers".
The tax is intended to protect the local processing industry, by ensuring that it can obtain nuts before they are all exported to Asia. The sole beneficiary of abolishing the export tax would be the Indian hand-shelling cashew industry which would be able to buy raw nuts from Mozambique at an even cheaper price.
The World Bank's assault over a decade ago on protection for the cashew processing industry, complete with threats to withhold loans from Mozambique unless the protection was reduced, led to the closure of all 14 large scale, mechanized processing plants that were operating in the country in the 1990s, with the loss of around 10,000 jobs.
Subsequently the industry has been rebuilt with smaller factories, using more labour intensive methods, and about 5,000 jobs have been recovered. Removing the export tax would threaten the viability of these companies, and undermine the goals USAID sets for AgriFUTURO.
At the launch ceremony, the US charge d'affaires, Todd Chapman, said "We are expanding our commitment to the agricultural sector, because we see a potentially brilliant future for agriculture in Mozambique".
"Mozambique has the potential to produce a virtual supermarket of high value crops and in filling much sought-after market niches in Europe, the Middle East, Asia and southern Africa", he added.
AgriFUTURO, he pledged, would "help agricultural production, at all levels in the supply chain, to work more efficiently to promote a robust trading economy".
Chapman said the AgriFUTURO programme team consists entirely of Mozambican nationals "thus maximizing the use of local expertise".
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