Addis Fortune (Addis Ababa)

9 December 2012

Ethiopia: Liberalising Seed Market Pertinent to Change Long Overdue Agricultural Lag

editorial

The time is defining for the technocratic chief executive officer (CEO) of the Ethiopian Agricultural Transformation Agency (ATA), a new breed of agricultural institution with the objective of introducing new solutions for the rather traditional agricultural system of the nation.

A man with a Western education, style and experience, who is educated at the prestigious London School of Economics (LSE), Khalid Bomba has been pushing for a change in the improved seed distribution system of the nation for the last 18 months. Now that a new seed proclamation is tabled to parliament, his vision seems to have inched to a realisation.

It is not only the ATA that is going to cheer the approval of the new seed proclamation, when it happens in the near future, but rather the whole nation that has been shouldering the burden of an undeveloped seed distribution system for centuries. When approved, the new proclamation will set the stage for a wholesome overhaul of the very traditional and confusing seed distribution system of the nation.

It is not that the new proclamation is the first attempt to change the dismal state of the whole problem that extends well down to the farmer level, though. Previous governments have taken their own steps, in their own way, to improve the system.

Their measures include establishing separate institutions with a mandate to manage the seed distribution system, organising cooperatives, selecting cadres of focal farmers and establishing research organisations. Yet, the improvement on the system had only been marginal.

Many quick fixes had been made on to the system since the change in government of the 1991. The internationally acclaimed agricultural extension system of the country that brought technical assistance to the grassroots level is all but one of the responses of the incumbent government. As a result of which the rate of absorption of improved seeds has seen a huge leap in magnitude.

Total supply of improved seeds for the 2012/13 harvest year had been 1.1 million quintals, almost a sprint as compared to the total supply of 240,924 quintals of 2007/08. Average annual growth rate of the absorption rate for the last seven years had been 59.4pc. No doubt that the growth is impressive, by any standard.

As compared to the demand, however, the latest supply is miniscule. Anything supplied has to be compared to a farming population of about 80.5pc of the total population and the demand such a population would create. Average improved seed production per capita has been 0.012 quintals, a disappointing figure even compared to African standards.

There is a wholesome agreement that the seed provision system of the nation is not meeting the productive demand of the farmer population. And a large portion of the problem matrix relates to the institutional setup.

Even after decades of reform trials, the institutional structure of seed distribution remains confusing and unresponsive to the challenges of the farmer. It brings little innovation that could enhance productivity at farming unit level. It sees weak linkage within itself that, eventually, has made it passive.

At the base of the problem lays a parallel system of institutions that less frequently communicate each other. On the one hand resides a tier of agricultural research institutions with a mandate to produce the first generation of seeds (breeder seeds). On the other lays the tier of executive institutions with the mandate to oversee the broader agricultural system, from input supplies to marketing.

It has been the case for decades that the two systems witness their own challenges. And only rarely do they join hands to alleviate the productive problems of the farming population. Even when they do, they often do it from the point of view of their mandates, which has less to do to the pertinent challenges of the farmer.

Bureaucracy plays its own role in the relationship of the two structures. Political interests of incumbents often interfere with the scientific and legal mandates of the institutions to eventually hamper their performance. No different is the case with the status quo.

Mandated to introduce new variety of seeds, the tier of agricultural research institutions ought to respond to the productive challenges of farmers. As it stands, however, its undertaking lags far behind the changing cycle of productivity problems. So much as it remains rigid, it fails to bring varieties fit enough to the multidimensional productive demands of the farmers.

Its procedures of certifying breeder seeds is also criticised for it lacks the professional in dependence required of such a process. A committee of professionals, who, themselves, are part of the national research process, certify first generation (F1) seeds. This deprives the system of an essential element of integrity - independence.

At the other end of the spectrum subsists a club of implementing institutions, varying from the agricultural ministry to regional and zonal agricultural bureaus, that have financial and human resources to streamline effective distribution of improved seeds. This club of institutions, however, faces regulatory, capacity and financial challenges to avail improved seeds for the large farmer population. It, therefore, is heavily complacent about productivity lag.

Institutional politics is also rampant in this line of the system. Hence, vertical and horizontal conflicts are common sight.

It does not end there, however. Another set of institutions, largely corporate in structure, exists on top of the two tiers of institutions. These include the Agricultural Input Supplies Enterprise (AISE) and the Ethiopian Seed Enterprise (ESE). By and large, these are institutions that work on distributing the seeds to farmers and farmers' cooperatives.

It is indeed sad that such a multitude of institutions hardly interact with each other to serve the farmers. And at the base of their complacency to do so lays lack of proper institutional incentives.

At stake for Khalid and his technocratic team of experts, then, is to bring about a lasting change to this unproductive system of seed distributions. It is in anticipation of such a change that the upcoming seed proclamation is eagerly awaited.

But, everything less than liberalising the sector for the involvement of both local and foreign companies would be short of being transformative. It is in embracing incentives that a systemic transformation could be realised.

Liberalising the seed market could infuse enough market traits in the whole system. This would eventually make supply flexible enough to respond to the productive demand of farmers. So would it initiate a research framework that incessantly works towards the challenges of the farmer.

Liberalisation would also bring players with the necessary human resource, technological and financial capacity to respond to the systemic challenges. It would also disguise improper dealings, such as selling hybrid seeds that might make farmers over reliant on corporations, by influencing demand.

As the time is definitive, then, it is up to the solution providers at the ATA, including CEO Khalid Bomba, and the legislature to change the confusing improved seed provision system of the nation, once and for all. And the change has to place both markets and the state in their right place of defining the play and overseeing it, respectively.

If the whole issue is about enhancing agricultural productivity by improving improved seed absorption, liberalisation is the best available option. That is why Khalid et.al ought to push for it to be given a chance in the new proclamation.

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