Initiative for Policy Dialogue and the South Centre Working Paper, March 2013

This paper: (i) examines the latest IMF government spending projections for 181 countries by comparing the four distinct periods of 2005-07 (pre-crisis), 2008-09 (crisis phase I: fiscal expansion), 2010-12 (crisis phase II: onset of fiscal contraction) and 2013-15 (crisis phase III: intensification of fiscal contraction); (ii) reviews 314 IMF country reports in 174 countries to identify the main adjustment measures considered in high-income and developing countries; (iv) discusses the threats of austerity to development goals and social progress; and (v) calls for urgent action by governments to adopt alternative and equitable policies for socio-economic recovery.

Les pays en développement sont à présent en proie à un ralentissement économique, se manifestant par un déclin de la croissance du produit intérieur brut (PIB) et des exportations et un durcissement des conditions de prêt, à cause de la crise de la zone euro et du ralentissement de l’économie américaine.

Depuis 2002, les prix mondiaux des denrées alimentaires ont été en constante hausse ; rien que pendant la période de 2007 à 2008, ils ont augmenté de 52%. Ces derniers mois, la flambée des prix des aliments a créé des zones de tension dans de nombreux pays en développement.

Pourtant, dans toute crise, il y a une occasion à saisir. C’est bien pour cette raison que les causes de la crise actuelle doivent être dûment étudiées et comprises. L’occasion qui se présente aujourd’hui aux pays du Sud est de repenser certains concepts tels l’autonomie, l’autosuffisance et la souveraineté alimentaire, tout comme d'examiner quels sont les aspects de l’environnement mondial qui ont conduit des pays à privilégier la production de produits alimentaires par rapport aux cultures d’exportation et les importations par rapport à la production locale, ce qui a eu des répercussions sur l’appropriation et la maîtrise nationales des principales ressources de production alimentaire.

 

Editorial: Succès du Mouvement des pays non alignés et échec du Cycle de Doha

 

Au cours de la dernière semaine de juillet, deux événements majeurs se sont déroulés parallèlement à Genève et à Téhéran. A Genève, les négociations commerciales du Cycle de Doha menées dans le cadre multilatéral de l’Organisation mondiale du Commerce (OMC), se sont soldées par un échec. A Téhéran, au contraire, l’action collective des 118 Etats membres du Mouvement des pays non alignés a redonné vie au Mouvement. Alors, comment expliquer l’échec du premier et la réussite du second ?

Research Papers 12

EXECUTIVE SUMMARY

Horticultural trade, especially fresh fruits and vegetables from Sub-Saharan African to European market, has received a great deal of attention over the past decade due to the rapid and sustained growth of its exports to Europe. This impressive growth has undoubtedly contributed to increased national incomes and has reduced rural poverty in Sub-Saharan Africa. Good examples in this respect are Kenya, South Africa and, to some extent, Zimbabwe. Despite this growth, the inclusion and proportion of the rent obtained from this lucrative business for smallholder farmers, who in the past used to be the major players, have been worsening over the span of the horticultural trade. One of the major contributing factors is the recent changes and dynamism of the global governance of fresh fruits and vegetables value chain. The changes of governance of global value chains for FFV from the market based coordination to the explicit vertically integrated coordination, coupled with other factors such as stringent phytosanitary measures, private standards like EurepGAP, and the increased consumers’ demand and choices, have led to the exclusion of smallholder farmers in the value chain because of their failure to comply with different requirements and standards. This poses a potential threat to the efforts of addressing chronic poverty and well being of the rural poor in the region.

Thus, the purpose and scope of this paper were: to investigate, compile and analyze concrete evidence regarding the nature of changes in the governance of fresh fruits and vegetables value chain and their causes; to identify the opportunities and challenges stemming from these changes and what determine success and failure in the new future governance and architecture; to see how the competitive advantage of FFV producers is affected by the changes in the governance of FFV value chains; to discuss the implication of the changes for the aspirations of economic diversification of commodity dependent developing countries. Finally, the paper provides recommendations on copping mechanisms, private sector strategies, and public policy responses that would enable developing countries’ producers, taking into account ownership and equity considerations, to appropriate a fair share of the rents in the FFV value chains.

 

Research Papers 1

INTRODUCTION

A number of developing countries,1 and especially least developed countries (LDCs), rely on agriculture for their food security, export earnings and rural development. It has been estimated that the agricultural sector accounts for between 30 per cent and 60 per cent of gross domestic product (GDP) for many of these countries, and is the major source of foreign exchange. The Food and Agriculture Organization of the United Nations (FAO) (2002) noted that the economies of many developing countries depend on the exports of one or a few commodity exports, making them particularly vulnerable to price variations on specific commodities. It noted that single commodity-dependence is more pronounced in tropical regions, and notably so for specific tropical products including sugar, coffee, bananas, cotton lint and cocoa beans. The variability and decline of commodity prices is well documented (FAO, 2005). It erodes the competitiveness of commodities exported from non-subsidizing developing countries, discourages investment and expansion of their food exporting sectors and, in the event that developing countries depend heavily on agricultural exports, worsen their terms of trade.

According to the FAO’s State of Agricultural Commodity Markets (2005), the variability and decline in international agricultural commodity prices has serious implications for developing countries that are highly dependent on commodity export earnings, especially from traditional tropical crops. Since tariff escalation in agricultural markets is regarded as one of the major factors hindering the processing of traditional products for export, analysts have explored the potential for exporting non - traditional fresh fruits and vegetables to QUAD countries (Canada, the EU, Japan and the United States). These are valid alternatives because first, tropical fruits and vegetables are not usually cultivated in QUAD countries and therefore, their trade is not distorted by domestic producer support measures. Secondly, consumer tastes in QUAD countries are diversifying into ‘exotic’ tropical fruits and vegetables. The FAO for example, is currently helping market players to develop international trade for organic mangoes and pineapples produced in Sub-Saharan Africa.

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