By Annet Adong
The current government efforts are directed towards having Uganda transform from a low income to a middle income country.
The agriculture sector has been identified as one key sector to drive the vision 2040. This is because of its potential role to uplift majority of the population, who depend on it as their livelihood source, out of poverty.
African Union’s Comprehensive Africa Agriculture Development Program (CAADP)) estimates that a 6 percent per annum growth in agricultural sector is sufficient to not only reduce by one half the population below the poverty line, but also to substantially reduce the number of the population in absolute poor.
One of the major challenges hindering the attainment of this growth rate is the low production and productivity of the sector. Recently, President Museveni, in the state of the nation address, recommends a four acre approach geared to transforming agriculture from subsistence to a commercial activity.
However it is important to take into consideration the binding factors that currently constrain farmers from transforming agriculture to a business venture.
First the current status of soils in Uganda is poor. According NARO, the soils in Uganda have been over utilized and deeply weathered. As such, the fertility of the soils has diminished over time due to over cropping, soil erosion and low nutrient replenishment. Furthermore, the low usage of both organic and inorganic fertilizer has reduced productivity.
As a result, farm yields are much lower than previously achieved. Research has shown that an acre of maize with no fertilizer applied currently yields about 834.14kg with a potential of increasing to between 70 to 120 percent once nitrogen is applied.
In a training workshop of agrochemical inspectors and analysts organized by the Ministry of Agriculture and Economic Policy Research Center recently, most scientists emphasized the need for Ugandans to forget the notion that their soils are fertile. Otherwise there will reach a point in time when they will harvest nothing.
Uganda is one of those countries with the highest nutrient depletion rates in the world and the use of fertilizer is necessary to replace these nutrients and make them available for plants. But one of the major challenges to fertilizer availability and use has been attributed to the high costs of importation of fertilizer which translates to higher fertilizer prices.
In as much as soil nutrients need to be replenished, farmers being profit maximizers will not use fertilizer if the costs supersede the market price of a given commodity. Unlike Uganda, some developing countries like Malawi have taken up subsidies for fertilizer. However, subsidies partially explain distortionary effects on the economy.
Any prospects to have the costs of fertilizer reduced have hit a snag. The recent budget speech, by the Minister of finance, levied a 18 percent tax on agricultural inputs (fertilizers inclusive).
Therefore, agriculture production and productivity may continue to be low and poverty will prevail as it is unlikely that we shall be able to achieve the 6 percent growth rate as envisioned by CAADP.
There is a need to not only reconsider the tax on agricultural inputs, but also fast track the construction and operationalization of the Tororo phosphates plant which is crucial to addressing fertilizer availability and use.
The writer is a research analyst at Economic Policy Research Centre