MIDWEEK OPINION: with John Kakande.
Oct 15, 2002
PRESIDENT Museveni as well as many African leaders and international non-government organisations, notably OXFAM, have persistently attacked North America, Japan and the European Union over their trade-distorting agricultural subsidies.
The North Will Not Scrap Subsidies.
PRESIDENT Museveni as well as many African leaders and international non-government organisations, notably OXFAM, have persistently attacked North America, Japan and the European Union over their trade-distorting agricultural subsidies.
The World Bank figures suggest that giving developing countries more access to markets in the rich countries could earn them about US $150bn a year. It has been argued that rich countries gave about US $57bn in aid to the developing countries in 2001, but paid more than US $350bn to their own farmers.
Agricultural subsidies are financial assistance to farmers through government-sponsored price-support programmes. The subsidies are not a recent phenomenon. As far back as the 1930s most industrialised countries developed agricultural price-support policies to reduce the volatility of prices for farm products and to increase or stabilise farm income.
Subsidies are concentrated on relatively few crops with rice being the most heavily subsidised crop followed by cotton.
No matter what poor countries say, North America, Japan and Europe won’t scrap the agricultural subsidies in the near future. They are a politically sensitive issue. French farmers have vigorously protested decreases in subsidies that have made them the second largest food exporter after the United States.
The US in 1996 enacted the Freedom to Farm Act to cut agricultural subsidies. The legislation was a complete flop and by 2000 aid to farmers had reached over $22bn, three times the 1996 level. Now US federal government has come up with the Farm bill 2002 to boost the subsidies instead of cutting them.
Oxfam argues that through the new legislation (Farm Bill), the US wheat, rice and cotton farmers would increase their earnings by up to 50%, allowing them to further undercut produce from poor countries.
What is the way forward for Uganda? The move taken by the Uganda Grain Traders Ltd (UGT) to mobilise sh9bn to buy all the maize and beans from the farmers in order to boost exports is a step in the right direction.
Government should also directly get involved in supporting farmers. This should be one of the things that the Plan for Modernisation of Agriculture (PMA) should provide for. The Government should adopt the agricultural policies being pursued in the rich countries.
It was unwise for Government to scrap the state agricultural produce marketing boards like Coffee Marketing Board and Produce Marketing Board. The marketing boards were grossly inefficient because of mismanagement. But they were potentially viable and were initially efficient and profitable.
PRESIDENT Museveni as well as many African leaders and international non-government organisations, notably OXFAM, have persistently attacked North America, Japan and the European Union over their trade-distorting agricultural subsidies.
The World Bank figures suggest that giving developing countries more access to markets in the rich countries could earn them about US $150bn a year. It has been argued that rich countries gave about US $57bn in aid to the developing countries in 2001, but paid more than US $350bn to their own farmers.
Agricultural subsidies are financial assistance to farmers through government-sponsored price-support programmes. The subsidies are not a recent phenomenon. As far back as the 1930s most industrialised countries developed agricultural price-support policies to reduce the volatility of prices for farm products and to increase or stabilise farm income.
Subsidies are concentrated on relatively few crops with rice being the most heavily subsidised crop followed by cotton.
No matter what poor countries say, North America, Japan and Europe won’t scrap the agricultural subsidies in the near future. They are a politically sensitive issue. French farmers have vigorously protested decreases in subsidies that have made them the second largest food exporter after the United States.
The US in 1996 enacted the Freedom to Farm Act to cut agricultural subsidies. The legislation was a complete flop and by 2000 aid to farmers had reached over $22bn, three times the 1996 level. Now US federal government has come up with the Farm bill 2002 to boost the subsidies instead of cutting them.
Oxfam argues that through the new legislation (Farm Bill), the US wheat, rice and cotton farmers would increase their earnings by up to 50%, allowing them to further undercut produce from poor countries.
What is the way forward for Uganda? The move taken by the Uganda Grain Traders Ltd (UGT) to mobilise sh9bn to buy all the maize and beans from the farmers in order to boost exports is a step in the right direction.
Government should also directly get involved in supporting farmers. This should be one of the things that the Plan for Modernisation of Agriculture (PMA) should provide for. The Government should adopt the agricultural policies being pursued in the rich countries.
It was unwise for Government to scrap the state agricultural produce marketing boards like Coffee Marketing Board and Produce Marketing Board. The marketing boards were grossly inefficient because of mismanagement. But they were potentially viable and were initially efficient and profitable.