Zambia - Natl Ag Policy 2012 To 2030 DRAFT-2011
Zambia - Natl Ag Policy 2012 To 2030 DRAFT-2011
(FINAL DRAFT)
MINISTRY OF AGRICULTURE AND CO-OPERATIVES
AUGUST, 2011
Table of Contents
Acronyms ii
Executive Summary iii
Chapter Page
1. INTRODUCTION 1
1.1 Background 1
1.2 Public Investment in Agriculture Development 2
1.3 Contribution of the Agricultural Sector 3
1.3.1 Agriculture Gross Domestic Product 3
1.3.2 Increasing Agricultural Exports 5
1.3.3 Increasing Access to Agricultural Input and Product Markets 5
1.3.4 Reducing Food Insecurity and Poverty 6
1.4 Institutional Capacity of Public and Private Sector 8
1.5 Summary of the Key Issues 10
List of Figures
1. Crop Production Shares in 2010 4
2. Trends in Production of Staple Crops 4
3. Trends in Agriculture GDP 4
4. Trends in Agricultural Exports 4
List of Boxes
1. Summary of the Key Issues Affecting Performance of the Agriculture Sector 10
ii
Acronyms
iii
Executive Summary
Following various stakeholder observations on the National Agriculture Policy (NAP 2004-2015), MACO launched its
review in 2010. The review was to culminate in the preparation for the Revised NAP 2012-2030. Literature review,
limited participatory consultations, and written submissions were employed as the basis for obtaining stakeholder
input in developing proposals for demand-driven agriculture policy and an inclusive coordination of its implementation.
In summary, Zambia stands on the verge of agriculture prosperity but there are a number of weaknesses that need to
addressed to improve the performance of the agricultural sector. These include:
(i) low agricultural productivity among small scale farmers;
(ii) inefficient input and output agricultural markets;
(iii) decreasing rate of growth of agricultural exports;
(iv) poor small scale farmer access to productive agricultural resources and services to increase production; and
(v) the weak public and private sector capacity to facilitate planning, resource mobilisation, implementation,
monitoring and evaluation of agricultural policy and regulatory provisions.
iv
In line with the national economic vision 2030, the derived agriculture vision is:
“A Competitive and diversified agricultural sector driven by equitable and
sustainable agricultural development”
The revised NAP 2012-2030 provides policy recommendations and action areas to enable agribusiness to produce
and commercialise in an environment with clear rules that are predictable and stable, with the government focusing
on facilitating, supporting and providing incentives for productive activities.
It is important to note that no one institution has capacity to implement the proposed action areas. The revised NAP
2011-2030 marks the beginning of strong partnership and teamwork between farmers, agribusiness, public sector,
civil society, and development partners. Each partner is expected to integrate the implications of the revised NAP
2011-2030 objectives in their strategic plans and work plans. Timely and sustained implementation of the various
action areas shall lead to significant increase in production, exports, and reduction of food insecurity and poverty,
especially among those who predominantly depend on agriculture. This will ensure that Zambia utilises the massive
agriculture potential as a way of significantly contributing to the realisation of the national economic vision 2030.
v
Implementation of the revised NAP requires efficient utilisation of both national and donor resources. At the same
time, the government and cooperating partners will mobilise funding from both domestic and external sources. The
government and other partners will make their funding commitments once detailed and prioritised investment
programmes and budgets have been developed. In addition, private sector contribution shall come from commercial
banks, financing institutions facilitated by government, and out-grower schemes. It is hoped that commercial banks
shall overcome their administrative deficiencies and fears to increase agriculture credit on affordable terms.
It is recognised that there are both capital and human capacity limitations within the public sector and therefore it will
be important to share NAP 2012-2030 implementation responsibilities with all key stakeholders. Therefore, MACO
shall focus on the core-functions and encourage the other stakeholders to supplement the efforts on the basis of
comparative advantage. In areas where there is a clear case of market failure, the government shall enlist the input
of all stakeholders in designing and implementing transitory institutions and or arrangements to address the
constraints.
vi
PART I: REVIEW OF THE NATIONAL AGRICULTURE POLICY
2004-2015
1. INTRODUCTION
1.1 Background
Farm land is obtained through two main land tenure systems, customary and
leasehold. While the customary system accounts for 94% of farmland, the
leasehold system accounts for only 6%, with title deeds being issued for a
renewable period of 99 years. However, out of the estimated 1.5 million small
scale farmers, only 3% have title deeds. The lack of title deeds, in many cases,
discourages small scale farmers from adopting a sustainable, long-term land
management approach. As a consequence, they are unable to access loans
using the land as security.
In addition to the vast expanse of arable land, Zambia also has extensive surface
and underground water resources which can be used to irrigate nearly 2,750,000
hectares of which 423,000 hectares is readily available for development. Based
on the Ministry of Agriculture and Cooperatives (MACO) estimates in 2004, only
155,912 hectares (37%) of the readily available land was actually irrigated. The
factors affecting the utilisation of irrigation potential include inadequate access to
long-term credit, poor extension services, inadequate involvement of farmers in
management of irrigation projects, poor understanding of farming systems;
dependence on government and donor assistance; marginalisation of marketing
and production support services; inadequate efforts in the strengthening of
relevant institutions, and poor land tenure arrangements.
1
Farm size (Ha) Less than 5 5 to 20 More than 20
Crops grown Food Food/cash Cash
Type of production Subsistence and occasional Commercial Commercial
sales
Source: CSO [2001]
Despite the fact that approximately 80% of the producers of food are women,
they face gender-based constraints, such as inequalities in access to land, credit,
services, training, extension services, and representation in policy-making and
planning. As a result, women do not adequately respond to the opportunities
being created by the liberalised environment.
Between 2004 and 2015, the objectives of the National Agricultural Policy (NAP
2004-2015) were to:
1) Ensure national and household food security through all-year round
production and post-harvest management of adequate supplies of basic
foodstuffs at competitive costs.
2) Contribute to sustainable industrial development by providing locally
produced agro-based raw materials.
3) Increase agricultural exports thereby enhancing the sector's contribution to
the national balance of payments.
4) Generate income and employment through increased agricultural
production and productivity.
5) Ensure that the existing agricultural resource base is maintained and
improved upon.
% Agric (GRZ) 5 6 7 8 6 8 7
%Agric (GRZ+Donor) 6 7 9 13 9 9 7
%Donor in Total Agriculture
Budget 17 21 28 36 28 11 N/A
% FRA in Total Agriculture
Budget 16 14 27 21 9 8 8
% FISP in Total Agriculture
Budget 32 34 35 28 21 34 35
Source: MACO (2010)
MLF = Ministry of Livestock and Fisheries
GRZ = Government of the Republic of Zambia
FRA = Food Reserve Agency
FISP = Farmer Input Support Programme
In terms of utilisation of the agriculture budget, FRA and FISP allocations varied
from 62% in 2006 to 30% in 2008. These variations relate to the changing
number of target beneficiaries and the costs of implementing the subsidies. The
Government believes that the bias in the agriculture budget allocations to FRA
and FISP is needed to address the high level of poverty among small scale
farmers. However, the Government welcomes some of the recommendations to
minimise market distortions and improve targeting and general management of
these social programmes.
Over the years, donor support to agriculture development increased from 17% in
2004 to 36% in 2007. In subsequent years, donor support to the sector has been
declining. At the same time, some out-grower schemes are increasing support to
provision of selected public services, such as extension services and research.
However, both donors and the private sector are concerned about frequent
changes in policy interpretation, marginalisation of the core government services
in the agriculture budget, and crowding out of the private sector from providing
commercial services.
Maize and cassava dominate crop production (Figure 1). Even though there is a
general upward trend, crop production varies from year to year due to the effects
3
of climate change, such as droughts and floods that lead to reduction in crop
yields (Figures 2). The agriculture sector contributes to climate change through
gas emissions and unsustainable production practices, such as shifting
cultivation practices that result in approximately 2.4% deforestation per year, and
using late fires to clear land, etc. Therefore, the agriculture sector will promote
production practices that minimise contribution to climate change, such as
conservation farming, tree planting, etc.
In view of the fact that the current crop varieties have high potential yields (Table
3), the slow agriculture sector growth rate is attributed to low productivity (output
per unit of inputs), especially among small scale farmers who obtain only 25-50%
of the yields of the large scale farms. The causes of low productivity include
inadequate resources for the purchase of inputs, use of inappropriate farming
practices that lead to soil degradation, rainfall variations, and the failure to fully
develop the irrigation potential. As a result, low productivity leads to high per unit
production costs, consequently constraining the sector’s ability to contribute to
growth, increased exports and employment, and reduced levels of poverty and
food insecurity.
4
Figure 1: Crop Production Shares 2010 Figure 2: Trends in Production
of Staple Crops
The Government recognises the important role of the private sector in developing
stable markets for inputs and primary products and investment in value-addition
and bulking to generate large volumes for transportation over long distances.
Therefore, a number of incentives have been implemented to encourage private
sector investment. For example, removal of customs and duty on most
agricultural machinery and equipment; capital expenditure allowance of 20% for
the first five years on farm improvements, etc. However, private sector
investment is still constrained by the following factors:
7
that infrastructure development is expensive, there is strong justification to focus
on farm blocks and resettlement schemes as centers of agricultural development.
Small scale farmers produce most of the staple foods consumed in Zambia and
some of the export crops and yet many experience high levels of poverty and
food insecurity.
a) Food Insecurity
The overall objective of the NAP 2004-2015 was to reduce the high levels of
malnutrition and stunting which stand at 20% and 54% respectively. The high
level of malnutrition and stunting indicate that while government efforts focus on
achieving self-sufficiency in staple foods, there is inadequate emphasis on
production of complementary food crops (such as vegetables, fruits and
legumes). Similarly, there is inadequate capacity to prepare nutritious meals to
ensure balanced diet. In addition, food production is not evenly distributed
among households, thus many households do not have adequate access to food,
especially among communities with little purchasing power.
b) Poverty
At 64%, Zambia’s poverty level is high, with the agricultural sector being the main
source of employment (72%) and income for most Zambians, especially women
who constitute 65% of the rural population. Therefore, measures to accelerate
agriculture sector growth must ensure that the benefits reach small scale farmers
to enable them to raise their incomes and standard of living.
FISP and FSP have been instrumental in increasing the number of farmers using
fertilizer and hybrid seed and have in general contributed to increased maize
production and rural purchasing power among some of the beneficiaries.
However, MACO-FISP is criticised for consuming approximately 31% of the
agriculture budget, thereby marginalising the provision of other supportive
agriculture services; crowding out the private sector and failing to facilitate the
creation of a liberalised fertilizer market to provide adequate and timely amounts
of fertilizer to all farmers; bias towards maize production even in areas with no
comparative advantage, perpetuating the use of compound D even if it is clear
that there are soil variations within and across farms; indirectly blocking the
development of a decentralised and competitive fertilizer blending industry in that
MACO-FISP prefers to buy the relatively more expensive fertilizer (compound D)
8
than the generally cheaper fertilizer blends (up to 40% cheaper in Malawi);
excluding lime as a part of the package on farms with acidic soils; failure to
facilitate the establishment of an independent fertilizer regulatory institution to
monitor fertilizer grades and standards; and weak extension services to improve
the efficiency of fertilizer use to increase productivity; failure to encourage local
mining of some of the nutrients for fertilizer production; and the restrictive tender
qualifications as suppliers are required to have at least 25% of the stock ready
for distribution in the country.
The FRA is also seen as a major source of market instability in that operations
have been extended to all parts of the country in contradiction of the original
mandate; uniform price of maize is paid with no regard to the comparative
advantage and financial import and export parity prices. As a result, the private
sector is discouraged from providing strong commercial services, including the
establishment of an efficient agricultural commodity exchange to reduce
marketing risks on price as well as demand and supply. FRA is also criticised for
accumulating stocks without well-defined programmes to contribute to the
reduction of food insecurity among the most vulnerable people such as school
children, poor expecting mothers, and poor old people; and similarly, to
contribute to the promotion of value addition as a way of increasing the demand
for staple foods.
The organisational setup for innovation, research and extension includes public
institutions that mainly depend on government funding, private companies, seed
companies, large farms, out-grower schemes, and trusts that are mainly funded
through donor grants and small government allocations. Over the years, publicly
funded research has been adversely affected by inadequate funding, poor
coordination, limited number of high level scientists (PhD and MSc), and lack of
sociologists and agricultural economists. As a result, very little research and
development is being undertaken.
Even though the government has many extension workers, many farmers
continue to use crop production practices that lead to soil degradation e.g.
9
unsustainable land preparation, continuous mono-cropping, shifting cultivation
practices that result in approximately 2.4% deforestation per year, and using late
fires to clear land. Many extension workers have limited exposure and access to
new technologies meant to increase production, storage services and facilities
meant to reduce post-harvest losses, skills to prevent and control of major
diseases and pests, and knowledge of agricultural markets. Even when
extension workers have the required knowledge and skills, they are often
constrained by inadequate funding.
The private sector players also have inadequate knowledge and skills to enable
them identify opportunities and to develop and implement efficient agribusiness
operations. Skills are particularly inadequate in the identification of viable
markets and processing industries. It is therefore not possible to meet the
requirements of the market and the emerging processing industries have to
depend on expensive expatriates.
Zambia has in general liberalised the economy and the emerging stable
macroeconomic environment is attracting significant private sector investment,
resulting in GDP growth rates greater than 6% per annum. However, the
performance of the agriculture sector has been below expectation in that:
a) The agriculture sector reform programme has not yet been fully and
consistently implemented and as a result, private sector investment and
sector growth rates are relatively low. Hence there is need to ensure that
complementary sector policies are implemented and the legal environment is
improved to attract significant private sector investment.
b) Poor rural roads and infrastructure result in high cost of transportation of
inputs and products and therefore reduce the net incomes and discourage
farmers.
c) Improved sector coordination through creation of viable and effective
partnerships among GRZ, private sector, NGOs, community-based
organisations, and donors increases the pool of available resources for
agriculture development.
d) Inefficient, inadequate and expensive credit is constraining agriculture sector
growth, as farmers cannot obtain appropriate inputs, machinery and
equipment to increase production.
e) Zambia needs to quickly strengthen research and extension services to
enhance productivity and competitiveness to enable her to take advantage of
the huge opportunities that are emerging in national, regional and
international agriculture markets.
10
f) Globalisation and the eventual elimination of subsidies imply that there is
urgent need to improve the productivity of small scale farmers and integrate
them into the production and supply chains.
In general, the poor performance of the agriculture sector is due to: (i) low
agricultural productivity among small scale farmers; (ii) inefficient input and
output agricultural markets; (iii) decreasing rate of growth of agricultural exports;
(iv) poor small scale farmer access to productive agricultural resources and
services to increase production; and (v) weak public and private sector capacity
to facilitate planning, resource mobilisation, implementation, monitoring and
evaluation of agricultural policy and regulatory provisions. The main issues
facing the agriculture sector are summarised in Box 1.
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Box 1: Summary of the Key Issues Affecting Performance of the Agriculture Sector
Low agricultural productivity
Inadequate access to appropriate extension messages on sustainable crop production
Inadequate access to appropriate agricultural inputs, including fertilizer, seed, herbicides, animal and
appropriate mechanical power and equipment
Reduced availability of labour due to prevalence of HIV/AIDS prevents timely completion of key farm
tasks
Lack of affordable and accessible agricultural financial services for farmers, especially for small scale
farmers without land title deeds to provide the required collateral
Low investment in irrigation encourages dependence on uncertain rainfall, resulting in frequent
variations in yield.
Inadequate public and private sector research and extension services constrain development of
appropriate technologies and delivery of extension messages to increase production
Poor small scale farmer access to productive agricultural resources and services:
Inadequate access to purchased inputs due to low purchasing power
Crop production is largely rain-fed and is vulnerable to weather-related fluctuations leading to frequent
crop failure and food insecurity.
Low utilisation of irrigation in crop production.
Bias towards maize and neglect of other crops like fruits and vegetable and legumes to enrich the diet
and the soil nutrients.
Small scale of operation due to reliance on outdated equipment and unsustainable land preparation
practices.
Low number of small scale farmers accessing credit due to lack of title deeds to land.
FRA uniform pricing of maize adversely affects the production and marketing of other crops with
relatively higher margins.
Weak public and private sector capacity to facilitate creation of the enabling environment, planning,
resource mobilization, implementation:
The agricultural sector reform programme has not yet been fully and consistently implemented and
therefore, adversely affects profitability and investments
Inadequate legal and regulatory framework regarding market conduct, contracts, ownership rules and
property rights, and grades and standards, etc, discourage private sector investment
Inadequate government budget allocations and donor support to public investment in key public goods,
such as research, extension and infrastructure has adversely affected productivity and competitiveness.
12
Poor working relationship with cooperating partners has reduced the pool of available resources
Most of the agriculture budget is biased to FISP and FRA to support maize production and has
weakened diversification
Weak institutional capacity and reluctance to work with the private sector/NGOs as effective partners in
delivering services
Government and special interest groups do not have adequate data and information to enable them to
make informed decisions on subsidies and measures to protect them from outside competition
Inadequate integration of gender issues at all levels of agriculture development constrains full
participation
High level of HIV/AIDS among some of the key players in the agricultural sector constrains the
availability of required labour at various levels
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PART II: REVISED NATIONAL AGRICULTURE POLICY 2012-
2030
In line with the implementation period for the national Vision 2030, the revised
NAP 2012-2030 shall be implemented from 2012 to 2030. Over this period, the
agricultural sector will strive to make maximum contribution to the macro targets
that have been specified in the national vision.
According to the Ministry of Finance and National Planning (2006), the Zambian
people’s economic development vision is to become:
1 Lower middle income countries category is from US$ 999 to US$3,946. Since Zambia wants to be prosperous, it was assumed
that the appropriate target category is the upper middle income (more than $3,946). In Africa, only a small number of countries
have already attained the upper middle income status: Algeria, Seychelles, Botswana, Gabon, Libya, Mauritius, South Africa, and
Tunisia.
14
“To facilitate the development of a competitive,
diversified, equitable and sustainable agriculture
sector”
(iv) Improve access to productive resources and services for small scale
farmers, especially women and young farmers.
The key issues and selected examples of the action areas are discussed in the
following subsections.
15
2.2.1 Promote Sustainable Increase in Crop Productivity
16
Promoting agro-processing and value addition for major food and
industrial crops with consistent surplus as a means of expanding market
opportunities and increasing incomes of farmers;
Encouraging decentralised production and marketing of alternative
sources of soil nutrients, such as fertilizer blends, liquid fertilizer and
inorganic fertilizer.
2.2.4 Improve access to productive resources and services for small scale
farmers in outlying areas to enable them to increase crop production
and incomes and reduce food insecurity.
Food insecurity and poverty among poor small scale farmers shall be reduced
through:
Promoting environmentally friendly farming systems such as conservation
farming, aforestation, and the use of organic manure to ensure long-term
productivity and viability;
Promoting increased use of relatively cheaper sources of soil nutrients,
including organic fertilizers, fertilizer blends and liquid fertilizers as a way
17
to reduce production costs and make staple food crops competitive on
local and international markets;
Promoting production and consumption of crops that enrich the soil
(soybean, groundnuts) in rotation with food grains as a way to reduce
fertilizer costs and increase yield and farm incomes, as well as
consumption of protein rich food crops;
Promoting production and consumption of fruits and vegetables to
enhance the diets and diversify income sources;
Promoting appropriate farm mechanisation hire services for small scale
farmers who do not have access to machinery and equipment as way to
increase cropped area and overcome labour constraints arising from
HIV/AIDS;
Increasing the area under irrigation as a way of increasing yields,
promoting intensification and reducing rainfall-related production
variations;
Working with the Ministry of Lands to increase the number of farmers with
title deeds as an incentive to adopt sustainable land management
practices and enhance the collateral value for accessing credit;
Strengthening capacity of farmer groups, including cooperatives, to enable
their members to produce adequate volumes for efficient marketing;
Facilitating access to affordable loans to farmer associations and groups;
Reforming the operations of FISP and FRA to minimise market distortions
and sharpen targeting as a way of enabling Zambian products to compete
in domestic and the regional markets.
18
2.2.5 Strengthen Public and Private Sector Institutional Capabilities
19
3. IMPLEMENTATION FRAMEWORK OF THE NAP 2012-2030
3.2 Commitments
The Government shall ensure that vulnerable populations have the opportunity to
contribute to and benefit from agricultural growth as the best way of achieving
sustainable food security and to reduce the vulnerability of households to
economic and climatic shocks that often erode assets, coping mechanisms, and
deepen poverty, hunger, and malnutrition.
The Government recognises the roles of the various agriculture stakeholders and
therefore NAP 2012-2030 shall be implemented in partnership with other
stakeholders. Key stakeholder representatives shall be involved in developing
five-year strategic plans and joint work plans, coordinating implementation,
monitoring and evaluation of the emerging impacts.
20
3.2.2 Cooperating Partners’ Commitments
The Cooperating Partners have reconfirmed their commitment to the Aid Policy
and Joint Assistance Strategy for Zambia (JASZ) and concede that achieving the
MDGs and meeting Zambia’s Vision 2030 requires increases in the volume and
quality of development assistance. Therefore, development partners shall align
and scale up assistance to the sector to fund the priority programmes and
projects emanating from the agriculture sector’s five-year strategic plans and the
annual work plans, as well as CAADP priority investment programmes. In line
with the National Aid Policy, the development partners shall provide indications of
future aid to the sector based on five-year sector development plans,
programmes and projects.
The African Union through NEPAD (New Economic Plan for African
Development), SADC, COMESA and the other regional partners are committed,
through the Maputo Declaration, to support Zambia in defining priority
programmes that will allow the country to meet the agriculture sector objectives.
In this regard, some of the recommendations emanating from Zambia CAADP
Compact shall be included in the comprehensive sector strategy and annual work
plans. It is expected that the African Union, COMESA, SADC and other regional
partners will support Zambia in its efforts to mobilise financial and technical
support aimed at identifying the priority areas, preparing bankable projects,
mobilising funding and implementing the projects.
The overall coordination and oversight of the implementation of the revised NAP
2012-2030 will be provided by the Agricultural Sector Advisory Group (AgSAG)
composed of all key stakeholders in the agricultural sector. As one of the major
stakeholders, MACO is the Secretariat to the AgSAG. In order to ensure
effectiveness and efficiency of the AgSAG and the Secretariat, the Government
is committed to implementing some of the recommendations of the Performance
Enhancement Programme (PEP) for the period 2011-2013. This will entail
appropriate capacity building for the key stakeholders.
21
With regard to implementation modalities, the Government will drive the
development of the agricultural sector by partnering with the private sector, civil
society and farmer organisations - including small, medium and large scale
farmers. These partners shall be actively involved in the enhancement of:
(i) monitoring and evaluation;
(ii) advocacy on behalf of their constituency;
(iii) capacity building for farmer organisations and individuals;
(iv) promotion of sustainable agricultural practices;
(v) farmer training and extension services;
(vi) storage capacity;
(vii) access to inputs;
(viii) efficient marketing of outputs;
(ix) increasing exports;
(x) financial services;
(xi) value addition; and
(xii) actual implementation and management of programme components.
22
investment and growth. Table xx below shows current legislation under the
Ministry.
23
Ministries of Lands
and Agriculture, the
Act has been
dormant. It needs to
be amended to take
care of agricultural
land use planning
and management,
including farm blocks.
15. Agricultural Statistics Chapter 229 No. 13 of 1994 Xxxxxx
Act
16. Agricultural Products Chapter 232 No. 13 of 1994
Levy Act
17. Control of Goods Act The Act falls under
Ministry of
Commerce Trade
and Industry but
affects the Ministry of
Agriculture and Co-
operatives in as far
as the schedule of
controlled goods is
concerned.
18. The Financial Services The Act falls under
Act the Ministry of
Finance and National
Planning but affects
the agricultural
sector.
In order to realize the objectives and to implement the National Agricultural Policy,
there will be need to mobilize funding by government, cooperating partners, non-
state actors and the private sector from both domestic and external sources.
Government and other partners will make their funding commitments to well
articulated, detailed and prioritised investment programmes based on five-year
strategic plans including the Zambia CAADP framework.
Private sector contribution may come from equity, commercial bank loans,
financing institutions facilitated by government to increase direct investment in
the sector, and outgrower schemes. It is hoped that commercial banks shall
overcome their administrative deficiencies to increase agriculture credit at
affordable terms. However, the Government shall in the interim work with
interested private sector and NGOs to facilitate development of a sustainable
institution to provide credit on affordable terms to farmers.
24