An array of policy measures to support agricultural production. Between 2011 and 2015, Benin’s agricultural policy was implemented through the “Plan Stratégique de Relance du Secteur Agricole” (PSRSA), which is currently being renewed for the 2017-2025 period.The PSRSA aimed at (i) enhancing agricultural growth and food security through an efficient production and (ii) ensuring competitiveness and market access by developing value chains. To achieve these objectives, the Government was involved in the collection, processing and distribution of staple food (rice, maize) as well as of cotton, its main export commodity (from 2012 to 2015). The Government also provided input subsidies to cotton producers every year, while certified seeds were occasionally subsidized for maize and rice producers (2008-2009). Market support measures included floor prices at farm gate fixed annually for cotton and rice as well as recommended prices for rice and maize in selected retail stores. Finally a 10 percent tariff is in place for rice imports.

Price incentives at farm gate level despite inefficiencies in rice and maize value chains. This policy-mix contributed to create price incentives for cotton (26 percent) and rice (21 percent) producers between 2011 and 2015, while maize producers operated in a relatively neutral market environment (2 percent). Rice and maize value chains remain little structured and suffer from a lack of agricultural and marketing infrastructures (irrigation, storage, transformation, and feeder roads). Despite government efforts, the average annual agricultural growth did not exceed 1 percent between 2011 and 2015, far below the Maputo 6 percent target.

Cotton as a hindrance to crop diversification. The cotton value chain shows a higher degree of efficiency and organization compared to other crops.  As it weighs about 40 percent of agricultural export value and 13 percent of gross domestic product, it is a key value chain in terms of government policy. The fertilizer and seed subsidies, together with high international price, made cotton more attractive to farmers. Besides, cotton growers were the main beneficiaries of agricultural public expenditures until 2014. The doubling of the area harvested and production is certainly the result of this favorable policy environment. The provision of subsidized inputs for cotton was set as a high priority, whereas no specific subsidized inputs are available for cereal, vegetable and fruit crops. However, the lack of support for the provision of such inputs is not in line with the PSRSA goal of value chains development and hampers agricultural sector growth.

Lack of investment in agricultural infrastructures and research. Between 2008 and 2015, the Government of Benin spent on average 59 billion CFA each year in support of the food and agriculture sector. Nevertheless, the share of total agricultural public expenditure in the national budget did not exceed 8 percent of budgeted expenses and 6 percent of disbursed expenses, well below the Maputo/Malabo 10 percent target. Agricultural public expenditure mainly took the form of direct support to producers (21 percent of development expenditure). These costly and short-term measures mobilized funds that could have contributed to a long-term improvement of the agricultural sector competitiveness, for instance through investments in production and marketing infrastructures as well as in agricultural research in value chains other than cotton.

Public expenditure indicators for Bénin will be released in July 2018.