The performance of the livestock sector in sub-Saharan Africa over the last two decades has been disappointing; in most African countries, growth in livestock production has been insufficient even to maintain levels of consumption (Addis Anteneh, 1984). Many development policy analysts (see, for example, Schultz, 1976; Bale and Lutz, 1979; Peterson, 1979; USDA, 1980; Bates, 1983a) suspect that a major reason for this inadequate performance has been the prevalence of inappropriate government policies. Bates (1983b) analysed the validity of these suspicions and concluded that policy analysts were on the right track: livestock policies too often have not only failed to assist but also, in some cases, have hampered livestock development (World Bank, 1981).
There are, however, many technical difficulties to be overcome, particularly in the development of the dairy subsector. For example, extensive areas in the humid zone are tsetse infested and hence inimical to livestock production, leaving much of sub-Saharan Africa with no comparative advantage in milk production. In the arid zone and parts of the semi-arid zone where traditional pastoral systems produce milk mainly for subsistence, it is difficult to develop production and marketing systems which can efficiently serve the increasing urban demand. Moreover, African governments have often intervened on behalf of urban interests to the detriment of producer price incentives.
The extent to which dairy production has been inhibited by policies adversely affecting producer prices was addressed in the present study, but limited data availability prevented a very detailed analysis. The study therefore focused on the degree to which policies have stimulated commercial imports to increase more than would be expected from the excess demand arising from increased population and per capita income. Preliminary calculations in Chapter 6 show that less than two thirds of the changes in commercial dairy imports can be explained by increases in human population and per capita income. Obviously, other factors are involved, of which import prices and government policies are the two most important.
Europe and the United States have substantial dairy surpluses and are prepared to sell significant quantities of dairy products at very low prices or to give them away free. This has a twofold impact, as the availability of cheap or free dairy imports not only discourages domestic milk production, but also stimulates an increase in domestic consumption, exceptions being countries where food aid is being used to help finance dairy development projects.
In addition, a number of African countries maintain overvalued currencies, which also cheapens the domestic price of imported milk, discourages domestic production and encourages domestic consumption. And while some African countries have trade policies which may be designed to protect domestic dairy industry and thus encourage domestic production and/or raise government revenues, such policies have generally been overwhelmed by the effect of overvalued currencies.
It is hoped that this study will help improve the understanding of the effects of African livestock development policies and thereby contribute to the evolution of more favourable policies. The general trends in dairy production and consumption in sub-Saharan Africa, as well as the role of dairy imports in regions and countries with varying thresholds of sensitivity to the importation of certain foodstuffs, are discussed in Chapter 2. The objectives and instruments of dairy import policy are described in Chapter 3, while in Chapter 4 the potential of dairy food aid for dairy development is considered, citing India's Operation Flood and similar, but so far less successful, projects in Africa.
A general theoretical analysis of the economic effects of different import policies is presented in Chapter 5. Apart from some basic data which are given in Chapter 2, the empirical analysis of dairy imports into sub-Saharan Africa begins in Chapter 6, with a discussion of the factors that have caused dairy imports to increase. The analysis is refined in Chapter 7 where two typical dairy import policies, those of Nigeria and Mali, are described in detail. And finally, a summary of the results of the study is given in Chapter 8, together with some observations on the methodology used and certain selected implications for policy-makers and policy analysts.
