Among the ways in which governments intervene in the livestock subsector, the most prevalent, and arguably the most important, is interference with prices. Price intervention policies are often implemented with the aim of achieving certain broad objectives which, in developing countries, include output expansion, government revenue generation, improvement of income distribution, stabilisation and inflation control. In pursuing these objectives, governments possess a wide variety of policy instruments which can be manipulated directly with the intention of achieving the desired objectives. For example, they can establish price controls or price supports to benefit consumers and producers, respectively, or they can impose import duties and export taxes to raise government revenue. In addition to direct measures, indirect forms of government intervention including exchange rate adjustments can also influence the production, consumption and trade of livestock products.
In reality, sub-Saharan African (SSA) countries have pursued a wide variety of pricing policies, differing in the choice of instruments as well as in their objectives. 1 The effects of these policies on production incentives have also been varied. The multiplicity of objectives and their instruments suggests that in some cases conflicts will arise between the desired objectives and the policies pursued to achieve them. The likelihood of such conflicts is heightened when, as often happens, the different ministries of these countries are interested in different objectives. The ministry of agriculture, for instance, may advocate higher farm prices to encourage output expansion while the finance ministry may be interested in interventions that raise revenues. In this situation, one of the contributions of price policy research will be to quantify the effects of different policy options in order to permit an informed discussion which can lead to better decision making and an improved incentive system.
1. For this study, sub-Saharan African (SSA) countries are taken to include only those 39 countries listed in ILCA's strategy and long-term plan document (see ILCA, 1987a).
The broad objective of this study is to review, analyse and present evidence concerning the effects of livestock pricing policies on production incentives in a sample of SSA countries. The specific objectives are to:
· provide a comparative picture of objectives and policy instruments used by selected SSA countries with respect to the livestock sub-sector· estimate the effects of direct and indirect price interventions on incentives, livestock output, consumption, trade and government revenue.
In what follows, the experiences of six SSA countries are profiled. These countries, namely Côte d'Ivoire, Ethiopia, Mali, Nigeria, Sudan and Zimbabwe, were selected on the basis of their livestock population, production, trade and consumption. Data were collected through interviews with policy makers and livestock marketing officials and from a wide range of primary and secondary published documents.
To introduce the subsequent discussion, Chapter 2 examines the growth and performance of the livestock subsector in the study countries. It demonstrates the diversity of situations and experiences with respect to production, consumption, export and import of livestock products.
Chapter 3 considers the multiple objectives of price policies in the selected countries and analyses the principal instruments employed to influence producer and consumer prices. The discussion highlights similarities and the diversity in objectives and policies dealing with the livestock subsector and also examines the compatibility of policy goals with their instruments.
Chapter 4 assesses the impact of government intervention on price incentives. The final chapter discusses the effect of intervention on the welfare of producers and consumers and on foreign trade and government revenue. It concludes by highlighting the main findings of the study.
