2.5 Current performance and problems

2.5.1 Qualitative monitoring
2.5.2 Quantitative monitoring

The logical next step in identifying the most important policy issues is to assess the sector's current performance in terms of each objective. At this stage, no particularly complex or detailed analysis is required; that may come later when the key issues have been identified. Rather a broad monitoring system that keeps an eye over the whole field will suffice.

2.5.1 Qualitative monitoring

At a very basic level, performance can be monitored simply in terms of the presence or absence of easily identifiable "problems" formulated mainly in qualitative rather than in quantitative terms. Since most people and politicians conceive of policy issues in terms of "problems" rather than "unfulfilled objectives", this approach has much to recommend it. We list below some of the most commonly perceived problems. Table 2.8 sets out the probable relationship between these problems and the broad groups of objectives already discussed.

· inadequate supplies of livestock products to the consumer (queues and empty shelves at shops, black markets, sky-rocketing prices)

· excessive dependence on imports of livestock products

· unproductive resources (under-utilised or low yielding land or livestock)

· desertification (erosion, overgrazing etc)

· unstable supplies and consumption (due to weather conditions, disease outbreaks etc)

· inefficient livestock services (e.g. animal health, feed supplies, artificial insemination, water supplies)

· distorted prices (too high or too low, discriminatory, excessive marketing margins)

· inadequate market outlets (too few, unreliable, do not cater for some products)

· undesirable concentration of livestock ownership

· unfair pattern of access to land (between livestock holders, or between pastoralists and cultivators).

Table 2.8. The probable relationships between policy problems and policy objectives.

	Objectives
Problems	Independence	Efficiency	Resource conservation	Stability	Equity
Inadequate supplies	-1	- -2			-
Excessive imports	- -	+/-3
Unproductive resource		- -	+/-
Desertification		- -	- -
Unstable supplies	-			- -	-
Inefficient services		- -		-	-
Distorted prices	- -	- -			-
Inadequate markets		- -			-
Concentrated livestock ownership		+/-	+/-		- -
Unfair access to land		+/-	+/-	+/	- -

¹ One negative (-) indicates a negative relationship.
² Double negatives (-) indicate a strong negative relationship.
³ Positive and negative signs together (+/-) indicate that the relationship may be either positive or negative.

2.5.2 Quantitative monitoring

More sophisticated performance monitoring of the livestock sector is both desirable and possible. For each broad group of policy objectives, there are three main steps to monitoring performance:

· Set up one or more fairly simple quantifiable for evaluating performance.

· Establish a minimum level of performance which is regarded as "acceptable", i.e. one which does not require priority attention to rectify.

· Identify existing sources of data, or generate new data, with which to measure the performance of a particular country's livestock sector.

Setting up quantifiable criteria

Box 2.2 gives an example of how a particular criterion could be made to work. Tables 2.9-2.13 list summary suggestions for appropriate quantified criteria for each broad objective group.

The objectives set, especially in the case of the economic efficiency objective, often involve a complex group of concepts and considerations. These can only seldom be fully captured by a single quantifiable criterion. It is usually preferable to use criteria which can be made to work in practice and then to make subjective adjustments in one's evaluation, knowing that the criteria chosen may not capture the full complexity of an objective or may even distort it. For example, in Table 2.9 we suggest "changes in per caput production" as one criterion by which to evaluate performance in terms of the efficiency objective. In most situations this is correct, e.g. increasing meat output increases national income. But there are cases where the opposite may be true, i.e. increasing meat output decreases national income. Such would be the case if domestic meat production was heavily protected or subsidised and if the cost of imported inputs (e.g. feed, fencing etc) exceeded the cost of importing the meat. The use of several criteria simultaneously can help to mitigate the effects of such situations.

Box 2.2: An independence criterion. A possible quantified criterion for assessing performance in terms of the independence objective would be the self-sufficiency ratio in the main livestock products, i.e. meat of cattle, goats, sheep, pigs and poultry, and fresh, powdered, condensed and evaporated milk plus butter. The self-sufficiency ratio is defined as the ratio: domestic production/domestic consumption. Domestic consumption is assumed to be equal to domestic production plus net imports (including imports of live animals). Net imports are gross imports minus gross exports. We can calculate self-sufficiency ratios separately for different commodities in quantity terms (e.g. tonnes). But, if we want to do it for all the main food commodities (i.e. meat, milk, dairy products) together, it is better to do so in value terms (i.e. dollars). However, both domestic production and net imports (of similar quality) of any one commodity (e.g. beef) must be valued at the same prices (for example at the price of imports - the issue of the appropriate prices to use is discussed in module 4). If we do these calculations, for example in the case of Nigeria, we find that total domestic production of the commodities concerned in 1985 had a value (at import prices) of about US$ 1033 million, and net imports had a value of US$ 175 million. Thus the self-sufficiency ratio in the principal livestock products is 1033/(1033 + 175) x 100, or 86%.

Table 2.9. The independence objective: Some quantified criteria for evaluating performance.

Summary formulation of criterion	Point of reference	Possible data source
Self-sufficiency ratio (S.C.)	Absolute	FAO P. and T.Y-B
Per caput imports (S.C.)	Own past performance	FAO T.Y-B
Ratio of livestock imports to agricultural exports (by value)	Own past performance	FAO T.Y-B
Change in livestock exports (S.C.)	Own past performance	FAO T.Y-B

S.C. = selected commodities only (e.g. beef and milk).
FAO P.Y-B = FAO Production Year-Book.
FAO T.Y-B = FAO Trade Year-Book.

Table 2.10. The efficiency objective: Some quantified criteria for evaluating performance.

Summary formulation of criterion	Point of reference	Possible data sources
Change in per caput domestic supply (S.C.)	Absolute	FAO P.Y-B
Change in per caput domestic supply (S.C.)	Similar countries	FAO P.Y-B
Change in per caput domestic supply (S.C.)	Own past performance	FAO P.Y-B
Domestic/international price ratios (S.C.)	Similar countries	Annual survey
Yield of land and livestock	Similar countries	FAO P.Y-B
Marketing margins (S.C.)	Similar countries	Special surveys

S.C. = selected commodities only (e.g. beef and milk).
FAO P.Y-B = FAO Production Year-Book.

Table 2.11. The resource conservation objective: Some quantified criteria for evaluating performance.

Summary formulation of criterion	Point of reference	Possible data sources
Vegetation composition and cover on monitoring sites	Own past performance	Annual surveys
Comparison of aerial photographs (% cover)	Own past performance	Annual surveys

Table 2.12. The stability objective: Some quantified criteria for evaluating performance.

Summary formulation of criterion	Point of reference	Possible data sources
CV of annual output (S.C.)	Similar countries	FAO P.Y-B
CV of per caput annual consumption	Similar countries	FAO P. and T.Y-B

CV = coefficient of variation, defined as: (standard deviation/mean) x 100.
S.C. = selected commodities only (e.g. beef and milk).
FAO P.Y-B = FAO Production Year-Book.
FAO T.Y-B = FAO Trade Year-Book.

Table 2.13. The equity objective: Some quantified criteria for evaluating performance.

Summary formulation of criterion	Point of reference	Possible data sources
Lorenz curve of livestock holdings (selected species)	Similar countries	Special surveys
Lorenz curve of livestock holdings (selected species)	Own past performance	Special surveys
Ratio of winners in pastoral/cultivators crop damage	Own past performance	Special surveys cases
Ratio of retail and producer prices to international	Own past performance	Annual surveys prices (S.C.)
Ratio of retail and producer prices to international	Similar countries	Annual surveys prices (S.C.)
Rate of gifting livestock from poor to rich households	Own past performance	Special surveys

S.C. = selected commodities only, e.g. beef and milk.
CV = coefficient of variation, defined as: (standard deviation/mean) x 100.
Lorenz curve = A graphical device to demonstrate equity of distribution. See the appendix for a detailed explanation.

Establish minimum level of performance

We need to consider what minimum standard should be set for the level of acceptability of performance. Remember that the point of the whole exercise is to identify priority issues. If standards are set too high, performance in every respect becomes unsatisfactory and everything then becomes a priority issue. If set too low, then everything is acceptable and there is no priority to change anything. We need to set standards at a level that draws attention to a small number of really poor performances. The "setting of standards" may not be a formal, public or long lasting exercise. It is more likely to be one of continuous informal discussion amongst the few policy makers and analysts most concerned.

Broadly speaking, there are three types of reference points in relation to which some minimum acceptable standard can be set. Let us take as an example the efficiency objective and use as a criterion "growth in per caput domestic beef supply". One possible reference point would be an absolute one. We might set a 1% annual increase in per caput domestic beef supply as the minimum acceptable level. Another reference point could be one that is relative to the performance of similar countries. We might, for example, set the average annual change in per caput beef supplies, experienced by all sub-Saharan African countries, as the minimum acceptable level. The third reference point would be one that is relative to that country's own past performance. For example, we might set the minimum acceptable level as being at least equal to the country's own average annual performance over the last decade.

Identify existing sources of data

Performance monitoring on the basis of quantifiable criteria requires available and pertinent data. The FAO Production and Trade Year-Books include FAO estimates for some national-level data (e.g. livestock populations, production, imports and exports). Some of the data, however, are not reliable. As well, while national data is important, it is often the case that regional and/or social group within-country data is also needed. It is unlikely that many countries will be able to adopt immediately all the criteria (and their attendant data requirements) listed in Tables 2.9-2.13. However, unless progress is made towards adopting many of them, governments concerned will remain vulnerable to internal and external pressure to adopt someone else's priorities in the policy making arena.