To export or not to export?
A recent paper looks at possible reasons why farmers in parts of the developing world insist in growing crops for local markets when crops for export markets are considered to be more profitable. The authors suggest that this could be explained by:
"[M]issing information about the profitability of these crops, lack of access to the necessary capital to make the switch possible, lack of infrastructure necessary to bring the crops to export outlets, high risk of the export markets, lack of human capital necessary to adopt successfully a new agricultural technology, and misperception by researchers and policymakers about the true profit opportunities and risk of crops grown for export markets."
The paper also takes a look at the work of DrumNet, a social enterprise in Africa, to analyze whether a package of services could help farmers switch to export crops and market them. The researchers found a slightly positive impact from DrumNet’s package of services, but nothing overwhelming.
Comments (2)
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export products are specific to particular markets. The standards and quality requirements for a particular markets can only be appreciated by farmers who have physically been into those particulat markets. Promotion of exports in agriculture therefore require that projects are started at greenfield level with technical assistance and special financing to support the initiative. You cannot wil from the perspective of 'let there be exports and there was exports'.
Posted by: Phil Chilomo-Zambia | Apr 2, 2008 9:59:26 AM
Your analysis is very interesting. I would add two more elements :
1. the lack of financial support for farmers in small countries
2. many important markets are too demanding in term of standards- sanitary and phytosanitary measures
so even if the farmers wish to explore exports opportunity, it is impossible to do so
Posted by: Amena ABDIRASSOUL | May 1, 2008 2:43:10 PM