Low import tariffs, smuggling activities, unpredictable tax exemptions and weak enforcement of quality and food safety standards: The potential of local rice value chains is undermined in West African countries. This article provides deeper insights into these challenges and offers strategic options to support the policy dialogue among ECOWAS countries.
Dr. Johanes Agbahey is agricultural economist. As advisor at the German Corporation for International Cooperation (GIZ) GmbH, he is actively engaged in the development and management of projects based on requests from partner countries. His work contributes to improve agricultural policies and enhance intra-African trade.
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ)
West Africa remains dependent on the volatility of international markets due to increasing rice imports. Rice has become a major staple food in the diet of households in West African countries, representing 37% of cereal food consumption Despite increased domestic rice production after the food price crisis in 2008, the competitiveness of the rice sector has improved only slightly. Low import tariffs, smuggling activities, unpredictable tax exemptions and weak enforcement of quality and food safety standards have undermined the potential of local rice value chains and are harmful to West African rice farmers.
The study presents consumption and production trends as well as imports and import dependencies in the rice market. Low import protection, deficiencies in West African countries' customs systems, and government support to producers in large rice-exporting countries have encouraged extra-regional rice imports. Rice imports now cover 40% of consumption needs in West Africa, making this region one of the top rice importers with about 18% of global imports. These imports strongly compete with local rice production and discourage private investment in the rice sector. At the same time, West African governments, pursuing the goal of national self-sufficiency in rice, have directed considerable public resources to rice farming and processing. Moreover, different rice trade policies between West African countries have led to cross-border spill-over effects further complicating the task of developing cost-competitive and quality-oriented value chains and promoting intra-regional trade in locally produced rice. The challenge presented by the rice sector thus raises the issue of policy cooperation between West African countries.
The market power of international rice exporters, as well as dominant national agricultural and industrial policies, the goal of national self-sufficiency in rice, and the risks of climate change complicate the policy coordination of trans-regional import systems and regional trade in locally produced rice in West Africa.
The study examines the main transhipment routes for both formal and informal rice trade flows, shown in the Figure. Legal transhipment of imported rice takes place when after being shipped to a West African port, the imported rice is transported throughout the region, particularly to supply landlocked countries in the Sahel. However, in several cases, imported rice crosses borders illegally, circumventing customs duties and regulations. Up to 85% of Beninese imports are re-exported to Nigeria through highly ramified smuggling networks over which the two states have little control.
Several Beninese localities serve as hubs for trade with Nigeria. These include old cities that perpetuate traditional commercial activities despite the border between the two countries. Besides frequent import bans, high transport and logistics costs in Nigeria encourage importers and traders to carry Asian rice through Benin. These high costs are due to several factors: bottlenecks at the ports of Lagos, Port Harcourt and Calabar; high transaction costs and clearance fees; difficult transport between ports and inner cities (Abuja, Kaduna, Kano and others). In contrast, Benin, with the port of Cotonou and good management of its road network, offers to the Nigerian traders a more efficient ‘logistics platform’ to reach Nigerian consumer markets. This is more the case since the Beninese administration largely eliminated the checkpoints and as road transportation delays are the lowest in the region. Revenues and profits from the smuggling of imported rice between Benin and Nigeria are shared between a complex network of actors on both sides of the border.
Policy events at regional and country levels affect rice imports and production in different ways. As elsewhere on the African continent, West African governments immediately responded to the 2008 food price crisis by reducing import duties and other taxes on imported rice and other cereals. However, reductions in import duties entail large fiscal costs and do not properly target the most exposed populations – the poorest are not the biggest consumers of rice, and traders do not pass on cost reductions to consumers to their fullest extent.
At the same time, those initiatives mainly allocated resources to irrigation infrastructure and rice farming technological research, with the result that few benefited from those investments. With the adoption of the ECOWAS Common External Tariff (CET) for extra-regional trade in 2013, rice was assigned a 10% import tariff, which provides little protection to rice producers in the region. In addition, the implementation of the CET differs between countries (for example, Nigeria usually applies an import duty on rice much higher than the 10% CET), and ECOWAS member states continue to use other tariff-like trade policy tools, such as import and export bans, for the purpose of regulating supplies and prices in domestic markets.
For instance, since 2008, the government of Ghana has banned exports of locally produced rice and took regulatory measures to stop rice imports through land borders. Following the major cereal production shortfall in the Sahel in the marketing year 2011 – 2012, Mali suspended import duties. In response to an unusually strong import demand in Mali, in late 2011 the Burkinabe government responded by enacting a ban on exports of rice and other cereals. To limit rice smuggling from Benin and Niger and to protect the domestic rice industry, the Nigerian government has placed substantial import tariffs on rice, reaching 110% in 2013. Taking a step further, Nigeria enacted between May 2013 and October 2015 a ban on land imports. Subsequent to the re-opening of borders, rice trans-shipments surged again, leading Nigeria to place a full ban on imports by land from Benin and Niger since 2019. Those government interventions contribute to the volatility in rice prices and trade across the region as shown in the figures.
The three synergistic reform areas that have been identified are: regulating extra-regional rice imports, structuring domestic rice markets for improved quality-cost competitiveness, and promoting intra-regional rice trade for regional rice market development. Recent developments indicate that progress in regulating rice markets and developing competitive and inclusive value chains is possible. This requires the alignment of interests, incentives for private investment, and the promotion of a coherent policy that links a tighter regulation of imports with the structuring of domestic markets.
Progress in regulating rice markets and developing competitive and inclusive value chains is possible. This requires an alignment of policy and private sector interests, as well as incentives for private investment and coherent policies to regulate and structure imports and domestic markets.
Building on the existing momentum in regional trade, trade facilitation could further contribute to strengthening the rice value chain and have positive impacts on livelihoods, food security and job creation. In this context, the development of the rice sector as part of a more sustainable agricultural and food system also depends on the interests of the various countries in better coordinating national rice policies and implementing regional trade agreements.
The study therefore aims to support private and public actors, stakeholders and networks in the rice sector to reach consensus on feasible measures and reforms.
Developing the rice value chain and promoting rice trade for the benefit of West Africa requires a comprehensive policy dialogue on coordinated national rice policies and regional trade agreements. This study supports ECOWAS in this endeavour.
The study was conducted by the European Centre for Development Policy Management (ECDPM) and the Initiative Prospective Agricole et Rurale (IPAR) and financed by the Gesellschaft für Internationale Zusammenarbeit (GIZ) on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).
The discussion paper and further information can be found here.
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A report by Bettina Rudloff and Annette Weber (SWP)
The Corona-Virus exacerbates existing crises through conflict, climate, hunger and locusts in East Africa and the Horn of Africa. What needs to be done in these regions? To face these challenges for many countries, all of these crises need to be captured in their regional context.
A report by Alexander Müller and Jes Weigelt (TMG)
As the climate changes, the population of Africa is growing and fertile land and jobs are becoming scarcer. New ways are currently leading to urbanisation of agriculture and a new mid-sized sector in the countryside
A contribution by Michael Brüntrup (DIE) und Daniel Tsegai (UNCCD)
Droughts are the natural disasters with far-reaching negative consequences. While rich countries are still vulnerable to drought, famines are no longer found.
Climate change is destroying development progress in many places. The clever interaction of digitalisation and the insurance industry protects affected small farmers.
A study by the World Bank predicts that millions of people in sub-Saharan Africa will have to leave their homelands because of climate change. We have spoken with one of the authors
A contribution by Dr. Karin Gaesing and Prof. Dr. Frank Bliss (INEF)
Especially in densely populated areas, land pressure leads to overexploitation of available land and a lack of conservation measures. The West African country of Benin, with heavily depleted soils in many places, is no exception.
An Interview with Francisco Marí (Brot für die Welt)
Brot für die Welt (Bread for the World) did not attend the UNFSS pre-summit. Instead, the organisation took part in a counter-summit that took place at the same time. A conversation with Francisco Marí about the reasons, the process - and an outlook for the future
Vitamin-poor nutrition must become more expensive, in-vitro meat is not a panacea, and agricultural systems should be more decentralised. Bioland President Jan Plagge in an interview about the challenge of (future) world nutrition.
Genetically modified bacteria become edible proteins, cows graze on pasture, and no waste is produced in an industrial circular economy. Journalist Jan Grossarth sees a silver lining for the future of world nutrition
A Contribution by Emile Frison and Nick Jacobs (IPES-Food)
While having failed to solve the hunger problem, industrial agriculture appears to be causing additional ones both in environmental and health terms. Emile Frison and Nick Jacobs call for a transformation.
Vertically growing plants, magnetic cotton. Hairy leftovers fertilizing fields, tractors running on algae? These six innovations could lead agriculture’s next Green Revolution!
A Contribution by the Forestry Research Institute Nigeria
The 'Domestication of Small Monogastric and Ruminant Animals' (DSMR) project led by a Nigerian research institute works with local communities to solve the bushmeat crisis.
The G7 is responding to the worsening global hunger crisis by mobilizing an additional $4.5 billion for this year alone. A key milestone for this in the run-up was the international conference on global food security "Uniting for Global Food Security".
Healthy, productive soils are a prerequisite for global food security – one of the priorities of German development cooperation. State Secretary Jochen Flasbarth on Germany’s efforts to support sustainable land management and why the VGGT are more important than ever today.
How can we reach more people with successful approaches to food security? In Berlin, an international conference organized by the Deutsche Gesellschaft für Internationaler Zusammenarbeit (GIZ) addressed this issue.
Why are short- and long-term responses important to address current and future global crises? Sebastian Lesch, Head of the Agriculture Division at the German Federal Ministry for Economic Cooperation and Development (BMZ), provides answers to these and other questions in an interview with the Global Donor Platform for Rural Development (GDPRD) and explains how much Germany welcomes all donors pulling together and acting in concert.
How to maintain functioning food markets in global food supply chains in the face of vulnerability and disruption? Markets that support local and territorial food systems are part of the solution. Thomas Forster presents proposals for these markets to cope with future shocks.
The Global Alliance for Food Security (GAFS), jointly launched by the German G7 Presidency and the World Bank, released the Global Food and Nutrition Security Dashboard during COP27: A Rapid Response Tool for Coordinating Global Action for Food Security.
How can the challenges related to water, rural development and climate resilient agriculture be addressed? What innovations need to be promoted? The Water and Energy for Food (WE4F) initiative presents strategies and innovations for sustainable, integrated water management in German and international cooperation.
A Year of Multiple Crises: Russian war against Ukraine, extreme weather events, high prices for energy and fertilizer, food crisis had severe implications for food security and agriculture globally and especially in Sub-Saharan Africa. A Transformation of the food systems is needed.
Since early February 2022, two of the biggest grain and oilseed exporters have been at war. An overview, which countries are affected most severely by the destabilized grain markets, and what comes next.
Rising food and gas prices, physical destruction and supply chain disruptions: Why the Black Sea region matters and how the war in Ukraine affects global food security.
The Corona pandemic is hitting economies around the world very hard - but developments in African countries are quite diverse. There are different speeds, resiliences and vulnerabilities. What are the reasons for this? Apl. Prof. Jann Lay of the GIGA Institute provides answers.
A contribution by Prof. Dr. Anna-Katharina Hornidge
In the video format "#99SecondsWith" of the German Institute of Development and Sustainability (IDOS), Prof. Dr Anna - Katharina Hornidge talks about the new Africa-Strategy of the Federal Ministry for Economic Cooperation and Development (BMZ).
Four interviews kick off the relaunch under the new name „Food4Transformation“, asking the same questions from different perspectives. Mareike Haase and Stig Tanzmann from Brot für die Welt explain why the right to food, inclusivity, agroecology and food sovereignty are the central levers for a successful transformation.
Four interviews kick off the relaunch under the new name „Food4Transformation“, asking the same questions from different perspectives. Dr Julia Köhn, Chair of the German AgriFood Society, points out in the interview: Only if innovation and transformation are profitable in the medium term can they close the food gap in the long term.
The Federal Ministry for Economic Cooperation and Development (BMZ) has released a video on the transformation of agricultural and food systems. In the video, Federal Minister Svenja Schulze also speaks about the urgent need to combat global hunger and contribute to resilient agricultural and food systems.
A Contribution by Dr. Fatima Olanike Kareem and Dr. Olayinka Idowu Kareem
High agricultural prices affect developed and developing countries alike, but the problem is aggravated for the latter through the lack of or inadequate resilience measures. Dr. Fatima Olanike Kareem, AKADEMIYA2063, and Dr. Olayinka Idowu Kareem, University of Hohenheim, explain what can be done to mitigate the negative effects on food security.
Iraq suffered many years of war, sanctions and economic crises. However, Ally-Raza Qureshi from the World Food Programme in Iraq sees progress. But now the effects of climate change are becoming apparent in the country. What is to be done?
The world is currently experiencing a historic food crisis. High fertiliser prices are part of the problem. In addition to the necessary short-term aid measures, the crisis ought to be made use of to develop and implement longer-term fertiliser strategies for sustainable, in particular smallholder increases in production in the Global South.
In a world facing crises – from pandemics, armed conflicts, and climate change – how do we ensure everyone has enough food within planetary boundaries? A new podcast by Food4Transformation discover solutions talking to government officials, scientists, NGOs and farmers around the world.
The Gaza Strip depends heavily on humanitarian aid, more than ever with the current war. Gaza population is very young: Half of them are children. What is their situation on the ground? Questions for Lucia Elmi, Unicef Special Representative to the State of Palestine.
In Sub-Saharan Africa, not all financial institutions (FIs) have access to knowledge about how to implement processes to enhance rural financial inclusion. The pan-African Community of Practice (CoP) plays a pivotal role in supporting these institutions along this transformative journey.
How can agriculture engage more young people in rural areas? Advocacy and education campaigns can play an important role here. Simeon Kambalame, Timveni Child and Youth Media Organisation, has launched such a campaign in Malawi.
Women and girls in poorer countries are affected in particular ways by the multiple crises the world is currently facing. Uncovering the linkages between gender, resilience and food security, experts from International Food Policy Research Institute (IFPRI) look at ways to support women and girls’ capacity to respond to crises.
The armed conflict between Israeli forces and the Hamas is escalating. What does this mean for a Gaza, region that was already heavily dependent on external aid? Questions for Dr. Muriel Asseburg, Senior Fellow at the German Institute for International and Security Affairs (SWP) in Berlin.
Felix Phiri has been Head of the Department of Nutrition, HIV and AIDS at the Ministry of Health in Malawi for almost 20 years. A conversation about constants and change.
Diversifying our protein supply to include plant-based foods and cultivated meat can be a game-changer for climate mitigation and climate adaptation, especially in the countries of the Global South. However, a great deal of research is still required to capitalise on this potential. And political support, as Ivo Rzegotta, Good Food Institute, demonstrates.
Small farmers in developing countries must modernise their farming methods, but poorly understood reforms could exacerbate poverty instead of alleviating it.
The Global Hunger Index (GHI) 2020 shows that the world is not on track to meet the international goal of “zero hunger by 2030”. If we continue at our current speed, around 37 countries will not even have reached a low hunger level by 2030.
Startups are booming in African agriculture. What are the current trend and challenges – and can other regions benefit from innovative approaches? A Video-Interview with Claudia Makadristo, Regional Manager of Seedstars
A conversation with aquatic researcher Shakuntala Thilsted on the long-neglected nutrition benefits of aquatic diets and the empowering qualities of a sustainable aqua-food systems transformation.
At the UNCCD COP15, the Töpfer Müller Gaßner Think Tank (TMG) hosted four side events. The agenda of the kick-off event included discussions for the Human Rights and Land Navigator.
A Contribution by Adrian Muller, Catherine Pfeifer and Jürn Sanders (FiBL)
Taking Biodiversity Focus Areas under production or abandoning lower yielding, more extensive production systems is the wrong approach to mastering the looming global food crisis, say the authors of the Research Institute of Organic Agriculture (FiBL).
Taking a look at the data (as of February 11th 2022) what the current price hike means for world hunger and what can be done to prevent from another food crisis.
Interview with Caroline Milow and Ramon Brentführer
Groundwater resources remain dormant in the soil of African regions. Where does it make sense to use them – and where does overexploitation of nature begin? Caroline Milow (GIZ) and Ramon Brentführer (BGR) talk about potentials in the future and lessons from the past.
Agriculture is coming under pressure worldwide: bacteria, viruses and insects are causing problems for crops. In Palestine, Dr. Rana Samara from the Palestinian Academy of Science and Technology is researching solutions to the problem. And she finds them in nature itself.
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