Executive Senegal Summary - UNEP€¦ · 1 Sénégal: «Cadre intégré, étude diagnostique de l’intégration commerciale » draft, chapitre 5, ... country has been very fast since

UCAD

UNEP COUNTRY PROJECT ON TRADE LIBERALISATION IN THE AGRICULTURE SECTOR AND THE ENVIRONMENT

INTEGRATED ASSESSMENT OF IMPACTS ON TRADE LIBERALISATION OF THE RICE SECTOR IN

SENEGAL

Summary

ISE

September 2003

EVALUATION INTEGREE DES IMPACTS DE LA LIBERALISATION DU COMMERCE SUR LA FILIERE RIZ AU SENEGAL (DRAFT)

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ACRONYMS AND ABREVIATIONS

ACA Cost Advantage Analysis ACG African Consulting Group ACP Afrique Caraïbes Pacifique AEM Multilateral Environmental Agreements ADRAO Association for the Development of Rice Growing in West Africa. ANCAR National Council for Agricultural and Rural Agency APOV Association of Onion Producers of the Valley ARI African Initiatives on Rice ARM Market Regulation Agency AsA Agricultural Agreements CAF Cost Insurance and Freight CBD Convention on Biological Diversity. CCNUCC United Nations’ Framework Agreement on Climatic Changes CGSMR Management and Monitoring Committee of the Rice Markets CILSS Inter State Committee against Drought in the Sahel CIRAD International Cooperation Centre in Agricultural Research for

Development. CIRIZ Interprofessional Committee on Rice CITES Convention on International Trade on Endangered Wild Species CNCAS National Bank for Agricultural Credit in Senegal CNCR National Council for Discussion and Cooperation with Farmers. CNNCI National Committee on International Trade Negotiations CONCOFIR National Committee for Discussion on the Rice Sector COSEC Senegalese Council of Shippers CPSP Price Adjustment and Stabilisation Agency CPN Nominal Protection Margin CRI Internal Resource Costs CSA Food Security Program CSE High Council of Water CSE Ecological Follow -up Centre CTE Technical Committee on Water DAPS Department of Analysis, Prevision and Statistics DCE Foreign Trade Department DSRP Poverty Reduction Strategy Paper EES Strategic Environmental Assessment EIE Assessment of Environmental Impact ESAM Senegalese Survey on Households FPE Investment Funds Promotion GIE Economic Interest Grouping GMP Power-driven Pump ICS Senegalese Chemical Industries IRRI International Institute for Research on Rice ISE Institute of Environmental Sciences


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ISRA Senegalese Institute for agricultural Research LPDA Agricultural Development Policy Document MAE Ministry of Agricultural and livestock MAP Table of political Analysis MEF Ministry of Economy and Finance MEPN Ministry of Environmental protection MGS Global Support Measures MPMEC Ministry in charge of Small and Medium Enterprises and Commerce NERICA NEw Rice for Africa NPA New Agricultural Policy ONG Non Governmental Organisation OMVS Organisation for the Development of the Senegal River ONRS National Rice Watchdog in Senegal OP Farmers’ Organisations PAMLT Structural Adjustment and Economic Policies in the Medium and Long

Term PASA Adjustment Programme of the Agricultural Sector PASR Structural Adjustment Policy of the Rice Sector PMIA Project for Modernisation and Intensification of Agriculture PNAE National Action Plan for Environment PAN/LCD National Action Plan against Desertification PNIR National Rural Programme for Infrastructure PNUE United Nations Programme for Environment PREF Economic and Financial Adjustment Plan PROGES Management Water Project in the South Area PSAOP Programme of Agricultural Services and Farmers’ Organisations Union of Farmers, Shepherds and fishermen RETADV Association of the Agricultural Entrepreneurs of the Senegal River Valley SAED Development and Exploitation of the Senegal River Delta Lands and of the

Senegal River Valley and the Falemé SCP Performance Behaviour Structure SODAGRI Agricultural and Industrial Development in Senegal SODEVA Agricultural Development and Popularisation SOMIVAC Agricultural Promotion of Casamance SPIA Industrial and Agricultural Product Company TCI Structural Tax on Imports TDP Graduated Protection Tax TEC Common External Tariff TES Table of Input-Output TVA Value Added Tax UCAD Cheikh Anta Diop University UEMOA West African Economic and Monetary Union UNACOIS National Union of Traders and Industrialists of Senegal UNIS National Interprofessional Union of Seeds UPA Unit of Agricultural Policy USAID United States Agency for International Development


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5

CONTENT


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AKNOWLEDGEMENT The current project has been initiated and supported by the United Nations’ Programme on Environment(PNUE) which, under the supervision of Hussein ABAZA, did every thing possible to ensure the success of this activity. Special thanks to Sophie FORSTER for her scientific and technical support on the field; to Konrad MOLTTKE who critically assessed this study and to Rahila MUGHAL for the administration and facilitation of the programme activities . This project has been carried out thanks to the support and contribution of many institutions and resource people who did their best to ensure its successful implementation. The Institute of Environmental Science (ISE) of the Faculty of Science and Techniques of Cheikh Anta Diop University of Dakar (UCAD) as the main national institution in charge of carrying out this study, needs to be thanked as well. We also thank the Department in Charge of Analysis, Prevision and Statistics (DAPS) of the Ministry of Agriculture and Hydraulics and to the Inter-professional Committee on Rice.(CIRIZ) Thanks to the invaluable commitment of the steering Committee which supervised the national study process , we managed to benefit from the expertise and advice of the Company in charge of Developing and Promoting lands in the Delta of the Senegal River and the Valleys of the Senegal River and the Falemé (SAED); SODAGRI, ( Company in charge of Agricultural and Industrial development in Senegal) ; the Inter professional Training Centre in Agricultural Fields (CIFA); the Information Agencies in charge of monitoring the rice Sector; the National Rice Watchdog in Senegal (ONRS); ARM (Agency for Markets Regulations ); the Ministries in charge of Commerce, Environment, and Finance; the Regional Divisions of Rural Development, in Fatick, Kaolack, Kolda, and Saint Louis; the Private Sector; the Farmers’ Organisations, Traders, importers, Non Governmental Organisations, (NGOs); the Senegalese Institute in Charge of Agricultural Research (ISRA); the Association for the Development of Rice growing in West Africa (ADRAO) and the Centre for Ecological Follow Up (CSE) We also pay tribute to the scientific committee made up by Professor Amadou Tidiane BA, Director of the ISE, Jeanne KOOPMAN from Boston University, visiting Scholar at ISE, Dr, Helene David BENZ researcher at CIRAD and Jean René CUZON Technical Aid at the Ministry of Agriculture and Hydraulics for their effective support . The Research Team has been coordinated by Professor Abdoulaye SENE. Many Thanks to all the Colleagues from the research team, Abdoul Aziz GUEYE, Amath Dior MBAYE, Seydou CAMARA, Issa MBAYE and the Resource Persons, Amadou Fall DIOUF and Dr Mame Ndiobo DIENE (DAPS), Magatte BA (CSE), Abdoulaye FALL (ISRA), Pathé BALDE (DEEC), Mbaye Mbengue FAYE (consultant), Dr Henry LO (ISE) and Ibrahima DIENG (PH.D Student at ISE), who have provided useful information and given necessary data for the study as well as all the ISE administrative and technichal Staff .


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INTRODUCTION Agriculture plays an important role in socio economic activities in Senegal ; the agricultural sector uses nearly 70% of the labour force and the vast majority of the homes in rural areas indulge in Agriculture which is their main source of income . However, it is important to note that in 2000 agriculture accounted only for 17% of GDP which explains why 54 % of the population live below the poverty line. Senegalese agriculture is mainly driven towards exports (peanuts grains and oil, gum arabic, cotton grain, horticulture ) following a productivity approach supervised by many States interventions as well as the market. From 1964 to 1984,there was an agricultural policy that strongly subsidised agricultural exports through inputs and equipment on credit 1 without an adequate rural development . The current Senegalese context is characterised by the pejoration of climatic conditions , State disengagement (end of subsidies and credit for inputs ) transfer of decision making to local communities, empowerment of producers and the liberalisation of the market. Such changes have created important breakdowns in the incentive approach to production, processing and marketing. They have initiated important changes in the agricultural sector similar to the organisational dynamism of the producers that has never existed before. Because of the persistence of drought, rainfall is still a limiting factor that forces the Government to develop a water harnessing policy. The water –related infrastructures built on the River Senegal in the North and in Casamance in the South, will promote the adoption of an irrigation system of crops to supplement the pluvial system. This will pave the way for the development of rice growing in order to satisfy the growing national demand. Internal demand constitutes a great potential for rice production but is meaningless because of the important imports of broken rice. With globalisation of markets and reforms on the agricultural sector, in general, local rice has undergone some sale difficulties due to institutional problems , lack of competitiveness compared to imported products and organisation in its distribution channels. Questions on the impact of liberalisation of commerce on the rice sector are about sector performance, production environment and the resulting behaviour of the stakeholders by these new incentives. The aim of this study is to determine direct and indirect effects of this liberalisation of commerce on the rice sector and its economic, environmental and social effects on populations. It also aims at understanding changes

1 Sénégal : « Cadre intégré, étude diagnostique de l’intégration commerciale » draft, chapitre 5, tome 2, mai 2002, p.39-41


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that occurred in the paddy market as well as those of commercial inputs, services and local resources that farmers use for the production of rice and on their environment. I. CONTEXT 1.1 Importance of the rice sector in the economy Broadly speaking, the primary sector ( agriculture, cattle breeding, fishing, forests,..) has known a 1.3% growth rate per year in real terms, less than the growth rate of the population which was about 2.7% per year from 1991-1995. Agricultural growth was negative in 1997 (-2%) and in 1998 (-0.7%.) From 1991- 2000, the agricultural growth rate increased for about +3.6%. Agricultural products account for 20% of the Senegalese exports, whereas food imports occupy more than 29% of the total of our foreign assets. Added to that is the fact that our exports of agricultural products are mainly dominated by peanut products followed by cotton, fruits, vegetables, leathers and hide.

Senegal has become one of the greatest importer of broken rice in West Africa, after Nigeria , and therefore a net importer of rice. The evolution of rice consumption in the country has been very fast since the end of the second World War. Traditionally, rice is grown for home consumption in Casamnace, the southern part of the country, whereas millet is consumed in the rest of the country. The decline in cereal production caused by peanut hegemony which has been grown vastly in the cultivable lands, has increased the need to resort to huge imports of rice.

Rice imports have created an imbalance in the country trade balance with an important hole in foreign currency amounting to about 100 billions of CFA F per year. From 1995 to 2002 rice imports have grown roughly to 63 % going from 435 500 tons to 709 575 tons or from 59 to 110 billion CFA F in value. The market share is respectively for local rice between 7 and 13% and between 87 to 93 % for imported rice. It is important to note that nearly 30% of the local rice is home consumed The Senegalese agriculture is a multifunctional agriculture, a vulnerable agriculture made up of small rural family plots of lands for whom the development of the rice sector will enable to follow food security , poverty alleviation and rural development objectives. Public authorities must guarantee the satisfaction of basic food needs for people, maintain them in their rural areas, help population settle in their lands as well as diversify their crops. 1.2 Objectives of the project The overall objective of the project is an integrated assessment of the environmental and social impacts of trade liberalisation and Agreements on Agriculture (AoA) of the World Trade Organisation (WTO) on the rice sector; Senegal must prepare a negotiating position based on clear information integrating the environmental concerns and the elaboration of its technical terms in view of the DOHA agenda development cycle.


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The main objectives of this projects consist in : - Assessing the environmental, social and economic impact of the trade liberalisation

and Agreements on Agricultural measures in the rice sector in order to remedy the potential negative effects

- making a sound analysis of the environmental, economic and potential social

consequences of the Government’s option to increase rice production in view of reducing imports and ;

- developing accompanying measures and proposing solutions to reduce potential

negative effects on trade liberalisation and Agreements on Agricultural measures so as to increase profits of the Government’s option

- the end result of this study is to define an advantageous national position for Senegal,

net importer country of food product in the framework of the multilateral trade negotiations

II. NATIONAL POLICIES OF TRADE LIBERALISATION 2.1. Reminder of national policies of State intervention The Senegalese commercial policy has undergone several reforms that led to more transparency and opening up ; the simplification of the tariff structure and the reduction of trade resulted in a tariff system that harmonises with the adoption in 1999 of the External Common Tariff of the European Union and West African and Economic Monetary Union (WAEMU). The various macro-economic policies adopted since 1960 by the public sector and which affect the rice sector have progressively developed before and after the liberalisation of the agricultural sector

2.2. Integration Policies and community liberalisation 2.2.1. Regional agreements WAEMU was created in 1994 with 8 West African member countries2 and adopted a convergence pact of, stability, growth, and solidarity in order to harmonise macro economic and sector based policies as well as tax regulations for the various member countries . This mechanism has been designed to harmonise agricultural but also to regulate the circulation of goods and services within the community space. By this process, agricultural products would have a market of 60 million consumers with the same advantages for all the member countries In theory WAEMU is a custom union but complex and arbitrary rules do not allow member countries to profit from internal preferential tariff for WAEMU ; efforts must be made to set up a real zone of free exchange. 2 Ces pays sont : Bénin,, Burkina Faso, Cote d’Ivoire, Guinée Bissau, Mali, Niger, Sénégal et Togo.


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The global objective of the WAEMU Agricultural Policy (WAP) is to contribute in a sustainable way to the satisfaction of the food needs of the populations , to the economic and social development of the member States and alleviate poverty . The sub-regional space must be protected from unfair external competitiveness. The harmonisation of tax policies affects the agricultural sector and allows to realise the convergence of taxation mechanisms and equal treatment of economic operators within the community space Material and agricultural inputs are now subject to an 18% in VAT. However, There still is a paradox : unlike other economic actors , farmers have no means of having back the VAT and are therefore unfairly penalised. The Economic Community of West African States (ECOWAS) created in 1975 is a model of market integration for 16 member countries. Through free movement of goods and services this union helps to agree on the port duties of the community. 2.2.2. Agreements on Agriculture (AoA) The conclusions of the negotiation of the Uruguay round (UR) in 1994 resulted for the first time in the integration of agricultural products in the multilateral commercial regulation systems . AoA has set up a new efficient mechanism which allows to subject the practices of the developing countries to the rules and disciplines that should be respected by the WTO member countries in the three fields that are access to markets, internal support and subsidies to exports in order to make agricultural products participate in a more open global trade based on the market. It is important to examine the behaviour of the countries after the implementation of the AoA. 2.3. Senegalese Commitments within the framework of the AoA Following the negotiations of the Uruguay Round (1986 -1994) Senegal took some commitments in terms of tariff which can be summarised as follows : A consolidated uniform maximum rate of 30% plus additional rights and various taxes that could go up to 150% have been adopted by Senegal on agricultural products . In theory such tariffs should enable to put in place levels that could go up to 180% (Table 2) Preliminary authorisations for imports of dairy products mainly and certain category of agricultural equipment as well as quotas have been withdrawn and replaced by a temporary surcharge. With the structural adjustment policies and commitments made towards partners of the WAEMU and ACPs, Senegal was forced to engage in a customs disarmament process and implement relatively high tariffs .


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With liberalisation, a change in the privileged partnership framework is expected. However, compensating and correcting mechanisms must be designed to limit the impact of European subsidies on African agricultures. Due to the vulnerability of the rural economy of the country , Senegal is exposed to the multilateral commercial system, therefore it will gain in reinforcing regional solidarity in the framework of the WAEMU. III. NATIONAL PRODUCTION OF RICE 3.1 Presentation of economic, environmental and social variables and data relating to rice production The basin of the Senegal River (regions St-Louis, Matam and Tambacouda), the regions of Kolda and Ziguinchor constitute the three main zones of rice production in Senegal, with very different systems of production. The Senegal River Valley and the Anambé basin are irrigated systems with perfect water harnessing; the region of Ziguinchor and part of the Kolda region have rain fed systems. Each system of production (irrigated or rain fed) has potentials to increase its productivity with the new technologies. The eco-geographical zone of Casamance in the Southern part of Senegal occupies 61% of all the lands destined to rice growing. The main part of the local production of rice in Senegal is grown in the River Senegal Valley. The average yields of this intensive system of rice growing is between 5 and 6 tons /ha. In general, the Delta production is mainly marketed whereas that of the middle and upper valley is mainly destined to home consumption. Irrigated production in the Anambé valley is still at marginal level. Rain fed and lowlands rice productions have not yet gone over the level of home consumption.


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Map 1 : Rice in cereal production : campaign 2001 - 2002

Source : ISE ,2003


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The overall demand for rice has, however, been constantly growing between 1995-2002. It is much higher than the current production level and it is urgent to secure this by increasing the national part of rice production. We import as many quantities of rice as we produce in cereals ( millet sorghum, maize, rice, and fonio) in the country. The local rice production is the second most important in terms of cereal production after millet but only represents 20 to 30% of the national production of cereals. Senegal must reduce its dependence towards an unpredictable and speculative international market that is estimated at 4% (SAED, 1997). This is all the more worrying as broken rice consumed in Senegal is a marginal segment of the world market. The gap between cereal production and offer, in general , is bridged by the commercial imports and food aid . Food aid have in fact been reduced from 120 000 in 1980 to 13 000 tons in 2000, among which 10 000 tons are cereals. The low levels of local production and aid has lead to an imports of food products. Variable fluctuations in imports are noted from one campaign to another and range between an average of 450 000 and more than 800 000 tons per year , ( Fall, 2002). These cereal imports are another important dimension of this critical food situation. They have greatly progressed on average from 1980 to 2000. However, they are largely dominated by rice and wheat in particular which are at 156% of their levels in 1976 (USAID, 1993) and 168% in 2000. Imports of food grains have therefore increased three times faster than the population. Chart 1 : evolution of rice offer /demand

Evolution offre-demande de riz au Sénégal (1995 - 2002)

0

100 000

200 000

300 000

400 000

500 000

600 000

700 000

800 000

900 000

1 000 000

1995 1996 1997 1998 1999 2000 2001 2002

annéesstock théorique de riz demande globale riz (tonne) offre globale riz (tonne)

Source : ISE, 2003


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3.2. Use of natural resources for rice production The development of irrigated agriculture in the Senegal River and Anambé valley by public authorities was not a product of a dynamic evolution of the traditional local system of production (falling water crops, rain fed crops, migrant livestock and continental fishing), but of the will of the planner to look for an autonomy in strategic agricultural product. By massively introducing the irrigated system of production with a major option for rice, farmers of the valley get into a long process of specialisation and agricultural intensification which is not yet completed. The great drought of the 1970s have forced the Government, donors and technicians to improve technology (full harness of water) through very costly investment (infrastructures, close technical supervision, directive planning for production, campaign credit, mechanised services, administered prices , processing and production marketing). After many decades, this mode of administered development has not yet reached its objectives .Therefore, the period opened with NPA (1984) marks the Government disengagement in compliance with liberalisation policy with measures that are going to trigger new dynamism, create new initiatives and engender a boom in the private cultivated lands. Irrigated lands are thus going to break the dynamic of after falling water crops, livestock and fishing practices . This has lead to a real change in the traditional production systems based on the use of natural resources around the river. Growing competition for access to natural resources and the progressive intensification of agriculture and mainly rice growing raise acutely the issue of their adequate management and use. In such a context of liberalisation where the private investments are encouraged, the use of these resources leads to re examine land tenure issue, water systems, etc. whose challenges are very important. The new socio-economic context of Government disengagement and liberalisation, leads farmers’ organisations and private producers to get more and more involved in the management of irrigated systems. The Government has transferred the management of lands to decentralised local communities and production facilities and equipments to producers. 3.3 Performance and policies of the rice sector With the aim of ensuring more food security to meet demographic growth, and promote competitiveness of agricultural products in the local and foreign markets while preserving natural capital and productive basis, major strategic orientations of agriculture are defined in the main documents which are : the Agricultural Development Policy Paper (LPDA), the Service and Agricultural Support Programme to Organisations of Producers (PSAOP), the Poverty Reduction Strategy Paper (PRSP) and the law on Agricultural Orientation Law (AOL)which is being discussed. In the future, Senegalese agriculture should rely on the promotion of a modernised family farming system and the participation of a confident private sector in order to effect a transition from extensive production to systems to diversified sustainable intensive ones.


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The main idea behind the policy regarding cereal products is to achieve food self sufficiency based on boosting production , in particular « of irrigated crops in those areas where it is feasible to harness water resources partially or otherwise » as a consequence, the government regards the Valley important in relation to the strategies to increase national cereal production, rice in particular . Measures taken by the various stakeholders ( producers, service providers, agricultural research and credit) to adjust to new circumstances have made it possible to enhance the viability of irrigated rice growing by making local production more cost effective and competitive thanks to the liberalization policy, the institutional environment of the production of rice is characterised by a new development dynamics with the advent of many types of organisations for the population (GIE, OP, UNIONS, Small and medium-sized enterprises of agricultural services etc ). Despite research and development efforts and considerable investment in water-related infrastructures , the drive to increase rice production is still up against many constraints throughout. The main reasons behind the low level of agricultural activity around the area seem to be among others : difficult access to credit, lack of seasoned labour, water and land mismanagement, lack of new varieties, for double cultivation problems linked to quality and processing. Following the total liberalisation of rice production in 1996, combined with the efforts of the devaluation of the FCFA, there emerged issues relating to costs, competitiveness, productivity, and cost effectiveness regarding rice production system and , in general, the issue of sustainability of irrigated systems . The debate on the future and sustainability of irrigated crops, and cost effective water investment has generated renewed interest in potential progress regarding the rice production sector. . Structural change has resulted in various types of professional organisation as far as rice growing in Senegal is concerned some organisations have opted to look after the activities relating to production (credit, purchase of inputs, agricultural work, marketing). Others to strengthen coordination between producers and the other stakeholders. In Senegal, agricultural activities has considerably been diversified to include joint management of the infrastructures for production and control over products development. Farmers’ partners have also changed while new patterns of relationship based on the market, have emerged.


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IV. ENVIRONMENTAL LEGISLATION 4.1 At national level It was as early as 1983 that a legal and statutory framework was to set up together with the first code on the environment, to deal with environmental problems ( topsoil degradation, air water and soil pollution, industrial hazards, ..). In relation to decentralisation , the policy of transfer of powers to manage natural resources and the environment, to local authorities came into force in 1996. Some strategic planning tools have been adopted : the National Environmental Action Plan (PNAE, 1997) the National Action Plan against the drought (PAN/ LCD, 1997), the Senegalese Forest Action Plan (PAFS), the national strategy to implement the framework Convention on Climatic Change; the Action Programme on Biological Diversity , the Action Programme for the protection of the Ozone Layer , the management plan for harmful waste. The adoption of new legal clauses (forest, water, hunting and protection of the fauna and flora , hygiene, local communities , etc, codes) was made as part of a move towards sustainable development. In the process, the policy of subjecting national law to international conventions signed and ratified by Senegal, and of implementing the principles and measures included in Agenda 21, was reasserted. As part of a more coherent approach, some highly strategic measures were taken to renew and consolidate the institutional machinery for the management of the environment and national resources ; and to adopt a more harmonious legislation to reduce risks of overlap and dispersal of efforts made for the sake of the environment and the promotion of sustainable development. It was in this context that the new Environment Code, which has been revamped and updated was promulgated in January 2001 while the decree for its enforcement was signed in April 2001. The provisions of the 2001-01 Act of January 2001 relating to the Environment Code (LCE) and the related enforcement decree N0 2001-282 of 12 April 2001, represent the fundamental legal and statutory framework governing activities with effects on the environment. The Code was worked out bearing in mind the provisions relating to the protection of the Environment and natural resources. 4.2 Enforcement of multilateral environmental agreements (AEM) Senegal has signed and ratified several international conventions, a first set of which relates to a reduced use of dangerous chemicals products and pesticides : the UN framework convention on climatic change; the Rotterdam Convention on previous agreement procedure with full knowledge of the facts, applicable to some dangerous chemical products and pesticides used in international trade; the phytosanitary convention for Africa; the Stockholm convention on persistent organic pollution; the Carthagina protocol on the prevention of biotechnological risks ; the international convention for the protection of plants.


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A second set of conventions concerns the protection of natural resources and ecosystems (biodiversity, vulnerable surrounding) : the Ramsar convention on international humid areas ( water bird habitats); the Bonn Convention on the preservation of migratory species from wild animals; the convention on biological diversity (CBD); the convention on International Trade in endangered species (ITES) . A study of « AEM » reveals interrelations with WTO subjects and rules regarding free trade and synergy between trade and the environment, as mentioned in the negotiation mandate of the Doha Declaration. In this connection, the focus is mainly on the compatible nature of the regulations for environmental protection , with the multilateral trade system and their effects on rice production. V. INTEGRATED ASSESSMENT OF THE IMPACTS OF TRADE LIBERALISATION ON THE RICE SECTOR 5.1 Environmental impacts 5.1.1 Analysis of the impact of water-related development on the environment The environmental context is characterised by a chronic and persistent decline in rainfall, which has led to a drastic weakening of agricultural production. The measures taken by the policy makers in order to be less dependent on rain and to reverse the trend towards desertification consisted in creating long-term food security and in promoting the national economy by resorting to local production to substitute for ever-increasing imports. The creation of water related agricultural development has resulted in considerable environmental and social damage: Destruction of plant diversity and reduction of habitat , Disruption of traditional production systems around the valley, based on the natural conditions of the river (after drop of water level crops, cattle-breeding, fishing); A considerable drop in catches regarding continental fishing; Risks of water eutrophication Risks of soil degradation (salinity, acidification ) Degradation of surface waters; A higher level of the ground water; Risks of an increase in conditions favourable for the formation of disease carrying organisms (river blindness, amoebas, entero-infection, etc. ) The table of interrelation between rice growing and the components of the ecosystem reveals that the worst effects concern the soil and the populations


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Table 1: Table of interrelations between rice growing and the components of the ecosystem (source : ISE, 2003)

Water

surface Underground water

Soil Flora Fauna Populations

Clearing + + +++ +++ +++ +++ Fertiliser +++ +++ +++ ++ ++ +++ Pesticides +++ +++ +++ +++ +++ +++ Racks ++ ++ ++ + + ++ Draining +++ +++ +++ +++ +++ +++

+ : low impact ; ++ : important ; +++ : very important - : without impacts. The decision made by the Government to opt out of « AHA » and the liberalisation of the sector are going to have some social and human effects in addition to the biophysical impacts. The increase in production leads to change in styles of production including the use of fertilisers and phytosanitary products : Risks of conflicts over access to lands; The populations’ poor skills to optimum use of the racks likely to cause environmental degradation;. Risks of contamination of pasture lands by waste from draining water; Waste from washed away fertilisers damaging water quality; Invasion of the national markets by all kinds of inputs, following the liberalisation of trade ; Middlemen’s poor technical skills to take care of products or advise producers; Uncertain proportioning of products, and direct/indirect intoxication; Risks of bio-accumulation of pesticides wastes in food chain; Risks of accidents in the preservation and handling of pesticides; Use of waters unfit for domestic use (washing up bathing, etc. ) 5.1.2 Impacts of rice growing on the environment The liberalisation of the sector has led to new needs to plan and use space and for the utilization of land and water . This has had some effects on the environment of rice growing systems. Given the continual use of water for purposes of irrigation , of pesticides and fertilisers, rice growing contributes to the emission of carbon dioxides, methane, nitrogen oxide and ammonia. Methane emission are specific to irrigated rice growing, given the long periods of flooding and the anaerobic decomposition of organic matters when badly applied , urea evaporates in the shape of ammonia.

In moving from one pasture to another, cattle breeding has been dislocated by irrigated rice growing which, by taking up space and gradually eliminates pastures and cattle trails.

Salinity of soils has been the main problem facing rain fed rice growing in the South of the country , following the drop in rainfall.


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Irrigated rice growing is usually blamed for deforestation (banking , canalising and planishing work linked to land management), but it was shown during the discussions that strangely enough, the planned areas around the valley are those places where trees are to be found, a consequence of reforestation on a rather large scale. 5.2 Social Impacts 5.2.1 Impacts on the structuring of professional associations Thanks to the Government’s liberalisation policy, several socio-professional associations have emerged revolving round rice production. The new conditions of irrigated agriculture around the river Valley are characterised by the advent of dynamics, institutions and mechanisms that contribute to the ongoing remake of the socio-economic environment. There are about 2000 associations around the valley, dominated by GIE which are gradually involving into federations, unions and unifying associations (ISRA, 1996) The current organisational fabric of farmers’ associations in Dagana is the densest in the region and even in the country. It comes from types of associations suggested by the Government and the other support institutions and represent a “sui generis” response to their own needs. Such a mix of technocrats and grassroots populations has resulted , today, in a list of many inter professional associations regarding rice, tomato, sweet potato and recently, onions; plus professional organisations supplying services Such types of associations are an attempt to fulfil the functions given up by the Government : intermediary financing, marketing, supply of inputs, training. The various restructuring aspects (credit, land system..) did not allow them to fulfil all the potential held by the GIE. Those organisations have played an important role in structuring initiatives for individual farms autonomous farmers’ groups, and for villages and local communities within the new context. Such producers’ organisations have created links of partnership with institutions for research (ISRA,CIRAD, WARDA, IRD, University of Saint Louis…) and technical support ( SAED, DRDR, ANCAR etc ) The creation of facilities for exchange and consultation represent a further step in building the capacities of the people involved in rice growing . Interprofessional associations provide opportunities for exchange and consultation around a given product, operating within a given area like the Senegal River Valley and sometimes, at national level like UNIS. Such events involve all the participants in the production of a given product (producers, industrialists , service supplies, traders, inputs and credit suppliers, consumers, carriers, ..) 5.2.2 Needs analysis Thanks to workshops, the needs of those involved in rice production have been analysed.. 5.2.2.1 Producers Producers and service providers discussed both the positive and negative effects of the liberalisation of trade and issues related mainly to :


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- co-existence of both agricultural and animal husbandry and involving both the Walo and Diery areas in relation to agricultural by-products ;

- the significance of locally growing rice ; - the unfair competition with rice imported mainly from Asia and heavily

subsidised - marketing problems resulting from a lack of supervision ; - the possibility of creating a private institution able to organise the supply and

marketing of products ; - the results and follow –up of the study

The ensuing debates did not fail to engage farmers in scrutinising their practices and

responsibilities regarding the difficulties plaguing rice growing .

The various issues debate come under four main headings :

Marketing as the major constraint facing rice growing, now;

Production cost; cost effectiveness and competitiveness of local rice ;

Tide-over food and cash ;

Potential for progress .

5.2.2.2 Importers and traders Since liberalisation , the number of importers has gone down from 43 to 7 , between 1996 and 2002. The accumulation of surplus rice stocks has led to a reduction of the number of operators. There’s no shortage of rice on the market and there is a security stock of 100 000tons . Import is completely free and speculative . The import of rice is seen as a market opportunity which is cost-effective compared to other imported goods. Rice can also be re-exported towards neighbouring countries like : Mali, Guinea Bissau and sometimes The Gambia. Senegalese rice importers are ordinary economic operators who are very passive in international trade. Traders are king. Without any capacity for negotiation, local importers strive to make consumers bear the cost price; this leads retailers to prevent housewives from taking advantage of lower prices on international markets. For Senegalese investors, it is out of the question to participate in the production of local rice. Even if some of them think that it would be better to grow the rice rather than import it, they do not make up the section of the private sector that intends to join in growing the product. Also , even if they acknowledge the fact that it is difficult to give any support to peasants, local importers do not engage in the marketing of local rice despite the protection measures taken by the Government.


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5.2.2.3 Consumers and communicators The opinions expressed during discussions between representatives of consumers’ Associations and communication experts led to the following conclusions :

- As far as rice production is concerned , supply is the main issue , since demand already exists ;

- The local rice market is disorganised; - Local rice production still suffers from a lack of information and promotion at

national level. -

5.3 Economic Impacts 5.3.1The effect of reforms on production and producers the objectives of such reforms relate to market efficiency through a transfer of responsibility for rice collection and processing by producers or farmers’ associations, and for imports by the private sector. Reforms have strongly affected conditions surrounding rice production around the River Senegal Valley and , to a lesser extent, the Anambé zone because of the high level of take –up of capital , and the highly commercial nature of rice production in those areas. However, those reforms have left the Casamance region intact thanks to its relative isolation from rice markets . 5.3.2 The impact of reforms on prices and production markets despite a few attempts at protecting local rice which could help reduce the fluctuations of world prices on the local market , the vulnerability of paddy rice has increased. Immediately after the devaluation of the FCFA , producers demanded as much as CFA F 125 for a kilogram of paddy rice. As a result those rice mills that were agreed by the CNCAS for the collection processing and marketing of white rice were out bidden . Such a constraint made it urgent to create a rice inter professional Commission (CIRIZ) around the Senegal River Valley , which includes all the stakeholders (producers, industrialists, traders, service suppliers , funding institutions , SAED, …) Then the participants understood that a compromising price was needed for the paddy in order for the rice to be marketable . Consequently, before any production drive , all the participants come together in order to negotiate the costs of the various intermediary services and the price of the paddy bearing in mind market circumstances . as a result, of a series of difficulties registered over the last few years, the price of paddy now varies between 90 and CFA F 100 a kilogram. Rice is a strategic product for the social well-being of households in both urban and rural areas. So, pricing has always been a highly sensitive political barometer . for the unions who insist on protecting workers’ purchasing power, any increase in the price of rice which absorbs a big share of households’ budget is likely to trigger salary claims. The expectations over prices have not been fulfilled because the pricing policies initially followed by the Government have obviously helped maintain levels of protection close to those applied before the reforms for the domestic market. This has a few effects on the


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protection of rice and the incentives to promote national production. The reform has led to a reduction of production. There’s been a net positive contribution to the competitiveness of local rice.

5.3.3 The impact of reforms on natural resources The distribution of natural resources among the various agricultural activities has changed following the liberalisation of the rice sector. Water and land are the main source of concerns : 5.3.3.1 Water The increase in rice growing raises the whole issue of the availability of water. Water is the main constraint in rice growing, from controlled flooding to the harnessing of water resources. Water is a vital environmental barometer sought by various competing users. For the time being, the availability of water is not a real constraint, but in the mid and long term , the needs for water in relation to the three components of the OMVS programme (irrigation, navigation, electrification, ) will produce a call for different political and economic arbitrations. 5.3.3.2. Land The land issue is a decisive factor for the promotion and development of investments in water related equipment in irrigated agriculture. Irrigated lands have gone from a pioneering zone status to that of lands for agricultural production managed by a rural council by virtue of powers transferred by the Government to local communities. As far as the rural communities are concerned , land management has led to a quick development of private investment in irrigation between 1988 and 1991 specially around the Senegal River Valley . Around the Delta, of the river rice production has taken up almost all the lands. In the various areas where the rice is produced, the land market is not regarded as an institution . Still the number of transactions has increased ever since the sector of rice was liberalised with a transfer of power for land allocation to local counsellors. This is a policy of distribution of the available lands , based on the principle of development and appropriation of such lands. 5.3.4. Impact of reforms on the market for inputs and services The transition from a system tightly controlled by the Government to a liberalised one, took place without the people concerned having any means of consultation, coordination, or information. This has had some bad effects on the supply of inputs services, and on marketing , to which the effects of the devaluation of the CFA F in 1994 should be added. The increase in the prices of inputs and equipment, coupled with the difficulties in operating the credit system have had a tremendous effect on the cost effectiveness of local rice through a reduced use of inputs and an increase in productive costs


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5.3.5. Impact of reforms on rice marketing The study of changes in the current status of the system of rice marketing was conducted as part of the “Structure Behaviour Performance” (SCP) approach. So the economic efficiency of the system was assessed by comparing the behavioural characteristics of the two main products: imported rice and locally- produced rice , with those linked to a market where competition is given full play. One of the effect of the liberalisation is a diversification of sources and a search for rice qualities on a large scale. The improvement of the qualities of rice has become a strategic option of marketing. Traders reacted favourably by submitting a wide range of qualities and prices regarding rice.; this allowed consumers a lot to choose from in terms of quality and price. As a result, over the last few years, a big section of the urban population has opted for fragrant rice. The effects of the liberalisation of the rice market has revealed the achievements of the private sector. Research work has shown that the transfer of function of intermediation goods, supply of inputs from the Government to the private sector has helped to improve access to land, capital and inputs ; it has also made it easier to distribute such resources between rice growing and other non agricultural activities (Gaye, 1977). As for the locally-grown rice , a big part of it is used as a subsistence product and is not sold. Between 50 and 60% of it is marketed every year and most of it is produced, marketed and used around the River Valley zone. Only a small share is exported towards other areas through Saint Louis to be sold in Dakar and in the other regions of Senegal. 5.3.6. Impact of reforms on rice consumption in Senegal, Rice is the biggest source of calories, a position held by millet until the late 1970s. From a historical point of view , rice has never been a traditional food product for most of Senegal, except in Casamance where the Diolas have grown rice for centuries. This serves food crisis linked to a period of drought (from 1968 to 1983) led to massive importations of broken rice to replace millet and sorghum used as staple food products. The pattern of rice consumption shows marked preference for broken rice (95%) as against whole rice in both urban and rural areas. 5.3.7. Impact of reforms on by-products markets The search for productivity gains regarding rice production through liberalisation, has resulted in better use for by products. So, there has been rapid change concerning trade in straw, bran and rice husk. Among the sectors using rice products or by-products, there is above all animal farming which uses both rice straw, from the fields under cultivation, and other by-products from paddy rice processing like bran, hay or flour. 5.3.8. Impact of production systems reforms: diversified activities The all-out privatisation of the cereal sector in 1996 and of rice in particular, resulted in considerable changes in agricultural options and in the allocation of resources. So, in places of irrigated rice production, activities have been focussed on growing rice during the rainy season, whereas the other crops are grown during the off season, hot and cold.


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The recent orientation policy introduced by the new Government insists rather on a system for more and diversified agricultural products backed by the application of a total liberalisation of the agricultural sector. The debate on the future and sustainability of irrigated agriculture, and on the profitability of investment, specially regarding rice production, has resulted in renewed interest in the other crops to diversify and protect income sources. Given the prevailing constraints of rice production in relation to irrigated production systems , the quest for other farming methods allows to reduce those risks linked to one-crop systems, and to diversify and increase income. Diversification is also a strategic means of protecting income. VI . IMPACTS ASSESSMENT 6.1 Combining competitiveness and environmental protection Rice still holds pride of place in terms of food for the Senegalese populations, in towns and rural areas where it has been increasingly used over the last few years. National paddy production stood at about 230, 000 tons in 2000-2001, or 130, 000 tons of white rice with a mean processing coefficient of 0.65. For 2001-2002, the final amounts were 243, 907 tons of paddy rice, or 158, 540 tons white rice. Nevertheless, the country still imports nearly 2/3 for assumption; this is nearly 600,000tons of refined rice, mainly from Thailand, Viet-Nam, other countries in Asia and Latin America. This leads to a deficit in the trade balance and disturbs the balance of payment, As a result, increasing the production of rice has become a worry for public authorities to meet increasing national needs and to reduce the dependence on the world market. So the aim is to achieve self sufficiency with rice by using all the potentials to hopefully promote rice production in the North and South of the country . However, the quest for competitive rice by-products, imposed by the globalisation of the economy, still holds: we have to be competitive while protecting the environment. 6.2 Methodology The so-called “MAP” (Policy Analysis Matrix) approach helps work out gains, costs and profit made by farmers in relation to the most efficient way of allocating resources. The inclusion of the environment into a MAP study involves the external aspects of the sector. Two types of effects on the environment should be considered: external effects and use-related effects. The main objective of the MAP approach is to measure the impact of the Government’s policies on the private profitability of agricultural systems and on the efficiency in the use of resources.


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The main stages to be followed are:

• identifying the sectors and sub-sectors • data collection working out the budgets, based on market prices. • Distribution between exchangeable inputs and internal factors • Re-assessing budgets, based on reference prices

The indicators used in the MAP analysis are:

• Financial return = receipts - costs in market price • Ratio cost financial profit= cost ratio (internal factors ) divided by receipts –

inputs costs exchange to market price . • Economic Return = receipts – costs to reference price • Cost in internal resources = ratio cost (internal factors ) divided by receipts –

inputs cost exchangeable to reference price • Ratio cost economic profit = ratio total costs divided by receipts reference price • Nominal protection margin = ratio receipts divided market prices divided by

receipts to reference price 6.3 Environmental costs It is quite complex to quantify (at this stage of our study ( the environment costs of trade liberalisation on the rice sector ; however, in qualitative terms, the price to pay to develop rice growing combines different costs : degradation of the environment, displacement and relocation of people, reduction of falling water crops areas , decrease of pasture lands, artificial support to rise in water levels , floods etc ) Determination of environmental costs in the irrigated areas takes into account fertilisers, and phytosanitary products variable such as herbicides (Propanyl and Weedone), and frequently used pesticides (Furadan) In the case of rain fed production systems animal manure is the most used or manure made from a mixture of rice straw and animal excretion , household refuse and ashes prepared by women . It happens that , in practice among farmers’ organisations, dosages prescribed by research have never exceeded if they are not used at their lowest the most important problem raised by the use of pesticides and fertilisers is not in the dosage applied by the producers but on the doubtful origin of certain products that come from uncontrolled channels 6.4 Economic Costs After 1996, a relative stability in input price was noted leading to a more profitable situation to improve income from rice growing ( opportunity to benefit from margins and


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potential progress of the sector. ) The possible option of a two-crop rice system is a good way to slightly improve producers’ income and increase the offer in local rice Table 2 : Matrix of Political Analysis of the national sector expressed per ton of

rice sold (campaign 2001/02)

Unit :F.CFA for 1 ton of rice sold

RECEIPTS

COSTS

PROFITS

Exchangeable inputs Internal Factors Market price A 218 094 B 55 883 C 128 900 D 33 311 Reference Price E 230 209 F 47 376 G 196 006 H -13 173 Divergences I -12 115 J 8 507 K -67 106 L 46 484

Source ISE, 2003 Table 3 : MAP national aggregated in 2001/02 expressed into national production

of rice sold

Billion of F CFA* RECEIPTS COSTS PROFITS

(F CFA/kg) Exchangeable Inputs

Internal factors

Market price A 31.55 (218)

B 8.08 (56)

C 18.64 (129)

D 4.83 (33)

Reference price E 33.30 (230)

F 6.85 (47)

G 28.35 (196)

H -1.90 (- 13)

Divergences I -1.75 (-12)

J 1.23 (8)

K -9.71 (- 67)

L 6.72 (46)

• for a production of 144 640 Tons of white rice (Source ISE, 2003) The reduction of internal resources requires a lot of efforts mainly the combination of accrued productivity ( increase in yields and extension of two crop systems for rice), greater efficiency of rice processing factories , and more lucrative prices. In short, it is about a complete reform of the sector that can be assessed by the law of offer demand and local commerce of rice. We notice that the national sector is not protected with a CPN = 0.95 We notice financial profitability of the sector with a profit ranging around CFA F 33 311 per ton of rice sold. On the other hand the sector does not present any economic profitability but rather social loss ranging around CFA F 13 173 per ton of rice sold. This situation is simply due to the influence of sub-sectors in other zones that do not present economic profitability. In the whole, the rice sector receives from the rest of the economy a net transfer of 6.72 billions of CFA F , which shows that it is favoured by existing policies and that this confirms the State option that aims at promoting the local sector.


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Local rice is still threatened by imported rice in terms of competitiveness .Global rice market is however , residual and only represent 4% of world production. . Global rice market of broken rice consumed in Senegal is still very marginal at international level . Therefore, the State should not depend only on world market where fluctuations of the world exchange rate depends on the gap between offer and demand . At the national level, options in favour of intensification and security of agricultural production have led to the realisation of costly investments to harness water ( dams, water related infrastructures, etc,. ) and the development of irrigation. This policy resulted in a strong involvement of populations of the river in rice growing activities which represents about 400 000 people (ISRA, 1996). Moreover, the economy of this zone has been dominated by rice growing which represents 89% of regional income. It must also be noted that 60% of irrigable lands of the Delta which produce 62% of the commercialised national production are mainly favourable to rice growing. It is then important to increase progress margins and improve its competitiveness . Full liberalisation without accompanying measures in terms of support and advice has produced contrary effects to what was expected. Thus the inter-professional committee for discussion on rice was created in order to bring together the various partners to discuss so as to improve competitiveness of local rice and ensure sustainability of rice production systems in the valley of Senegal river. 6.5 Social Costs results recorded by MAP from data of the 2001 –2002 rainy season campaign have revealed that rice growing activities shows a social loss of about 1.90 billion of CFA F for the total production of 144, 640 tons of white rice; this translate by a Cost in Internal Resources ( CIR) superior to 1, then the sector is at the limit of cost effectiveness. However, this generality hides the existing disparities in the various systems of rice production. Only the irrigated system of the Anambé is uncompetitive.(CRI of 2.94). Rice of the valley produces a CIR inferior to 1 and therefore economically competitive in relation to imported rice. Moreover , revenues drawn from this sector represent 89% of agricultural revenues of this zone. The sector occupies more than 400, 000 people (ISRA, 1996). The liberalisation of trade in imported rice (dissolution of the CPSP in December 1995) has penalised the rest of the small family producers despite the State intervention between 1996 and 1998 which has bought back all the stocks of local rice. Rice growing has revealed its limits in generating enough revenues to feed and satisfy the needs of producers. The small family operators ( from 0 to 1hectare of area ) are in a situation of precarious stability . They constitute a vulnerable group inclined to migration or fall into poverty


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Liberalisation has led to the end of activities of many Economic Interest Groupings (GIE) of operators on the private areas and therefore to an annual fluctuation of cultivated areas and productions. The number of operational rice processing factories has drastically decreased ; about ten of them have disappeared because of difficulties linked to fund raising and marketing of local rice, like others who have changed managers. The end credit loan for equipment by CNCAS (National Credit for agriculture in Senegal) constitutes a social cost that involves a reconstruction of irrigated agriculture on much healthier bases VII. MITIGATION MEASURES OF NEGATIVES IMPACTS AND IMPROVEMENT OF POSITIVE IMPACTS 7.1 Identification of mitigation measures Agriculture is one of the most devastating activity of natural resources and policies that have been implemented have considerable effects for which one needs to find means of reducing the various forms of impacts it has on environment and society. 7.1.1 Measures to reduce environmental impacts

- Compensate losses in wooded areas by planting actions, development and implementation and developing the degraded integrated zones ;

- Ensure follow up of soil, surface water and ground water quality; - Carry out periodical release in order to dilute and regenerate waters ; - Integration of rice growing and fish farming ; - Integrated fight against parasites.

7.1.2 Measures to reduce social impacts Promote and support the installation of

agricultural input providers recognised by the State in the various agricultural rice growing areas ;

- Carry out sensitising and information campaign for operators on the choice of fertilisers and pesticides ;

- Ensure an epidemiological monitoring of identified illnesses ; - Promote health education for populations ; - Take advantage and improve if need be local know-how and indigenous

knowledge in the south zone ; - Build institutional organisational and operational capacity of all the

stakeholders of the rice sector ; - Build capacity and levels of service providers


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7.1.3 Measures to reduce economic impacts The outcome of exchange liberalisation has clearly shown the weaknesses of the former regulation systems and the inability of the local rice market to position itself compared with imported broken rice. If importers and traders who managed to position themselves comfortably gain substantial profits, rice growing of the Delta will be affected weakened, disillusioned by the private experience and this will lead to the bankruptcy of many rice growers. One the most important constraints in the improvement of performance of irrigated rice remains the lack of technical skills . The question that is raised is in terms of respect of crop schedule, recommended norms and quality of the execution of crop operation. The Information and technical levels of farmers need to be reinforced as well as the strategies they adopt to overcome technical and socio-economic difficulties associated with production distribution and sales must be revisited. Agricultural equipment are also old and outdated . 7.1.4 Institutional and regulatory measures Following the various workshops that gathered producers, decision-makers, consumers’ associations, and communication professionals, a series of measures was proposed aiming at improving all the sector (environment, production, market and consumption) 7.2 Identification of policies The institutional agricultural framework has undergone profound changes during the past decades under the effect of the New Agricultural Policy (NAP) of 1984 and the Structural Adjustment policies (PASA) of 1994 : removal of support to inputs and agricultural credit, liberalisation of prices and agricultural market products, Government refocusing on its regalian , privatisation, restructuring functions or the closure of public companies in charge of rural and agricultural development, and lastly more empowerment of farmers with transfer of certain activities. All these important reforms and changes did not meet the expectations that were stated in the various terms of reference for agricultural development. The implementation of the Agricultural Structural Adjustment Programmes (ASAP)has not to this day managed to eradicate the heavy tendency of the country in remaining a net importer of food products. The idea of trying to reach a rate of food self-sufficiency of 80% by the year 2000 still remains an illusion. The Agricultural Service Programme and Support to Producers’ Organisations (ASPSPO) has introduced institutional and structural reforms necessary for the revival of a sustained rural economic growth . ASPSPO has been implemented to support the governmental strategy of reinforcement of rural development services. Decentralisation and empowerment of producers’ Organisations by favouring the expression and satisfaction of basic needs. The main objective of ASPSPO is to increase production and productivity of small scale farming and incomes of rural people in a sustainable way while taking into account the protection of natural resources.


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Certain major challenges such as food security or even food self-sufficiency, the development of a diversified , competitive, attractive and efficient agriculture in view of gaining foreign markets, professionalisation of all the stakeholders of the agricultural sector to develop in a permanent way the production capacities and processing of agricultural products must be enhanced so that the agricultural sector could play a vital role by contributing to the economic growth of the whole country. The rice sector must fulfil two objectives : to guarantee food security and alleviate poverty in rural areas. Small scale family farming is in a better position to guarantee diversified food production ; poverty alleviation must rest on small scale family farming as the poorest populations are mainly rural. Rice is a guaranteed marketable product at national level ; an assured rice growing sector will contribute to the improvement of farmers’ income and to make the best of a diversified cereal production. In view of the weakness of the private agricultural sector, agricultural farming constitute an important asset to improve productivity, intensify diversified agricultural production on sustainable models and stop natural risks (climatic vagaries, rodents .diseases) ; rural economy will develop only through the improvement of the standard of life of producers and by a better control of the producing conditions (guaranteed water management, land control and biodiversity protection) Agriculture needs a global rethinking in order to get out of the multiform structural crisis, ; a shared vision for the future of rural areas must be defined, in a concerted way with guiding agricultural policies and a law on land reform in line with the decentralisation process and good governance. 7.3 Implementation of the strategy Protect or allocate to local rice production part of the rice market : a simple continuous reduction measure of the size of the market occupied by imported rice constitute a transfer of income for the farmers producers of rice. The impact of such a measure will contribute in alleviating poverty by increasing income levels and eradicating drop in home consumption Rice growing has achieved substantial and noticeable progress in rural economy ;the main advantage with rice is that it gives a guaranteed financial income through domestic consumption , it also ensures farmers food and fits easily the agricultural diversification scheme ; it is competitive in the sub-regional market economy . Winning back the food market can be only achieved by resorting to limited imports , improving the operationality of agricultural market products and by guaranteeing reasonable price to consumers, and good payment conditions to producers. It is only through this that food security will be achieved on the basis of recognition of the rights to food sovereignty.


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Because of the uncertainties associated not only with instability of the market price at global level but also to the recent agreement with the major Asian countries exporters of rice to regulate the market, the main economic precaution to take should be applied to the issue of food security ; it is therefore important to rely on regional and sub-regional solidarity ( complementary interplay with neighbouring countries.) and on the creation of an efficient protection (flat discount of TEC), on the valorisation of local products and the development of facilities . 7.4 Measures to improve competitiveness of local rice. Different analyses have shown difficulties of local rice compared with imported rice. Expected productivity gains come from the improvement of conditions of use of internal resources which condition competitiveness. Reduction of internal cost of resources requires a lot of efforts , mainly the combination of an accrued production( yield increase and extension of the two crop system for rice). Greater efficiency of processing factories, and better payment prices . in short, it is a question of an overall reform of the sector which can be assessed by the law of offer, demand and commerce of local rice. The Organisations of producers think that liberalisation has set an unfair competitiveness of local rice at the expense of imported rice. Rice producers of the Valley of river Senegal demand the institution of a Structural Tax on Importation(STI ); it is a structural mechanism for the protection of local production projected by Decision of the WAEMU Committee.. Rice is among the products that can’t benefit from it when fluctuations of prices at international level justify it. STI is destined to fight against the effects of erratic variations of international prices and discourage practices in unfair competitiveness.. Under the aegis of the Minister in charge of commerce, rice producers of the Valley and traders grouped together in UNACOIS (Senegalese Union of Traders) have signed a charter for the moderation of rice prices Production cost reduction (fertilisers and pesticides) and the fall in water related agricultural development cost contribute in accelerating the development pace and increase productivity of the local rice sector. Consumers’ associations have taken very strong stand to defend the local product mainly by removing the 8% VAT applied to agricultural inputs and fertilisers and pesticides, machines and agricultural equipment as well as spare parts. ADRAO and ISRA play very important roles in the quest of high yield variety which has helped to increase greatly local production ; other attempts were made (sensitising peri urban areas, reference stores, etc..), but the production is still very low compared to the demand even if this rice has its own market (its own demand) which should be organised in an optimum way.


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7.5 Challenges and prospects of implications of the AoA on rice policies in Senegal Great reforms undertaken within the framework of the Senegalese agricultural sector and agreed upon with Brettons Woods institutions (PASA) have led to the implementation of more compelling measures of liberalisation than those projected in the AoA and WTO afterwards. Senegal needs more flexibility to apply urgent measures aiming at preserving the interests of small farmers against massive imports of rice in particular and unfair commercial practices, mainly those that affect the production of key products in the foodstuffs (the rice example again ).

In terms of food security and sustainable development, there is an urgent need to increase production so as to satisfy national needs and promote investment and commerce of agricultural and rice products. This requires adequate incentive measures at the producer’ level (access to credit, land, and inputs) as well as a sound economic, institutional, and social environment.(stability of prices, adequate facilities, research and development, development of promoting services etc.).

In order to increase rice production mainly in Senegal, producers should be protected at least temporarily against external shocks and mainly market fluctuations. Among the measures foreseen, AoA allows subsidies for inputs. Subsidies on credit, water and electricity can not be used by the African countries if they do no go over the minimis level. Moreover, the only protection which small producers can enjoy is the consolidated rates which can be insufficient to meet global prices which are very low or even « falsified ». Senegal defends the position of WAEMU member countries in the framework of the commercial negotiations and it is stated as follow.

- Achieve food security; - Basic increase of agricultural sustainable productivity ; - Free access to agricultural products on the markets of developed countries ; - Implementation of safeguarding measures aiming at promoting and

developing agricultural sectors ; - Ban on agricultural subsidies of developed which create distortion on the

international market Within the framework of the AoA three types of consideration summarise the concerns of the Senegalese authorities:

- Development of the offering capacity of agricultural products in terms of quantity and quality ;

- Implementation of the Marrakech ministerial order on (DC) and LDCs net importers of food products , and ;


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- Other measures that are not commercial and which could create a synergy between Commerce and Environment .

VIII . RECOMMANDATIONS AND CONCLUSIONS

Recommendations are about national policies to implement in order to reduce negative outsourcing associated with trade liberalisation, to optimise net profits and to formulate action plan for the execution of these recommendations.

1. Study the possibility to annually find campaign credit for an adequate funding of agricultural activities viewed from the angle of global operation

2. Find mechanisms and credit lines in the long and medium term for the funding of

equipment and water -related agricultural development 3. Stop 18% VAT applied on agricultural inputs fertilisers and pesticides ,

agricultural machines and equipment, agricultural as well as spare parts . 4. Support producers organisations in setting up input supply services, processing

and commercialisation of agricultural products with a private type of management.

5. Study the setting up of a sustainable funding system of the commercialisation of

rice in relation with producers’ organisations

6. Promote the high potential yield of the NERICA rice variety in the rain fed production areas of Upper and Lower Casamance

7. Define an adequate family farming land size to improve competitiveness of local

rice

8. Design ways and means enabling to reduce water-related agricultural development costs so as to accelerate the pace of development in the country

9. Reassess NDIAYE’s action plan with the donor’s community interested in

redefining priorities and implementing retained actions

10. Reformulate land tenure so as to create real conditions of security and guarantee of rights to agricultural operators mainly family

11. Reinforce existing rice processing units in the Valley and in other production

areas with rice sorting equipment to improve rice quality

12. Producers’ organisations should get together in association in wider scale to develop adequate marketing strategies enabling a good positioning of their products in the market.


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13. Authorities must define a vision for the Senegalese agriculture with an

agricultural and rural policy before creating a document for agricultural development strategy.

14. Explore in the Asian countries technologies and agricultural equipment that can

be easily harnessed (harvesting techniques), not costly and adapted for our countries in order to engage in a real programme of rice growing equipment.

15. Carry out joint research ADRAO – ISRA - SAED

16. Draft regulation on production, importation and distribution of products that

contain Genetically Modified Organisms(GMO)

17. Define legislations that govern inter-profession

18. Reactivate the National Consulting Committee on the Rice Sector (CONCOFIR, 1998)

19. Promote and reinforce decentralised saving and micro credit systems of producers

20. Upgrade market information systems and facilitate access to producers

organisations

21. Set up an environmental assessment framework on commercial negotiation round; the analytic frame allowing to integrate environmental and social concerns in all the various stages of the negotiation process

22. Reinforce actions for the integration rice growing and fish farming 23. Introduce in the various on-going implementation or planned programmes

integrated actions to fight dangerous parasites and rodents for a better protection of crops

24. Carry out information and sensitising actions for operators on the choice of

fertilisers and pesticides.

25. Protect efficiently the WAEMU space by supporting agricultural payment price in order to alleviate poverty and ensure food sovereignty.

ACTION PLAN FOR THE IMPLEMENTATION OF RECOMMANDATIONS

Measures Structures in charge of implementation

Deadlines

1. Stop 18% of VAT applied to inputs , agricultural equipment and spare parts

MEF Immediately

2.Set up input supply services, processing and marketing of agricultural products

CIRIZ-FEPROBA Short term

3. design a funding d and marketing system CNCR-3P, ASPRODEB, State, Donors, Short term 4.promote campaign credit on a yearly basis CNCAS - CNCR - 3P, ASPRODEB Immediately 5. Equip rice processing factory with sorting materials CIRIZ-FEPROBA, State , Donors Short term 6.Promote marketing strategy of positioning rice on the market CIRIZ-FEPROBA-Rice producers –Traders local

consumers and communicators Medium term

7.Reactivation of the National Consulting Committee on the rice sector (CONCOFIR)

MEF-MC-MAH Immediately

8.Set up an environmental assessment framework of commercial negotiation round

MEF-MC-MAH- MEPN-ISE Short term

9. Draft a regulation on production , imports and distribution of products containing Genetically Modified Organisms..(GMO)

MEF-MC-MAH- MEPN- CNCR-3P Short term

10. Renegotiate TEC within WAEMU MEF-MC-MAH-CNCR-3P Short term 11.Adopt the decree on quality norm of paddy rice and white rice MEF-MC-MAH-CNCR-3P-consumers s Short term 12. Find mechanisms and lines of credit in the medium and long term to fund water-related agricultural equipment and development

CNCAS-CNCR-3P-ASPRODEB Short term

13. Define a legislation that governs the inter profession

MAH-MEF- MC-CNCR-3P Short term

14. Protect efficiently WAEMU space by supporting agricultural payment prices and ensure food sovereignty

MEF-MC-MAH- MEPN- CNCR-3P Medium term


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CONCLUSIONS Despite a real and confirmed will to boost agriculture and the existence of real assets , the performance of the Senegalese agricultural sector has been very disappointing in the past decades. This can be explained by exogenous factors linked mainly to climatic vagaries which have affected the country but also many other constraints to agricultural development at the structural level of certain sectors (cotton, peanuts, cereals foodstuffs, horticulture crops, etc ) as well as external original shocks linked to distortion of the international market The different reform measures on agricultural policies undertaken up to now have not enabled to eradicate the heavy tendency of the country to remain a net importer of foodstuffs mainly for rice which represents about 35% of its imports of cereals Senegal has, however, among its priority objectives for agriculture taken the pledge to reduce food insecurity or even establish food sovereignty in the country while contributing to employment. The importance of agriculture at the national economic level goes way beyond its commercial mission The Government has decided to translate very soon its will to reform and take up the main challenges of the agricultural sector into an agricultural policy which constitutes from now on the legal agricultural development framework for the coming twenty years. The Senegalese concerns within the framework of WTO are mainly on the sectors that present an immediate or future interest to exports or whose contribution to economic development is significant , compared to its current strategy of growth and poverty alleviation.. One should have in mind that within the framework of globalisation , Senegal must give particular importance to sub-regional cooperation . Therefore one has to give privilege to regional and sub-regional space to increase competitiveness of agricultural products which contribute to the materialisation of our food sovereignty , the development of our exportations and poverty alleviation. Rice production can play a vital role in stopping the process of reproduction of poverty in rural areas; poverty in rural area can manifest itself in various forms of deprivations that reflect the low levels of incomes, drop in the consumption level, difficulties to have access to credit and minimum coverage from social services. Development based on irrigated rice growing involves the integration of fish farming , arboriculture and the activities related to cattle feeding, source of energy, etc. Rice growing is an efficient economic and social production system which is compatible with a diversification of crops to contribute to materialisation of food security and as such increase farmer’s level.


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