Reforming the cotton sector in Sub-Saharan Africa

Abstract

Cotton production was initially promoted in Sub-Saharan-Africa (SSA) through public monopolies. But most of them have now been abolished through privatization and liberalization. Among the reforms which have been implemented, some were successful while others were not, as appears from this review of six countries at different stages of their reform agenda. In three Francophone countries (Benin, Burkina Faso, and Cote d'Ivoire), reforms were limited. There was no competition on price paid to growers, but the ginning and input sectors have been privatized to various degrees over the last ten years. Institutional reforms went much further in Benin than in Burkina Faso, but performances were no better in Benin. Since the first private ginnery was established in Benin in 1995, production increased faster in Burkina Faso than in Benin. In three Anglophone countries, the cotton sector has been liberalized since 1995 in Zimbabwe, 1994 in Tanzania, and 1985 in Ghana. Zimbabwe was the best performer; but one cotton company held 75 percent of the market since 1999 and price competition has been very limited. In Ghana and Tanzania, price competition for the purchase of seed cotton was much stronger than in Zimbabwe; liberalization gave an initial boost, but the improvement did not last. The use of fertilizers and pesticides fell; yields and production declined, and the seed multiplication system nearly collapsed. In the last seven years, production increased more rapidly in the three Francophone than in the three Anglophone countries (70 percent versus 10 percent). The share of export prices received by growers was higher in Zimbabwe than in Francophone countries in the four years following the liberalization of the cotton sector in Zimbabwe; but it was lower in the four following years.