This document summarizes a presentation on opportunities for increased intra-regional trade in food staples within the Common Market for Eastern and Southern Africa (COMESA) region. High poverty and food insecurity levels exist in many COMESA countries. While maize production varies significantly between countries, all face high and increasing food price volatility. The region has potential for expanded trade due to its large combined market, varying agricultural zones and production seasons, and existing informal cross-border trade. However, challenges include high transport costs, non-tariff barriers to trade between countries, and lack of market information. The presentation recommends integrated regional approaches and policies to address food security, investment in market information systems and infrastructure, and elimination of barriers

1. Exploiting opportunities in intra-regional trade
in food staples in COMESA region
Presentation at the 28th triennial conference of the International
Association of Agricultural Economists (IAAE) Foz do Iguacu, Brazil,
18-24 August 2012
by
Julliet Wanjiku, Maurice Ogada, Paul Guthiga, Joseph Karugia,
Stella Massawe and Jonesmus Wambua
ILRI-ReSAKSS-ECA

2. Presentation Outline
 Introduction
 COMESA poverty levels
 Food insecurity
 Food price indices
 Regional Trade patterns
 Basis of intra-regional trade
 Challenges of intra-regional trade
 Suggested policy interventions

3. Poverty levels are high in COMESA region
Poverty Rural poverty Urban poverty National poverty
survey year rate (%) rate (%) rate (%)
Burundi 2002 68.7 66.0 68.0
DRC 2004–2005 75.7 61.5 71.3
Egypt 2004–2005 ... ... 20.0
Eritrea 1993–1994 ... ... 53.0
Ethiopia 2004–2005 39.3 35.1 38.7
Kenya 2005–2006 49.1 33.7 45.9
Madagascar 2001 70.1 48.1 76.5
Malawi 2009 43.0 14.0 39.0
Mauritius 1992 ... ... 10.6
Rwanda 2005–2006 ... ... 56.9
Swaziland 2000–2001 75.0 49.0 69.2
Tanzania 2007 38.0 24.0 33.6
Uganda 2005–2006 34.2 13.7 31.7
Zambia 2006 64.0
Zimbabwe 1995–1996 48.0 7.9 34.9
Sources: IMF (2004); NSO (2009); UNCTAD (2005); URP (2007); UBOS (2006); NSO (2007); NISR (2007a);
World Bank (2008); AfDB (2009); World Development indicators http://data.worldbank.org/indicator.

4. Food insecurity in COMESA region
Proportion of children under 5 with moderate and severe malnutrition 1996-2005

5. Maize production (Tones) in COMESA region
Source: FAOSTAT
Production maize has been quite erratic in most of the countries; maize
yields in a majority of countries are very low and in most cases have been
less than 2 tons/ha

6. Food Price Indices 2007=100
400
350
300
250
200
150
100
50
0
Ethiopia- Food Total FAO GLOBAL- Food
Kenya- Food & Non-Alcoholic Drink Malawi- Food
MauritiusFood And Non Alcoholic Beverages Rwanda- Food And Non-Alcoholic Beverages
Tanzania- Food and Non alcoholic beverages Uganda- Food
Zambia- Food Djibouti - Food
Data source: FAO Global: FAOSTAT; Kenya: Central bank of Kenya; Ethiopia: Ethiopia central statistical agency; Rwanda: National institute of statistics of Rwanda; Tanzania: Tanzania
national bureau of statistics; Uganda: Uganda bureau of statistics; Malawi: Malawi national statistical office; Madagascar: Madagascar national institute of statistics; Mauritius: Mauritius
government website; Zambia: Zambia central statistical office.
 The food price index has been increasing
 Severity of high food prices varies by countries & seasons
 This offers opportunity for increased regional food trade

7. Maize price volatility
Data source: Tanzania: Bank of Tanzania; Kenya: Ministry of Agriculture; Uganda: Uganda bureau of
statistics; Global: FAOSTAT
Maize prices are more volatile in Kenya than in Tanzania and Uganda. The domestic
maize prices in Kenya, Tanzania and Uganda are more volatile than the global maize
prices.

8. Regional Trade Patterns: Intra-COMESA trade flows
Value of COMESA exports in US dollar COMESA Aggregation
140,000,000 Libyan Arab Jamahiriya
Egypt
Sudan
120,000,000
Zambia
Kenya
100,000,000 Democratic Republic of the Congo
Ethiopia
80,000,000 Mauritius
Uganda
Zimbabwe
60,000,000 Madagascar
Malawi
40,000,000 Swaziland
Seychelles
Burundi
20,000,000
Rwanda
Djibouti
- Comoros
2006 2007 2008 2009 2010 Eritrea

9. Maize imports (Tonnes) for selected COMESA
countries
Rising in some countries, falling in others
700000
600000
500000
400000
300000
200000
100000
0
2000 2001 2002 2003 2004 2005 2006 2007 2008
Burundi Ethiopia Kenya Malawi
Mauritius Mozambique Rwanda Uganda
Tanzania Zambia Zimbabwe

10. Increased informal trade ( about 40% of total trade)

11. Basis of Regional Trade
 Larger regional market
base
 Domestic markets are
smaller and fragmented
 Regional approach
provides expanded
market-about 420
million people in
COMESA
•

12. Basis of regional trade…
Length of growing period (LGP)
Agro-ecological and political
boundaries do not coincide
This offers potential to
scale up improved
production techniques and
land management
practices across the
boarders

13. Basis of regional trade…
Diversity in agro-ecological zones/spatial climatic variability implying:
diversified agricultural production
 even where countries produce similar agricultural products, supplies are available
at different times in a year due to staggered harvesting in the region
Source: Data: FEWS NET,2008

14. Basis of regional trade…
Maize Surplus and Deficit status in
East Africa

15. Production spots and market flows for maize and
Livestock in the Greater Horn of Africa (GHA)
Maize
Livestock

16. Border markets for food staples in ESA
Border markets
enhance movement
of food staples
across countries,
dictated by supply
& relative prices
Source: ReSAKSS-ECA, 2011

17. Other factors promoting intra-regional trade in food
staples
 Regional production volatility- Areas with low food supply are able
to receive food from areas with increased supply
 Substitution among food staples- countries facing shortages of their
main food staples could secure substitutes from other countries e.g.
Maize vs cassava
 Varying tastes and preferences- what a country produces is not
necessarily what is preferred locally. Such products could be sold to
where they are needed most.

18. Challenges of intra-regional trade
High transport costs
90
80
70
percentage
60
Kenya
50
40
Tanzania
30 Uganda
20
10
0
NTBs (%) Transport costs NTBs (%) Transport costs
(%) (%)
Beef transfer costs Maize transfer costs
Source: Karugia et al., 2009

19. Challenges of intra-regional trade....
 Regional barriers to trade: Common NTBs
 Administrative requirements mainly licenses, municipal and council permits
 Security
 Taxes/duties mainly excise and cess duty
 Road blocks
 Custom barriers
 Weighbridges
 Corruption e.g. through bribes
NB: There is need to implement the commitment to eliminate NTBs and
prevent entry of new NTBs so as to reap maximum gains from intra-
regional trade

20. Other challenges....
 Lack of information
 Export-import bans
 Non predictability: Impact of climate change
 High cost of production and low intensity in input use

21. Suggested interventions
 An integrated regional approach to food security and agricultural
growth rather than national isolated approaches, joint regional food
policies;
 Clear follow up and monitoring of implementation of commitments to
eliminating NTBs and prevention of entry of new NTBs at regional
level;
 Increased investment in early warning system through joint regional
efforts;
 Investment in market information at regional level; and
 Investment in improved regional and within country infrastructure:
Through joint government actions.

22. Exploit opportunities in regional
diversity
to increase food security
Thank you!