[Policy Monitoring Report]
Policy measures in response to the soaring food prices
-The Government of Sierra Leone-
Kim, Sunae (TCAS)
25 September 2009
I. Overall Strategy in Action Plan/Intervention
The Ministry of Agriculture, Forestry and Food Security in collaboration with FAO, WFP, IFAD and the World Bank adopted three major mitigation and response strategies in providing short-, medium- and long-term interventions[1]:
a. To mitigate price increases through reduction in tariffs on imported rice and to minimize the transmission of impacts of the price increase to consumers through discussion with importers
b. To use safety nets to mitigate the impact of rising prices on the poorest and most vulnerable, through targeted programmes such as FFW, CFW, school feeding and supplementary feeding for vulnerable groups – children under five years, pregnant and lactating women, and households affected by HIV/AIDS
c. To increase national production by providing such incentives as additional seeds and fertilizers, encouraging investment in larger producers, and improving handling and transport to ease access to food markets.
II. Short-Term Measures
1. Institutional environment
An emergency inter-ministerial task force with Ministers of Agriculture, Finance, and Trade and Commerce was set up, leading all national initiatives in response to the food and fuel price increases.
2. Immediate mitigation policies
a) Trade based measures
o Reducing import tariffs on petrol, diesel, kerosene, rice, wheat, flour and sugar (March, 2008)[2]
o The reference values (CIF) used for the calculation of import duties for these products were set at values below the prevailing international prices
o Partnership with the private sector: opted to negotiate with importers to minimize the pass-through of food prices to consumers[3]
b) Non-trade based price stabilization and market improvement measures >
o Price and market stabilization measures (including stock policy and responses to price volatility)
o Market Information
c) Support to reducing pro-harvest losses and improving downstream activities
o Storage facilities and reduction of post-harvest losses
d) Social protection: unemployed urban youth, urban/peri-urban areas
o Support inputs for crop production
o Input market management & mechanization and farm equipment (ex. assisting farmers with tractor services)[4]
e) Seed availability
o Provided 71,000 bushels of seed rice to farmers[5]
o Implementing rice seed loans for the current planting season, and organic fertilizers
f) Funds from a strategic petroleum reserve to subsidize petroleum product prices were used for five weeks in June and July of 2008
g) Direct dietary support and nutrition education
o Pregnant and lactating women received monthly take-home rations of food
o Children from 6-59 months of age received monthly take-home rations of f food;
o Pregnant and lactating women participated in health care and nutrition practices training sessions
o Village volunteers, of whom 50% are women, received food aid as compensation for time spent on project activities; and
o Regular refresher training of health centre staff and village volunteers on growth monitoring and mother child health issues
h) Safety net programs
o School feeding: school children in the selected urban poor and rural primary schools receive one hot meal during school days from September to December 2008
o Food for work programme
o Direct feeding and distribution of commodities to HIV/AIDS-affected households
III. Medium- and Long-term measures
Poverty Reduction Strategy
The World Bank expects a second Poverty Reduction Strategy Paper (PRSP) for 2009-2011 to remain in line with the 2005-07 PRSP. The national strategy 2005-2007 addresses three major development priorities:
Ø Good governance, security and peace building
Ø Pro-poor sustainable growth for food security and job creation
Ø Human development
1. District[6] and Commodity Strategic Programs
(based on PRSP II – National Sustainable Agriculture Development (NSADP) 2010-2030, drafted on Sept 2009, by NSADP/CAADP and MAFFS)
a) Crop production intensification through district-based development
- Key priority crops/sector (incl. forestry, fisheries and livestock) and unique objectives are developed for each district
- Strengthening farmers’ organizations at the village level
i. The introduction of the Farmer Field Schools (FFS) and the Agricultural Business Centres (ABC) owned by Farmer-based Organizations (FBOs)
ii. Capacity building activities for FBOs have been committed by Irish Aid and the EU
- Expansion of area and quality of key tree crops (as cash crop)[7]
- Support for mechanization and processing businesses
i. Provision of farm tools, planting materials, labour saving machinery such as power tillers, rice mills and agro-chemicals (fertilizers and pesticides)
ii. Oil processing
iii. Production of dairy products: Unlike the first phase of PRSP which focused on production of livestock (cattle, goat and sheep), PSRP II (NSADP) highlights intensification and extensification, producing dairy products such as milk, cheese, butter and fresh eggs.
iv. Ethanol and bio-fuel processing. etc.
b) Increased availability of livestock[8]
- Poultry restocking support
i. Target of 50 hens and five socks per FBO or Agricultural Business Unit Shop (ABU)
- Small ruminant restocking support
i. Target of 50 female heads each of sheep and goats and 5 male heads of each of sheep and goats per FBO or ABU
- Livestock veterinary service support targeting 195 FBOs/ABUs from July to December 2008
c) Agriculture Infrastructure
- Rehabilitation and upgrading of feeder roads for better market access of producers
- Development of irrigable swamps
- Rehabilitation and modernization of existing storage and processing facilities and equipment
- Rehabilitation and construction of Research Centers and MAFFS Offices
- Other institutions’ projects: In 2008 the World Bank approved US$40 million Rural and Private Sector Development Project[9].
d) Private Sector Promotion
- Provide the enabling environment to attract investors into the agriculture sector through the review of investment policies and laws, standards, loan guarantee, long term lending to agriculture etc.
i. Revise the Investment Promotion Act’s package to reflect the new agricultural incentives in 2009 GoSL budget. The most recent Investment Promotion Act was entered into force in August 2004
ii. Review of Cooperatives Societies Act 1977 to reflect modern functions and roles of cooperative societies and farmer-based organizations
iii. Develop and enact a comprehensive law and regulations on sanitary and phytosanitary standards
iv. Develop comprehensive policy on climate change together with regulations on use of carbon credits to encourage reforestation and aforestation
- Capacity building of the Sector Institutions, including Multi Sector Commodity Group
i. Sector website and database development and management
ii. Training FBOs, producer organizations, rural youth and technicians for business management, leadership and technical skills
- Coordination and management of all sector programmes and activities
- ‘Seed Enterprise Enhancement and Development (SEED)’ project: to increase seed and grain production through a value chain approach and to privatize Seed Multiplication Unit[10]
2. Land Tenure System
New computerized GIS-based land registration systems and clear land use policies are to be developed in collaboration with UNDP and FAO[11] (NSADP 2010-2030).
3. Development or improvement of database and information system[12]
Recognizing low capacity for monitoring, evaluation and early warning on food price fluctuations, the government proposed to establish:
a) National- and district-level database systems containing information on market intelligence and agriculture sector investment
b) Early warning system
c) Strengthening of the existing food security monitoring system which also provides the nutrition status of vulnerable groups.
The proposal also highlights district level actions such as:
a) Re-establishment of annual crop and food supply assessments
b) Development of capacities for information dissemination and monitoring activities
IV. Regional Cooperation - the NSADP/CAADP Compact
1. The ECOWAS regional Trade
a) Commodities such as milled rice, goats, dairy and poultry products, fruit juices
b) Eventually biofuels as petroleum
2. The Mano River Union
a) Agricultural trade
b) Regional integration for forestry and fisheries
c) Promotion of private sector in key commodities
d) Education of experts
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[1] FAO (2009), Responding to the food crisis: synthesis of medium-term measures proposed in inter-agency assessments.
[2] The import duty on petroleum was reduced from 5 percent of CIF ad valorem to US$20 per metric ton. The import duty on rice was reduced from 15 to 10 percent. The fixed reference price used to value rice was set at US375 per metric ton, well below world prices but higher than the 2007 reference price o f US$260 per metric ton. The import duty on flour was reduced from 20 to 10 percent, wheat from 5 to 2.5 percent, and sugar from 20 to 10 percent.
[3] FAO (2009).
[4] FAO Mission Report (Policy Database).
[5] World Bank, Food price crisis response trust fund program document for a proposed grant in the amount of US$4 million to the republic of Sierra Leone for a food crisis response development policy grant, July 29 2008.
[6] District-based development is aligned with the Local Government Act, 2004: http://parliamentsl.org/acts.htm
[7] Supports from the EU (EDF-10) and Sierra Leone Agriculture Research Institutes (SLARI).
[8] Sierra Leone- National Agricultural Response Programme (NARP) 2008.
[9] World Bank, July 29 2008.
[10] Country Brief, TCA, 21/08/2009.
[11] NSADP 2010-2030.
[12] FAO (2009).