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Lessons from the field: rural development in West Africa - An analysis of the results of Bank lending for some 68 projects in the region yields suggestions for improvement

Author(s):
International Monetary Fund. External Relations Dept.
Published Date:
December 1981
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Owaise Saadat and Francis van Gigch

Since 1974, the Bank’s Western Africa Region has financed some 68 agricultural and rural development projects in 15 countries in West Africa, which are intended to affect directly the lives of almost 1.7 million farming families (see chart for the volume of lending to this sector). Most of these projects are still to be completed and it is difficult to measure their impact fully, but some valuable experience has been gained. This article attempts to analyze briefly the major issues.

Rural development projects aim both to improve local production directly and to create the conditions in which improved productivity can occur. This may involve activities ranging from developing and improving crop varieties and farming practices to offering advice on adjustments to the policy and institutional framework within which a project has to be implemented. A few of the problems encountered are intractable: a farmer cannot reap crops in times of drought, even if he uses proven dryland practices. Nor can he affect the international price of the product he grows. But the Bank’s work has shown that there is a great deal that can be done to improve production in even the poorest regions of West Africa, if the recommendations made to the farmer are suitable and if the policies that affect him are right.

Adoption of technology

At the heart of each project is the “technological package,” that is, the interrelated improvements or innovations in crops or a farming system that could increase production, productivity, and incomes. Technological recommendations have ranged from the promotion of an entirely new crop with a new cultivation practice (palm oil in Benin) to the simple improvement in the cultivation of an existing crop (swamp rice in Sierra Leone). Although a variety of promising packages have been developed at the research station, their adaptability to field conditions is often still to be tested by the farmers themselves.

World Bank photo

Since the 1950s and 1960s, sufficient tests have been done on cash crops for export (coffee and cocoa in the higher rainfall areas, cotton and groundnuts in the middle rainfall zone); yet relatively little is known about staple food crops such as millet, sorghum, yams, cassava, and cowpeas. In addition, in dryland farming under Sahelian conditions (especially in areas with less than 800 millimeters annual rainfall and where the rainfall pattern is highly erratic and somewhat unpredictable), the known improved techniques, calling for an intensification in crop farming, are still imperfectly developed and hence give mixed results. In these arid areas, the Bank, with the support of regional international research institutes, has been encouraging the adaptation of innovations. Two topics of concern are (1) dryland farming, including soil and water conservation techniques and minimum tillage practices; and (2) low- cost, small-scale irrigation—including controlled or semicontrolled flooding as well as improved traditional irrigation practices making use of more efficient water-lifting devices. Where innovations appear to lead to a small increase in the value of output in relation to costs, or cause the farmer to be more vulnerable to factors such as drought, the Bank has also favored an initial testing, on a pilot basis, of farmers’ reactions to the recommendations.

Socioeconomic environment

Even if a technological recommendation is technically feasible, it may not be readily adopted by farmers if it does not suit their needs. For example, while most of the technological packages developed so far have been largely based on sole cropping systems and have included recommendations for improved practices and increased use of inputs, the traditional farming system is based almost entirely on multiple cropping and intercropping. (The beneficial and risk-reducing aspects of the indigenous cropping system are now more widely accepted, and international research institutes like the International Institute of Tropical Agriculture and the International Center for Research in Semi-Arid Technology are providing a leading role in developing technologies suited to indigenous mixed cropping systems.)

World Bank and IDA in West Africa: total lending and lending for agriculture and rural development, 1976-80

(In millions of U.S. dollars)

Source: World Bank Annual Report 1980.

The adoption of a new recommendation may also be impeded by the fact that at the farm level a clearly defined “decision hierarchy” may not always exist, at least not in the traditional sense, where an individual head of the farm family makes all decisions regarding the farm. Quite often, under the West African farming system, the decisionmaking process tends to be communal, and at times it may well prove difficult, though not impossible, to elicit communal support for a new technology even among the innovators. On the successful United Nations Development Program-financed Matourke project in Upper Volta, for example, it took almost four years of deliberations before the village council agreed to allocate land “permanently” to those farmers willing to change traditional practices of shifting cultivation.

Last, but not least, it is important that the profitability of a new recommendation be assessed on the basis of the farmer’s own priorities. Standard profitability measures such as “net farm income” or “rate of return on investment” are less relevant to the West African smallholder than anticipated returns per man-day on which he usually allocates time among crops, This is understandable given that labor is usually the most important (and increasingly costly) factor of production, and land is not often a limitation. In the Benin Zou Bourgou Cotton project, for example, despite favorable cotton prices, the farmers chose to grow maize, which required less labor and therefore ensured relatively higher returns per man-day, and also satisfied the farmer’s concern for food security. (Farmers’ declining interest in cash crops like cotton and groundnuts can also be attributed to the relatively high foodcrop prices and their increased marketability.)

Although it is crucial for the final outcome that project designers have a good understanding of how the rural smallholder makes his decisions, this has not been easy to acquire in West Africa, where there is a dearth of reliable farm management studies. As a result the design of some of the Bank’s earlier projects was based on overgeneral assumptions which later proved flawed. For instance, in the earlier projects, labor was assumed to be generally in surplus (in many projects the cost of family labor was taken to be near zero). In fact, however, seasonal shortages of labor were partly responsible for farmers not adopting agricultural innovations. In the First Sierra Leone Agricultural Development Project, seasonal labor shortages and the need to supplement family labor with high-cost hired labor were part of the reason for the lack of widespread adoption of improved swampland rice cultivation.

Another assumption that proved somewhat misleading was the practice of assessing the availability of farm labor purely in terms of a farmer’s total household. Experience in West Africa suggests that it is equally important to recognize the division of labor by sex, religion, age, and activity. In a rural development project in The Gambia, for instance, a proposed double cropping system for rice was not widely accepted, mainly because the farmer’s family labor was divided between subsistence crops (the women’s responsibility) and cash crops (the men’s domain) and, contrary to expectations at the time the project was appraised, labor was not easily transferable between the two economic activities.

Attempts have been made to improve knowledge about the environment in which farmers operate, including (1) increased financing of adaptive research and trials on farms, involving better coordination between research and extension; and (2) setting up project monitoring and evaluation units—not only to improve the effectiveness of implementation but also to help collate and synthesize the experience relevant to planning future projects. Despite these measures it will take time to obtain satisfactory knowledge about the West African farming environment.

Management

The West African countries have been independent for some 15 or 20 years, but despite considerable progress made in education and training, most still cannot fully meet their increasing needs for trained national staff. Manpower shortages in the agricultural sector are further accentuated by social factors such as the low prestige and inconveniences attached to rural jobs, and, in some cases, the reluctance of trained staff to move from one region to another. These shortages are often revealed through significant delays in starting projects, highly centralized project execution, lack of adequate guidance to and supervision- of field staff, and frequent turnover of key personnel. The quantity of local managers and professionals will eventually increàse, but it will take time.

Given the scarcity of trained national staff, especially at the middle and higher management levels, the Bank and other agencies have included technical assistance in the financing of projects in the form of provisions for hiring expatriate staff. The principle of such technical assistance has been that concurrently with their implementation duties, the expatriate staff would discharge training functions. Experience, however, shows that this form of training has generally fallen short of expectations. In its recent agricultural projects, the Bank has tried to improve the effectiveness of training. The training responsibilities of expatriate staff are now often separated from their purely management and technical functions, and the function of planning, monitoring, and evaluating training is the responsibility of a specialist. These specialists are also responsible for organizing and supervising training fellowships that are now frequently financed to complement in-service training. The Bank is also assisting the improvement of national management training capability with the establishment of training institutes like the Agricultural and Rural Management Training Institute in Nigeria.

Outside influences

In many cases project management, however effective, is faced with pressures that are totally external to the project itself, but that may at times dominate purely technical and management problems. Such influences may arise from (1) inadequate support services; (2) cumbersome government budgetary procedures and consequent shortfalls in financial flows; and (3) prices and pricing policies.

The importance of efficient agricultural support services—of transportation, marketing, input supply, credit, training, and so on—hardly needs elaboration. Yet, they are frequently insufficient in West Africa. Consequently even at the risk of increasing project complexity and demands on management, rural development projects in the region include, as a rule, special provisions to establish or improve the supply of key agricultural services. Despite the special provisions, however, the projects are not able to cater fully for certain essential services that fall within the domain of public sector management and control.

In most of West Africa, for instance, farm inputs—including fertilizers, insecticides, and seeds—are rarely supplied by the commercial sector, and the state monopolies that handle such inputs are seldom efficient. More important, the difficulties in procuring and distributing a variety of inputs to a large number of widely dispersed farmers place an unreasonable burden on the already overstretched agricultural public administration. The resulting long delays in the delivery of inputs to farmers and high costs to the Treasury mean that ultimately many farmers willing to innovate cannot implement the agronomical recommendations on which development depends.

Project implementation is quite often hampered by an insufficient or delayed release of government funds, principally because of chronic budget deficits, inconsistent policies, and cumbersome financial controls. Complicated financial controls, too, often delay payments in the francophone countries.

Funding problems are to some extent caused by the projects themselves. They engender demands for recurrent government expenditures—to maintain input subsidies, feeder roads, tractor hire services, water points, dispensaries, hospitals, schools, and so on. When postproject recurrent expenditures cannot be met, maintenance suffers and so do the projects. It is apparent that the traditional cash flow analysis of isolated projects is insufficient to highlight aggregate budgetary constrictions arising from a number of on-going and planned development projects. To cope with this problem, the Bank is increasingly appraising individual projects after a more rigorous analysis of government’s present and future long-term recurrent expenditure commitments against the prospects for available public resources.

At another level, experience has shown that there is a strong need for a judicious review of those domestic policies that have recurrent cost implications for agricultural projects. Almost all countries, for example, subsidize inputs, particularly fertilizers. It is estimated that if all currently planned rural development activities in Nigeria are pursued, by 1985 its bill for fertilizer subsidies will reach the equivalent of US$1 billion—a considerable burden even in relatively prosperous Nigeria.

The Bank is assisting its West African borrowers to develop a capacity to analyze and plan agricultural policies, including their recurrent cost implications. In Senegal, for instance, the Bank recently contributed to a review of fertilizer production and pricing policies that would allow the Government to adjust its policy and achieve savings. Moreover, where possible, the Bank has tried to help governments save on recurrent costs by developing activities that can be more efficiently handled by nongovernmental agencies. Commercial outlets, for instance, can supply input services whenever it is compatible with social or political options. But despite these efforts, the long-term viability and replicability of projects, in an atmosphere of budgetary constraints and funding difficulties, frequently depend on their ability not only to generate fiscal revenues but also to channel a sufficient proportion of these revenues back to the projects. Since direct cost recovery is the most effective means to assure an adequate flow of funds for projects, the Bank has encouraged a policy of maximum direct cost recovery from beneficiaries. Results have been mixed, however. Cost recovery has clearly been better for projects involving traditional export crops, such as cocoa, coffee, cotton, and groundnuts, and for irrigation projects. On the other hand, projects based on traditional food crops usually present the most intractable cost recovery problems because in their case it is both difficult and undesirable to control output marketing. Thus, a considerable proportion of expenditures on project maintenance needs to be met from external sources either from the government or from foreign sources.

Prices and pricing

There is ample evidence that West African farmers are highly responsive to price changes and that product prices are an important determinant of a project’s success. Despite its importance, however, prices are generally beyond the direct control of project management and remain the most unpredictable element in project implementation. The chief reason behind the unpredictability of prices is the inherent difficulty in both forecasting prices and formulating government policies on them.

Given this difficulty, the Bank, in an attempt to design projects to permit farmers to adjust to changing economic conditions, has moved away from financing single crop development projects—which are relatively simple to organize and manage—to supporting the most significant commodities in the project area for which reliable improvements are known. Under this approach, although the development or introduction of a new crop may be stressed initially, services are also provided to cover the combination of crops the farmer usually cultivates so that he enjoys the flexibility to respond to changing price signals.

The unpredictability of prices is complicated by government intervention in agricultural pricing. In general, the record of government price intervention in West Africa is mixed. The price of cocoa in Cameroon, Ghana, and Nigeria, for example, has been kept for a long time at unreasonably low levels, and production and exports have decreased considerably. In Cameroon, the Government revised cocoa prices substantially upward in 1978 and the following two crop seasons suggest a reversal of the production trend.

An important objective of the Bank’s work is to help its borrowers to improve the formulation and implementation of agricultural pricing policies. As a general principle the Bank advocates that a country’s agricultural prices be guided by those prevailing in the world market, and it discusses with potential borrowers, in the course of sector work and project appraisal, the adequacy of prevailing agricultural prices and helps to develop price policies. Two such recent examples are the ongoing assistance to the Ivory Coast, to help it review its rice and food price policies, and the technical assistance provided to the Nigerian Grains Board.

Future priorities

This review of the Bank’s relatively short experience with rural development in West Africa has identified areas where further work or emphasis would be beneficial.

  • First, further information needs to be gained about rainfed farming; in particular, substantial efforts are needed to develop crop packages suitable for dry land agriculture (“dry” land being areas with less than 800 millimeters of annual rain). In concert with other donors, the Bank has made a start in financing agricultural research projects in West Africa to strengthen indigenous research capability and institutions.

  • Second, emphasis is needed on socioeconomic research to gain a better understanding of the farm level decision-making process.

  • Third, since the shortage of indigenous skills is a serious constraint to successful project execution, it is important to complement in-service project training with additional formal training, particularly in management skills.

  • Fourth, considering that project implementation puts claims on borrowers’ future recurrent budgets, it is important, particularly for West African economies relying almost exclusively on the agricultural sector, that project design emphasizes the minimization of this burden on government. In addition, project selection ought to involve an analysis of the recurrent cost requirements of projects in the context of the aggregate recurrent expenditures implied by all ongoing and expected investment activities.

  • Fifth, agricultural and rural development projects need to be supported by an appropriate policy and institutional framework; to that end borrowers should be assisted to improve their ability to analyze and design policies in areas such as prices, taxation, and subsidies, as well as in project analysis and selection.

  • Sixth, within the field of agricultural public administration, planners should pay particular attention to the need of borrowers to improve financial planning, procedures, and control, as well as to develop systems of project monitoring and evaluation to provide managers and government with project development feedback.

Finally, it is particularly important that implementation be kept under constant review. In that vein the different procedures available to the Bank, including formal ex post project evaluation, are expected to contribute to its ability to improve the design of rural development projects in the region.

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