Cotton Sector Policies And Performance In Sub-Saharan Africa:Lessons Behind The Numbers In Mozambique And Zambia
Cotton is one of the most important smallholder cash crops in Sub-Saharan Africa (SSA). How to ensure input supply, credit recovery and competition is a subject of intense policy debate. This paper examines the performance of cotton sector development policies in Mozambique and Zambia. Both countries face the challenge of organizing input supply to farmers in the absence of rural credit markets, and competing in international markets distorted by production subsidies in developed countries. Both countries privatized cotton ginning in the 1990s. Emerging from civil war, Mozambique established geographical monopolies to interlink input and output markets and facilitate credit recovery. In Zambia, the government completely liberalized the cotton sector, forcing the private sector to deal with the problem of input distribution and credit recovery by itself. Despite being landlocked, Zambia's cotton sector has achieved better performance in terms of both value of cotton output per hectare and smallholder share of world market prices. An analysis of the institutional and technical factors behind the two countries' performance provides insights to guide the design of public/private partnerships relevant to many SSA countries.
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Policy Research Working Paper Series
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