Impact of rural poverty reduction strategies: The case of smallholders in Sierra Leone

The present analysis, which exploits one of the first empirical data collected from smallholders in Sierra Leone since the end of the civil war, compares the impact of two poverty reduction strategies targeting smallholders in Sierra Leone: support to rice production is compared with support to coffee and cocoa production in terms of sustainable income generation and contributing to macroeconomic stability and growth. Supporting rice production is intended to help the country regain self-sufficiency in its traditional principle staple. This will help towards improving food security and reducing dependency on volatile world market prices which, for example, with respect to the recent global spike has had dramatic effects on the lowest incomes. Support to cocoa and coffee production on the other hand aims to create and increase income by producing exportable commodities with higher value added. This research addresses strategic options most successful in improving food security and accelerating economic development. Additionally, bottlenecks in terms of inputs, infrastructure and social and economic factors are identified and analysed in order to isolate those which once improved will impact most on productivity. The results are discussed within a broader economic and socio-economic context in particular with respect to enhanced targeting and impact of Official Development Assistance.Agriculture, Poverty, Official Development Assistance, Sierra Leone, Food Security and Poverty, O1, Q1,

Rural poverty reduction and food security: The case of smallholders in Sierra Leone

Sierra Leones ranks amongst the poorest countries in the world in terms of per capita GDP, due to several factors. Concerning the agricultural sector and more specifically smallholders, which constitute the big majority of farmers, inadequate tools, land preparation, infrastructure and limited access to markets and inputs, adding to very low labour productivity, cause that smallholders operate far below their productive potential, with crop production remaining primarily driven by (semi)subsistence households generating very little income. Consequently, Sierra Leone's subsistence farming system is characterised by a highly inefficient input/output mixes as well as high pre harvest and post harvest losses. Farmers lack access to yield-increasing inputs (such as improved tools) and face limited ability to invest in economic activities not only due to credit shortage but also to village-level institutional arrangements which do not support using land as collateral for loans. Lastly, reduced cash-income keeps smallholders particularly vulnerable to remain in the poverty-trap. The present report analyses the results of a survey of 604 smallholders in 5 districts in the Northern and Eastern regions of Sierra Leone carried out in 2009 when the EU STABEX-funded projects were concluding. The purpose is on the one hand, to improve knowledge and understanding of the agri-economic and social conditions of rural areas in Sierra Leone, and on the other hand to provide a general assessment of aid programmes financed in this area by the 8th European Development Fund. For this reason, the regions selected for the survey were those representatives of the main agricultural areas of the country where support was provided: the Northern region largely dominated by rice farmers, and the Eastern region where rice farmers are also engaged in coffee and cocoa production under agro-forestry plots. While rice (main staple food) production is expected to comply with food security objectives, coffee and cocoa (main export commodities) are high value export commodities which push economic growth. Consequently, both types of crops are considered relevant in contributing to the country's development. The results of the economic analysis indicate that rice production, which largely covers own household consumption, is far below its potential due to high losses, low productivity and labour-intensity of farming, particularly in the Northern region. On the other hand, coffee and cocoa production in the Eastern region was found to be economically profitable, generating income for most of those smallholders who cultivate those crops. Regarding farm households' characteristics and income, strong regional differences between the poorer North and relatively wealthier East were observed and reflected throughout all factors analysed: yields, household size, sources of farming income, magnitude of losses and productivity. Households in the Eastern region who produce coffee and cocoa, also dispose on average of more family labour, more land and higher income compared to households in the Northern Region. Rice was recognized as being an imperative component for food security while the high market value of coffee and cocoa confirmed both commodities as important sources of income and foreign currency. Qualitative data from the survey indicated that the STABEX aid programmes were perceived as adequate in terms of their technical nature as well as regarding infrastructure and organizational improvements. However, the amount of aid was deemed altogether insufficient considering the number of households requiring assistance. In this sense, the responses to perceived adequacy do not evaluate the measure itself, but rather the amount provided in relation to local needs as understood by the recipients. Based on this analysis a set of recommendations for the policy are drawn.JRC.J.4-Agriculture and Life Sciences in the Econom

THREE ESSAYS ON RENEWABLE ENERGY

This dissertation studies three main issues related to renewable energy in the United States and in Sub Sahara Africa. The first chapter seeks to provide answers to a very fundamental question for second generation biofuels: “How much crop residue can farmers harvest from their fields for sale to cellulosic ethanol companies without affecting current levels of production?” The model developed is applied to 101 counties from four Midwestern states in the United States (Colorado, Iowa, Nebraska and Wyoming). Results show that soil organic matter significantly contributes to explaining changes in technical efficiency and total factor productivity. Furthermore, average crop residue harvest potentials were 33%, 53%, 35% and 8% in Colorado, Iowa, Nebraska and Wyoming respectively. The second chapter analyzes the market and welfare effects of foreign biofuel investments in Sierra Leone. A log-linear comparative static displacement model was used to carry out the analysis and a 30% demand shock was introduced into the system to represent an increase in biofuel demand. Results revealed large welfare enhancing gains for consumers of inedible biofuels but resulted in welfare losses in the staples and edible biofuel consumer markets. Producers generally reported welfare gains by virtue of owning factor inputs (land and other). Equilibrium quantities of inedible biofuels, edible biofuels and food increased by about 8.8%, decreased by 0.22% and increased by 0.6% respectively. Prices for both inputs and outputs increased while quantities of inputs also increased. The third chapter determines the degree of responsiveness of farm energy input prices and corn prices to changes in crude oil prices using time series techniques. An Error Correction Model (ECM) and a VAR (vector autoregressive model) was fitted. The VAR was used to deduced variance decompositions for the six variables considered (prices of crude oil, diesel, gasoline, natural gas, electricity and corn) to determine the various contributions to the respective error variances. Results showed that the variables converged to a long run stable equilibrium. The strongest relationship was estimated for crude oil prices and diesel and gasoline prices. Prices for natural gas, electricity and corn had small and negative association with crude oil prices. Advisor: Lilyan Fulginiti

Impact of rural poverty reduction strategies: The case of smallholders in Sierra Leone

The present analysis, which exploits one of the first empirical data collected from smallholders in Sierra Leone since the end of the civil war, compares the impact of two poverty reduction strategies targeting smallholders in Sierra Leone: support to rice production is compared with support to coffee and cocoa production in terms of sustainable income generation and contributing to macroeconomic stability and growth. Supporting rice production is intended to help the country regain self-sufficiency in its traditional principle staple. This will help towards improving food security and reducing dependency on volatile world market prices which, for example, with respect to the recent global spike has had dramatic effects on the lowest incomes. Support to cocoa and coffee production on the other hand aims to create and increase income by producing exportable commodities with higher value added. This research addresses strategic options most successful in improving food security and accelerating economic development. Additionally, bottlenecks in terms of inputs, infrastructure and social and economic factors are identified and analysed in order to isolate those which once improved will impact most on productivity. The results are discussed within a broader economic and socio-economic context in particular with respect to enhanced targeting and impact of Official Development Assistance