What can Africa learn from China on Agricultural Development?

blog and paper by Li Xiaoyun, Tang Lixia, Xu Xiuli, Qi Gubo and Wang Haimin of the China Agricultural University. Things that jump out compared to the usual Western spiel? The focus on staple foods, smallholders, gradualism and the role of the state. “In China, a consistent agriculture-centred development strategy and staple food crop-led agricultural development policy, honed through an incremental learning process, significantly shaped small holder agriculture. This is a lesson in itself as it speaks to the need for consistency of purpose and the trust required to invest in one’s own traditional systems. Another lesson from China stems from the steady transformation towards a market system ensured by the provision of irrigation, china agriculture researchimproved seed, and fertilizer and market facilities provided by the state, which enabled small holders to access the services economically. In contrast, despite the consensus reached on the vital role of agricultural policy in Africa, most countries have not been able to develop their own consistent home-made strategy. Building a food-based agriculture takes time and must be accompanied by comprehensive support systems to assist new appropriate technologies to emerge. This includes re-investing in agricultural education, research institutes and experiment stations as well as a modern extension service. African perspectives on agricultural development have been largely interrupted by various external influences. As a result many well-intentioned support programs have not been well integrated with the African small holder agricultural system, and at the same time, African countries have not been able to develop their own governmental capacity to provide the necessary support services for smallholders. The smallholders have become a victim of marketisation and privatisation. China’s experience suggests that for the countries with a majority of small holdings, the development of agriculture requires consistent context based strategies. With a dominant staple crop rural structure, agricultural development can be staple crop-led. Above all, market reform should be gradual so that smallholders will not be put into a ‘market trap’ under market reform. China’s agricultural development experiences also suggests that the effect of agricultural strategy and policy development depends on the state’s capacity to implement them on the one hand, and on the other hand, whether the policy is suitable for small holders and their social, economic and environmental conditions. gps-service-farmers-small-19097Policy issues cannot be considered simply as technical problems such that efficiency problems can be solved by technocratic solutions. Nor has it been effective in Africa to try and produce more favourable agricultural environments by encouraging external interventions led by big objectives and big business. The most important consideration is how to put the real needs of small holders at the top of those big policies and plans. This is not to suggest that large scale farming for cash crops and export materials should be stopped or stunted, but it is clear that this single structural track in agriculture is insufficient to earn investment capital for wider state development. It is also clear that food security will not be solved this way and thus rural poverty will persist. What might be learned from the China case is that both food-based systems and large scale agriculture can exist side by side and that many mutual benefits can be derived from their co-existence. A shift in emphasis towards sustaining and improving the food-based smallholder systems in Africa can be an inexpensive complement to the on-going cash crop economies. A symbiosis that fits the African reality needs to be configured and strongly maintained by State policy and programs. The state has a clear role to play. As in China, food systems are a public as well as a private good. Nevertheless, Africa still should be very cautious about what to learn from China’s successful experience in agricultural development. For example, China’s long-standing food production-based agricultural policy has achieved national food security and increased food exports while farmers’ incomes have grown at a slower rate. China’s agricultural production system has featured ‘high input – high output’ production patterns that have made an important contribution to food security, but many have had irreversible impacts on the environment and natural resources. In a word, it is clear that Africa cannot copy China’s experience be it from the perspective of a national strategy or of small farm family operations. With diverse internal situations on the continent, in order to successfully learn from China’s experience in agricultural development, Africa should carefully identify and make adjustments to China’s experience in order to adapt to local and regional situations; just as China has done throughout its long history. Above all, African nations need to make their own agricultural plans and continue to develop the human and fiscal resources to implement them.” [h/t Tim Kelsall] ]]>

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Comments

5 Responses to “What can Africa learn from China on Agricultural Development?”
  1. Priyanthi Fernando

    So why did I find the title of this blog disconcerting? even though the message of the text is that “Africa cannot copy China’s experience”. Well firstly because it confuses Africa, a continent of 50 plus countries with a single country. Second because it makes no mention of local markets, and population densities, which are critical. And third, because it ignores the role that China is playing in Africa. The Economist ran some articles about it sometime back http://www.economist.com/node/18586448 and personal contacts with East African colleagues do seem to bear out the fact that their presence is exploitative, worrisome for pastoralists etc etc

  2. I rather agree with Priya’s sentiments.
    You say: “African nations need to make their own agricultural plans and continue to develop the human and fiscal resources to implement them.”
    Maybe the real lesson for Africa is to emulate China’s one-party top down approach – no freedom of speech, no freedom of association, etc. etc. You can really get things done that way…
    We developed countries impose many new rules on African farmers if they are going to supply us with fresh veg, coffee etc., but we don’t tell China to clean up its act on clothing manufactures for instance. I wonder why.

  3. Halima Begum

    Great post – I think the sentiments are right – despite some generalisations about Africa.
    It is really important to get behind south-south learning and cooperation. I had the pleasure of hearing Li Xiaoyun a few years ago, and what struck me was the power of wanting to do development in alternative ways and calling on other developing countries to try things differently. The great story about China’s growth and development isn’t about emulating the China model. It’s about breaking the dependency on a single model, and working from what works best from the ground – and with a country’s own history and trajectory. This has been the transformational lesson since 2008: received wisdoms from the Bretton Woods institutions are not the only show in town.
    Learning from China is also about China learning from other developing countries, too, so it’s a mutual learning model. China still has much to learn, I’d say, not just much from German or British expertise, but also from other parts of the developing world.
    So, ultimately, learning from the Chinese model raises questions about knowledge and knowledge generation (something which Michael Edwards flags up in a parallel blog post on this site on NGOs and annoyance). Knowledge and evidence on what works shouldn’t just emanate and end with evaluations in J-PAL or Brookings Institution, but from every organization, and from every part of the globe. The more dispersed, the better.

  4. Wais Alemi

    The following is a speech made by Dr. Lim Mah-Hui on behalf of the South Centre at a Seminar on the 18th meeting of Afreximbank Advisory Group on Trade and Export Development in Africa, High-level Roundtable 1– Can Africa learn from China?, in Beijing on July 13. The seminar was held in conjunction with the 19th General Meeting of Shareholders of African Export-Import Bank.
    The South Centre is thus very pleased to be invited here to take part in a meeting on this important topic – the relationship and cooperation between Africa and China. China is a huge country that has great potential to take its rightful place in the world and Africa is an emerging world player after many years on the sideline. What can Africa learn from China’s great leap into the international world economy and how can China assist Africa takes achieve its goals?
    We are living in interesting and perilous times. The Chinese word for crisis is made up of two characters – danger and opportunities. Times of danger also offer opportunities to those who are able to use them to their advantage. The international economy is in its worst crisis since the Great Depression. There could be a break-up of the Euro zone with momentous consequences for the world economy; and the U.S. economy is limping along with high level of unemployment five years after the great financial meltdown. Growth in these two largest economies is below 2% at best. On the other hand, the Asian economies, particularly China, though affected are better off. Growth is forecasted to be about 8% for China and 5.8% for Africa in 2012.
    Why has China been able to maintain such stellar economic performance over the last two decades? To me, the key lies in its ability to combine the positive elements of a state economy and a market economy. While a rigid and centrally planned economy of the Soviet type is unsuitable for a complex modern economy, the free-for-all market fundamentalist economy that was touted as the end of history is discredited by the present global economic and financial crisis.
    I see two mega-trends or issues for the 21st century. The first is the relationship between the state and market and what is the right mix between the two; the second, related to the first, is the contest between labour and capital for the fruits of growth and its social and political consequences. On both these issues, the experience of China’s development offers valuable insights.
    China’s spectacular economic growth took off after Deng Xiaoping introduced market reforms. One of the most important experiments he started in the late 1970s was the establishment of Special Economic Zones (SEZ) in the southern coastal region of China that had a rich history of entrepreneurship. In 1992 after he made a historic visit to the southern region again, he declared the SEZs to be a success and he pushed for expansion of market economy to the whole country. In the same year he appointed Zhu Ronji to head the powerful state planning committee and later also as governor of China’s central bank. Zhu took the best of state planning and market reforms to drive the economy forward. Fortunately, he rejected the Washington Consensus and the shock therapy model that was foisted on Eastern European countries after their breakaway from the USSR. He implemented his famous 16 macro-economic policies that combined capitalist fiscal and monetary policies with outright state planning and administrative controls. He was not wedded to a rigid ideology. To everyone’s surprise it worked. He brought down inflation to 1% but maintained growth at 9% by 1998 that continued for the next two decades.
    China introduced market reforms, but they did not abandon state planning and controls. His theory can be termed as ”managed marketisation”. He cleaned up the banking system, reformed state owned enterprises to become more responsive to market forces, kept a tight control over capital flows, managed China’s foreign exchange rate, encouraged high savings rate, provided incentives for selected foreign direct investments, and drove a hard bargain for technology transfer. In short, instead of succumbing to neo-liberal market fundamentalism, China combined elements of state and market economy.
    This is perhaps the most important lesson that China offers to countries that are looking for alternatives to neo-liberalism.
    The great financial crisis of 2007-09 called into question market fundamentalism. The trickle-down theory of market fundamentalism has not worked. While it has generated growth, some of which are financially fictitious and unsustainable, it exacerbated inequality, unemployment and poverty. However, rather than taking corner solutions of either market fundamentalism or total state control, we should engage in theory and in practice to find the right mix between the two, realising that there is NO SINGLE MODEL for all societies. There is a role for both market and state forces; and they should be harnessed and regulated to achieve sustainable development from an ecological, social and economic viewpoint.
    This is not to suggest that China’s growth is without problems. There are three pillars to development – growth, distribution and sustainability. China combining state and market forces has produced super-charged growth over the last two decades. But she has not adequately addressed the issues of distribution and sustainability. This is best captured by Premier Wen Jiabao’s remarks after the National People Congress in March 15 2007. He said that although China has experienced steady and fast growth, she cannot remain complacent. He continued that China’s growth is ”unsteady, unbalanced, uncoordinated and unsustainable”. How China will address the last two pillars is crucial not only for China but for the rest of the world.
    In the recently concluded Rio Plus 20 summit in Brazil, all countries agreed to intensify the implementation of sustainable development, which incorporates the three dimensions of economic growth; social development, social inclusion and social equity; and environmental protection. All three have to be integrated in an appropriate model of development in the future. Of course each country and each region is free to choose how to do this. But both China and Africa have to reconsider their development strategy to take social distribution of benefits, and environmental sustainability into account, when planning economic growth.
    Next, I will sketch briefly the areas that China can cooperate with and assist in Africa’s development.
    Over the past two decades, China’s economic relation with Africa has grown significantly in terms of trade, investments, and official aid. However, most of these have been concentrated in the extractive industry and the provision of infrastructure related to this sector. There have undoubtedly been gains for African countries from this expansion of export earnings due to increased commodity demand and prices. The assistance provided by China for infrastructure development has also been favourably commented upon.
    However, while the resource rich African countries have benefitted from the commodity boom generated by China, there have also been concerns raised that in many countries there has not been enough diversification of the economies beyond commodities, especially into manufacturing, for example by value addition through more processing of the commodities and manufactures based on the commodities. Also, there have been concerns about the environmental and distributional consequences of the extractive sector. It would be useful for African countries to examine more deeply these issues of economic diversification, and social and environmental issues, so that sustainable and equitable benefits can be derived from future commodity production.
    Going forward, more emphasis should be placed on developing the manufacturing capabilities of the African countries be it the forward and backward linkages of extractive industries, agriculture, manufacturing for exports, as well as small scale manufacturing industry. Some Chinese firms have set up export manufacturing platforms in the textile and apparel industry in East Africa to take advantage of trade preferential status given by the US and EU countries to Africa.
    Another area that China can assist is to assist African countries to build up their capacity in the pharmaceutical drug industry. Africa like other developing regions urgently require access to affordable medicines, not only for HIV-AIDS and malaria, but also for a wide range of diseases and this need will increase in the future. China has increasingly efficient drug companies that have the potential to develop and produce more medicines in the future. It would be useful to consider setting up joint ventures between Chinese and African companies. This is especially because African countries that are LDCs enjoy exemption from implementing the TRIPS agreement with respect to patents in medicines until 2016, and this exemption may also be extended after 2016. Through such joint ventures, African companies may seek to gain technology transfer from Chinese companies, while the joint venture companies may enjoy exemption from patents, thus facilitating their ability to produce generic medicines and to export them to other African countries.
    Special Economic Zones have been a major catalyst for growth in China. In 2009, China announced the setting up of 7 Special Economic Zones in several African countries. This is an important experiment to build manufacturing capability, but whether this success can be replicated in Africa depends of the presence of enabling local conditions such as good infrastructure and institutional governance.
    China has introduced bilateral local currency swaps with important trading partners in Asia and Latin America recently. The same could be done with African countries to generate greater trading and investment opportunities.
    Finally the present global financial and economic crisis gives China an opportunity to consolidate its relationship with Africa. It is clear that there is no political will at the international level to institute any meaningful changes to the international financial architecture. Hence, the next best solution is to look for regional support and solutions. The alternative of promoting regional cooperation and groupings and a multi-polar world instead of nationalism or a single super power world should be further developed. Asia is in the process of doing it. Likewise Africa and Latin America are doing it. Continued assistance by China to Africa will serve China’s long-term strategic and political interests.
    Regards,
    Wais

  5. its nice to see that the global south economy is on the rise and it has increased from 36% to 54% of world economy since a decade, the pattern in that rise is also south to south cooperation and their cooperation in agriculture sector would further speed up that which is a good news for all the development countries.

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