Food aid that supports development: searching for appropriate policies

Critics argue that food aid leads to dependency and decreased grain production. However, it remains an important part of donor assistance to southern Africa.

Recent analysis of food insecurity in southern Africa has highlighted the chronic nature of hunger and vulnerability and the need for long-term social protection. Little is known about how the impact of food aid differs between long-term safety nets and emergency responses.

Research from the Regional Hunger and Vulnerability Programme, South Africa, evaluates the impact of food aid on grain markets in southern Africa. It questions whether food aid always increases domestic food supply. Critics argue that this causes falling product prices, discouraging food production, but the links between food aid and domestic food production are more complex.

Evidence from existing studies shows that food aid has no statistically significant impact on long-term agricultural production. However, there are cases where food aid has discouraged food production. In these cases, poor management of food aid delivery is the major factor. There is also evidence that food aid usually replaces commercial imports before having an impact on domestic food production. This can decrease private sector participation in the marketing of staple foods and stifle investment in marketing innovations.

Case studies of grain markets and food aid in Zambia, Lesotho and Malawi broadly confirm these findings:

• In Malawi, the impact of food aid on domestic markets varied from year to year. This was dependent on the size of the gap between food production and food demand (the food gap), government policies and the timing of imports.
• In Lesotho, food aid had little impact on food prices, mainly displacing imports from South Africa.
• In Zambia, food aid increased on-farm labour and decreased casual labour as farmers had less reason to work for cash to buy food. However, labour costs increased for larger farmers.
• The government’s role is important. The liberalised economy of Lesotho behaves very differently to those of Zambia and Malawi, where the government continues to be involved in grain marketing.
• There is little evidence on how food aid affects local market development. Traders argue that government interventions in markets are the major constraint and food aid is less important.

Food aid has enabled agricultural and income growth in some rural areas. However, poorly managed programmes can cause substantial declines in local food production. To be effective, food aid policies must avoid incentives to reduce local production. The researchers suggest:

• Food aid responses must be well timed and emphasise systems such as flexibile and efficient cash transfers and vouchers.
• Programme food aid and money for project aid are both outdated and should not continue.
• Procuring food aid from within the country or the neighbouring region is better than imported food, because it minimises market distortions.
• It is important to identify and select food aid beneficiaries more reliably.

It can be argued that food aid that is part of a long-term, predictable and small-scale resource transfer does less to discourage markets and production. However, food aid is not necessarily a ‘best choice’ for social protection programmes. Policymakers must also consider criteria about the efficiency and appropriateness of food aid.

Source(s):
‘The impact of food aid on grain markets in southern Africa: implications for tackling chronic vulnerability: a review of the evidence,’ Regional Hunger and Vulnerability Programme Report, by Nick Maunder, 2006 (PDF) Full document.

Funded by: UK Department for International Development; AusAid

id21 Research Highlight: 3 November 2006

Further Information:
Nick Maunder

Contact the contributor: nickmaunder@telkomsa.net

Regional Hunger and Vulnerability Programme, South Africa

Regional Hunger and Vulnerability Programme
Postnet 307
Private Bag X30500, Houghton
Johannesburg 2041
South Africa

Tel: +27 11 642 5211
Fax: +27 11 642 6093
Contact the contributor: rhvp@rhvp.org

Other related links:
id21 insights - 'Achieving food security: what next for sub-Saharan Africa?'

'Is food aid effective?'

'Does tying matter?'

'Is cash the best way to assist poor and vulnerable people?'