Department of Agricultural, Food, and Resource Economics Food Security Group

IDWP 145. T.S. Jayne, Nicole M. Mason, William J. Burke, and Joshua Ariga. 2016. Agricultural Input Subsidy Programs in Africa: An Assessment of Recent Evidence

This study reviews the evidence regarding the recent wave of smart input subsidy programs
in Africa and identifies components of a holistic and sustainable agricultural productivity
growth strategy that could improve the contribution of input subsidy programs to African
governments’ national development objectives.

African governments’ commitment after the Abuja African Fertilizer Summit (2006) to
increase fertilizer use from 8 to 50 kg of nutrients per hectare by 2015 reinforces the
importance of inorganic fertilizer for increasing crop productivity and attaining food security
in Africa. The impacts of achieving this target, however, will depend greatly on the
agronomic efficiency of applied fertilizer. Many African governments’ efforts to raise
agricultural productivity have focused on programs to increase fertilizer use. Relatively little
effort has been made in recent decades to help African farmers raise the efficiency with
which they use fertilizer.

Over the past decade, targeted input subsidy programs have constituted the main tool by
which many African governments have sought to raise fertilizer use; in many countries, these
programs have become the centerpiece of state agricultural development and food security
strategies. While they have produced important benefits on national food production and food
security, these impacts have been attenuated by generally low crop response to fertilizer use
and to implementation features that depress the programs’ contribution to overall fertilizer
use. These limitations in turn have diminished the subsidy programs’ contribution to poverty
reduction and sustainable agricultural productivity growth. Low crop response to fertilizer
has also impeded the growth of commercial demand for fertilizer in Africa. There is strong
evidence that farmers will demand more fertilizer when they are able to obtain higher crop
response to fertilizer and therefore make its use more profitable.

A more holistic strategy for raising smallholder crop productivity – focusing on sustainably
raising the efficiency of fertilizer use as well as the quantity of fertilizer used – will more
effectively achieve the region’s agricultural, food security, and poverty reduction objectives.
Such a holistic strategy may include input subsidy programs, especially if they are
implemented according to smart subsidy criteria, which has often proven difficult. Other and
probably more important components of a holistic agricultural productivity strategy will
include greater public investment in coordinated systems of agricultural research,
development, and extension that emphasize bi-directional learning between farmers of
varying resource constraints and agro-ecologies, extension workers, researchers, and agrodealers.
The agricultural systems of Africa are undergoing rapid change with regard to
population densities, land scarcity, relative factor abundance and prices, land degradation,
climate variability, and new technologies. Because African farming systems are dynamic,
yesterday’s best agronomic and crop management practices are unlikely to be suitable for
today. Existing public agricultural research, development, and extension systems are
profoundly under-resourced, often demoralized, and in a de facto sense, sometimes defunct.
Effective agricultural science and extension programs are necessary to interactively work
with farmers to identify new best practices to maintain and increase crop productivity in the
face of these dynamic changes in the economic and biophysical environments. Moreover,
because of substantial micro-level variation in these environments, effective crop science and
extension systems must be localized to properly tailor agronomic best practices to
heterogeneous environments.

While African governments’ efforts to raise fertilizer use are laudable, expenditures on input
subsidy programs in most cases appear to produce substantially less impact on national
development objectives than their potential. The gap between existing and realistically
achievable impacts reflects both informational/knowledge barriers and political economy
barriers. While the contribution of input subsidy programs (and fertilizer use in general) to
sustainable growth could be much greater with strong and sustained government commitment
to complementary public goods investments as well as to government redesign of certain
aspects of subsidy programs, it is necessary to take a hard country-by-country assessment of
the feasibility of achieving these outcomes in the foreseeable future.