EACREGIONALPOLICYBRIEF

ImproveCoordinationofRegionalOrganicTradewithPromotionof‘AdvantageousCrops’

ExecutiveSummary

TheOrganic agriculture sector has been growing rapidly in East Africa, alongside a growing trend ofconsumerawarenessanddemand fororganicproduce.Themajorityoforganicproducts fromKenya,TanzaniaandUgandaaredestinedformarketsinEuropeandNorthAmerica.Meanwhile,organiccross-bordertradewithintheregionisextremelylow,despiteconsiderabledemand.ThisisconsideredtobelargelyduetopoorcoordinationbetweentheEACmemberstates,resultinginhighertradecosts,anddissatisfied consumers. It is recommended that the East African Community work to promote theorganic sector and to strengthen coordination, through the use of public authorities mandated tosupportorganicoperatorsand through thepromotionof regionalorganic trade. Trade inparticularlyadvantageouscropsineachcountrywouldbeespeciallyeffective.

Introduction

A regional study implemented in 2015 by Tanzania Organic AgricultureMovement, funded by TradeMarkEastAfricaChallenge(TRAC)Fund,setouttounveilthepolicybarriersconstrictingregionaltradeinorganicproduce.Oneofthemajorfindingswasthatthereisalackofsupportfromthepublicsector.Theabsenceoforganicagriculturepoliciesineachofthethreecountriesstudied(Kenya,TanzaniaandUganda)andlackof interventionstoencouragebettercoordinationare indicatorsofthis.Despitethelackofpublicsupport,theproductionsideofthesectorhasflourished.Thisismainlyduetocivilsocietyandprivatesectorinitiatives.Yearonyeargrowthinthesectorhasfaroutstrippednationalgrowthineachof thecountries’economies.But trade inorganicproducewithintheregionhowever isvirtuallynon-existent.

ProblemStatement

AccordingtoIFOAM(FiBL&IFOAM,2015)EastAfricahasover350,000organiccertifiedfarmers.To put this into perspective, there aremore organic producers in Tanzania, Kenya andUgandacombinedthaninthewholeofEurope,orNorthAmerica.Currentlyhowever,theproducegrownbythesefarmersismostlybeingsoldintomarketsoutsideAfrica.ForanEastAfricanCommunitylookingtofostersolidintra-regionaleconomicgrowth,theorganicsub-sectormustnotbeignored.

Atthesametime,demandfororganicproducebyconsumers intheregion isontherise.Theseconsumers say that they can’t find organic produce. The feworganic outlets in the region, likefarmers’markets, operate infrequently.Without adequate regulation in place, producemay besoldby ill-informedordishonest tradersas ‘organic’but theyarenotable to substantiate theirclaimwithevidenceorcertification.ThechainlinkingproducersandconsumersoforganicsinEastAfricaisbroken.

An analysis of the sector in Tanzania for instance shows that the North of the country has aconcentration of organic production of coffee and cotton. The coffee and cotton farmers alsogrow other secondary crops like green grams and beans, which also qualify for organiccertification. These organic farms are close to Tanzania’s borderswith Kenya andUganda. Thismeanseasytraderouteswithlowtransportcosts.Tanzaniaisnotaloneinthisrespect.

Another rationale for cross border regional trade is an environmental one. A study by theUniversityofAlbertafoundthatwhileorganicfoodishealthierforconsumersthanconventionalproduce,itisoftentradedoverlongdistances,withincreasedfoodmiles/carbonfootprint.Crossborder trade provides a much lighter carbon footprint than imports of produce and chemicalinputs from outside Africa. The public sector could domuchmore to develop and exploit theaforementionedopportunitiestogrowregionalorganictrade.

CaseforChange

InUganda, in theabsenceofconcretepolicyonorganicagriculture, twopublicauthoritieshavebeen tasked with promoting the sector. The Uganda Coffee Development Authority has set atargetthat10%ofcoffeefarmersshallbeorganic,andtheUgandaExportPromotionBoardhasassistedinpromotingtradefairsandtrademissions.Bymandatingthesetwonationalauthoritiestosupporttheorganicsector,theUgandanstatehasshownausefulwayforwardfortheregion.

A key recommendation for state action is the recognition and support for one or two‘advantageous’ crops ineachcountry. In this case,anadvantageouscrop isone that thenationcan produce organically in large quantities and can trade within the region at comparativeadvantage.

AdvantageousCropsforEastAfrica

Kenya

Macadamiaisahighvaluenut,grownwidelyinKenyawithouttheuseof synthetic inputs. The organic sector has been very successful insupporting and encouraging Kenya’s macadamia farmers to followorganicpracticesandachievecertification.MakingorganicthestandardformacadamiaproductioninthecountrywasrecommendedaspartofaKenyanstudyonnationalpolicygapstoorganicproductionandtrade.

Uganda

In Uganda, fruits are a large component of organic exports. Inparticular,organicproducersinUgandagrowapplebananas,pineappleand passion fruit for markets in Europe. Demand is high for theseexotic products, and processors in Uganda add value by drying andpackaging them ready for retail sale. Growers of these fruits wouldbenefitfromeasieraccesstocross-borderregionaltrade,asoperatorscomplain of freight costs as high as 60% being levied on exports toEurope.

Tanzania

In Tanzania, organic cocoa and green grams are advantageous crops.Organic cocoaproduction is concentratedmainly inonedistrict,Kyelawhereseverallargetradingcompaniesarebased.Organicgreengramsare produced as a secondary crop by most of the nation’s organiccottonfarmers,centredinShinyanga,witheasyaccesstothenorthernborders. The growing Kenyanmarket for organic food is an obviousopportunityforthesewellplacedproducers,whiletheirorganicfarmingpracticesensuresaneasyroutetocertification.

Fostering conducive trade agreements would be a strategic way of kick-starting cross borderorganic trade within the region. Crops have been identified in each member state that havecomparative advantage for production and trade. These should be promoted through trademissions, exhibitions and ultimately trade agreements between nation states to concentrateproduction and trade of certain advantageous organic crops in respective countries. The EACshould also provide support to establish strong and sustainable value chains of theseadvantageouscropsateverylevel.

Conclusion

EastAfricahasdevelopedanenormousbaseoforganicproducers.Theregionisalsoexperiencingagrowingwaveofconsumerdemandfororganicproduce.However,alackofcoordinationmeansthatthevastmajorityoforganicproducefromtheregionisonlybeingexportedtointernationalmarketsliketheUSAandEurope.Asaresult,EastAfricanconsumersfind itdifficulttosourceorganicfoodfromtheregion,andorganicproducersstruggletoconnecttotheregionalmarket.

This coordination problem can and should be addressed by the East African Community. Bysupporting trademissions foradvantageouscrops,andmandating regionalbodieswith the taskofnurturingorganictrade,theEACcanstrengthenorganictradewithintheregion,andfullyrealizethegainsoftherapidlygrowingsector.

PolicyRecommendations

1) The EAC should identify and promote organic trade in the region’s ‘advantageous crops’throughtrademissions,exhibitionsandbyfosteringtradeagreements.

2) Support should be given to actors at each level of the value chains for the ‘advantageouscrops’.

3) Regionalauthoritiesshouldbemandatedwiththetaskofpromotingtradeinorganicproduce.

References

FiBlandIFOAM,2015.TheWorldofOrganicAgriculture:StatisticsandEmergingTrends2015.Frick:ResearchInstituteofOrganicAgriculture(FiBL)andIFOAM-OrganicsInternational.