economic impact assessment of rinderpest control in africa › 7624 › 120b06a9aa4... · 460 rev....

Rev. sci. tech. Off. int. Epiz., 1999,18 (2), 458-477

Economic impact assessment of rinderpest control in Africa

E.N. T a m b i ( 1 ) . W . Maina (1), A . W . M u k h e b i ( 2 ) & T.F. Randolph ( 1 )

(1) International Livestock Research Institute, P.O. Box 30709, Nairobi, Kenya (2) Kenya Agricultural Commodity Exchange, P.O. Box 59142, Nairobi, Kenya

Summary T h e a u t h o r s a s s e s s t h e e c o n o m i c i m p a c t of t h e P a n - A f r i c a n R i n d e r p e s t C a m p a i g n ( P A R C ) . T h e P A R C p r o g r a m m e c o m m e n c e d in 1986 w i t h t h e o b j e c t i v e t o c o n t r o l a n d u l t i m a t e l y e r a d i c a t e r i n d e r p e s t f r o m A f r i c a . F r o m a m o n g t h e t h i r t y - f i v e c o u n t r i e s t h a t p a r t i c i p a t e d in P A R C , t e n c o u n t r i e s w e r e s e l e c t e d f o r t h e a n a l y s i s , b a s e d o n d a t a a v a i l a b i l i t y . T h e t h r e e f o l l o w i n g k e y s o c i o - e c o n o m i c i s s u e s w e r e a d d r e s s e d : c o s t - e f f e c t i v e n e s s , r e t u r n s t o i n v e s t m e n t a n d t h e w e l f a r e g a i n s of t h e i n t e r v e n t i o n .

T h e s t a n d a r d c o s t - b e n e f i t a p p r o a c h b a s e d o n a c o m p u t e r s p r e a d s h e e t m o d e l w a s u s e d t o a s s e s s t h e e c o n o m i c i m p a c t of r i n d e r p e s t c o n t r o l . B e n e f i t s of t h e i n t e r v e n t i o n c o n s i s t e d of i n c r e a s e d r e v e n u e d u e t o a v o i d e d p r o d u c t i o n l o s s e s . E s t i m a t e s of t h e v a l u e of p r o d u c t i o n l o s s e s w e r e o b t a i n e d u n d e r b o t h ' w i t h P A R C a n d ' w i t h o u t P A R C s c e n a r i o s a n d t h e i n c r e m e n t a l b e n e f i t s w e r e d e r i v e d a s t h e d i f f e r e n c e b e t w e e n t h e t w o s c e n a r i o s . In a d d i t i o n , a n e c o n o m i c s u r p l u s m o d e l w a s u s e d t o a s s e s s t h e d i s t r i b u t i o n of w e l f a r e e f f e c t s g e n e r a t e d b y t h e i n t e r v e n t i o n .

A n a l y s i s of f u n d i n g f o r t h e n a t i o n a l c a m p a i g n s s h o w e d r o u g h l y e q u a l c o m m i t m e n t t o t h e p r o g r a m m e b y n a t i o n a l g o v e r n m e n t s a n d t h e p r i n c i p a l d o n o r , t h e E u r o p e a n U n i o n . E x a m i n a t i o n of t h e i m p l e m e n t a t i o n c o s t s in t h e t e n c o u n t r i e s i n d i c a t e d t h a t w i t h t h e e x c e p t i o n of o n e c o u n t r y , P A R C w a s i m p l e m e n t e d in a c o s t - e f f e c t i v e m a n n e r w i t h a v e r a g e c o s t s a p p e a r i n g w i t h i n a r e l a t i v e l y n a r r o w r a n g e . T h e f i g u r e s o b t a i n e d in E C U ( E u r o p e a n c u r r e n c y u n i t s ) w e r e b e t w e e n ECU0.27 a n d E C U 0 . 6 0 p e r h e a d of c a t t l e v a c c i n a t e d . T h e e s t i m a t e d a v e r a g e r e t u r n f r o m t h e t e n c o u n t r i e s ( E C U 1 . 8 f o r e a c h E C U i n v e s t e d in t h e c a m p a i g n ) d e m o n s t r a t e s t h a t b a s e d o n t h e s a m p l e of c o u n t r i e s , r i n d e r p e s t c o n t r o l in A f r i c a h a s b e e n e c o n o m i c a l l y p r o f i t a b l e . In e a c h of t h e t e n c o u n t r i e s , e s t i m a t e d b e n e f i t s at l e a s t c o v e r e d t h e v a l u e of t h e i n v e s t m e n t in P A R C . T h e p r o g r a m m e h a s p r o v i d e d a t o t a l n e t p r e s e n t v a l u e of E C U 2 9 mi l l ion f o r t h e t e n c o u n t r i e s , s u g g e s t i n g t h a t t h e i m p l e m e n t a t i o n of P A R C h a s b e e n a w i s e p u b l i c i n v e s t m e n t d e c i s i o n . A n a l y s i s of t h e d i s t r i b u t i o n of t h e w e l f a r e g a i n s f r o m P A R C r e v e a l e d t h a t p r o d u c e r s d e r i v e d t h e g r e a t e r s h a r e of t h e E C U 5 8 m i l l i o n in n e t v a l u e of p r o d u c t i o n l o s s e s a v o i d e d d u e t o r i n d e r p e s t c o n t r o l in t h e t e n c o u n t r i e s . C o n s u m e r g a i n s a c c o u n t e d f o r a p p r o x i m a t e l y o n e - f i f t h of t h e t o t a l , d u e t o l o w e r p r i c e s f r o m i n c r e a s e d s u p p l i e s .

Keywords A f r i c a - Cost-benef i t analysis - Economics - Economic surplus - P a n - A f r i c a n Rinderpest Campaign - Rinderpest - W e l f a r e analysis.

Rev. sci. tech. Off. int. Epiz., 18 (2) 459

Introduction Livestock plays a key role in the agricultural economy of Africa, contributing over a quarter of the total value of agricultural production in the countries of sub-Saharan Africa (16). In addition to providing food, income, employment and foreign exchange earnings, livestock serve as a store of wealth and supplier of inputs and services such as draught power, manure and transportation. Despite the important role of livestock for economic development in sub-Saharan Africa, growth in livestock productivity has been below that of other developing regions. In the last decade, for example, per capita production of livestock in sub-Saharan Africa dropped by 14% compared to a 1 0 % fall in West Asia and 0 % growth in Latin America (2, 16).

An important factor which contributes to the decline in livestock productivity is the prevalence of disease. Disease limits productivity through morbidity and mortality, resulting in losses of meat, milk, hides and skins, eggs, wool, manure and animal traction. Of all animal diseases, infectious diseases such as rinderpest, contagious bovine pleuropneumonia (CBPP) and peste des petits ruminants (PPR) account for the largest share of the losses (11) . Most governments of sub-Saharan Africa are unable to maintain effective surveillance and control or eradication programmes against these infectious diseases because of inadequate funding. In the last decade, however, collaborative efforts between national governments and international donor institutions such as the European Union (EU) have led to significant progress in the control of epidemic diseases in Africa.

Particular attention has focused on controlling rinderpest. In 1986, the Pan-African Rinderpest Campaign (PARC) programme was instigated by the Office International des Epizooties (OIE) and initiated under the auspices of the Inter-African Bureau for Animal Resources (IBAR) of the Organisation of African Unity (OAU). Jointly funded by the EU and national governments, PARC has sought to control and ultimately eradicate rinderpest from Africa, while simultaneously supporting the restructuring of livestock services and providing appropriate improvements in livestock husbandry methods.

The programme has represented a major investment in disease control. After more than a decade of intervention undertaken across many countries, a review and assessment of the impact of the PARC experience is essential. The impact of PARC can be considered at several different levels, beginning with the direct impact in terms of disease incidence. This has been the subject of a number of epidemiological studies that have clearly shown that PARC has largely achieved the objective of eliminating rinderpest from much of the continent (13) . However, beyond the

epidemiological impact, are three key socio-economic issues which need to be taken into account; these are discussed below.

The first of these issues relates to the lessons that can be drawn from the way in which the programme was implemented in the various countries. As livestock numbers and the degree of disease risk vary, the cost effectiveness of the intervention needs to be assessed. This type of analysis will offer guidelines to decision makers in regard to how such factors may influence the economic viability of additional control. The second question is a critical one. This is whether or not a disease control intervention on the scale of PARC has been a wise public investment and whether rinderpest control has indeed generated sufficiently large benefits to justify the public expenditures incuned. Donors and national decision makers will require the answers to these questions when considering future investments in similar control interventions for other contagious livestock diseases. Finally, a third and last issue involves properly identifying those who have benefited from the intervention. In particular, the degree to which not only producers benefited from lower production losses, but also consumers from lower prices for livestock and livestock products needs to be determined.

This study addresses these various questions by evaluating the economic impact of rinderpest control as implemented under PARC in several African countries. The research was conducted by economists from the International Livestock Research Institute as part of collaboration with OAU/IBAR to support impact assessment activities.

Rinderpest in Africa Rinderpest was first introduced onto the African continent in 1841 when domestic cattle were infected in Egypt by cattle imported from Romania. The resulting epidemic killed 7 5 % of cattle and buffaloes in Egypt (1) . In Africa south of the Sahara, rinderpest first appeared in Ethiopia in 1884, again, through cattle imports, but this time from India. Outbreaks were reported in the Province of Hamasien from where the disease spread through Tigray into Gojam and Shewa. In 1888 and 1889, the disease spread southwards, covering almost all of Ethiopia as well as neighbouring Somaliland, Kenya, the Sudan and Uganda. By the end of 1892, an estimated 9 0 % of the cattle population of Ethiopia had been lost (including wildlife), while Uganda lost an estimated 9 5 % of the total population of 400 ,000 cattle (6, 10, 14).

From East Africa, rinderpest appears to have spread to West Africa during the period between 1885 and 1886 and to South Africa in 1896 (1). In West Africa, rinderpest outbreaks became established as a constant threat throughout the period from 1886 to 1960. Although the creation of Veterinary Services and the development of new vaccines during this period gave added protection and reduced damage to cattle,

460 Rev. sci. tech. Off. int. Epiz., 18 (2)

the spread of rinderpest to other parts of Africa continued to kill cattle and wildlife. As the numbers of infected cattle increased, efforts by national governments in cooperation with international organisations to control rinderpest intensified.

The Joint Project campaign against rinderpest In May 1961, the first major programme for the eradication of rinderpest in Africa was initiated at a meeting held in Kano, Nigeria, by the Co-ordinating Committee for Technical Co-operation and the Foundation for Mutual Assistance in Africa. Known as the Joint Project 15 (JP15), the programme was financed by aid from various international and individual country sources. According to Lepissier, the aim of JP15 was to eradicate rinderpest from Africa through a continent-wide vaccination campaign using low cost vaccines to confer lifelong immunity in cattle (4).

In West and Central Africa, Phase I of JP15 was implemented from 1962 to 1965 and covered Nigeria, Niger, Cameroon and Chad, an area in which cross-border cattle trade was increasing. Based on reports of outbreaks in Nigeria, Niger and other countries to the west, Phase II of the programme was extended westward to cover Dahomey (now Benin), Ghana, Upper Volta (now Burkina Faso), Togo and parts of Mali and Ivory Coast (now Côte d'Ivoire). Phase III of JP15 covered the remainder of Mali and the Ivory Coast, Chad, the Gambia, Guinea, Liberia, Mauritania and Sierra Leone during the period from 1966 to 1969.

Estimates by Lepissier show that the JP15 campaign cost an estimated US$16.4 million with US$7.2 million (44%) contributed by national governments, US$6.6 million (40%) by the European Development Fund (EDF) and US$2.6 million (16%) by the United States Agency for International Development (USAID) and the Governments of Great Britain, Germany and Canada (4). As reported by McCauley, an economic analysis of the JP15 campaign in Cameroon, Chad, Niger and Nigeria showed that for 33 million vaccinations given to ensure appropriate immunity, the programme incurred an average cost of $0.32 per vaccination (5) . Felton and Ellis evaluated the economic consequences of the rinderpest vaccination campaign in Nigeria (1) . Using mortality losses avoided, improved reproductive rate and improved productivity in meat and milk as benefits, a discounted benefit-cost ratio (BCR) of 2.48 and an internal rate of return (IRR) of 4 8 % were estimated. The conclusion drawn was that the campaign not only succeeded in reducing mortality during outbreaks, but also promoted the development of Veterinary Services which were able to undertake other major disease control and eradication programmes.

While the campaign appeared to have succeeded in substantially reducing the incidence of rinderpest in some countries, the review by McCauley points to the fact that the campaign did not achieve the aim of eradication (5).

Approximately 70 million cattle were vaccinated using the tissue culture vaccine developed at the East Africa Veterinary Research Organisation in Kenya. However, the target immunity level of 7 0 % was never achieved. By the time the JP15 campaign ended in West Africa in 1969, the number of rinderpest outbreaks had substantially dropped and mortality during outbreaks was likewise reduced. In Nigeria, for example, mortality in areas affected by outbreaks was in the range of 3 % to 5%, compared to 12% prior to the campaign (1).

According to animal health reports from the Food and Agriculture Organization of the United Nations, the OIE and the World Health Organization, most of Africa was relatively free from rinderpest during the decade following 1969, except for a few sporadic reports of outbreaks in Chad in 1970, Ethiopia in 1975, Cameroon in 1976 and Senegal in 1980. During the early and mid-1980s, however, more than half of the countries reported increasing numbers of outbreaks of rinderpest. In 1980, Burkina Faso and Mali reported 8 and 26 outbreaks respectively. In Mali, by 1984 the number of outbreaks increased to 40 , in which 1,015 cattle were affected and 537 died (3). Ghana reported 26 outbreaks in 1985, while Burkina Faso reported 4 0 outbreaks involving 4 5 4 cattle in 1986.

Beginning in 1975, rinderpest spread progressively in East Africa from a focus in south-eastern Ethiopia, enveloping the entire country and spreading across to the Sudan by 1977. In 1976, rinderpest was introduced into the Rift Valley from south-eastern Ethiopia and by the late 1980s an epidemic of rinderpest spilled from the border of Sudan and Ethiopia into the Afar region of Ethiopia (15). In the late 1980s, a focus persisted to the west of Lake Tana in Ethiopia. The persistence of endemic areas in the Afar region and in parts of southern Sudan increased the risk of rinderpest spreading to other parts of Africa.

The Pan-African Rinderpest Campaign As the renewed spread of rinderpest throughout Africa became increasingly evident, concern over control of the disease was revived at the OAU/IBAR. In 1986, PARC was launched as a continent-wide campaign against rinderpest. The main objectives were as follows:

a) to control and ultimately eradicate rinderpest from the continent through vaccination campaigns, systematic sero-surveillance, active investigation of outbreaks and control of animal movement wherever possible

b) to revitalise and restructure livestock services

c) to provide appropriate improvements to livestock husbandry methods (11) .

The agreement for the implementation of PARC was signed in July 1986 between the European Economic Community and OAU/IBAR. Immediate action began in 1986 in five countries where rinderpest had spread extensively, namely: Burkina Faso, Ethiopia, Mali, Nigeria and the Sudan. Emergency


activities then followed in 1987 in Togo, Kenya and Uganda (Table 1). After these preliminary interventions, Phase 1 of PARC commenced in 1988/1989 with funding amounting to 50 million European currency units (ECU) (Phase I was funded by the 4th and 5th EDF), with the funds committed through the 3558/PR Regional Financial Agreement). The project was renewed and Phase II of PARC started in 1990, ending in 1994/1995. Funding for this phase totalled ECU7.5 million (Phase II was funded by the 6th EDF through the 4318/REG Regional Financial Agreement). The project entered Phase III in 1994/1995, and ended in March 1999

(this phase has been funded under the 7th EDF and with remaining funds from the 5th and 6th EDFs).

Initially, the PARC strategy consisted of blanket vaccinations of all cattle, aiming at a target herd immunity level of 80%. Later, the approach changed in favour of the following:

a) strategic vaccinations of young cattle

b) ring vaccinations around endemic foci and the establishment and maintenance of a cordon sanitaire (sanitary cordon) around the foci

Table I Financing of the national components of the Pan-African Rinderpest Campaign programme, 1986 to 1996*

Countries Phase 1

Immediate action E m e r g e n c y action (4th and 5th EDF) (Agreement 3558/PR)

Phase II (6th EDF)

(Agreement 4318/REG)

Phase III (7th EDF)

(National agreements)

Y e a r xECU1,000 Y e a r xECU1,00U Year Duration x ECU1.000 Year Duration x ECU1.000 Year Duration x ECU1,000

W e s t and Central A f r i c a

Benin 1991 1 600

Burkina Faso 1986 1,358 1991 2 350 1995 3 3,900

Burundi 1990 2 600

Cameroon 1988 2 1,800

Chad 1989 2 2,570

Côte d'Ivoire 1988 2 2,100 1993 3 3,000

Gabon 1990 2 800

Gambia 1989 2 1,000

Ghana 1990 2 1,600

Guinea-Bissau 1990 2 700 1996 3 1,300

Guinea 1995 4 4,100

Liberia Cancelled (750)

Mali 1986 1,819 1991 1 600 1993 2(a) 3,600

Mauritania 1995 3 3,000

Niger 1990 2 1,600 1995 3 3,000

Nigeria 1987 1,917

Central African Republic

1995 4 1,800

Rwanda 1990(b) 2 700 1995 4 4,600

Senegal 1988 2 2,200

logo 1987 90 1991 (b) 2 500

East A f r i c a

Djibouti 1988 2 700

Ethiopia 1986 4,512 1989 2 4,300 1993 4 9,000

Kenya 1987/1988 695 1989 2 2,400

Uganda 1987 572 1989 2 2,000 1995 ( c l 4 3,900

Somalia 1988 2 1,700

Sudan 1986 3,575

Tanzania 1989 190 1991 (d) 2 3,720

Source. Pan-African Control of Epizootics (PACE) proposal provisional report, June 1998 (12) *The dates indicate w h e n funding commitments w e r e made; expenditures w e r e only incurred as activities w e r e implemented, often at a much later date. Actual expenditures differed from the commitments a) For control of contagious bovine pleuropneumonia: five years b) Project not executed c) Agreement 5462/UG (6th EDF) d) Agreement 4354/TA (6th EDF) EDF: European Development Fund

462 Rev. sci. tech. Off. int. Epiz., 18(2)

c) strict surveillance along national borders

d) annual sero-surveillance and monitoring to establish and maintain appropriate herd immunity levels that are capable of stopping the spread of the disease.

After twelve years of programme implementation, PARC has effectively addressed the problem of rinderpest in Africa. In Central and West Africa, initial actions from 1986 to 1988 reduced the threat of rinderpest, and subsequent activities over the following decade prevented recurrence. As of 1999, the region has been free from the disease for over ten years; the last outbreak was reported in July 1988 on the border between Ghana and Burkina Faso. Liberia and Sierra Leone have not vaccinated for over a decade and the Gambia ceased vaccination in 1988 and is continuing epidemio-surveillance as advocated by the OIE pathway of freedom from disease.

In East Africa, vaccination efforts have been less successful, partly due to the larger wildlife and cattle populations. Herd immunity levels, evaluated by sero-monitoring, vary from one country to another and are as low as 4 0 % in Uganda, 4 9 % in Kenya and 57% in Ethiopia, and as high as 9 0 % in Tanzania (Table II). As a consequence, cases of rinderpest outbreaks are still being reported. Uganda and Eritrea reported the last cases in June and December 1994, respectively, followed by Ethiopia in November 1995. In Kenya, the Lineage 2 rinderpest virus with very mild symptoms was reported at the Nairobi National Park in December 1996 (Fig. 1). By February 1997, the virus spilled over to the Hai, Monduli, Ngorongoro and Karatu Districts of Tanzania. In February 1998, the Sudan reported outbreaks of rinderpest in the Eastern Equatoria Province and Torit County (Table III). As long as a focus of rinderpest remains in East Africa, and herd immunity levels remain low in many areas, the risk of transmission will remain high with the consequence of significant economic losses in cattle and wildlife.

Table II Herd immunity levels to rinderpest in East Africa, 1993-1997 (percentage)

Country and a r e a 1993-1994 1995-1996 1996-1997

Ethiopia ( a )

Afar endemic area 62.0 66.0 40.0

Afar cordon sanitaire 75.0

Rift Valley 55.0

Dire Dawa 50.0

North-west cordon sanitaire 63.0 43.0

South-west cordon sanitaire 58.0 49.0

K e n y a ( b ) 36.0

Kitengela 79.0

Mashuru 33.0

Nairobi 49.3

S u d a n 64.0

T a n z a n i a ( b ) 90.0

U g a n d a ( b ) 40.0

Sources.

a) National Animal Health Research Institute, 1995 (8) b) Organisation of African Unity/Inter-African Bureau for Animal Resources/Pan-African Rinderpest Campaign, 1998(13)

Methods As described in the preceding section, PARC has had undeniable epidemiological impact in effectively reducing -and in some areas, eliminating - the risk of rinderpest in sub-Saharan Africa. In the present study, the authors evaluate whether PARC has been an appropriate and efficient means to achieve these objectives. To this end, three key issues were identified in the Introduction. The following section describes the approach adopted to address each of these issues.

Table III Documented outbreaks of rinderpest in nine countries in sub-Saharan Africa

Country Date of o u t b r e a k A r e a s af fected

Eritrea ( a ) January 1992 and December 1994 South-east border with Afar region of Ethiopia

Ethiopia (b) November 1995 Afar region

Ghana-Burkina Faso border ( c ) July 1988 Funzi, Yola

Kenya ( a ) December 1994 to January 1995 October 1996 to January 1997 December 1996

Tsavo National Park Nairobi National Park (in wildlife) South Kajiado

M a l i ( c ) 1986 Koulikoro, Segou

Sudan ( a ) February 1997 to February 1998 Kasingor, Junglei, Upper Nile, Eastern Equatoria Provinces, Torit County

Tanzania ( a ) February, April and June, 1997 Hai, Monduli, Ngorongoro and Karatu Districts

Uganda ( a ) April/July/September 1991 to June 1994 Kotido, Morato, Sudi, Morato

Sources:

a) Organisation of African Unity/Inter-African Bureau for Animal Resources/Pan-African Rinderpest Campaign, 1998(13) b) National Animal Health Research Institute, 1995 (8) c) Kane et al., 1996(3)

Hev. sel teck Off. int. Ep'a., 18 (2] 463

Segou1986

Locations of outbreaks ofrinderpest lineage 1in Junglei and Eastern Equatoria

•Member Countries of thePan-African Rinderpest Campaign

| | Ten countries in the sample

• Areas of reported outbreaks of rinderpest

Fig. 1

Study countries and reported rinderpest outbreaks, 1988-1998

Cost-effectivenessThe question of whether PARC has been able to implementrinderpest control at a reasonable cost needs to be answered.In the absence of a similar expérience for comparison, thecost-effectiveness of PARC can be evaluated through aninternai comparison of the implementation costs across thecountries that participated in the programme. Sincevaccination has been the principal control measure used inthe Campaign, the number of cattle vaccinated againstrinderpest offers an obvious indicator of programme activity.Cost-effectiveness is therefore measured in terms of totalPARC expenditures in each country per head of cattlevaccinated. This cost figure per vaccination is expected to varyacross countries depending on the scale of the programmeand the efficiency vnth which the programme wasimplemented. Per vaccination cost will also vary dependingon the extent of other programme expenditures related torestructuring of livestock services and improving livestockhusbandry techniques. Since costs are incurred in différentcurrency units, to enable easy comparison of unit costs acrosscountries, the costs hâve been converted to a single currencyunit using the average annual exchange rate. The singlecurrency unit used in this case is the ECU.

Cost-benefit analysis

The second question considers the quality of PARC as a publicinvestment. The standard technique for addressing thisquestion is économie cost-benefit analysis (CBA). The basicapproach involves aggregating ail incrémental costs associatedwith the control intervention and comparing thèse costs to thetotal value of benefits generated attributable to theintervention. Since costs and benefits occur over several years,thèse values must be appropriately discounted to account forthe time value of money. (The time value of money refers tothe économie principle that one ECU received today hasgreater value than one ECU received sometime in the future.This is because the ECU received today could be invested andeam additional interest in the future, so that the ECU todayequals more than an ECU in the future.)

Cost-benefit analysis générâtes several commonly usedindicators to characterise the value of the control interventionas an investment. The three indicators used in this studyinclude the following:

a) Net présent value (NPV): the NPV represents the total netbenefit of the investment in the control intervention, and iscalculated as total benefits less total costs, ail appropriately


discounted to current - or 'present' - monetary value. Since the NPV is an absolute monetary figure, it can be influenced by the scale of the intervention and may be difficult to compare across different situations. A 'good' investment is expected to at least generate returns to cover costs, and so the NPV should be positive.

b) Benefit-cost ratio (BCR): the BCR uses the same discounted total benefits and total costs as the NPV, but compares these benefits as a ratio of benefits to costs rather than a net absolute monetary amount. A ratio facilitates comparison of interventions of variable scale. Again, a 'good' investment should at least cover initial costs, so the benefits should be greater than costs and therefore the ratio should be greater than one.

c) Internal rate of return (IRR): the IRR expresses the returns to the investment in the control intervention as an interest rate, and so permits comparison of the returns to the intervention with returns to other possible interventions or to simply investing the funds in an interest-earning bank account.

Welfare analysis Those who have benefited from PARC need to be identified. In the relatively narrow focus of CBA, livestock producers clearly gain from reduced rinderpest risk, both in terms of lower production losses and the diminishing need to continue vaccinating against rinderpest. Both of these effects, however, lead to lower production costs and encourage increased production, which in turn places downward pressure on prices for livestock and livestock products. As prices decline, consumers will gain and producers will see profit margins reduced. To account for these interactions, the impact of rinderpest control must be analysed from a wider perspective. This is the purpose of welfare analysis using the economic surplus approach. Welfare analysis permits the evaluation of how changes in supply will affect markets for livestock and livestock products, and quantification of the net economic

effect of an animal disease control programme, taking these market adjustments into account, on society as a whole, and how the benefit shares are distributed among producers and consumers. The economic surplus approach is used here to measure the change in the overall well-being of producers and consumers as a result of rinderpest control under PARC.

Study design Of the twenty-six PARC member countries that implemented rinderpest control under PARC (Table I), a subset of ten were chosen as representative experiences for rinderpest control in Africa (Fig. 1). These countries included Benin, Burkina Faso, Côte d'Ivoire, Ethiopia, Ghana, Kenya, Mali, Senegal, Tanzania and Uganda. The choice of the countries was guided by the availability of information on the epidemiology of rinderpest and data on expenditures incurred by the PARC programme. These countries reflect the range of experiences across West and East Africa as well as the different scales of intervention (Ethiopia being the largest operation and Benin the smallest).

A questionnaire was designed to collect data on the costs and benefits of the PARC programme. The countries were visited and interviews were conducted with national PARC staff, livestock producers and other stakeholders. Relevant documents on the PARC programme were also reviewed at the national PARC offices and at the regional programme co-ordination offices in Nairobi and Bamako.

The time horizon for the analysis varied from one country to another, reflecting the different timing of the implementation of the PARC programme in each country. In most cases, implementation began well after the original funding commitments were made (Table I). Country-specific time horizons are displayed in Figure 2. In Benin, data were available only for two years, whereas in Kenya, only the emergency vaccination campaign of 1997/1998 was evaluated

Burkina Faso

Côte d'Ivoire

Ethiopia

Mal i

Senegal

Ghana

Tanzania

Uganda

Benin

Kenya

1 9 8 9 1 9 9 0 1991 1 9 9 2 1 9 9 3 1 9 9 4 1 9 9 5 I 9 9 6 I 9 9 7 1 9 9 8

Fig. 2 T i m e h o r i z o n f o r a n a l y s i s , by c o u n t r y


because of a delay in the disbursement of operational funds to PARC in Kenya until 1997. It should be stressed that for CBA, the assumptions regarding the time horizons are extremely conservative. The benefits from rinderpest control will extend well beyond these horizons and usually would be incorporated into the calculation of benefit value. To do so would require the extrapolation of the impact of rinderpest control into the future and the introduction of a number of additional assumptions. To avoid these additional assumptions, the time horizon was restricted to the period for which data were available. The fact that benefits are limited to these very short periods means that benefits and the various cost-benefit indicators will be significantly underestimated.

The analysis was conducted for each country individually, and then as a group, using a spreadsheet model developed in the Microsoft Excel® computer programme, and based on a model created by Mukhebi for assessing the economic impact of tick-borne diseases and disease control (7) .

Costs Two types of costs are generally associated with a control intervention, as follows:

a) new control costs which are incurred in the implementation of the control measures that would not have been incurred under the existing situation

b) livestock production revenues foregone due to the control measures.

In the case of rinderpest control under PARC, no production revenues are sacrificed, so incremental costs are limited to those directly associated with PARC activities, including both those for vaccination and those to support restructuring of livestock services. Two types of cost items are considered: fixed and recurrent costs. Fixed costs included expenditures on capital equipment (e.g. motor vehicles, laboratory, communication and camping equipment, office equipment and infrastructure). Capital equipment, such as vehicles, were evaluated as being used full time for campaign activities and were straight-line depreciated over five years (straight-line depreciation assumes that an equal share of the value of equipment is depreciated each year during the life of the equipment). Recurrent costs included expenditures on vehicle and equipment operation and maintenance, office and laboratory materials and utilities, personnel salaries and allowances, administrative overheads (e.g. national and regional coordination meetings and workshops, border harmonisation meetings), and vaccine supplies. Personnel costs were estimated based on annual salaries as the proportion of time spent on PARC activities. Vaccine costs were calculated as the product of the quantity used and the unit price of vaccine in each country.

Costs were estimated as expenditures of funds contributed by the EU and the respective national governments. Only the actual expenditures incurred were considered, rather than

budgetary commitments. Financial and material contribution varied by country according to the financial agreements signed between the EU and the individual government. In most cases, the EU funds were used to cover the cost of capital equipment and materials, technical assistance salaries and allowances, and some operational and miscellaneous items. National government funds covered expenditures on local staff salaries and allowances, operational costs on utilities, vehicle operation and maintenance, vaccines and other miscellaneous items. Costs incurred by the regional coordination offices in Nairobi and Bamako were apportioned equally among the participating countries in each region.

Benefits For the purposes of the CBA, two types of benefits from rinderpest control are considered, as follows:

a) increased revenue from improved productivity

b) savings in control costs avoided after the initial rinderpest campaign.

Lacking information on private use of rinderpest control (especially rinderpest vaccination), benefits are represented primarily as increased revenue due to avoided production losses. Incremental benefits are therefore estimated as the difference between production value under the 'with PARC versus the 'without PARC scenario. The 'with PARC scenario represents what actually occurred with the implementation of PARC, and consequently is based on available data. The 'without PARC scenario, on the other hand, describes what would have happened in terms of continued outbreaks, production losses and control costs, had PARC not been implemented, and so must be estimated.

In the 'with PARC scenario, incidence and case fatality rates were calculated for the countries where data were available and then extrapolated to those countries without data. The incidence and case fatality rates calculated for Ethiopia were extrapolated to Kenya, Tanzania and Uganda. Incidence and case fatality rates calculated for Ghana were extrapolated to the coastal countries (Benin and Côte d'Ivoire) while those from Mali were extrapolated to the Sahelian countries (Burkina Faso and Senegal). In the case 'without PARC, an econometric time series model is used to forecast incidence and case fatality rates for the time period covered by the programme (the model used is an auto-regressive integrated moving average [ARIMA] model). The baseline data on incidence and case fatality used in the model are calculated from serological survey data from Ethiopia (the serological data were collected by the Shola Zonal Disease Investigation Laboratory in the Afar, Tigray, North Welo and South West Maji regions of Ethiopia [8]). The forecast rates were then applied to all the countries. As expected, the forecast incidence and case fatality under this scenario are higher than those estimated for the 'with PARC scenario. As a result, production losses due to mortality and morbidity are lower with PARC than without PARC, and estimated benefits greater.

466 Rev. sci. tech. Off. int. Epiz., 18 (2|

Results This section presents the results of the impact assessment, specifically addressing the three issues discussed in the Introduction. Key assumptions underlying the analysis are also identified.

A joint effort Before discussing the impact assessment, a brief review is useful to establish to what degree PARC met the objectives of being a truly joint effort between the donor - the EU - and the individual country governments. The measure of success is indicated by the relative funding shares contributed by the EU and the national governments to each national campaign.

Table IV and Figure 3 summarise the absolute and relative funding shares. According to these figures, the national governments were highly committed to PARC, contributing half or more of the funding for their national campaign in most countries. Country funding shares ranged widely from a high of 5 8 % in Ghana, to a low of 2 6 % in Uganda. Funding from the national government equalled or exceeded the EU share in six of the ten countries studied (Benin, Burkina Faso, Ghana, Mali, Senegal and Tanzania). However, the result for Mali, which funded 5 7 % of the total cost of the national campaign, should be qualified, since 1 0 % of the total was derived from the fonds vaccins, a vaccine cost recovery fund established with funds from the EU. Of the remaining four countries, two (Côte d'Ivoire and Uganda) contributed relatively small shares for less than a third of the total. In Uganda, 4 % of the campaign costs were met from the proceeds of the livestock development fund and the remaining 2 2 % from the Government. Although most countries (six out of ten) contributed half or more of the

funding for the national campaigns, overall, the EU contributed the larger share (56%) of the ECU52 million total for the ten countries. This reflects the relatively small share contributed by a few countries to the national campaigns.

The EU funding played an important role in supporting national-level commitment to rinderpest control. Not only did this funding mean that costs were shared, but vital start-up capital was provided in each country. Following the end of the JP15 campaign in 1976, rinderpest had once more become a major problem in nearly all of the countries. However, because of inadequate funding, no national government could initiate a wide-scale vaccination campaign against rinderpest. Public-funded routine annual vaccination remained sporadic and could never cover the entire country. With the signing of the PARC agreement in 1986 between the EU and OAU/IBAR, campaign activities began in Burkina Faso, Ethiopia, Mali, Nigeria and the Sudan only after EU funds had been disbursed. Similarly, for the other countries that later joined the PARC programme, activities did not begin until after EU funds were disbursed. Therefore, in addition to playing a major catalytic role in organising the fight against rinderpest in Africa, the EU helped to initiate the campaign even in countries where counterpart funding was not immediately forthcoming.

Cost-effectiveness of the campaign against rinderpest The total and unit costs of the rinderpest campaigns for the ten study countries are summarised in Table V and Figure 4 . Expenditures for the ten countries studied totals an estimated ECU51.6 million. The scale of individual country campaigns varies widely, ranging from ECU14.4 million for Ethiopia to ECU0.5 million for Benin.

Table IV Funding shares of the European Union and national governments to the campaigns against rinderpest in ten countries of sub-Saharan Africa

a) CFA francs (millions) b) Ethiopian Birr (thousands) c) Cedis (millions) CFA: Communauté financière africaine Discrepancies in totals may exist due to rounding errors

d) Emergency vaccination only e) Kenya shillings (millions) f) Includes expenditures on cost recovery fund

g) Tanzania shillings (millions) h) Uganda shillings (millions) i) Includes expenditures from the tivestock Development Fund

E u r o p e a n U n i o n e x p e n d i t u r e s N a t i o n a l g o v e r n m e n t e x p e n d i t u r e s T o t a l C o u n t r y P e r i o d c o v e r e d X ECU1.000 L o c a l P e r c e n t a g e X ECU1.000 L o c a l P e r c e n t a g e X ECU1.000 L o c a l

c u r r e n c y of total c u r r e n c y of total c u r r e n c y

Benin 1992/1993 to 1994/1995 244 103 ( a ) 47 272 115 53 516 218 Burkina Faso 1989/1990 to 1997 2,497 1,152(a) 49 2,633 1,162 51 5,130 2,314 Côte d'Ivoire 1989/1990 to 1997 4,639 2,133 ( a ) 73 1,675 743 27 6,314 2,875 Ethiopia 1989/1990 to 1995/1996 8,606 35,255 ( b ) 60 5,781 23,590 40 14,388 58,845 Ghana 1992 to 1996 928 471 ( c ) 42 1,286 792 58 2,215 1,263 Kenya 1997/1998 (d) 1,783 105 ( e ) 52 1,642 97 48 3,424 201 Mali 1988/1989 to 1995/1996 2,479 980 ( a ) 43 3,285 1,407(f) 57 5,764 2,387 Senegal 1989/1990 to 1997 2,417 1,077(a) 50 2,406 1,170 50 4,824 2,248 Tanzania 1992/1993 to 1996/1997 1,661 806 ( g ) 45 2,011 984 55 3,672 1,790 Uganda 1991/1992 to 1996/1997 4,005 4,429(h) 74 1,399 1,578(i) 26 5,404 6,007 T o t a l 29.259 56.6 22,390 43.4 51.651

6,007


Country

• European Union contribution • National government contribution

Fig. 3 Relative shares (percentage) of the contributions of the European Union and national governments to rinderpest control in ten countries of sub-Saharan Africa

For the ten countries in the sample, 123 million cattle were vaccinated at a total cost of ECU51.6 million, representing an average cost of ECU0.42 per animal. Although the total cost of the campaign was high in Ethiopia, the large numbers of cattle vaccinated probably contributed to the low average cost of ECU0.27 per cattle. This compares remarkably well to the figure of US$0.32 per head cited by McCauley for the earlier JP15 campaign involving 30 million cattle (5) . The remaining countries, with the exception of Côte d'Ivoire, achieved average costs in a relatively narrow range from ECU0.34 to ECU0.60. For Côte d'Ivoire, per unit costs were unusually high, reaching an average of ECU1.71 per head of cattle.

Unit costs were generally not constant from year to year for a given country. Unit costs averaged ECU0.78 during the first year when the initial capital investment was incurred, but dropped to ECU0.30 per head thereafter until rising to ECU0.73 per head between 1994 and 1995 (Fig. 5) . The high average cost incurred during the first year reflects the high cost of capital investment between 1989 and 1990 when the PARC programme commenced in most countries. Most of the start-up capital was provided by the EU and covered the cost of vehicles, laboratory and field equipment and materials, as well as the construction of some basic infrastructure. On the other hand, the large numbers of vaccinations given during

Table V Total and unit costs of rinderpest control in ten countries in sub-Saharan Africa

T o t a l c o s t s T o t a l c o s t N u m b e r of catt le v a c c i n a t e d A v e r a g e cost/animal C o u n t r y P e r i o d (xECU1.000) (%) (x 1,000 h e a d ) ( E C U )

Ethiopia 1989/1990 to 1995/1996 14,388

Côte d'Ivoire 1989/1990 to 1997 6,314

Mali 1988/1989 to 1995/1996 5,764

Uganda 1991/1992 to 1996/1997 5,404

Burkina Faso 1989/1990 to 1997 5,130

Senegal 1989/1990 to 1997 4,824

lanzania 1992/1993 to 1996/1997 3,672

Kenya ( a ) 1997/1998 3,422

Ghana 1992 to 1996 2,215

Benin 1992/1993 to 1994/1995 516

T o t a l 51,649

27.8 53,015 0.27

12.2 3,689 1.71

11.2 14,479 0.40

10.5 8,981 0.60

10.0 10,545 0.48

9.3 10,336 0.46

7.1 10,749 0.34

6.6 5,753 0.60

4.3 3,817 0.58

1.0 1,153 0.43

100.0 122,517 0.42

a) Includes only the cost of the emergency vaccination campaign


Fig. 4 Average costs of rinderpest control in ten countries of sub-Saharan Africa

the first year was due to the PARC policy of country-wide vaccinations. The original PARC strategy for rinderpest eradication was for all national programmes to carry out massive country-wide vaccinations of all cattle in order to raise national herd immunity to levels that would stop the transmission of the virus. This strategy was pursued from 1986/1987 until 1991/1992. In Ethiopia for example, the policy led to a blanket vaccination of 21 million cattle in 1989/1990. Successful results were obtained as reports of rinderpest outbreaks in West and Central Africa ceased after 1988 and the incidence of disease was reduced in several areas of East Africa. The decline in the numbers of vaccinations given in subsequent years reflects a change in policy in favour of strategic vaccinations of cattle, ring vaccinations around endemic foci and increased emphasis on epidemio-surveillance and sero-monitoring. This strategy had a sub-regional focus which involved the following:

a) implementation of a strong cordon sanitaire in eastern Chad and eastern Central African Republic to prevent infection spreading from East to West Africa

b) gradual cessation of vaccination in West Africa followed by verification of the absence of disease and viras

c) improved control of rinderpest in the infected areas of East Africa.

The cost of vaccination varied significantly, therefore, between countries and from one year to another. Larger programmes appear to benefit from economies of scale. In Figure 6, average unit costs are graphed against the total number of catde vaccinated for each country. However, the trends depicted in Figure 6 provide only a rough approximation of the relationship between average costs and vaccination numbers. The figures probably do not capture

accurately the full effect of economies of scale because of the uneven number of years of effective vaccinations per country involved in the calculation of the estimates used, as well as differences in the implementation of the PARC policy of strategic vaccinations. Nonetheless, again with the exception of Côte d'Ivoire, Figure 6 demonstrates a general, though not pronounced, downward trend in the unit cost as the numbers of cattle increase.

The unusually high cost of vaccinations in Côte d'Ivoire may be explained in part by the high costs of personnel compared to the other countries in West Africa, and a relatively long period of four months devoted to the campaigns. In addition, the issue of sanitary mandates to private veterinarians, on two

Fig. 5 Relationship between number of cattle vaccinated against rinderpest and unit cost of the rinderpest control campaign in ten countries of sub-Saharan Africa, 1989-1997


Fig. 6 Relationship between average cost per head of cattle vaccinated and number of cattle vaccinated across the study countries

occasions, led to vaccinations against CBPP and PPR as well as rinderpest. In 1994, for a cattle population of 1.3 million, the Government of Côte d'Ivoire allocated an estimated FCFA206 million (approximately ECU0.36 million) to the vaccination campaign as salaries and other operational costs. During that year, only 551 ,000 cattle were vaccinated. The Governments of Burkina Faso and Mali on the other hand, allocated an estimated FCFA106 million (approximately ECUO.18 million) and FCFA126 million (approximately ECU0.22 million) as personnel costs, respectively. Cattle vaccinations in these countries during 1994 were 2.5 and 2.3 million, respectively. In 1995, PARC in Côte d'Ivoire issued sanitary mandates to three private veterinarians to vaccinate against rinderpest, CBPP and PPR. A total of 593,000 cattle were vaccinated against rinderpest and CBPP in three regions at a total cost of FCFA97 million. In 1996, the mandates were extended to six private veterinarians and a total of 1.1 million cattle were vaccinated at an estimated cost of FCFA200 million. In addition to subsidising the private veterinarians, the PARC programme paid for the cost of vaccinations in areas not covered by the sanitary mandates.

In East Africa, the relatively high cost of vaccination, (ECUO.60 per head in Kenya for example), could be attributed to the emergency nature of the campaign. When the Emergency Programme for the Eradication of Rinderpest in Kenya was launched in July 1997, the aim was to immunise a target cattle population of 5.5 million in each of two rounds of vaccination, or a total of 11 million cattle. At the time of this analysis, the programme had incurred an estimated cost of ECU3.4 million and only 5.77 million cattle had been vaccinated (3.5 million during round one and 2.2 million during round two). The inability of the vaccination team to access certain areas due to the El Niño rains, shortages of vaccines due to manufacturer production problems and price increases (9) might have accounted for the relatively high cost.

The Pan-African Rinderpest Campaign as a public investment The second issue to be examined is the value of PARC as a public investment. Cost-benefit analysis is used to assess whether PARC has generated sufficient benefits to justify the expenditures incurred during implementation.

B e n e f i t s Cost-benefit analysis involves comparing the costs and value of benefits over time associated with the national PARC campaigns. The costs have been described in the preceding section. The principal benefits are assumed to be the physical production losses avoided by reducing the incidence of rinderpest, which include meat and milk products, draught labour and manure. Avoided losses due to rinderpest control are estimated as the difference between the losses incurred with PARC and those that would have been expected to occur without PARC over the time horizon considered for each country (Figure 2) . The aggregate results for the subset of ten countries are displayed in Figure 7 and reported in Table VI. Total production savings due to PARC are estimated at 126,000 tonnes of beef, 39 ,000 tonnes of milk, 14,000 tonnes of manure and 86 ,000 hectares of animal traction.

The avoided physical losses were assigned appropriate economic values based on the average annual prices of the respective products in each country, and converted into a common currency, the ECU. The totals for the ten sample countries are reported by type of production loss in Table VI, and country aggregate figures in Table VII. The estimated value of loss for all products for the ten countries totals ECU 14 million with PARC and ECU113 million without PARC (Table VI). Overall, the total value of loss incurred with PARC represents only about 1 2 % of the loss incurred without


Fig. 7 Losses in cattle products due to rinderpest in ten countries of sub-Saharan Africa

PARC, which means that 8 8 % (ECU99 million) of the total loss is realised as the benefits of the PARC programme. Beef accounts for 8 1 % of the total benefits followed by milk (12%) , animal traction (6%) and manure (less than 1%).

Individual country benefits range from ECU35.4 million for Ethiopia to ECU0.5 million for Benin. The ranking of countries by total value of benefits generally follows that reported in Table V for total campaign costs, except for Tanzania, which realises relatively more benefits, while Côte d'Ivoire realises relatively fewer.

Subtracting costs from the estimated benefits yields the net benefit gained by each country (Table VII). In all cases, the net benefit is positive, which means that the benefits from PARC in each country at least covered the value of the investment in PARC. Ethiopia, which incurred the highest expenditures for rinderpest control, derived the highest total and net benefits, while Benin, which had the lowest investment, derived very modest benefits. In terms of net benefits per head of cattle vaccinated (Fig. 8 ) , Benin had the lowest (ECU0.07) while Tanzania had the highest (ECU0.88), with most countries receiving between ECU0.11 and ECU0.33 net benefit per head of cattle. Although benefits per head of cattle vaccinated were highest in Côte d'Ivoire, net benefits were relatively low due to the high cost of vaccination. Over the ten countries, the average net benefit per head of cattle was ECU0.38.

Table VI Quantity and value of losses in cattle products due to rinderpest in ten sub-Saharan African countries, 1989/1990 to 1996/1997, by product

Quanti ty l o s s e s V a l u e of l o s s e s (x ECU1.000)

P r o d u c t W i t h P A R C W i t h o u t P A R C A v o i d e d l o s s e s W i t h P A R C W i t h o u t P A R C A v o i d e d l o s s e s

Beef (tonnes) 18,262 143,859 125,597 10,814 91,813 80,999

Milk (tonnes) 10,781 49,784 39,003 2,515 14,121 11,606

Animal traction (ha) 11,831 98,291 86,460 397 6,607 6,210

Manure (tonnes) 387 14,280 13,893 10 374 364

T o t a l 13,736 112,915 99,179

PARC: Pan-African Rinderpest Campaign

Table VII Value of losses in cattle products due to rinderpest in ten countries of sub-Saharan Africa, 1989-1997 (x ECU1,000)

Country L o s s e s i n c u r r e d

w i t h P A R C ( A )

L o s s e s i n c u r r e d w i t h o u t P A R C

(B)

A v o i d e d l o s s e s (benef i ts )

( B - A )

T o t a l c o s t s

(C)

N e t benef i ts per c o u n t r y

( [ B - A ] - C )

N e t b e n e f i t s per a n i m a l

( E C U )

Ethiopia 7,070 42,503 35,433 14,388 21,045 0.40

Tanzania 2,433 15,560 13,127 3,672 9,455 0.88

Mali 35 10,643 10,608 5,764 4,844 0.56 Uganda 2,076 12,494 10,418 5,404 5,014 0.33 Burkina Faso 25 7,862 7.837 5,130 2,707 0.26 Senegal 26 6,997 6,971 4,824 2,147 0.11 Côte d'Ivoire 29 6,762 6,733 6,314 419 0.21 Kenya 2,001 6,228 4,227 3,422 805 0.27 Ghana 24 3,268 3,244 2,215 1,029 0.13 Benin 18 599 581 516 65 0.07 T o t a l 13,737 112,916 99,179 51,649 47,530 0.38

PARC: Pan-African Rinderpest Campaign

Rev. sci. tech. Off. int. Epiz., 18(2) 471

Fig. 8 Average net benefits of rinderpest control in ten countries of sub-Saharan Africa

Figure 9 shows the evolution of aggregate net benefits for the ten countries from the beginning of the campaign in 1989/1990 through to 1996/1997. During the first year, the campaign incurred a loss of ECU2.2 million but thereafter net benefits remained positive. Similarly, net benefits per head of cattle vaccinated were also negative (-ECUO.46) during the first year, but increased thereafter.

Returns to investments in rinderpest control under the Pan-African Rinderpest Campaign

As noted earlier, the standard indicators of NPV, the BCR and the IRR are used as measures of the value of the PARC as a public investment. These indicators take into account the time value of money, and therefore give lower value to benefits

Benefits

Year

Costs Net benefits

a) Expenditures incurred prior to the first project fiscal cycle of 1989/1990

Fig. 9 Net benefits and costs of rinderpest control in ten countries of sub-Saharan Africa between 1989 and 1998


earned later rather than earlier. However, given the short time horizons considered here, the discounted values should differ little from the undiscounted values. The three measures of returns to investments for rinderpest control are presented in Table VIII.

Table VIII Net present values, cost-benefit ratios and internal rates of return to rinderpest control in ten countries of sub-Saharan Africa

Country P r e s e n t v a l u e ( x ECU1.000) Benef i t - Internal rate

Country Costs B e n e f i t s Net cost ratio of return (%)

Tanzania 2,363 8,383 6,020 3.84 NA

Ethiopia 9,651 23,996 14,345 2.49 23.00

Mali 4,131 6,932 2,801 1.68 86.00

Uganda 3,607 5,869 2,262 1.63 NA

Burkina Faso 3,249 4,980 1,731 1.53 118.00

Senegal 3,303 4,357 1,054 1.32 31.00

Ghana 1,119 1,395 276 1.25 N A

Kenya 2,716 3,354 638 1.24 N A

Benin 437 488 51 1.11 33.00

Côte d'Ivoire 4,041 4,302 261 1.06 11.00

Total 34,617 64,056 29,439 1.85

NA: not available

The NPV represents the total surplus benefit generated by the control intervention. The NPV is an absolute measure which is generally influenced by the scale of the investment, and thus has limited value as a comparative measure. The total discounted present value of benefits and costs for the ten countries selected are estimated at ECU64 million and ECU35 million, respectively, yielding an NPV of

ECU29 million. Ethiopia and Tanzania alone capture two-thirds of the NPV (Fig. 10).

The BCR is a unitless ratio, and so serves as a better indicator for comparison of the profitability of control investments across countries with varying scales of intervention. The calculated BCRs indicate that rinderpest control is economically profitable for each country as in each case the BCR is greater than one. However, rinderpest control is most profitable in Tanzania, which has a BCR of 3 .84 :1 , followed by Ethiopia with a ratio of 2 .49:1 . Benin and Côte d'Ivoire display ratios very close to the break-even value of one. Overall for the ten countries, the BCR is estimated at 1.85:1, suggesting that each ECU invested in rinderpest control yields a return of ECU 1.85. This is somewhat lower than the ratio of 2.47:1 reported by Felton and Ellis for rinderpest control in Nigeria during the 1960s (1) .

The returns to an investment can also be measured as an interest rate. This is how the IRR is interpreted. For the countries for which IRRs are calculated (for some countries, the time horizon is too short or the structure of cost and benefit streams is inappropriate to permit estimating the IRR), the rates vary from 11 % for Côte d'Ivoire to 1 1 8 % for Burkina Faso. These suggest that the IRRs are well above the opportunity cost of capital.

The preceding estimates of benefits and costs indicate that PARC has been an economically profitable public investment. For each ECU invested in the PARC programme, the return on investment has increased over one to over three times across the different countries.

Country

• Benefits • Costs • Net benefits

Fig. 10 Present values of benefits and costs of rinderpest control in ten countries of sub-Saharan Africa For the country-specific starting dates and time period used in the present value calculations, refer to Figure 2


Beneficiaries of the Pan-African Rinderpest Campaign The results of the CBA demonstrate the performance of PARC as a public investment, but do not offer insights into the welfare transfers associated with the investment. As discussed earlier, livestock producers - including those who process and market livestock products - are expected to be the primary beneficiaries, directly gaining improved income from increased productivity. However, consistent with the fundamental laws of economics, the increase in productivity should place downward pressure on market prices for livestock products, thereby transferring some of the welfare gains from producers to consumers.

The shares gained by each group due to PARC are estimated using the economic surplus model. Only gains associated with avoided losses in terms of meat and milk are considered since little is known about the markets for manure and animal traction, which represent only minor portions of the expected productivity gains. Changes in meat and milk prices due to reduced production losses from rinderpest are estimated, based on representative price elasticities from the literature. Since this approach takes into account expected market price adjustments and does not consider all productivity gains for manure and animal traction, the estimated benefits differ to some degree from those derived from the simple CBA.

The distribution of total welfare gains between producers and consumers is shown in Table IX and Figure 11. Using the economic surplus approach, total welfare gains are estimated at ECU57.5 million with 8 1 % (ECU46.8 million) accruing to producers and 1 9 % (ECU10.7 million) accruing to consumers. Together, Ethiopia, Kenya, Tanzania and Uganda account for approximately 8 0 % of the total welfare gains. Welfare gains in meat account for 9 2 % of the total gains while

Fig. 11 Distribution of welfare gains from rinderpest control between producers and consumers in ten countries of sub-Saharan Africa

milk accounts for only 8%. The analysis confirms that livestock producers are indeed the main beneficiaries of PARC.

Conclusions The continent-wide JP15 campaign nearly eradicated rinderpest in sub-Saharan Africa in the late 1960s. Relaxed control led to a resurgence in outbreaks of the disease by the mid-1980s. In response to this situation, a second large-scale rinderpest control intervention, the PARC, was implemented in Africa, commencing in 1986. This study has reviewed the performance and impact of PARC. Four dimensions have been considered.

Firstly, funding contributions were reviewed, indicating that national governments generally shared equal responsibility with the principal donor, the EU, for funding their national

Table IX Distribution of total welfare gains from rinderpest control between producers and consumers in ten countries of sub-Saharan Africa (x ECU1.OOO)

T y p e of w e l f a r e g a i n B e n i n B u r k i n a

Faso Côte

d'Ivoire E t h i o p i a G h a n a K e n y a M a l i S e n e g a l T a n z a n i a U g a n d a T o t a l

Total w e l f a r e g a i n s

Meat 549 2,553 1,710 18,730 987 6,909 3,578 1,557 9,074 7,384 53,032

Milk 48 231 104 1,110 69 995 456 227 497 744 4,483

Total 597 2,784 1,814 19,840 1,056 7,904 4,034 1,784 9,571 8,128 57,515

C o n s u m e r w e l f a r e g a i n s

Meat 108 504 338 3,689 195 1,365 707 308 1,792 1,456 10,462

Milk 3 14 6 66 4 59 27 13 30 44 266

T o t a l 111 518 344 3,755 199 1,424 734 321 1,822 1,500 10,728

P r o d u c e r w e l f a r e g a i n s

Meat 441 2,049 1,372 15,041 792 5,544 2,871 1,249 7,282 5,928 42,570

Milk 45 217 98 1,044 65 936 429 214 467 700 4,217

Total 486 2,266 1,470 16,085 857 6,480 3,300 1,463 7,749 6,628 46,787

Discrepancies in totals may exist due to rounding errors


rinderpest campaigns. However, a few countries contributed significantly smaller shares, and as a consequence, the EU funded the greater share of the total cost of PARC for the subset of ten countries as a group.

Secondly, the implementation costs were examined. The Campaign appears to have been implemented in a cost-effective manner as witnessed by relatively consistent costs per head of cattle vaccinated across the ten countries studied. With the exception of one country, average per unit costs were maintained in the relatively narrow range of ECUO.27 to ECUO.60. More extensive campaigns generally achieved economies of scale, contributing to lower per unit costs.

Thirdly, the performance of PARC was considered as a public investment using CBA. According to the analysis, the funds invested in national PARC operations generated reasonable returns in each of the ten countries, producing sufficient benefits to at least reimburse the initial investment. Benefits exceeded costs by more than 5 0 % in half of the countries, while in the remaining five countries, benefits exceeded costs, but by a much more modest margin. The estimated average return over the ten countries of ECU1.8 for each ECU invested in the campaign indicates that, based on the sample of ten countries, rinderpest control in Africa has been economically profitable.

Fourthly, the distribution of the benefits of PARC between producers and consumers was analysed using the economic surplus approach. This analysis confirmed that producers have captured the greater share of the ECU58 million in net value of production losses avoided due to rinderpest control in the ten countries. Consumers, though, have also benefited from increased supplies leading to lower prices, and consequently have captured approximately one-fifth of the total ECU58 million in net benefits.

Overall, as a large-scale disease control intervention, PARC has proven to be a viable public investment. This has been particularly true for the four East African countries (Ethiopia, Kenya, Tanzania and Uganda) where outbreaks have occurred more recently, and where the expected losses would have been much more substantial in the absence of PARC.

For half of the countries studied, the returns to PARC, though positive, were quite modest. However, many of the assumptions underlying the analysis were extremely conservative. In particular, the lack of reliable epidemiological data for most countries, the unusually short time horizon adopted for the cost-benefit and welfare analyses, and the absence of data on private rinderpest control cost savings have probably led to a significant underestimation of the returns to PARC. Moreover, these benefits represent only a part of the potential benefits. Other indirect benefits include a reduction in lost production potential that had been constrained by the

risk and uncertainty created by fear of an epidemic, the training and skills acquired by staff during the campaigns, the change in attitude towards disease control through improved communications, and the complementary effects of policy reforms (e.g. privatisation and cost recovery) introduced under the PARC programme. If these various factors could be quantified or better data made available, the analysis could be further refined, and would probably provide additional support for the conclusions presented here.

Decision makers will now face the choice of continuing to tolerate a risk of rinderpest reappearing versus intensifying rinderpest control to fully eradicate the disease. The results of the present study should not be misinterpreted as proof that eradication will be a viable investment. Although the same general approach could be applied, the analysis of eradication would require different types of assumptions, particularly regarding the recurrent control costs that could be avoided in the future after successful eradication. Cognisant of the direct and indirect benefits so far achieved under the PARC programme, if a programme is not implemented to eradicate the virus from the remaining foci, national governments will no doubt attempt to continue running vaccination campaigns. However, given perpetual funding problems, a situation might ensue whereby a resurgence of rinderpest would be expected, as that which occurred after the J P 1 5 campaign. Before the advent of PARC, most countries in Africa funded rinderpest campaigns that led to a reduction in the number of outbreaks and losses. The national campaigns were sometimes more frequent and less expensive than under the PARC programme, but could not aspire to eradicating the disease. The PARC strategy had the advantage of organising blanket and strategic vaccinations, covering the entire territory of the country in a systematic manner, thus making elimination of the virus possible. Conducting a detailed analysis of the potential costs and benefits associated with eradication merits further research, particularly if recent advances in epidemiological modelling of contagious diseases such as rinderpest can be incorporated.

Acknowledgements This paper is an output of the Technical Assistance Service Contract between OAU/IBAR and the International Livestock Research Institute (ILRI). The contract was financed by the European Commission from the resources of the European Development Fund under the financial agreement no. 5463/REG: PARC, Project no. 7ACP/RPR/375. The authors wish to acknowledge the support and inputs of Dr B.D. Perry of the ILRI, Dr P. Rossiter of the OAU/IBAR Epidemiology Unit, and all the PARC national coordinators of the countries involved in the study for providing much of the data.

This paper is referenced by the ILRI as ILRI Publication No. 99101 .


Étude de l'impact économique de la lutte contre la peste bovine en Afrique

E.N. T a m b i , O.W. Maina, A . W . Mukhebi & T.F. Randolph

Résumé Les auteurs évaluent l'impact économique de la C a m p a g n e panafr icaine de lutte contre la peste bovine (Pan-African Rinderpest Campaign: PARC). Ce p r o g r a m m e , qui a débuté en 1986, avait pour objectif le contrôle et, à t e r m e , l'éradication de la peste bovine en Af r ique. Sur les t rente-cinq pays qui y ont participé, dix ont été sélect ionnés en v u e de la présente étude, sur la base de la disponibilité des données. Trois aspects s o c i o - é c o n o m i q u e s essentiels ont été e x a m i n é s : l'efficacité en fonct ion du coût, la rentabilité de l'investissement et les avantages induits pour la société. Les auteurs ont utilisé la méthode standard de l'analyse coût-bénéf ice, à partir d'un modèle informatisé, pour m e s u r e r l'impact économique de la lutte contre la peste bovine. Les bénéf ices de l'intervention consistent en l'accroissement des recettes, lié aux pertes de production évitées. Une estimation de la v a l e u r des pertes de production a été obtenue dans les deux scénar ios, « a v e c PARC » et « sans PARC » ; la di f férence entre les deux hypothèses a permis d'induire les a v a n t a g e s complémentai res. De plus, un modèle de surplus économique a été utilisé pour évaluer la répartition des a v a n t a g e s induits pour la société. Il ressort de l'analyse du f i n a n c e m e n t des c a m p a g n e s nationales que celui-ci est assumé à proportions à peu près égales, par les g o u v e r n e m e n t s c o n c e r n é s et par le principal bailleur de fonds, à savoir l'Union e u r o p é e n n e . L'examen des coûts de mise en œ u v r e dans les dix pays montre qu'à l'exception d'un seul pays, le PARC a été appliqué de manière ef f icace, les coûts m o y e n s se situant dans une fourchette relat ivement étroite. Les chiffres s'établissent entre 0,27 ECU (unité monétaire e u r o p é e n n e ) et 0,60 ECU par bovin v a c c i n é . D'après le rendement m o y e n estimé pour l'échantillon des dix pays c o n c e r n é s (1,8 ECU pour 1 ECU investi dans la c a m p a g n e ) , la lutte contre la peste bovine en Afr ique a été rentable. Dans c h a c u n des dix pays, les bénéf ices estimés couvraient au moins la v a l e u r de l'investissement dans le PARC. Le p r o g r a m m e a g é n é r é une valeur actualisée nette totale de 29 millions d'ECU pour les dix pays, montrant que sa mise en œ u v r e a été une décision d'investissement judicieuse de la part des autorités. D'après l'analyse de la répartition des avantages pour la société liés au PARC, les producteurs ont été les pr incipaux bénéficiaires des 58 millions d'ECU de pertes de production évitées en v a l e u r nette g r â c e à la lutte contre la peste bovine dans les dix pays. Les avantages pour le consommateur, qui représentent env i ron un cinquième du total, sont liés à la baisse des prix, suite à l'accroissement de l'offre.

Mots-clés A f r i q u e - A n a l y s e coût-bénéf ice - A n a l y s e des a v a n t a g e s pour la société - C a m p a g n e panafr icaine de lutte contre la peste bovine - Économie - Peste bovine - Surplus économique.

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Evaluación del impacto económico de la lucha contra la peste bovina en Africa

E.N. Tambi, O.W. Maina, A . W . Mukhebi & T.F. Randolph

Resumen L o s a u t o r e s e v a l ú a n las r e p e r c u s i o n e s e c o n ó m i c a s d e la C a m p a ñ a p a n a f r i c a n a c o n t r a la p e s t e b o v i n a (Pan-African Rinderpest Campaign: P A R C ) . El p r o g r a m a P A R C dio c o m i e n z o e n 1986, c o n el o b j e t i v o d e c o n t r o l a r y e n ú l t i m o t é r m i n o e r r a d i c a r la p e s t e b o v i n a d e Á f r i c a . D e l o s t r e i n t a y c i n c o p a í s e s q u e p a r t i c i p a r o n e n la P A R C s e e l i g i e r o n d i e z p a r a s u a n á l i s i s , a t e n d i e n d o s o b r e t o d o a la d i s p o n i b i l i d a d d e d a t o s . S e e s t u d i a r o n t r e s a s p e c t o s s o c i o e c o n ó m i c o s f u n d a m e n t a l e s : r e l a c i ó n c o s t e / e f i c a c i a , r e n t a b i l i d a d d e las i n v e r s i o n e s y b e n e f i c i o s p a r a la s o c i e d a d .

P a r a e v a l u a r el i m p a c t o e c o n ó m i c o d e la l u c h a c o n t r a la p e s t e b o v i n a s e ut i l i zó el p r o c e d i m i e n t o t í p i c o d e a n á l i s i s c o s t e / b e n e f i c i o , a p l i c a n d o u n m o d e l o c o m p u t a r i z a d o . El b e n e f i c i o b á s i c o d e la i n t e r v e n c i ó n r a d i c a b a e n u n m a y o r n i v e l d e i n g r e s o s , d e b i d o a la m e n o r i n c i d e n c i a d e las p é r d i d a s d e p r o d u c c i ó n . S e e s t i m ó el v a l o r de e s a s p é r d i d a s e n d o s s u p u e s t o s d i s t i n t o s : " c o n la P A R C " y "sin la P A R C " . La d i f e r e n c i a e n t r e a m b a s c i f r a s p r o p o r c i o n ó el v a l o r d e l o s b e n e f i c i o s s u p l e m e n t a r i o s . P o r o t r a p a r t e , p a r a e v a l u a r la d i s t r i b u c i ó n d e los b e n e f i c i o s s o c i a l e s g e n e r a d o s p o r la i n t e r v e n c i ó n s e ut i l i zó u n m o d e l o d e s u p e r á v i t e c o n ó m i c o .

El a n á l i s i s d e la f i n a n c i a c i ó n de las d i s t i n t a s c a m p a ñ a s n a c i o n a l e s r e v e l ó u n n i v e l m á s o m e n o s p a r e j o d e i m p l i c a c i ó n e n el p r o g r a m a p o r p a r t e d e los g o b i e r n o s n a c i o n a l e s y del p r i n c i p a l d o n a n t e d e f o n d o s , la U n i ó n E u r o p e a . El e s t u d i o d e los c o s t e s d e i m p l e m e n t a c i ó n e n los d i e z p a í s e s p u s o d e m a n i f i e s t o q u e , c o n la e x c e p c i ó n d e u n s o l o p a í s , la a p l i c a c i ó n d e la P A R C s e r e a l i z ó d e f o r m a e f i c a z e n r e l a c i ó n c o n s u c o s t e , d i s t r i b u y é n d o s e los c o s t e s m e d i o s d e n t r o d e u n i n t e r v a l o r e l a t i v a m e n t e e s t r e c h o . L a s c i f r a s o b t e n i d a s s e s i t u a r o n e n t r e 0,27 y 0,60 E C U p o r c a b e z a d e g a n a d o v a c u n a d a . A j u z g a r p o r los r e s u l t a d o s d e la m u e s t r a , el b e n e f i c i o m e d i o e s t i m a d o p a r a los d i e z p a í s e s (1,8 E C U p o r c a d a E C U i n v e r t i d o e n la c a m p a ñ a ) d e m u e s t r a q u e el c o n t r o l de la p e s t e b o v i n a e n Á f r i c a h a r e s u l t a d o e c o n ó m i c a m e n t e r e n t a b l e . En t o d o s y c a d a u n o d e los p a í s e s los b e n e f i c i o s e s t i m a d o s c u b r í a n p o r lo m e n o s el v a l o r d e la i n v e r s i ó n r e a l i z a d a e n la P A R C . El p r o g r a m a s e h a s a l d a d o c o n u n v a l o r a c t u a l i z a d o n e t o p a r a los d i e z p a í s e s d e 29 m i l l o n e s d e E C U , d e lo q u e s e d e d u c e q u e la i m p l e m e n t a c i ó n d e la P A R C h a s i d o u n a j u i c i o s a d e c i s i ó n d e i n v e r s i ó n p ú b l i c a . A l a n a l i z a r la d i s t r i b u c i ó n d e los b e n e f i c i o s p a r a la s o c i e d a d d e r i v a d o s d e la P A R C , s e o b s e r v ó q u e la m a y o r p a r t e d e los 58 m i l l o n e s de E C U d e v a l o r n e t o , q u e c o r r e s p o n d í a n a las p é r d i d a s e v i t a d a s g r a c i a s al c o n t r o l d e la p e s t e b o v i n a e n los d i e z p a í s e s , r e c a y ó s o b r e los g a n a d e r o s . L o s b e n e f i c i o s p a r a los c o n s u m i d o r e s , e q u i v a l e n t e s a c e r c a d e l 2 0 % del t o t a l , v e n í a n l i g a d o s al d e s c e n s o d e los p r e c i o s , f r u t o a s u v e z d e u n a m a y o r o f e r t a .

Palabras clave Áfr ica - Anál is is de la relación coste/beneficio - Anál is is de los beneficios para la sociedad - Campaña panafricana contra la peste bovina - Economía - Peste bovina -Superávit económico.


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