Proceedings of the Standing Senate Committee on
Foreign Affairs
Issue 15 - Evidence
OTTAWA, Tuesday, May 17, 2005
The Standing Senate Committee on Foreign Affairs met this day at 5:07 p.m. to examine the development and security challenges facing Africa; the response of the international community to enhance that continent's development and political stability; and Canadian foreign policy as it relates to Africa. Topic: Agriculture
Senator Peter A. Stollery (Chairman) in the chair.
[English]
The Chairman: Honourable senators, I want to welcome everyone to this meeting of the Standing Senate Committee on Foreign Affairs in the context of our special study and Africa. We will focus today on issues related to the very important topic of agriculture.
First, we will hear from Mr. Rangarirai Machemedze, Acting Director of the Southern and Eastern African Trade Information and Negotiations Institute in Zimbabwe. The institute is an African initiative to strengthen Africa's capacity to take a more effective part in the emerging global trading system and to better manage the process of globalization.
Mr. Machemedze's program area is research and outreach work on the WTO Agreements on Agriculture and Trade-Related Aspects of Intellectual Property Rights.
[Translation]
Our second witness is Mr. Baba Dioum, general coordinating officer of the Conference of Ministers of Agriculture of Western and Central Africa, Senegal. The goal of this conference is to create a regional market for agricultural commodities, to improve the competitiveness of agricultural commodities for export and to strengthen policy-making capacity. The conference has approximately 20 members, from Senegal to the Congo.
We will then have the pleasure of hearing Mr. Ndiougo Fall, president of the Network of West African Producers and Peasants Organizations (ROPPA), Senegal. The ROPPA includes 10 countries and advocates for family farms as being the core of sustainable livelihoods. Mr. Fall is the owner of a 10-hectare farm in the Thies region in Senegal. He has actively defended farmers' interests, both nationally and in the wider African context, since 1974.
Welcome to the Senate of Canada.
[English]
I would also like to take the opportunity to thank Inter Pares and UPA Development International for making us aware of the visit to Ottawa by our three witnesses. I want to remind members of the committee and interested parties that we are always on the lookout for people who are coming through Ottawa to give them the opportunity to come to our committee and enrich our study.
Mr. Machemedze, you have the floor.
Mr. Rangarirai Machemedze, Acting Director, Southern and Eastern African Trade Information and Negotiations Institute (SEATINI), Zimbabwe: Thank you for inviting me to share the experiences of Zimbabwe in relation to agriculture and the processes that we have gone through and other economic structural adjustment programs.
Zimbabwe today, and indeed Africa, faces political and economic crises as a result of multifaceted chain of events ignited by the 1990 structural adjustment programs that were forced on the country by the International Monetary Fund and the World Bank. To say that the IMF and the World Bank are solely responsible for these crises would be a misrepresentation of facts, but their policies have played a huge part in triggering the problems the country is facing.
When Zimbabwe started implementing the economic structural adjustment program, a number of sectors of the economy were affected, and this led to the ordinary people suffering the consequences. In implementing ESAP, the government adopted the so-called Washington Consensus principles which in effect reversed the otherwise staid growth of the economy that Zimbabwe was experiencing. The economy was agriculture based and is still agriculture based, but because of the reforms that were conditioned upon the country, we went into a negative growth period.
I will not go deep into the previous effects that ESAP had, but I will go into the issue of food security. That is what is important to us at the moment.
Food security in the Zimbabwe context has at its core questions over the production, pricing, marketing and consumption of maize and other food crops, on the one hand, and that of reproduction of labour on the other. Unlike developed countries where food production is largely a commercial activity, in Zimbabwe it also means subsistence production for the bulk of the rural population. The effects of globalization therefore have to be looked at both in terms of food security and the sustainability of the livelihoods of the rural people.
The free trade argument that Zimbabwe should secure food from the international market if it is the cheaper source and tend to exportable products such as ostriches or cut flowers is a dangerous argument, in our view. It not only endangers national food security but also threatens to put out of the land millions of people for whom food production is both a source of immediate food as well as a source of income.
You will notice that under the World Bank/IMF policies, we were forced to reduce tariffs on imports coming from outside of the country, especially on agricultural products. We were forced to remove subsidies on the supports that the farmers were getting. As a result, the country was left to the vagaries of the market economy which did not work. Most people were forced out of production and we went through a process of deindustrialization.
The same liberalization policies that were made under the World Bank/IMF period were now locked into the WTO period. This is the period that we are in today, where we are asked to reduce tariffs, particularly on agriculture. Given the situation in Zimbabwe such that 70 per cent of the population is involved in agricultural production, you realize that most of the farmers would just be wiped out of production.
I have been telling my colleagues that we are seeing the “Iraqification” of the process. We are being made another Iraq where we are disarmed in agriculture through the use of tariffs, and then we are bombed with cheap subsidized production coming from the West. This is a serious problem to us.
Under ESAP, the government began to relax its controls on the agricultural sector and to apply market principles to food production in marketing. The 1991 government paper on ESAP contained extensive discussion on food and on agriculture. It recommended the use of price signals and increased private market activities to promote agricultural growth; incentives to private farmers to produce cash crops for export; the relaxation of restrictions on maize sales; and the rationalization of what we had as the grain marketing board.
However, in the 1980s there had been a phenomenal growth of extension services and credit to communal farmers. These were drastically curtailed during the 1990s. The 1990s also saw a substantial reduction in the subsidies on farm inputs. The centralized crop purchasing system of the early 1980s was gradually abandoned and the farmers were left to locate their own markets. Because of the communal farmers immediate need for cash, they became more reliant on middle-men and were forced to sell at market-dictated low prices, which in turn reduced their incomes and purchasing power. On the other hand, most of the white commercial farmers gradually shifted away from maize production for domestic consumption to export crops, especially horticulture.
Recognized as a largely self-sufficient food producing country, Zimbabwe now entered a period of food insecurity. Over the decade, the government also reduced its role as a grain reserve holder, and thus its options in ensuring food security are now limited. This shift is reflected in strategic grain reserves, declining from an average of 26 per cent of total production in the 1980s to 20 per cent in the 1990s.
Today, Zimbabwe's requirements amount to 2.5 million metric tonnes per year, but in recent years, maize production has declined from 2.6 million metric tonnes in 1996 to an estimated 1.5 million metric tonnes in 1999.
We are at the WTO where negotiations are taking place, particularly on agriculture. Zimbabwe is one of the few countries that has been self-sufficient in terms of food production, but because of the international trade rules that started with the IMF/World Bank and now with the WTO, we have become a nation that is dependent on imports.
Another factor is worrying us in Zimbabwe, and that is the GMOs. The country is receiving food aid because of its dependence. A crisis has been created and the food that we are receiving is genetically modified maize. I do not know where the conventional maize has gone. We can ask that question. Why has Zimbabwe accepted GM maize when conventional maize is available?
Why do some farmers plant GM maize? We know how difficult it is to maintain and sustain agriculture when it is based on GM seeds. They are high technology seeds that need a lot of irrigation and most farmers do not have the irrigation equipment. They require a lot of chemicals in terms of fertilizers.
Some of the seeds actually contain terminator genes. The farmers would need to purchase seed every season because the terminator seeds do not allow the seeds to germinate the next season. These are some of the challenges that we are facing as a country.
I am sure you will ask me about the land reform program in Zimbabwe, so I will make reference to it now. Land reform has been one instrument that has been used to empower the indigenous people to produce for domestic consumption — local production for domestic consumption. It is still going on but it had its own limitations. It had its own casualties, and I think in any revolution you will find casualties and inconsistencies. Some farmers were getting more land — two or three more farms; others were getting no land. This is one of the challenges that we are facing as a country.
The expectation of our developed counterparts is to support the supply side constraints that we have as countries. We have problems in mobilizing resources to develop our agricultural sectors. It was developed to a certain level but now there is a need to develop it further so that we are able to produce for domestic consumption without distorting the markets.
[Translation]
Mr. Baba Dioum, General Coordinator, Conference of West and Central African Ministers of Agriculture, Senegal: Mr. Chairman, I would like to begin by greeting this august assembly and highlighting the importance of your subject which is to examine how the international community can contribute to development and security in Africa. I am pleased to see that the link is being made between development and security because, as you are well aware, the main source of instability is poverty and a lack of development.
We were invited to speak to you about agriculture. This subject is a very significant one because of the importance of the agricultural sector in the economies of the 20 countries I work for. You have often heard that 70 per cent of the population makes a living from the agricultural sector. Agriculture represents 60 per cent of our exports and more than 30 per cent of our gross domestic product. If the sector is healthy, then it is most likely that the economy of those countries concerned will also be. That requires an environment that will encourage the development of that sector.
Where shall I begin to describe the current situation to you? We have experienced crises that began in the early 1980s, as my colleague pointed out, with structural adjustments, that were nothing more than an attempt to regulate the national economy through fiscal balancing. That meant less spending and more cuts. The most vulnerable sectors were the social, education and agricultural sectors. Farm populations were the government's target of choice because they were less educated, less organized, and were part of the rural sector. Urban populations were, for their part, more likely to challenge certain decisions and measures. I am part of that group, as I was trained and worked as a civil servant. There was greater leeway in those sectors to make the adjustments that were required for achieving certain goals. We managed to achieve macroeconomic fiscal balances. However, as my colleague pointed out, it would be worthwhile examining the impact those policies had at a social level.
I would like to draw your attention to the context that African agriculture must now develop in. We were not major players in the beginning because it was the colonial era or the beginning of independence. At the Marrakech round, we were both present and absent; we were physically present but we were absent in that we did not react at all when the trade agreements were signed. We received food, aid and technical assistance in order to better negotiate in the future. That is what happened in Marrakech in 1994.
Today, the Doha round at least holds the promise of development. That is what we should be focusing on in order to answer your questions. If Doha is to be a development round, then trade has to contribute by acquiring resources for our countries, technology and the capacity to manage our economies. Will Doha meet those needs? That is the question we should be asking during this dialogue and over the course of future negotiations.
Development is nothing more than investment and results. Investment assumes additional resources that are available within the current context of global trade.
This time, our countries must be actively involved in the Doha discussions. That involvement will take the shape of a position based on reflection and analysis, discussion, and step-by-step negotiations that will involve some concessions where necessary without compromising the core. If the negotiations result in further poverty and hardship for our populations, then we will have to stop and indicate that those negotiations no longer serve our interests.
Take as an example cotton in Cancun and other products that might have negative effects. Subsidies, restricted access to markets and fixed currency mean that today a market can be temporarily opened and then closed, for example, using the sanitary control system. What this means is that you are giving with one hand and taking away with the other.
I think that the complexity of the negotiations is the biggest constraint. The overlapping frameworks in which African countries are working today only adds to these problems. We are negotiating with international institutions within the framework of bilateral assistance, but only on certain conditions. All aid or financing programs are accepted under certain conditions. Those conditions are sometimes incompatible with trade. For example, financing may be offered in return for privileges for businesses or experts. That is no longer trade but rather a constraint on bilateral and multilateral negotiations.
It is also a constraint to say, “open up your markets for us to be able to finance you”. That is where structural adjustments had to be made.
Well before Doha, we opened our markets and decreased our tariffs under structural adjustment policies. Maybe our tariffs will go down again within the WTO negotiations.
The second area of difficulty lies in the research and integration policy of our regional economies. In Africa, we are currently trying to create free trade zones. Countries will therefore try to harmonize their trade in order to create a viable economic zone which will allow trade between neighbours. But again, how do we protect ourselves? How do we come up with common external tariffs that protect those products we want to trade in, for example, the grain that we use to feed our people?
Third, we are negotiating with Europe on economic zones that, today, are predefined. We are being asked to group ourselves in order to negotiate free trade zones with them. European assistance does exist in the shape of a development fund. This aid is quite significant because 50 per cent of our trade involves the European continent.
Should we be giving up what we already have for an uncertain alternative, that is, should we be negotiating with the Europeans first and figure out how we can adjust to the Doha round or should we be undertaking simultaneous negotiations under conditions that may be contradictory at times? That is what we are negotiating at the level of the European Union, the ACP, in terms of economic zones, and also the WTO and the constraints we face there. I think that overall, we have to end up not with sequential negotiations, but rather with the WTO measures being compatible with our desire to integrate regionally and our desire to have a regional market where our products will be successful.
That being said, Mr. Chairman, I do not believe in autarchy, in other words, in a region that is turned in on itself. I believe in international trade and in exchanges. I believe in fair trade, fair rules. I also believe in relationships of power. I know that there will always be the strong and the weak. In that context, how will the weak live side by side with the strong while preserving a minimum of their interests? That is the question that should be asked today.
Mr. Ndiogou Fall, President, Network of West African Producers and Peasants Organizations (ROPPA), Senegal: Mr. Chairman, I am the president of the Network of West African Producers and Peasants Organizations (ROPPA) that includes the national organizations of 10 countries in that region. It has been a long process for these producers to reach that level of organization, but it is evidence of the conscious effort they made to participate in defining policies, contributing to development, and so on.
Of course, this has been facilitated by the wave of democratization that is taking place in the area, but it is also due in part by the withdrawal of the State because when the State withdrew, the producers took responsibility for certain areas, certain services they needed and that the State had sometimes neglected prematurely, under pressure from institutions that have already been named; the IMF and the World Bank under their adjustment policies.
To speak more specifically to agriculture and to point to a certain number of examples, it is worth noting that the past 30 years of global and liberalized trade policies have led to very difficult situations in the West African agricultural world. Overall, these policies have had a negative impact. All the KMUD and the World Bank numbers show that we are regressing. Our share of international trade has gone from 6 per cent to less than 1 per cent. Poverty, as we all know, has increased in the African regions and consequence of this has been an increase in out-migration and immigration. The rural sector, which up until now has employed 70 per cent of the population, the agricultural sector, which is an important economic lever, is going through a profound crisis. This crisis is affecting all sectors. I would like to give you two or three examples that you have most certainly heard about.
The first example is the West African poultry sector which, since being opened up to international competition, has almost disappeared in most countries. In Cameroon, between 2002 and 2005, that is in three years, 110 000 jobs have been lost. These are jobs in the poultry sector. Why? Because subsidized poultry products from Europe, America, and perhaps Canada, are being sold on our markets at very low prices.
Most of the time, these are cuts that have no market value and that no one can compete with. At the same time, this poultry sector crisis has led to job losses in the urban sector. All those people who were involved in small-scale production of feeding materials — such as drinking troughs, among others — have lost their jobs. The hatchery industry is now working at less than a third capacity. In the agricultural sector, corn production was absorbed mainly by the poultry sector and it is now disappearing because we have no buyers.
In terms of rice production, everyone knows that West Africa has an extremely important ability to ensure, in very little time, its self-sufficiency in rice. Today, most countries export more than half their needs in rice when we can produce rice on our own continent and ensure supply for consumers in the broader region. Why? Because once again, under pressure from the IMF and the World Bank, taxes were brought right down, which led to a massive influx of rice products from Asia and the United States.
This has led to problems because many governments agreed to building dams that need to be paid for, because this was a debt that was incurred for the purposes of land use. Today, it is the poor taxpayers who are suffering because they are being prevented from developing in order to pay that debt simply because the infrastructures that were built are no longer being used. The Niger band has more than one million hectares of land that can be developed. Only 10 per cent of this land has been developed.
The region of the Senegal River has more than 300,000 hectares that could be developed for use and only 10 per cent of that land has been developed. We are also all aware of the cotton situation. That was in fact a sector where all development partners thought Africa had a comparative advantage. International institutions pushed our countries strenuously to become involved in that industry in order to show that one can focus on a sector one has a comparative advantage in, and use it to develop one's economy. Today, the results show that this is not possible, mainly because this is a sector we have no control over.
At the time when Africa was producing the best cotton at the lowest prices in the world, American and European subsidies knocked back West African cotton production. Tens of millions of small farmers fell back under the poverty line. It is not because they did not know how to produce. No. It is because somewhere, the major powers subsidized their production and made us open up our markets, with those results. If these trends continue, it is certain that Africa will not achieve this millennium's goals, goals that international cooperation has mobilized around. Worse though, we may end up with a more serious situation. If the trend continues, we will not achieve this millennium's goals because we will be regressing. It is not the Africans' fault. It is the result of a system and this system is the international trade system.
When Europe puts a 163-euro tax on every tonne of wheat that enters their territory, and when the IMF prohibits most African countries from imposing more than a 50 per cent tax per tonne of wheat entering on their market, it is not fair. These are the kinds of situations we are facing on a daily basis.
Now, within the EPA negotiations framework, Europe is asking us to liberalize trade by 80 per cent. However, we know what the differences are between the European and African agricultural sectors. That kind of agreement would kill African agriculture and significantly increase poverty and conflicts in Africa.
We believe that the current trade rules, as they stand, are not compatible with development in Africa. Therefore those rules have to be reformed. What we want is for those rules to be reformed and that the reforms made under the adjustment policies framework, that was nothing more than forced liberalization, also be reformed. Without this, we feel that there is no consistency to international assistance. The international community has worked hard, but the impact of its work has been reduced by an efficient trade system. The impact of this assistance has been reduced by the IMF's and the World Bank's constraints. I do not think that that assistance to us should be continued on the one hand, when, on the other hand, others are doing all they can to prevent us from developing. There has to be greater consistency within the aid system and within international policies. Otherwise this aid is useless.
Many Africans think this aid is only a constraint meant to keep them in a situation of poverty forever. That poses a credibility problem for international institutions.
Within the context of these reforms, we feel that it is essential and necessary to ensure that national policies are consistent with each national context. What is good for the United States is not necessarily good for Senegal; what works in Canada will not necessarily work in Guinea. The context is not the same, the possibilities are not the same, the conditions are not the same. We cannot harmonize everything globally.
As long as steps are not taken to allow each group of country to define the most appropriate policy for its environment and its population's needs, then the problems of poverty and conflicts that were raised will remain.
We therefore believe that a far-reaching reform of the WTO is essential. It is for this reason that we have come to Canada to speak about the supply management system. Why? Because in most instances, the instruments which poor countries have to bolster their agriculture sectors and facilitate development are prohibited by the WTO. We do not have the same means available to us as developed countries. If a country has billions of dollars available for subsidies, the said subsides are deemed legal; however, if a country is not rich, any other instrument which it seeks encourages sanctions.
It is because of this situation that we are, indeed, facing difficulties today. Our priority is to focus on improving the context in which we have to work. It is the context which is problematic because producers are no longer even able to sell their produce on their domestic market, never mind the international market.
Mr. Chairman, I would be happy to take questions from the senators.
The Chairman: Thank you very much; this is a very interesting subject. The committee has a certain awareness of these problems. I am going to give the floor to senator Prud'homme.
Senator Prud'homme: Mr. Fall, I am overwhelmed by the ease with which you elucidate problems which, at the first sight, seem so complex. One good thing to come out of your visit is that this committee is being televised across Canada. Your overview of the situation was so clear that I am sure it will pique the interest of university students who are used to conceptual thinking. What you said shows that you have both feet firmly planted in reality.
I have always been interested in the Middle-East and Africa. I have dedicated 40 years of my life to the Middle East. I have learned a great deal since this committee chose to study Africa. Africa could have said either to be loved too little, or to be loved too much. Often, Africa is the forgotten continent. You have highlighted the contradictions of systems under which what is giving by the left hand is taking back by the right, a situation which is actually nonsensical.
When we proclaim that we are going to forgive the African debt, it looks to be an extremely generous gesture; however, it is futile if what is given is taken back by the other hand. Forgiving the debt will not prove to be a miracle solution unless it is accompanied by other reforms. Seemingly, elected representatives are satisfied.
Senator Corbin: I would like to begin by thanking the witnesses for their presentations. I would like to know whether, in your country, you have benefited from Canada Aid programs, be the governmental, charitable or private sector programs. Would you be able to comment on this issue?
Mr. Fall: We have benefited from Canadian aid on several occasions. My own organization, the ROPPA, received aid from CIDA for a capacity building program, a program which help us to understand a great deal in terms of the workings of the international trade system.
In addition, it was granted to some countries for infrastructure development, and specific aid has also been provided to the agricultural sector.
In my country, Senegal, aid has primarily been centered on horticulture in a food and vegetable producing region. In light of the constrains which we mentioned, I feel that, in terms of aid, the producers themselves should be more involved in defining the programs offered.
Donors are very often well intentioned. However, even if you provide significant resources, you can slightly miss the mark simply by not having adequately consulted with the recipient country as to where the focus should be. Let us take, for example, the programs which were introduced as part of anti-poverty strategies. The international community in its entirety is committed to supporting these programs, however, the way in which these programs were designed means that they do everything but fight poverty.
To fight poverty, you have to focus on those sectors of the economy in which poor people work. In many East African countries the programs focus on highway infrastructure; on the plus site, that allows producers to get their products on the market; however, he who produces nothing, has nothing to put on the market. In most instances, the infrastructure is designed to link tourist centres to the capital city. Yet, those living in poverty are in no way involved with tourism. Most of the time, other programs which really would help producers to increase their production levels and which would offer added value are missing, simply because there is scant producer involvement when it comes to defining projects and programs.
Here too, I should point out that the primary reason for this is that there is little understanding of which mechanisms actually result in real participation. Everybody is in favour of stakeholder participation, but in most cases there are no mechanisms to facilitate it, and when it comes to identifying projects and programs, there are no participation mechanisms at all. The majority of cooperation organizations act hastily. They consult two or three people, and feel that gives them an idea as to how to solve the problems of the poor folk in Senegal; in no time at all, a project is up and running.
I believe that consideration must be given to the beneficiary's thought process, it is something which is necessary, and something which takes time.
Mr. Dioum: In my professional life, I have frequented, and on several occasions, even negotiated with Canadian cooperation organizations. What I remember is that, unlike others, Canadians accept that they have an inadequate, indeed erroneous, understanding of Africa, something which results in them undertaking more effective consultations with governments and recipients. At least that is something.
I believe that Canada is leading the way in placing women at the heart of development programs. That is something which I have experienced; an adjustment whereby you have taken women's issues into consideration, or to put it more bluntly, placed women firmly on the radar screen of development programs.
What I am currently witnessing through cooperation programs with CIDA and other organizations, is that Canada places the emphasis on human resources, capacity building and training. To my mind, these are sound choices. Somebody remarked earlier that ill-thought-out policies are so because they are often drafted by public servants, and I should point out that I myself am a public servant.
Today's policies need to be based on cooperation. As far as I understand, Canada is committed to such an approach, but cooperation requires not only that all stakeholders sit down together, but that they have the necessary skills to be able to dialogue at the same level. This is something which was said earlier: the state has withdrawn, rural farmers are not adequately prepared to participate in this dialogue, and should, therefore, be provided with support. This is an approach which we commend. It is not only the skills of producers that have to be developed, but also those of the public servants who have to dialogue with them and who are not used to doing so. Real attitude changes are required for people to accept the idea that peasant farmers can hold reasoned opinions other than those based on union demands. I believe that we are making headway on this front, and that is perhaps the progress for which I am the most grateful.
A while ago, I came here, at my own expense, to see what you were doing in terms of supply management. I think that it offers a fairly interesting alternative for African countries. I was also interested in finding out how agricultural risk can be funded at grassroots level. This is an area which I believe to be very important; it is new to me, but something which I would like to see integrated into aid mechanisms and policy support.
[English]
Mr. Machemedze: I have two programs that I am aware of that are funded by Canada. The first is in Zimbabwe and that is funded through the Canadian International Development Agency. It is a gender-based program supporting the district councils of Zimbabwe in their efforts to mainstream gender activities in their programs. I am sure you agree with me that many programs, if left to gender, are outside. CIDA has been funding this activity.
Also, the Federation of Canadian Municipalities is funding a project on governance issues in the rural district councils, issues such as the fair accounting of resources.
I have heard about a program about which I do not have many concrete details. I would ask the committee to investigate it to see whether the funds that Canada is providing to Africa are really meant for development, or if they fund the same kind of programs in Canada. I have heard about the biotech program in Central and Eastern Africa, where Canada is pouring in $30 million. This is a biotechnology-related program. It is basically an issue of GMOs. The structures in place in Central and Eastern Africa are not yet functional to utilize these funds, but it is something that you need to investigate further, whether these funds will actually help the productive sectors of Africa or if they will just help to exacerbate poverty and hunger in funding programs that will cause, for example, countries to adopt technologies that are not suitable for the local needs. I would ask the Senate to investigate that program further.
[Translation]
Senator Losier-Cool: I have great admiration for Africa. I am a member of the Commission de la coopération et du développement des parlementaires de la Francophonie. I was involved in organizing the last summit on development.
Recently, I read an article in L'intelligent, a magazine published by Jeune Afrique, about the person responsible for Africa at a UNDP level. He was asked what should be done to facilitate development in Africa. He answered that the first priority should be to develop the agricultural sector, as well as the textile and IT sectors.
In answer to the same question, you spoke of the supply management system, and the importance of greater consistency and coordination. What is preventing the African agriculture sector from being developed? Asia, for example, has made progress because the agricultural sector has been developed.
I will come back to the issue of NEPAD and francophone countries at the WTO later. If I refer to your publications, I believe you are the agricultural expert, Mr. Dioum.
Mr. Dioum: The reason agriculture never developed is a long story. I am not blaming colonialism; all is fair in love and war. Our agricultural economies were basically extraverted, that is, turned towards the outside. Each territory was given a role which depended on a central power. Senegal grew peanuts which were exported to the factories of Bordeaux and Marseilles, among others, in order to produce peanut oil. The Ivory Coast grew coffee and cocoa. Guinea grew bananas and Cameroon grew pineapples. In this manner, each country was assigned a role.
Farms in Senegal knew how to grow peanuts because they were given that role and all the other segments in the system were given to others. Some people were in charge of producing, others of processing, of marketing and of transporting.
The Senegalese, in particular, ate rice, as well as the populations of other western African countries, but we did not produce rice. The reason why this was so was due to the crisis of the piastre in Indochina. When France wanted to repatriate the French fortunes which were in Indochina, it devised a sort of triangular trade, which consisted of buying rice and transporting it to Senegal. The piastre was then converted into the French franc. It was a way of encouraging people to invest in that colony.
We know the date and the content of the first shipment of the first boat which transported rice to Senegal. A buying partner was developed. Overnight, the Senegalese began to eat a product which was not produced in their country. Eating habits changed because of the foods which were imported. You sold peanuts to buy rice imported from Indochina from the trading partner next door. This type of market system created limits which became one of the major obstacles to agricultural development in our countries.
I agree, in my publications and in my thoughts, with those who say that the market determines production. If you do not sell, you cannot produce. You will produce just enough to feed yourself.
Did we create a market for this? I do not think so. Today, we are at a crossroads because if we want our agricultural sector to develop, we will need a true captive market which stimulates production and which will put money into the pockets of citizens so they can buy the technology which will enable them to produce more and more efficiently as compared to market standards. That is what happened in Asia. India's first goal was to meet the needs of its own market, which then enabled it to go beyond that stage today.
The Chairman: That is very interesting.
[English]
Mr. Machemedze: The policies that we have in Africa at the national level were actually meant to develop the agricultural sector. Zimbabwe had some very good policies to develop the agricultural sector. Indeed, the sector developed to such a level that it was actually one of the best in Africa, but today you can speak of the negative. It is actually now one of the worst. The question is why? It is the same question that was asked previously.
I can respond first by posing two questions: In the context of the new liberal paradigm, why is it that when we were doing everything wrong, which is what the IMF and World Bank said, everything was right? Why is it now when we are doing everything right, everything is wrong?
The policies that are now conditioned on Africa are counter-developmental. If we look at global trends at the moment — and I have to be frank with you — there is overproduction in developed countries and developed countries want markets. Where are those markets? One, of course, is Africa.
Second, there is rising unemployment in developed countries that they need to balance. How do they do it? You are moved out of production and replaced. When you are replaced, only a few companies, a few big farmers are in production. They are the ones reaping the profits.
The developed countries found a market in Africa because they displaced the farmers. They killed the agricultural sector through subsidies and other means such as tariff escalation. I will give you a little education here.
If you want to export raw materials and the developed countries want the raw materials, let them come. If you want to export oranges, let them come. However, when you turn those oranges into juice, if you want to export orange juice, the taxes are raised and you face some barriers to market.
How can the agricultural processing industry develop given such a situation? There is no way. We are talking about tariff escalation. The small farmers under the IMF/World Bank policies were forced to switch from crops that were meant to develop the agricultural sector locally to those crops that were essential for the foreign market, crops like flowers. We were growing maize and now we are growing flowers. How does that help Africa? You need the foreign exchange, but again, you face those barriers to trade.
One other issue is that of sanitary and phyto-sanitary measures that are imposed upon African countries. When one European company wanted to import some oranges from Zimbabwe, they said, “We want to inspect the premises where this orange juice is made.” When they came down to Zimbabwe, they saw that the technology we were using was a bit obsolete. It is obsolete, yes, but it is making the orange juice. They said, “You need to have digital technology to produce this product. You need high technology.” In a country like Zimbabwe, where do you get the financing to purchase that kind of technology? If you get that money, it becomes debt financing. You must finance that debt as well. So how can the agricultural sector develop given such a situation? That was locked into the WTO policy as well.
You have heard cries from developing countries asking, “How can we protect our own agricultural sectors when we are bombarded every day with requests from countries?” Right now the beef industry in Namibia and Botswana is almost dead. There is a lot of beef coming from Europe through the free trade agreement between South Africa and the EU. Botswana and Namibia are almost subsidiaries of the South African economy. The beef that comes through South Africa is just exported into these countries. How can you develop the beef industry when the imports coming into the countries cost much less than the beef produced locally? There is no way to develop. It will only go down.
We need at last an ear that will listen to the concerns of the farmers and the concerns of the ordinary citizens who are suffering on a daily basis. Agriculture is the key to development. With a weak agricultural sector, you have a weak industrial sector. Our economics are based on agriculture; therefore, the only development possible in terms of industrialization is the agricultural processing industry. How can that be developed when there is no production? At the same time, how can the production develop when there is no industry to process the products?
The same theory applies to the textile sector. I am sure you have heard about the cotton crisis that we are facing at the WTO at the moment. We are facing the worst ever prices in cotton. Zimbabwe, in southern Africa, is the largest producer of cotton. It exports 70 per cent of its cotton and retains only 30 per cent. The 70 per cent that is being exported is facing low prices. At the moment, the farmers are withdrawing their cotton from selling because it is not helping them.
The prices for this year are much lower than last year. A family farmer who has to send children to school, look after the family and buy food for the family is suffering as a result.
These are some of the challenges that we face in our agricultural sectors. This is why the agricultural sectors are not developing.
[Translation]
Mr. Fall: As far as that issue is concerned, our public authorities have committed themselves to that. Some elements distinguish us from the Asian countries. Asian countries trust their farmers. In India, farming is generally based on small family farms. These farms are productive and will probably grow. In most Asian countries, this sector receives significant support.
But in our countries, the situation is completely different. Our governments believe that we should have American- type farms and an agricultural system which is, for instance, managed with computers. It is not recommended that small farms be developed. Policies support large-scale farming, but there are no means to support this. Over time, the United States have developed their agricultural sector to the large-scale farming model it is today. And today, most of the agricultural producers in our countries are small farmers who are not given their due. This situation must change.
In Asia, small-scale farming is recognized and its development is supported. We have to deal with the way things are now. There is no point looking at other systems when we do not have the means to implement them at home.
The second distinguishing feature is the following. Because of adjustment policies, everything that was supposed to help support the agricultural sector and promote its development was abolished. In our countries, the International Monetary Fund and the World Bank play the role of administrators. There is no emphasis on research. If farmers want to invest in research, they have to pay for it themselves. I do not think that this is the case in Asia.
Outreach programs must be eliminated. There are almost no agricultural councils left in African countries. Producers are left to look after themselves. They say that everything has to be privatized immediately.
These are a couple of major elements which distinguish us from Asian countries and which have prevented us from reaching the same growth levels as over there. Asia has invested in research, in outreach programs and in agricultural councils. Other factors must be included, such as subsidies. A country like India has protected its agricultural sector. But today, it is impossible for us to do the same in Africa.
In February, I attended a governors' meeting of IFAD in Rome. The minister for Madagascar asked why Asian countries were allowed to implement viable protection policies, whereas Madagascar was not. Madagascar's agricultural policy is weakening, even while its main food staple is rice. That is another difference.
Senator Robichaud: You alluded to our supply management systems. Do you think that this system could help your smaller farmers to get together and maintain a certain degree of control on production in order to access other markets? Would that be a solution for African farmers?
Mr. Dioum: You know, history repeats itself. Several people from my generation have had to implement certain policies. We had an agricultural sector and policies which were administered. At the time, our boards set the prices for all farm products including grains and oilseeds.
But when the adjustment policies were implemented, those boards disappeared. Why? Because, to put it simply, the boards were a source of financial imbalance. When international products were cheaper, you nevertheless bought a farmer's production to pay him for his work, but we understood that this was a form of support which had to be eliminated. Previously, we had an active market which offered some potential, and even when there was too much supply, the boards purchased the product. That was one element. As I have always said, as long as the producer can sell, he will continue to produce.
That is what I read into supply management: you cannot deny it, when I listened to my friends for three days, when I visited their system, when I asked about the levels of protection for poultry, milk and beef. They quoted unbelievably high figures. I said that we never had the chance to protect our own production. I know there are small farmers and small dairy producers, but it remains that regardless of where they are located in Canada, according to a formula, they can sell their production. That, at least, is a good thing for agricultural development. It can be done, since it has already been done in the past. But it implies that you already have the necessary instruments of protection, the quotas, if necessary, to effectively control the circulation of these products in our markets, when necessary.
When we did apply the system, and I will refer to an example I am familiar with, namely the cultivation of potatoes in Senegal, we had remarkable periods of production because the conditions were right. During the local growing season, we closed the border to imports of potatoes and onions. This led to an exponential growth in the vegetable sector. But when we adopted policies preventing us from protecting our market beyond a certain level or percentage, and when at the same time exporting countries received ever-higher subsidies and adapted to local market conditions, we could not compete anymore. So that is a sector which has more or less disappeared in Senegal, in regions where there had been potential. Today, Guinea, which is trying to develop this sector, will also have to deal with import policies and so on.
That is possible. I am not suggesting to transfer it in the state in which I saw it, but that is possible. At least in form, it is an area of investigation that is extremely important for us; and I continue to work on it at my own expense while waiting to find Canadians who accept to support us in our approach. In terms of the agricultural approach, as well as international negotiations, I am sure that bridges can be built between Canada and African countries, in the area of supply management.
Mr. Fall: On the matter of supply, there are aspects that are very important to us, as it covers our vision of what agriculture must be initially. Basically, the purpose of agriculture is to provide people with food. Consequently, it must be directed towards the domestic market. Based on our understanding of the supply management system, it focuses on Canadian consumption. From that point of view, it is very important. We do not think it is safe to leave a people's food supply in the hands of other people. We do not want to get involved in a mechanism where our food supply will depend on a boat coming from the United States. We do not want that. We want to produce what we want to eat at home. That is our concern, and I believe that the supply management system offers that.
The second aspect is that it not distort any other agricultural sector. At least that is our understanding. However, the other mechanisms pose problems for other agricultural sectors. From that point of view as well, the system appears very attractive.
The third aspect is that its implementation certainly involves a number of conditions, which seems well within the reach of African countries, because it is not too costly. By gradually making our producers more responsible, we can promote a system like that in our countries. It must not be too costly for our public authorities that do not have money.
As Mr. Baba Dioum said, we also think that, when developed countries tell us that they will continue to subsidize our farmers — which we are not refusing, as the argument to that effect makes sense — the developed countries say to us: “We are subsidizing you because we want to ensure that our farmers have an acceptable standard of living”. That is very acceptable. But we say that if that is done, we too are entitled to an acceptable standard of living, and consequently, the subsidies must not cause problems for us. That being the case, a supply management system that integrates border protection could be a compromise. You lose your subsidies, but we protect ourselves and we put in place a supply management system.
Anyone who does not accept that undoubtedly has a hidden agenda, and consequently, we feel that the supply management system could represent a consensus in international negotiations. We know that it is under attack, it is being pushed around, but Canada must stay the course and say “We are in favour of mechanisms like this, because we think it will enable us to develop our agriculture.”
[English]
Mr. Machemedze: I am sure most of the points have been made by my colleagues, but suffice it to say that with supply management in place, if farmers are guaranteed markets and prices at the end of day, then farmers are also guaranteed production. Therefore, it will work.
In Africa, particularly in Zimbabwe, we had a similar program in milk, in cotton and also in maize. We had the Grain Marketing Board, the Dairy Marketing Board and the Cotton Marketing Board. Unfortunately, when we were about to be replaced in terms of production, we were forced to privatize these entities and leave everything to the vagaries of the markets. Therefore, the elements that are part of the supply management system were also part of that system. Definitely, it will work in Africa.
The Chairman: For the information of our members, the Steering Committee met a couple of days ago. As you know, we will not be going to the UN tomorrow. However, based on the evidence that we have received on the World Bank and the International Monetary Fund and the questions raised by our witness, we have decided that we do have to go to Washington.
[Translation]
It is not just today's witnesses, because we already have evidence showing that countries are being asked to do things that we do not do ourselves. To my mind, that is the issue. We are asking people in African countries to use policies that we do not use ourselves. These issues must be raised at the International Monetary Fund and at the World Bank in Washington.
That is why we must go to Washington and to the United Nations, because it is clear that there are questions that must be raised.
[English]
We have had evidence before the committee that the cost of agricultural imports into Africa equals the aid to Africa. Actually, with respect to all of the so-called aid to Africa, we have heard expert testimony that all it does is basically equal the money that African countries, which 30 years ago were self-sufficient in food, now spend on food imports. The committee will want to ask more about this issue.
[Translation]
Could you tell us what percentage of the population of Senegal and of Zimbabwe works in agriculture? We are somewhat gathering these figures. Some people are surprised at these rather impressive percentages. Would you give us the figures for Senegal, for instance.
Mr. Fall: Senegal is one of the most urbanized countries in West Africa, with a 56 per cent urbanization rate. The large part of these urban populations is still earning a living from agriculture. And so, 60 per cent of the population derives its revenue directly from agriculture.
The Chairman: You also have fishermen, do you not?
Mr. Fall: Yes.
The Chairman: Could you give us a percentage for that sector?
Mr. Fall: I could not give you the proportion of fishermen in the population. But fisheries are the main source of exports for Senegal. We have an income of more than 33 billion FAC francs per year from selling fish products. It mainly comes from traditional fishing, small fishermen.
The Chairman: So, 60 per cent of the population of Senegal works in agriculture?
Mr. Fall: Precisely.
[English]
Mr. Machemedze, could you give us the percentage more or less?
Mr. Machemedze: I do not have the current figure at the moment. There has been a significant amount of land reorganization in Zimbabwe. Many people have been resettled. Some who were not involved in farming have also moved into farming. Those figures need to be updated. Through our networks and colleagues here I will be able to send that information through once it is compiled.
[Translation]
The Chairman: I would like to thank the witnesses for coming this evening. They have come a long way to meet with us.
Senator Prud'homme: Mr. Fall, in reading your biography, we realize that you have been Commander of the Order of the Lion of the Republic of Senegal, Officer of the Order of Merit of Senegal, of the Order of the Lion of the Republic of Senegal as well as Chevalier de l'Ordre national du Lion du Sénégal.
Now we are brothers. Senator Corbin and myself, in the 1970s, were made commanders of the Order of the Lion of the Republic of Senegal by president Senghor. From now on we will have to declare it because with the new legislation, if we are overly sympathetic toward Senegal, we may be accused of being in a conflict of interest situation.
I thank you respectfully.
The Chairman: Thank you very much. We will be seeing you again very shortly.
The committee is adjourned.