Is the vegetable ban bearing fruit?
DR. LOVEMORE TAONEZVI* | Monday June 13, 2022 10:20
The ban which came into effect on 1 January 2022 targeted 16 vegetables such as onions, butternut, tomatoes, watermelons, carrots, potatoes, cabbage, and ginger. The ban is intended to support local farmers, increase national food security by encouraging local vegetable production, improve horticulture competitiveness, alleviate climate change effects, develop the agriculture value chain and foster citizen empowerment.
The key catalysts for this ban included the country’s high vegetable import bill (for instance, from January to October in 2021 the vegetable import bill for the 16 banned vegetables was approximated at P201 million), supply bottlenecks emanating from COVID-19 related international supply chain interruptions, and the lobbying efforts by local farmers who decried the preference of imported vegetables, mostly from South Africa, by local retailers over their local produce.
Therefore, the ban is expected to increase demand for locally produced vegetables and consequently stimulate local farmers to increase their output to at least meet the country’s vegetable needs.
Several arguments have been put forward against the ban, namely the lack of stakeholder consultation; the fuelling of food inflation; unreliable, insufficient, and low quality local agricultural produce; allocative inefficiencies as resources are channelled to agriculture in which Botswana has a comparative disadvantage to neighbouring countries like South Africa; and that the ban goes against the spirit of the SACU trade agreement.
Considering that five months have passed since the vegetable ban became active, the question one might want to ask is: Is the vegetable ban bearing fruit? Although we are still in the short run, the experiences so far are quite indicative. In line with expectation, in the first quarter of this year, the ban caused acute shortages of vegetables such as potatoes, onions, tomatoes, cabbage and ginger.
When these goods became available in the retail stores, they were largely of low quality and in short supply while prices doubled from their pre-ban levels. For instance, a 10kg potato bag was sold at a retail price of approximately P55-P70 before the ban and was priced at around P100-P150 in the first quarter of the year. The same applies to cabbage where a head was around P8-P13 pre-ban and jumped to P18-P25 post-ban. However, currently in the second quarter of the year, retail prices for these two vegetables have markedly dropped with a 10kg bag of potatoes priced at approximately P70-P100 and a head of cabbage at around P10-P15.
Moreover, the supply of these vegetables and others which were also banned has drastically improved in most retail shops, except for onions which are still largely unavailable.
The aforementioned improvement in supply indicates that farmers in Botswana have increased their output to fill the supply gap induced by the import ban. The high vegetable prices in the first quarter of the year signalled farmers to channel more resources to farming the banned vegetables. This then led to an increase in supply and the subsequent fall in prices of most of the banned vegetables.
Nevertheless, complains of poor quality and shortages are still being raised by consumers, especially businesses in the food and hospitality sectors.
These industries depend heavily on most of the banned agricultural products for sustainability and profitability. Recently, at the 40th conference of the Botswana Hospitality and Tourism Association, players in the hospitality sector, one of the sectors severely affected by COVID-19 containment measures in 2020 and 2021, highlighted that the vegetable ban is impeding the sector’s recovery efforts. They pinpointed that the locally produced vegetables are still of poor quality and of sporadic supply thereby negatively impacting their operations.
At the same conference, Fidelis Molao, the Minister of Agricultural Development and Food Security, emphasised that the government has no intention to terminate the ban despite a multiplicity of consumer complaints. The Minister also stated that future reviews of the ban would focus on extending the ban to other types of vegetables as opposed to lifting the ban. This shows the government’s commitment to implementing the Economic Inclusion Act alongside the Citizen Economic Inclusion Act and Public Procurement Act whose main tenet is to economically empower citizens and citizen owned enterprises.
In answering the question that was posed earlier, I would argue that the ban is showing signs of fruitfulness. Although there were severe shortages and steep price hikes of the banned vegetables such as onions, potatoes, and tomatoes in the aftermath of the ban, especially during the first quarter of 2022, the situation has markedly improved in the second quarter. Prices of the respective vegetables have generally reverted to their pre-ban levels and supply has improved in most retail shops in Gaborone and surrounding areas. Local farmers appear to have intensified their production of the prohibited vegetables to meet the local demand.
While shortages are still being reported and negatively impacting operations in sectors such as food and hospitality, I believe the situation will continue to improve in the medium to long term. We are currently in the adjustment phase as farmers need to acquire more human and financial resources together with securing new equipment and expanding farming land. Once these transitory adjustments are complete, the current shortages will be become a thing of the past and the agricultural sector will likely retain its long-lost status of being the backbone of the economy.
It is important to understand that the ban will come with some short- to medium-term pain. Nonetheless, with appropriate support from government, the retail sector and household consumers, the long-term benefits related to food security and the reduction of the annual food import bill (which currently stands at a staggering P9.2 billion) will be realised.
The government needs to empower local farmers through, for example, subsidies for borehole drilling and acquisition of modern agricultural equipment together with the provision of more land for agricultural purposes. Local farmers also need to be empowered through regular knowledge dissemination workshops to keep them abreast with contemporary horticulture approaches and issues. There is need for strategies to eliminate supply chain weaknesses which have been observed to exist between local farmers and the country’s retailers. Complementary infrastructure such as roads, electricity and dams also need to be developed so that farming activities can run efficiently, and that produce is timely delivered to consumers. Loans with affordable interest rates and insurance cover should also be availed to local farmers.
The agricultural sector needs to be prioritised in the agenda to diversify the nation’s diamond-dependent economy. The recent vegetable ban is a crucial step towards the development of the sector although the timing and the preparedness of local farmers are debatable. Botswana can draw inspiration from countries like Kenya which has developed its agriculture sector to a point where the sector directly and indirectly contributes to about 60% of the economy’s output and employs about 40% of the country’s population while at the same time accounting for 65% of the country’s export earnings.
In Botswana, a well-developed agriculture sector will improve the socio-economic welfare of Batswana through poverty alleviation, reduction in rural-urban migration (thus decongestion of cities and towns), reduction of food price inflation, creation of employment (especially in the rural areas), increasing export earnings and achieving food self-sufficiency. In conclusion, the vegetable ban is a step in right direction. The country is evidently starting to pick the ‘first fruits’ of the ban.
*Taonezvi is an Economics Lecturer, Faculty of Commerce, BA ISAGO University