The Validity of Import Tariffs and Import Quotas on Staple Food (Maize) When the Country Declares a State of Emergency
By Mangaliso Mohammed and Thembumenzi Dlamini
When the country declares a state of emergency following a natural disaster such as the 2015/16 El Niño induced drought, what should happen to tariffs and import quotas on staple foods at the country’s border gates? This question needs serious attention considering the fact that consistently when droughts hit Swaziland, a guaranteed third to half of the population becomes food insecure.
Even the country’s National Food Security Policy (2005) recognises and stresses recurrent droughts, the high incidence of HIV/AIDS, and declining agricultural productivity as the major contributing factors towards adverse food insecurity in Swaziland. The synergistic effects of these conditions create a difficult and complex food insecurity quandary that needs collective action.
The government of Swaziland declared the 2015/16 El Niño drought a natural disaster on the 18th of February 2016. Immediately after that, the country launched the National Emergency Response, Mitigation, and Adaptation Plan (NERMAP) (2016-2022), and rerouted funds to drought relief to curb the adverse impacts of the disaster and to avoid a humanitarian crisis. Sustaining the basics of human livelihoods – food security – became a focal challenge, putting aside the fact that the water shortage created its own set of complex problems.
Heat waves swooped across the country wiping out crops for those producers who had attempted to cultivate in the 2015/16 growing season. Maize production dropped by an astonishing 67%, from 101,000 tonnes in 2014/2015 to 33,000 tonnes in 2015/16 forcing households to be exceedingly dependent on the cash economy for basic food (Ministry of Agriculture, 2016). The country had to import the staple food (maize) from South Africa. What is worse, is that a tonne of maize soared by 66% from E3,533 in 2015 to E5,865 at the beginning of 2016. In fact, the Central Bank of Swaziland reported that the increase in maize and wheat prices resulted in a notable rise in food prices in the country. Food inflation surged significantly quadrupling from 4.3% in March 2015 to 19.0% in December 2016, reaching double digits for the first time in the past 3 years.
Without question, the drought created a desperate food insecurity situation that pushed some households to travel beyond Swaziland’s borders to buy their food due to price affordability disparities between Swaziland and South Africa. For some households, the best alternative was to reduce the number of meals they had each day while others turned to less preferred, and less nutritious cheap food.
A majority of people in rural Swaziland had no option but to rely on food donations distributed by National Disaster Management Agency (NDMA), the World Food Programme (WFP), and development organisations such as World Vision. The food hampers distributed to communities (especially communities in the Lubombo and Shiselweni regions) played a pivotal role in rescuing households from starvation.
Making the situation perverse was the failure of agricultural marketing boards in the country to relax instruments meant to regulate the importation of food into the country. Instead, it became a tug of war between desperate Swazi households trying to find affordable food and the agricultural marketing boards imposing all kinds of restrictions on food (processed or not) imports. This was in spite of the fact that the country had already declared the drought a national disaster, signifying a state of emergency.
So what is a state of emergency?
A state of emergency implies a situation of national disaster/danger in which a government suspends normal constitutional procedures in order to regain control. In such instances the government supplements domestic resources in order to prevent damages, losses, hardships or suffering.
Swaziland applies an import quota, export ban, and import levies on the maize commodity. Currently, a 1% import levy applies on maize grain and only the National Maize Corporation (NMC) has the monopoly to import a predetermined quantity of maize to meet local shortfalls. In addition, each person in Swaziland can import only 50kg of maize-meal per entry at the border gate. This set-up is supposed to benefit local maize producers and the country as a whole in terms of promoting food self-sufficiency, and by preventing producer prices from falling below what is an acceptable price level in Swaziland.
The market arrangement is not unique to Swaziland: it stems from food sovereignty discourse in which net-food-importing countries like Swaziland use imports restrictions such as tariffs and quotas to respond to world market price fluctuations and to deter imports on staple foods. Given that the production of the staple food (maize) in Swaziland is predominantly a smallholder agriculture activity, it needs special shielding from world market price fluctuations including other shocks.
Nevertheless, it is equally important to monitor the effectiveness and appropriateness of these market instruments to distinguish between short-term and long-term food production problems, and between different problems. Short-term adverse climate conditions may increase the risk of acute food shortages necessitating innovative and timely interventions on existing food market policies. For instance, when the country declares a state of emergency, especially due to a severe natural disaster such as the 2015/16 El Niño drought, shouldn’t business as usual on food import restrictions temporarily adjust to prevent the nation from going hungry?
Temporal removal of import restrictions besides increasing the individual import quota from 50kg to 100kg (which is what happened during the drought) could have dampened the severity of the drought. Would it have hurt the country to temporarily flex NMC’s monopoly rights by allowing some private traders to import maize into the country to meet the shortage of maize during the drought? The temporal adjustment of the agricultural marketing instruments would not negate the phytosanitary requirements of the maize coming into the country since it would still go through the same process to guard against pests and pathogens.
What is clear is that Swaziland remains vulnerable to droughts, and a choice has to be made for subsequent droughts: keep food import restrictions and risk households going hungry, or temporarily lift all tariff and quota restrictions and ensure affordable access to food and zero hunger.
As with most sustainable development policies, the choice is not as clear cut as one would think. Border restrictions on food imports have an important role to play in protecting local food industries but the ability to ensure availability, access, and affordability to nutritious food is just as important when the nation is thrown into a humanitarian crisis in the event of catastrophic natural disaster. After all, the first priority of development policy as evidenced by the National Development Strategy (NDS), the Poverty Reduction Strategy and Action Plan (PRSAP), and the Sustainable Development Goals (SDGs) 1, 2, and 3 is to keep people alive, free from hunger, and in good health and well-being.
In essence, the food self-sufficiency objective becomes less important when there is a looming hunger crisis. Chronic drought-like conditions in the country are discouraging households from food production such that slight increases in the cost of food have a huge effect on food insecurity at the household level.
What it means is that droughts are increasingly becoming a recurrent threat to achieving and maintaining SDG 2 of Zero Hunger within Swaziland’s boundaries. Government has the obligation to revisit all instruments meant to regulate food imports during disasters and capacitate the Agricultural Marketing Boards on their role during such state of emergencies in the country.
About the authors: Mangaliso Mohammed and Thembumenzi Dlamini are research economists at the Swaziland Economic Policy Analysis and Research Centre. They can be reached at firstname.lastname@example.org and email@example.com. They write in their personal capacity.