SERA Quarterly Report: January – March, 2016

The Tanzania SERA Policy Project (SERA) of the United States Agency for International Development (USAID) Feed the Future (FtF) Initiative is implemented by Booz Allen Hamilton. The SERA Project is focused on improving the policy environment for agriculture, and developing individual and institutional capacity to undertake policy analysis and advocate effectively for policy reforms. SERA began in April 2011, and completed the fourth full year of operation on September 30, 2015. This Quarterly Report, Quarter 2 (Q2) of Project Year 5 (Y5), covers the period from January 1, 2016 to March 31, 2016. SERA Project’s period of performance was originally set to end on April 7, 2016. However, a request for a no-cost extension has been approved by USAID which extends the period of performance through August 30, 2016. The SERA Chief-of-Party (COP), Marialyce Mutchler, was on leave during Q2 and the Senior Advisor, Don Mitchell, was the Interim Chief-of-Party and was resident in Tanzania from January 9 to March 12. The Ministry of Agriculture, Food Security and Cooperatives (MAFC) was reorganized in Q1 and the Ministries of Agriculture, Livestock and Fisheries were combined into a single ministry called the Ministry of Agriculture, Livestock and Fisheries (MALF). This Quarterly Report will refer to the reorganized Ministry and distinguish between activities undertaken with MAFC and MALF.

The following activities were completed during Q2:

  • The study tour to Mozambique for the Agriculture Business Environment Study was undertaken from January 17-23.
  • The draft Maize Gender Report was completed on January 31 and additional data analysis was requested of Taylor Nelson Sofres (TNS).
  • Don Mitchell attended the USAID Partner’s Meeting in Morogoro from February 8-10.
  • Alex Mkindi participated in a workshop in Dodoma from February 15-19 on Agricultural Investment Incentives and the Agricultural Business Environment.
  • Nancy Cochrane from the United States Department of Agriculture (USDA) delivered training on the construction of a Healthy Food Basket to staff of the Department of Food Security and Nutrition in Zanzibar during February 16-18 and was assisted by Aneth Kayombo of SERA.
  • Don Mitchell conducted training on Economic Principles for Food Basket Methodology (FBM) in Zanzibar on February 18.
  • Nancy Cochran and Aneth Kayombo met with the Department of Food Security of MALF on February 22 to discuss piloting the FBM in four districts and introduced the concept of a Healthy Food Basket.
  • The Food Basket Costs Policy Brief was launched at a workshop on February 19 by Don Mitchell, and Nancy Cochran made a presentation on the Healthy Food Basket.
  • The No-Cost Extension Modification Proposal was submitted on February 25.
  • Presentations and Chairing of Session at the Agriculture Policy Conference February 23-25 included:
    • Policy Options for Food Security by Don Mitchell
    • Agriculture Business Environment and Incentives by Don Mitchell
    • Land Compensation and Valuation Schemes by Don Mitchell
    • Secured Transactions/Collateral Registry by Dale Furnish
    • Chairing of Session on Inputs by Alex Mkindi
  • Don Mitchell and Dale Furnish met with the Bank of Tanzania (BOT) staff to discuss the Secured Transactions/Collateral Registry activity on February 26.
  • Professor Chen Zhen from the University of Georgia traveled to Tanzania to work with Edith Lazaro of SERA on the Food Demand Study from March 7-12.

The Mozambique study tour for the Agriculture Business Environment and Incentives study was conducted from January 17-23 and led by Don Mitchell. The team included James Ngwira from the President’s Delivery Bureau (PDB) and Martin Marsalu from the Tanzania Investment Center (TIC) as well Edith Lazaro of SERA. A local facilitator (Calisto Bias) was hired to arrange meetings and translate as necessary. The trip was very successful and provided the information needed to compare the agriculture business environment of Mozambique with that of Tanzania. The trip report (Annex 1) was circulated to the study team for comments and then revised and sent to the manager in each of the participating organizations.

Don Mitchell attended the USAID Partner’s Meeting from February 8-10 in Morogoro and renewed contacts with Feed the Future implementing partners and others involved with the USAID Economic Growth Agenda. Of particular note were discussions with David Kraybill and Isaac Minde of the iAGRI project, Geoffrey Kirenga and Jennifer Baarnes of Southern Agricultural Growth Corridor of Tanzania (SAGCOT), Julie Harrison from Michigan State University (MSU), Tom Carr of the NAFAKA, and the team from Dalbert that is providing support for SAGCOT Centre. Jennifer Baarnes, deputy Chief Executive Officer (CEO) of the SAGCOT Centre, was briefed on the status of the Agriculture Business Environment study and was provided with a preliminary draft of the PowerPoint to be delivered at the Agriculture Policy Conference. Geoffrey Kirenga, CEO of the SAGCOT Centre, delivered a presentation on the challenges faced by SAGCOT in attracting investors and said that SAGCOT has only delivered one land title of eight hectares (to Unilever for a new tea factory) in the entire five years that SAGCOT Centre has operated. Tom Carr, COP of NAFAKA, expressed interest in meeting to discuss SERA policy activities and was especially interested in our maize gender study. The Dalbert Group requested a meeting to compare our work on policy with their support of SAGCOT Centre. Julie Harrison of Michigan State University, who is involved in a review of SAGCOT, was very interested in SERA’s views of SAGCOT’s successes that were reported by Geoffrey Kiringa.

The draft Maize Gender Report (Annex 2) was completed and circulated to our World Bank (WB)/International Finance Corporation (IFC) collaborators for comments and to SERA staff and selected others. It was also sent to TNS consultants for data corrections and completions.

Alex Mkindi traveled to Dodoma to participate in a workshop on the business environment and incentives for agricultural investors from February 15-20. The trip report is attached (Annex 3).

Training on basic economic principles needed for analysis of food security and implementation of the FBM (Annex 4) was provided to the Department of Food Security and Nutrition in Zanzibar on February 18 by Don Mitchell. The three-hour training covered the basics of demand, supply, price determination, inflation, exchange rates, import dependence, gross domestic product (GDP), and monitoring of regional and global food markets and food prices. The training was well received and should have improved the team’s ability to understand economic principles needed to implement the Food Basket Methodology.

The Food Basket Costs Policy Brief (Annex 5) was launched in Dar es Salaam on February 19 at a half-day workshop at the Protea Courtyard Hotel to about 20 people from various organizations. The Ministry of Agriculture, Livestock and Fisheries was represented by Caroline Kilembe from the Department of Food Security and she is emerging as a strong supporter of the Food Basket Methodology. She will feature strongly in our future efforts to anchor the Methodology in the MALF. Nancy Cochrane presented her work (done in collaboration with (SERA) on the development of a Healthy Food Basket. Nancy plans to return in April to continue work on the FBM and Healthy Food Basket with the MALF.

The 2nd Annual Agricultural Policy Conference was held during February 23-25 at the Serena Hotel in Dar es Salaam. SERA provided financial support for the conference, assisted in the planning of the conference, and was very visible by contributing to four presentations and chairing one session. The conference brought together key decision makers, including the Deputy Minister of Agriculture, the Permanent Secretary (PS) of Food Security in MALF, a member of parliament who is on the agriculture committee, the CEO of SAGCOT, and elder statesmen including Peniel Lyimo a former PS in both the Prime Minister’s Office (PMO) and MAFC. The new PS of the MALF requested that the presentations and reports be sent to him. Don Mitchell presented the Policy Options for Food Security which was updated from an earlier version with new material on Food Basket Costs and the Business Environment. Don Mitchell also presented the draft of an Agriculture Business Environment Study that showed that Tanzania is not competitive on taxes, fees, and operating costs compared to Mozambique and Zambia, and that access to land is the single most important constraint to attracting large investors into the agricultural sector. The results make it easier to understand why SAGCOT has not been successful in attracting foreign investors into the sector. Conference participants encouraged SERA to try and use the results to lobby the Government of Tanzania (GOT) to improve Tanzanian competitiveness in corporate agriculture. Don Mitchell also made a presentation on Land Compensation Schemes and Valuation Models from the study completed by Landesa for SERA. Professor Dale Furnish, the SERA consultant working on Secured Transactions/Collateral Registry made a presentation showing how the Secured Transactions Law needs to be changed and what the subsequent benefits of making such changes would be. Finally, Alex Mkindi chaired a session on Agricultural Inputs. The program for the conference and all PowerPoint presentations are attached as Annex 6.

Don Mitchell and Dale Furnish met with the Bank of Tanzania staff on February 26 to follow-up on the progress on the implementation of the Secured Transactions/Collateral Registry. Augustino Hotay, the BOT lead on this activity, and Nkawna Magina, presented SERA with a work plan for fast tracking the activity and requested support for a workshop and consultants to present the activity to BOT management. We suggested they submit a formal request and advised BOT that our availability and funds to support the activity were limited by the upcoming closing of the SERA Project. No request had been received by the end of Q2.

Nancy Cochran of the Economic Research Service (ERS) of USDA visited Tanzania from February 15-26 to provide training to the Department of Food Security and Nutrition in Zanzibar on the construction of a Healthy Food Basket and to meet with the Department of Food Security of the MALF to discuss continued work on the implementation of the Food Basket Methodology. The training in Zanzibar was conducted from February 16-18 and is attached in Annex 7. The discussions with the MALF included planning of a desk study prior to conducting a pilot in four districts (Bahi, Kilosa, Masai, and Longido).

Professor Chen Zhen of the University of Georgia in Atlanta, Georgia traveled to Tanzania from March 7-12 to work with Edith Lazaro and Don Mitchell of SERA on the Tanzania Food Demand Study. Professor Zhen is an expert on the econometric estimation of food demand systems and was able to provide technical leadership and guidance on the activity and substantial progress was made on the estimation of a theoretically sound demand system. The results will be completed by July and are expected to provide a better understanding of the economic parameters of food demand and provide the basis for estimation of future demand trends. The trip report is attached as Annex 8.

The first draft of the Agriculture Business Environment and Incentives study was completed by Don Mitchell and Edith Lazaro in March 2016 and circulated to team members for review and comments. The findings from the study show that Tanzania is not competitive with Mozambique and Zambia at attracting large foreign investors into the sector. Tanzania does not offer special corporate tax incentives to agriculture while Mozambique and Zambia do, and Tanzania has significantly higher local taxes and operating costs than Mozambique or Zambia. Access to land is also a constraint to foreign investors and the Tanzania Land Act (1999) precludes the sale of a land title by a foreign investor which prevents an investor from benefiting from land value appreciation. The preliminary findings were presented at the Agricultural Policy Conference and the final report will be submitted to key stakeholders and decision makers in April.

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