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Commodity Market Reform in Africa : Some Recent Experience

AGRICULTURAL COMMODITIES AGRICULTURAL MARKETS AGRICULTURAL OUTPUT AGRICULTURAL PRODUCTIVITY AGRICULTURAL PRODUCTS AGRICULTURE BALANCE OF PAYMENTS BANK LENDING CAPITAL FORMATION CENTRAL PLANNING COCOA COCOA PRICES COFFEE COFFEE PRICES COFFEE PRODUCTION COMMODITY COMMODITY PRICES COMPETITION POLICY CONSUMERS COOPERATIVES COTTON CROP CROP PRICES CROPS DEBT DEVALUATION DEVELOPED COUNTRIES DEVELOPMENT STRATEGIES DOMESTIC MARKETS DONOR AGENCIES ECONOMIC ACTIVITY ECONOMIC CONDITIONS ECONOMIC DEVELOPMENT ECONOMIC LIFE ECONOMIC PERFORMANCE ECONOMIC POWER ECONOMIC PROBLEMS ECONOMIC STRATEGIES ECONOMISTS EMPLOYMENT EXCHANGE RATE EXCHANGE RATES EXPLOITATION EXPORT CROPS EXPORT MARKETS EXPORTS FARM FARM PRODUCTIVITY FARMERS FERTILIZER FOOD CONSUMPTION FOOD CROPS FREE TRADE GRAIN GROWTH IN AGRICULTURE HUMAN CAPITAL IFPRI INCOME INCOME LEVELS INDUSTRIALIZATION INPUT USE INTERNATIONAL MARKETS INTERNATIONAL TRADE INVENTORIES MACROECONOMIC ADJUSTMENT MACROECONOMIC POLICIES MACROECONOMIC STABILIZATION MAIZE MARKET CONDITIONS MARKET EFFICIENCY MARKET FORCES MARKET INTEGRATION MARKET LIBERALIZATION MARKET REFORMS MARKET STUDIES MARKETING MARKETING BOARDS MIDDLEMEN MONOPOLIES MULTIPLIER EFFECTS OIL OIL PRICES OPEC PLANTATIONS POLICY INSTRUMENTS POOR HOUSEHOLDS PRICE CONTROLS PRICE DECLINES PRICE FLUCTUATIONS PRICE VOLATILITY PRICING POLICIES PRODUCE PRODUCER PRICES PRODUCERS PRODUCTION COSTS PRODUCTIVITY REGULATORY SYSTEMS RICE RICE PRODUCTION RURAL COMMUNITIES STRUCTURAL ADJUSTMENT STRUCTURAL CHANGE SUGAR TAXATION TERMS OF TRADE TRADE LIBERALIZATION TRADE REFORMS WELFARE GAINS WORLD MARKETS
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World Bank, Washington, DC
Africa
2014-07-31T22:14:42Z | 2014-07-31T22:14:42Z | 2003-03

Since the early 1980s, dramatic changes in export commodity markets, shocks associated with resulting price declines, and changing views on the role of the state have ushered in widespread reforms to agricultural commodity markets in Africa. The reforms significantly reduced government participation in the marketing and pricing of commodities. Akiyama, Baffes, Larson, and Varangis examine the background, causes, process, and consequences of these reforms and derive lessons for successful reforms from experiences in markets for four commodities important to Africa-cocoa, coffee, cotton, and sugar. The authors' commodity focus highlights the special features associated with these markets that affect the reform process. They complement the current literature on market reforms in Africa, where grain-market studies are more common. The authors suggest that the types of market interventions prior to reform are more easily classified by crop than by country. Consequently, there are significant commodity-specific differences in the initial conditions and in the outcomes of reforms related to these markets. But there are general lessons as well. The authors find that the key consequences of reform have been significant changes in or emergence of marketing institutions and a significant shift of political and economic power from the public to the private sector. In cases where interventions were greatest and reforms most complete, producers have benefited from receiving a larger share of export prices. Additionally, the authors conclude that the adjustment costs of reform can be reduced in most cases by better understanding the detailed and idiosyncratic relationships between the commodity subsector, private markets, and public services. Finally, while there are significant costs to market-dependent reforms, experiences suggest that they are a necessary step toward a dynamic commodity sector based on private initiative. This is particularly true in countries and sectors where interventions were greatest and market-supporting institutions the weakest.

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