Wheat Policy Options in Sub-Saharan Africa: The Case of Zimbabwe

Like many countries in sub-Saharan Africa, Zimbabwe is experiencing rapid growth in wheat consumption and imports. Policy makers in Zimbabwe and elsewhere must decide whether increased domestic wheat production might reduce dependency on imports and at the same time contribute to economic efficiency and food security goals. The domestic resource cost framework was used to assess Zimbabwe's comparative advantage among six major irrigated crops and to measure the effects of current government policies on producer incentives. The results indicate that irrigated wheat production represents an efficient use of Zimbabwe's resources during times of abundant rainfall, but the nation enjoys a comparative advantage in tobacco, maize, and cotton production during times of water scarcity. Existing agricultural policies provide disincentives for commercial farmers, because private profitability is less than social profitability for the major irrigated crops. However, this tax occurs across all commodities with similar incidence, so that the private incentives among crops are not greatly distorted from their social pattern. Sensitivity analysis confirms the robustness of these findings under a range of possible future economic and political developments. The domestic resource cost approach used in this study provides an operational method for measuring comparative advantage and should be of interest to policy analysts throughout sub-Saharan Africa