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The Implementation and Results of IMF/World Bank-Supported Agricultural Reforms: The Case ofSudan's Gezira Scheme AbdelRahman Ahmed AbdelRahman Introduction The Sudanese economy is a textbook example of a monoculture economy, in view of its primary dependence on cotton. The crop is the country's principal foreign exchange earner. Sudan's external payments crises have always been associated with crises in cotton production and/or exports. This is particularly the case in the late 1970s and early 1980s when the Sudan experienced acute balance of payments or foreign exchange crises. Those crises were associated with a precipitous decline in cotton yields and production.1 As Table 1 shows, yields and output experienced a steady decline that became particularly pronounced in 1979/80 and 1980/81. The fall in the crop's output had a negative impact on export volumes and earnings, though decline in export prices also seems to have some adverse effect on earnings. Since cotton was, and still is, the country's principal foreign exchange earner, the decline in exports coupled with a rise in Sudan's oil import bill in the mid and late 1970s and early 1980s led to unprecedented current account deficits. Most of Sudan's cotton (more than 80 percent) is produced in the Gezira Scheme, a public irrigation scheme set up early in this century. The parastatal's cotton yields declined precipitously in the late 1970s and early 1980s. This was attributed to the inefficiency of its financial and production relationships which had created a structure of incentives against cotton cultivation. In the early 1980s, the Government of Sudan implemented market- oriented reforms, supported by the World Bank and the International Monetary Fund, in the agricultural parastatal's financial and production relationships to reverse®Northeast African Studies (ISSN 0740-9133) Vol. 5, No. 2 (New Series) 1998, pp. 95-115 95 96 AbdelRahman Ahmed AbdelRahman the decline in the crop's yields. The basic strategy of the reforms was to restructure these relationships so as to create a structure of cost and profit incentives favorable to cotton cultivation. Although the reforms were implemented more than a decade ago, the question as to whether or not they have succeeded in solving the cotton production crisis has yet to be answered. Table 1. Cotton Production and Exports, 1977/78 - 1980/811 77/78 78/79 79/80 80/81 81/82 Production Area (thousand feddans)21,139 1,036979964 958 Output (thousand bales)31,015747 620539 854 Average Yield3.42.82.32.13.3 (large kantar4 per feddan) Exports Export volume (thousand bales)5821734 969466 238 Export receipts (millions of US dollars)296321 33318269 Average export price (US dollars per bale)360437 344391 290 Sources: Sudan - Request for Stand-By Arrangement EBS/82/7 (Washington, DC: International Monetary Fund, 1982), 6; Sudan 1983 Consultation, EBS/83/174 (Washington, DC: International Monetary Fund, 1983), 6 and 12; and Sudan - Request for Stand-By Arrangement EBS/84/83 (Washington, DC: International Monetary Fund, 1983), 51. 1 Production data are based on crop years (March-February) while export data relate to fiscal years (July-June). 2 The feddan, equivalent to 1.04 acres, is the basic unit of agricultural tenancy in the Sudan. 3 A hale of cotton lint weighs 420 pounds. 4 A large kantar weighs 315 pounds. 5 Exports in a fiscal year relate to production in the preceding year. This is because cotton is picked betweenJanuary and March and, consequently, given the time required for ginning and baling, very little is available for marketing in the fiscal year during which the crop is harvested. IMF/World Bank-Supported Agricultural Reforms 97 The very few studies that discussed the reforms have not attempted any methodical assessment, based on systematic evidence, of the effectiveness of those reforms.2 Nonetheless, it is concluded or implied that the reforms were not necessary or that they have failed. Most of those studies were undertaken only a few years (four years) after the implementation of the reforms. Consequently, it was too early to systematically assess their effectiveness. Sufficient time has now elapsed to permit a systematic assessment of whether or not the reforms have made any real difference. In view...

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Additional Information

ISSN
1535-6574
Print ISSN
0740-9133
Pages
pp. 95-115
Launched on MUSE
2011-07-06
Open Access
No
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