Increasing Agricultural Productivity through Fertiliser use

The importance of increasing inorganic fertiliser use in subSaharan Africa is generally accepted and fertiliser subsidy schemes have existed in Nigeria since the 1970s. These have typically been both expensive and unsuccessful, using up to 40% of the agricultural budget. In recent years, Nigerian governments have attempted two approaches: the first, the Growth Enhancement Support Scheme from 2012-2016, was an e-voucher scheme which entitled farmers to a 50% reduction on bags of fertiliser purchased from agro-dealers, who then recouped the subsidy amount from the state, receiving 25% each from the Federal and State governments. While seen as innovative, this scheme was very expensive, and reports of corruption indicated that fertiliser bags were frequently tampered with, reducing the quantity of effective ingredients and bag weights. This scheme was replaced by the Presidential Fertiliser Initiative (PFI), intended in part to deal with reports of corruption and increase volumes of fertiliser reaching farmers. Selected fertiliser blenders have been commissioned to mix 50kg bags according to a specific ratio of ingredients, including cheaper raw materials
negotiated through a bi-lateral deal with the Moroccan government. While this effective subsidy to fertiliser producer companies, and clear marking of the price on the fertiliser bags seems to reduce resource leakages, reports suggest that the new bags of fertiliser are not reaching farmers, and instead an active black market trade has been established. Without agro-dealers acting as middlemen, corruption is reduced but the subsidy is not effective in reaching farmers and increasing agricultural productivity.
This ACE project will seek to identify anti-corruption strategies that increase productivity through fertiliser use by conducting a close comparative evaluation of the two schemes. We are working with the national fertiliser producers organisation (FEPSAN) and other national agricultural associations to understand how pricing and incentives can be realigned in order to make the current fertiliser regime self-sustaining, reduce its vulnerability to black-market trading and smuggling and increase uptake by farmers. To do this we will explore the political economy

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