22 January 2015
Close to 70% of Tanzanian farmers are small-scale, resource-poor subsistence operators, who cultivate an average of less than one to three hectares of mainly rain-fed land that has deteriorated due to continuous cropping and lack of fertility management. In the farmers’ efforts to move up the commercialisation continuum and alleviate poverty through increased output and incomes, innovation and technical change are key. However, liquidity constraints and prohibitive prices have in the past discouraged farmer investment in capital goods such as power tillers; goods which would facilitate increased cropping area and timeliness of operation which would, in turn, have the potential to positively affect crop output and incomes. Faced with such difficulties, farmers are prepared to trade off quality and variety for relatively low-priced capital goods, provided they are good enough and rely less on heavily built infrastructure.
In recent decades, the capital goods market for power tillers has become dynamic with respect to cost, quality and origin of production. With new entrants like China, India and Pakistan joining Western Europe, USA and Japan in the supply of farm machinery, the range of choice for the Tanzanian farmer is increasing. Chinese and Indian power tillers have some distinctiveness in their engineering, acquisition cost, operational cost and supply chains, a distinctiveness that may be useful to the small farmer in Tanzania and create opportunities for inclusiveness.
Based on a field survey undertaken along the value chain of dealers, users, financial institutions and regulators of the power tiller markets in Tanzania, I find that capital goods from emerging economies possess inferior engineering and physical characteristics when compared with those from advanced countries. In addition, emerging economy capital goods have a negative effect on the environment, as they generate more noise and smoke during usage. However, the fact that they are low cost, easy to repair (and in many instances spare parts are easily available too) creates an opportunity for poor farmers to get onto the capital goods ladder and generate more income through productivity increases. Further, investing in emerging-economy power tillers does not only create more jobs but also gives a higher return on investment to the farmer. With inclusiveness, equity and distributional objectives on the policy agenda of many sub-Saharan African countries, emerging-economy farm machinery is worth considering if the poor farmer is to become properly tooled for increased output and incomes.
Andrew Agyei-Holmes is a research student in Development Policy and Practice, the OU's main centre for teaching and research in development studies and development management. His areas of interest include technological choice, agricultural productivity and rural development, food security, emerging economies and the changing world order of technology generation and transfer.
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