Home » The Socialist Solution to Soaring Prices of Zambia’s Staple Food
Africa Economy Featured News

The Socialist Solution to Soaring Prices of Zambia’s Staple Food

Around 150 police officers surrounded the Changanamai ground in Zambia’s second-largest city Kitwe on the morning of Saturday, October 7, to stop the Socialist Party (SP) from holding a rally against the worsening cost of living crisis. 

Even after the cost of the Basic Needs and Nutrition Basket soared to over twice the average income in Zambia by the start of this year, prices including that of the staple maize meal have continued to rise further, forcing families to reduce the number of meals consumed in a day. 

While this is forcing a further reduction of nutritional intake in the southern African country, whose malnutrition rate of 48% last year was already among the highest in the world, its Rural Development Minister Gary Nkombo has sought refuge in high-school economics textbooks. 

“We are where we are because of the principles of demand and supply. That is the baseline for determining a price,” he sought to explain last month, at a time when the already high price of the maize-based ‘mealie meal’ had soared by 67% over the span of a year. 

But President Hakainde Hichilema of the United Party for National Development (UPND), who came to power after defeating the incumbent Edgar Lungu of the Patriotic Front (PF) in the 2021 election, had not contested on this platform of market fatalism.  

“The current prices are way out of hand and completely unaffordable by the majority of our citizens,” Hichilema had complained in July 2019 when the price of a 25 kg bag of the maize meal had risen to K125, up from K70 a year ago. “Our target with our agriculture policies is to make sure a 25kg bag of mealie meal is kept at K50 or below. This is about survival of our people,” the then-opposition leader had reassured.

When he eventually took office as Zambia’s president at the end of August 2021, the average price of a 25 kg bag of ‘mealie meal’ was around K139. “I will be shocked to see a [further] price increase, it wouldn’t make sense. We have more than a million tons in the country right now, so why would the prices go up, impossible,” Agriculture Minister Reuben Phiri had said in November that year, when the price of the 25 kg bag averaged around K145, ranging between K125 to K165.

Rising steadily to an average of K156.5 in February 2022, it had reached nearly K197 by February 2023. Today, the average price of a 25 kg bag of mealie meal stands at six times Hichelema’s promised price, around K300, varying between K250 and K350, said Cosmas Musumali, an economist and the General Secretary of the SP.

Addressing a rally in the capital Lusaka last month, Hichilema tried to reassure that his government is taking measures to arrest the price rise. “In the short term, we have intensified monitoring of those who could be smuggling our mealie meal and maize into other countries. We will stop this,” he said

Well over a thousand 25 kg bags of mealie meal, allegedly destined to be smuggled across the border to neighboring Democratic Republic of Congo (DRC), have been seized in several raids over the last months. On the other hand, the government itself has sold to the DRC a million tons of mealie meal, at a time when the total maize production itself is around 3.2 million tons in 2022-23.     

“Exporting a million tons with such low levels of production doesn’t make any economic sense, and endangers the food security of the country,” Musumali told Peoples Dispatch.

Peasants suffer losses producing, government makes profit exporting

The government’s crackdown on what it terms “smuggling” is not only inconsistent with its exports but also “unfair” on the small peasants, Musumalo added.

“Most of the maize production is carried out by small-scale farmers. Less than 20% of them get any support from the government. And even this support is limited to a fertilizer subsidy. The government is buying at low prices from these farmers who are taking a loss, and selling it lucratively to DRC and Angola and other countries at a large profit,” he said. 

But when the small peasants themselves “trade their produce cross-borders with their relatives in the DRC” to get a better price, the government comes down on ‘smuggling’, Musumali said. Nevertheless, it has been unable to stem the outflow of maize, because “the border with DRC is too long to be effectively monitored.”

Hichilema has also proposed raising the floor price at which maize is bought, to incentivize the farmers to produce more and sell within the country’s borders. The floor price has “always been a balancing act,” Musumali explained. “You want to incentivize the farmers to grow more, but you do not want the urban consumers to bear the burden.” 70% of Zambia’s urban population live in informal settlements. “They don’t have jobs or have very low-paying jobs. Accessing affordable maize meals is a life and death matter to them,” he warned. 

Raising the prices paid to farmers, instead of addressing the factors causing the high cost of production “will only make matters worse. Ability of the urban poor to afford the staple will further be reduced,” he complained. 

Urgent need to recapitalize state-owned fertilizer producer

The government, he argued, will need to improve infrastructure, logistics, storage, the quality of seeds, and most importantly, bring down the cost of fertilizers, which has been soaring since the state-owned Nitrogen Chemicals of Zambia (NCZ) was decapitalized as a part of the neoliberal reforms.

NCZ, he explained, “is a product of the liberation days.” Immediately after independence, securing fertilizer imports was a logistical challenge for land-locked Zambia because it was surrounded by countries still under the yoke of hostile colonial governments.

“So the country had to set up its own capacity to produce fertilizers, and NCZ had become the lifeline. However, as a part of the structural adjustments carried out during the neoliberal reforms, the NCZ as a parastatal was decapitalized. With little investment, the infrastructure is run down with wear and tear. Instead of injecting capital to revive the NCZ, successive governments have been relying on private players, including foreign ones, to import fertilizer at high prices,” he said.

Corruption mars the tendering process, which has “always produced winners that are closely associated with the government.” This was true also under the previous two PF governments. With the change of government in 2021, the former private cronies have been pushed out of this business, and new ones, with close ties to the UPND, have been brought in, added Musumali.

With these tenders having become a means for the ruling political parties to secure funding, he said that successive governments have had an interest in ensuring that NCZ does not restart local production of fertilizer.

While new private companies are being set up to produce locally, these too are owned by people closely connected to members of the government, including President Hichilema, who is himself a large commercial farmer owning several ranches, alleged Musumali. “When the government will itself be the biggest purchaser of fertilizer, corruption is implied. So local production under such circumstances may not reduce” the fertilizer price any significantly below the price at which it is being imported, he argued.

Recapitalization of the NCZ, he maintains, is essential and urgent. With sufficient capital injection, “at least 50% of the initial capacity of the NCZ can be brought back into production within 6 to 8 months. That will make a huge difference.”

In the meantime, to meet the remainder of the requirement for the next five to six years, “we have to make more informed and timely deals with fertilizer producers, like Russia for instance. Tendering contracts to private players to import fertilizer is not a reliable way forward,” Musumali said, arguing the need for “direct government-to-government deals to ensure that fertilizers are supplied to Zambia in sufficient quantities throughout the year.”  

But these measures, he says, are only the first steps toward resolving the maize price problem. In the long run, reliance on chemical fertilizers is not sustainable, even if produced locally by the NCZ. 

“The only way out from the socialist perspective is making fertilizer more affordable by having smaller organic fertilizer production plants that do not depend on chemical inputs. Production outcomes from organic fertilizers have shown to be equal, if not higher, than artificial fertilizer,” Musumali said.

“The SP is working to ensure that at some point, organic fertilizer is produced at every district level, to meet the requirements of the local peasants. We already have an agroecology program in place. We are experimenting with teaching farmers to make organic fertilizers, and the production gains we are seeing in their farms are impressive. We already are able to demonstrate that productivity gains are possible through agroecological means,” he said, making a case for this program’s implementation on a large scale.   

‘Need to re-diversify the diets of our people’

Finally, Musumali argued, there should be a long-term program to wean off from the reliance on maize as the staple. “Maize was not always the major food crop in Zambia,” he explained. Introduced under colonialism, it was a crop that was initially “reserved for the white settlers that went into farming. Then the mining companies provided a market to maize, using it to feed the African labor force it employed.”

But the staple of Zambians had continued to remain diverse, including cassava, pumpkins, sweet potatoes, millets, sorghum etc, until the late 1920s and 1930s, when maize replaced this diverse food basket, as dietary options for Zambians shrunk. 

The mono-cultural cultivation of maize, with high quantities of water and fertilizer, has degraded the soil, much of which has become acidic, he said. “Maize is also prone to weeds and pests, and requires chemicals which small farmers are finding increasingly difficult to afford.” This, Musumali argued, has trapped its cultivation into a cycle of high production cost and low yield.

While stressing the need to deal with the reality that maize is the staple today, Musumali argued nevertheless that it should not be assumed to be a reality that cannot be changed. “In the long run,” he argued, “we need to re-diversify the diets of our people to include traditional and environmentally better-suited crops which do not need heavy inputs of chemical fertilizers and use less water.”

Source : People Dispatch