Grain Marketing Reform in Kenya 1992

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Kenya Agriculture Research Institute
This paper reviews the Government's policy objectives in maize marketing, noting that the emphasis has been on aggregate food security. It describes how a system of market control physical control over maize supplies - has evolved in pursuit of these objectives. This system has been subject to various pressures for market oriented reform, the most prominent of which have been the build-up of financial deficits by the Government's marketing parastatal (NCPB), and a consequent decline in the system's effectiveness. However, because of governments concern over food security risks that it associates with increased reliance on private markets, little progress was made with reform until 1988. In that year the Government initiated the Cereal Sector Reform Programme (CSRP), the first sustained attempt at grain market reform. This shift in Government policy was made possible by a succession of technical analyses in preceding years which led to a more balanced approach to reform, emphasising both the efficiency and food security aspects and the need for careful policy sequencing to minimise potential disruptions that might arise from liberalisation. Additional impetus for reform was provided by the build-up of unsustainable financial deficits at NCPB and the subsequent rise of grain marketing reform as a major focus of donor conditionality.