The ASSOCIATION FOR STRENGTHENING AGRICULTURAL RESEARCH IN EASTERN

The ASSOCIATION FOR STRENGTHENING AGRICULTURAL RESEARCH IN EASTERN AND CENTRAL AFRICA (ASARECA) INVESTING IN LIVESTOCK AND FISHERIES TRADE TO IMPROVE LIVELIHOODS OF POPULATIONS OF THE LAKE TANGANYIKA BASIN Paper Presented at the 1 rst EAC Lake Tanganyika Basin Development Conference, Bujumbura, November 2829, 2011 by Dr. Jean Ndikumana Manager, ASARECA Livestock & Fisheries Program

Outline Situation analysis Constraints to the development of livestock and fisheries trade in ECA in general and in the Lake Tanganyika basin in particular Investment opportunities to enhance trade in ECA Suggesting strategic investments to promote trade in the basin

SITUATION ANALYSIS

IMPORTANCE OF LIVESTOCK IN EASTERN AND CENTRAL AFRICA Contributes 10 – 40 % Of GDP in ECA Worth 34. 5% of the regional Ag. GDP Practiced on more than 60% of ECA total landmass.

IMPORTANCE OF FISHERIES IN ECA Fish amount for 22% supply of animal proteins; In addition to local consumption, fish is one of the leading export commodities for Kenya, Uganda, Tanzania. Small scale fisheries contribute to employment, food security and income.

Fisheries Production per environment in ECA (t x 1000) Environment 1990 1995 2000 2005 2009 Inland 1096. 0 1014. 9 1078. 6 1267. 2 1175. 3 Marine 145. 2 154. 8 184. 9 183. 2 194. 5 Aquaculture 4. 31 12. 20 19. 30 31. 32 103. 1 TOTAL 1245. 5 1181. 8 1282. 7 1481. 7 1472. 9

Aquaculture production of 7 ECA countries (t) (FAO, 2011) Country Production 2000 Production 2009 Burundi 100 200 Kenya 500 4900 2100 3000 Rwanda 270 400 Soudan Tanzanie 1000 2200 310 5700 Ouganda 820 77000 5100 93400 25700 152800 107000 390000 RDC TOTAL REGION Nigeria TOTAL SS AFRICA

POTENTIAL CONTRIBUTION OF LIVESTOCK TO ECONOMIC GROWTH OF ECA A study conducted by IFPRI and ASARECA to identify strategic priorities for ASARECA concluded that: When ECA is viewed as a region, milk emerged the most important commodity sub-sector for growth-inducing investment in research and development. Milk was followed by Cassava, maize and bananas.

Regional Ag. GDP Gains to 2015 from Growth in Selected Commodity Sub-Sectors (US$ million) Milk Cassava Maize Bananas Vegetable_Fruits Oilseeds Beef Coffee_Tea Sorghum_Millet Potatoes_Sweetpotatoes Rice Wheat_Barley Beans_Peas Poultry Sugar 0 50 100 150 200 250 300 350 400 450

POTENTIAL CONTRIBUTION OF LIVEST. TO ECONOMIC GROWTH OF ECA Looking at commodity groups, growth of the livestock commodities would result into the highest regional Ag. GDP gains to 2015, followed respectively by cereals, roots and tubers, fruits and vegetables and oil seeds.

Regional GDP Gains to 2015 from Growth in Selected Commodity Groups (US$ million)

POTENTIAL CONTRIBUTION OF LIVEST. TO ECONOMIC GROWTH OF ECA COUNTRIES Looking at sub-sectors, the study shows that investing in the livestock sub-sector would result into the second highest impact on the Ag. GDP just after staple crops.

Regional GDP Gains to 2015 from Growth in Selected Commodity Groups (US$ million)

PRODUCTION AND CONSUMPTION TRENDS For fisheries , growth has since 1990 s slowed down in the capture fisheries amidst indications that several fisheries are nearing production limits. Growth of demand for livestock and fisheries products is higher than production due to population growth and income, urbanisation and change in nutrition habits. All ECA member countries are net importers of milk and most of them are net importers of meat. The situation is expected to worsen if countries continue business as usual.

Human population, fish production and demand projections Country , Popul. 2006* Tot. fish Per prod capita (x 1, 000) 2006** supply (tx 1000) (Kg/yea r) ** Burundi 8, 090. 1 14. 2 3. 2 DR Congo 62, 660. 6 239. 6 5. 7 Kenya 34, 707. 8 159. 7 5. 3 Rwanda 8, 648. 2 0. 6 The Sudan 41, 236. 4 64. 6 2. 0 Uganda 28, 195. 8 399. 5 0. 8 Tanzania 37, 445. 4 341. 1 10. 3 TOTAL 1, 226. 9 Estim. Popul. 2050* Estim. Fish requirement s 2050 (t (x 1, 000) x 1000) 28, 315 189, 311 65, 176 25, 128. 7 73, 029 106, 049 82, 510 90. 6 1, 079. 1 345. 4 15. 1 146. 1 1, 039. 3 849. 9 3, 565. 5 Sources: *: Population Reference Bureau (2008); ** (FAOSTAT 2009)

Net trade in livestock products in Africa (’ 000 tonnes) 1970 1980 1990 2000 2015 2030 Beef 119 63 – 32 52 – 5 – 109 Eggs 0 – 3 – 5 – 17 – 9 – 22 Milk – 913 – 2, 496 – 1, 785 – 1, 971 – 3, 605 – 5, 226 Mutton/ goat Pork 29 40 29 59 73 80 – 4 – 9 – 21 – 42 – 71 – 108 Poultry – 2 – 43 – 86 – 149 – 280 – 606 Note: Negative figures imply imports Source: FAOSTAT (2002)

Constraints analysis for Livestock and Fisheries Development

Major Challenge Low contribution of Livestock and fisheries to sustainable livelihoods due to : Poor Returns from Investment in the livestock and fisheries sectors and Ø Low contribution to food and nutrition security from the fisheries sector. Ø

Causes for low contribution of fisheries to nutrition security Insufficient quantities of fish produced in relation to the demand caused by low aquaculture production Ø destructive fishing practices (fishing gear and methods) caused by weak regulatory policies and Ø high post-harvest losses (25%) due to poor facilities for post harvest conservation Ø

Causes of Low aquaculture production Ø Low utilization base of Aq. GR Ø Limited utilization of feeds and feed resources due to limited private investments in fish feed production Ø Lack of credible quality seed supply chain due to limited public and private investment in fish seed multiplication and distribution Ø Low adoption of existing production packages Ø High mortality rate of farmed fish due to inadequate knowledge of fish diseases and poor water quality.

Major constraints to increased returns from investments in aquaculture High post harvest losses due to poor infrastructures and limited use of innovations in processing. Limited value addition due to poor technical capacity for pre-and post harvest processing techniques. Poor market access due to poor infrastructures; poor institutional support; poor capacity to meet standards and lack of market information.

Major constraints to increased returns from investments in Livestock production Low farm level profitability caused by low productivity; poor utilization of innovations and inefficient input and output markets Poor market opportunities due to poor access to markets; poor utilization of market based innovations and poor value addition in input and output market chains.

Major constraints to increased livestock productivity Low genetic potential : more than 90% of ECA livestock population are indig. breeds with low productivity but excellent adaptive traits. Inadequate nutrition: availability of feed resources in quantity and quality is the single most important constraint to livestock production across countries and production systems

Major constraints to increased livestock productivity Poor veterinary services : inadequate veterinary services delivery by the public and private sectors High Cost of inputs Poor organisation of farmers resulting in high production cost at farm level.

Major causes of poor market access for livestock and fisheries products Unidentified niche markets Inappropriate standards and sanitary regulations Inappropriate tax incentives Poor infrastructures and services Poor access to market information Poor value addition in input output market chains Trade barriers and effects of globalisation Poor utilization of innovations

Major Opportunities for investment to enhance Livestock and fisheries trade in the lake Tanganyika basin

Opportunities to enhance trade in Livestock and Livestock products Growth in demand for livestock and livestock products is higher than the growth in production at national or regional levels (ECA). All countries in the basin are net importers of milk, meat and other livestock products. Ready market in ECA, middle east and other regions of SSA.

Opportunities to enhance trade in Livestock and Livestock products High potential to improve productivity through investments in research to enhance generation and adoption of productivity enhancing technologies and innovations including tapping on the potential of biotechnology.

Opportunities to enhance trade in Livestock and Livestock products Harmonisation of quality, safety and standards at the basin as well as regional level in ECA. Investment in value addition to increase shelf life and respond to the consumer demand in terms of quality and safety (processing).

Opportunities to enhance trade in Fisheries Production growth lower than the demand growth for all countries of ECA. In all countries of the lake Tanganyika basin, production is lower than the demand there is huge market in countries such as DRC, Kenya, South Sudan.

UGANDA’S CROSS-BORDER FISH EXPORTS, 2005 Country of Quantity Value destinatio (tonnes) US $ n (million) DRC 10, 408 19. 4 Kenya 10, 675 13 Rwanda 89 0. 072 South 345 0. 876 Sudan Tanzania 26. 8 0. 032 Total 21, 544 33. 3800

Opportunities to enhance trade in Fisheries Capture fisheries on Lake Tanganyika and other lakes is declining due to overfishing. Major opportunity for investment in harmonising policies at basin level to control fishing efforts including involving fishing communities through appropriate incentives.

Opportunities to enhance trade in Fisheries The single most important opportunity to increase fish supply in the basin is through investment in aquaculture tapping on the wide availability of hydrological resources (rivers, streams, swamps, underground water; high rainfall). Example: Uganda.

Opportunities to enhance trade in Fisheries Investment in aquaculture is very profitable as illustrated by the quick cost benefit analysis of investments in pond and cage fish culture in Uganda.

SMALL SCALE CAGES (40 LVHD) FOR TILAPIA - 100 t/year Capital cost 40, 000 Revenue Total sales 200, 000 Operating costs Feed 130, 350 Fingerlings 27, 200 Labour and management 15, 000 Other costs 10, 000 Depreciation 4, 140 Total operating costs 186, 690 Gross profit 13, 310 Capital cost/ton 400 Gross profit/ton 133

LARGE-CAGE TILAPIA CAGE PRODUCTION ( 400 CAGES; 5000 t/yea (in US$ 2011) Capital costs Revenue Total sales (/yr) Operating costs (/yr) Feed Fingerlings Labour and management Other costs Depreciation Total operating costs Gross profit (/yr) Capital cost/ton Gross profit/ton 1, 160, 000 10, 000 6, 195, 652 1, 358, 696 920, 000 100, 000 235, 000 8, 909, 348 1, 190, 652 840 238

BASE MODELS FOR 10 HECTARE POND BASED SYSTEMS (2011 US$) Complete feed tilap. feed catfish Total capital costs Revenue Total sales (/yr) Fertilized ponds tilapia 230, 000 200, 000 347, 826 100, 000 93, 913 33, 967 6, 000 41, 600 10, 000 11, 500 196, 980 243, 478 27, 174 6000 41, 600 10, 000 11, 500 339, 752 1, 877 16, 984 6, 000 34, 400 10, 000 11, 500 80, 760 Gross profit 3, 020 8, 074 19, 240 Capital cost/ton Gross profit/ton 2, 300 30 1, 150 40 4, 600 385 Operating costs (/yr) Feed/Fertilizer Fingerlings Water Labour Other costs Depreciation Total operating costs

Opportunities to enhance trade in Fisheries Prices used for the above cost benefit analys is lower than current prices on the markets as indicated in the following slide.

PRODUCT- MARKET MATRIX, WITH PRICES, 2010 (US$/kg) Nile perch Tilapia Dagaa Smoke Sun- By. Fresh Smoke Sun- Sund dried products d dried Fres h Kenya 1. 89 1. 50 2. 03 2. 50 3. 23 1. 20 Tanzania 2. 50 1. 87 1. 56 1. 30 Uganda 2. 14 1. 43 0. 71 1. 43 1. 25 1. 43 DRC 2. 15 1. 29 2. 25 3. 22 Rwanda 3. 00 1. 50 S. Sudan 4. 62 3. 08 5. 77 5. 76 Burundi 8 5

Strategic Investment priorities to promote trade in the livestock and fisheries sectors in the basin

Increasing Livestock Production Investment in research to ensure that the sector development is supported by science based information to be generated, packaged and disseminated along the value chain (production, value addition, marketing; policy etc. ) to enhance utilisation of innovations.

Increasing livestock production Strategic investments needed in the following areas: Promote private sector investment in breed improvement, feed production and delivery of veterinary services through public private partnership.

Increasing access to market of livestock products Strategic investments in the following areas: Promote private sector investment in post harvest handling facilities (holding grounds, abattoirs, milk collection centres; appropriate containers etc. ) to minimize post harvest losses in the livestock sector Invest into processing facilities such as meat and milk processing plants to increase value addition.

Increasing Market Access of livestock and livestock products Promote enabling policy environment to enhance trade in livestock and livestock products by: Ø Establish and harmonise standards and safety regulations at the basin and regional levels. Ø Review trade policies at the basin and at regional level (EAC) to enhance trade of livestock and livestock products. (trade barriers; taxation ; incentives. . . ).

Increasing Market Access of livestock and Livestock products Build the capacity of actors along the livestock value chains to comply with the established quality and safety standards at national, regional and international levels. Invest in developing a strong market information network using modern communication technologies.

Increasing Fisheries Production Investment into research through appropriate funding to ensure the sector development is supported by science based information to be generated by strong research institutions. For example, initiate a fisheries Research Programme in Burundi under ISABU and in Rwanda under RAB. Strengthen TAFIRI.

Increasing fisheries production Strategic investments needed in the following areas: Investments to promote aquaculture through. Tapping on the tremendous hydrological resources in the basin (rivers, streams, swamps, underground water, high rainfall in many areas )

Increasing fisheries production Strategic investments needed in the following areas: Investments to promote aquaculture through. Facilitating private sector investment in quality seed supply chain and fish feed production

Increasing Capture Fish production Invest in policy harmonization in countries of the lake Tanganyika basin to control fishing efforts on lake Tanganyika to counter the declining trend of capture fisheries and restore its biodiversity.

Increasing access to market of fish and fish products Strategic investments in the following areas: Promote private sector investment in post harvest handling facilities ( cold chains, other post harvest handling facilities) to minimize post harvest losses. Invest into value addition facilities to increase shelf life of fish (smoking, drying, SME processing).

Increasing Market Access of fish and fisheries products Promote enabling policy environment to enhance trade in fish and fisheries products by: Ø Establish and harmonise at regional level appropriate standards and safety regulations for fish and fisheries products. Ø Promote policies that will enhance trade of fish and fish products in the basin and in the region (trade barriers; taxation and incentives).

Increasing Market Access of fish and fisheries products Build the capacity of actors along the fish value chains to comply with the established quality and safety standards at national, regional and international levels. Invest in developing a strong market information network using modern communication technologies.

Thank you for your audience