Since the beginning of 2008, prices of basic staple commodities such as maize and beans have increased by about 50 percent in Uganda due to greater demand in neighbouring countries, higher fuel prices and poor harvests in some critical parts of the country.
On the one hand, the rising prices of staples and increased regional demand provide a window of opportunity for Ugandan small farmers to move from subsistence to more commercial farming. With improved market infrastructure and enhanced productivity, small farmers have the potential to boost their production and actually begin to sell surpluses – including to WFP through its Purchase for Progress (P4P) initiative.
On the other hand, while they remain net buyers, the rising prices can affect the amount of household income that small farmers devote to food purchases. As a result, the small farmers may not have the resources required to make investments in their livelihoods and may consume less and poorer quality food, undermining their physical capacity to engage in productive activities. This situation has given hunger a new face in Uganda: smallholders not traditionally included in WFP’s beneficiary caseload are now in need of assistance.
The proposed programmatic response to the impact of high food prices in Uganda will aim to improve incomes and quality of life for vulnerable smallholder farmers through a safety net that:
- Creates assets that will enable vulnerable smallholder farmers to be better connected to markets and provide post-harvest support, thereby giving farmers a chance to benefit from high food prices (WFP Strategic Objective 3);
- Helps address immediate food and nutrition gaps resulting from high food prices, including micronutrient deficiencies (WFP Strategic Objective 4).
Project activities will focus on improving market infrastructure and enhancing productivity, thereby addressing the primary constraints to small farmers and medium-scale traders selling more good quality food at higher prices. The design of the activities builds upon the findings of recent evaluations. Taken together, the activities should help integrate smallholder farmers more fully and effectively into the dynamics of a growing market, leading to increased incomes, improved quality of life and reduced poverty. At the same time, the provision of cash or food will allow the households to meet their nutritional needs during this period of higher food prices.
The project is in line with the Government of Uganda’s Plan for the Modernization of Agriculture and the United Nations Development Assistance Framework (2006-2010). It supports WFP’s Enabling Development Objective 2 (‘enable poor households to invest in human capital through education and training’) and 3 (‘make it possible for poor families to gain and preserve assets’), and WFP Strategic Objectives 3 (‘restore and rebuild lives and livelihoods in post-conflict, post-disaster and transition situations’) and 4 (‘reduce chronic hunger and undernutrition’). The project supports Millennium Development Goal 1 (‘eradicate extreme poverty and hunger’).
The activities of the development project provide an initial response to help integrate smallholder farmers into growing local and regional markets, thus improving their incomes and reducing food insecurity and poverty. These activities are expected to be folded into a new country programme to be presented to the Executive Board in 2009.
Uganda has embarked on a development agenda over the past two decades, with generally positive consequences on welfare and hunger. The proportion of poor people declined from nearly 39 percent in 2002/03 to about 31 percent in 2005/06, and further reduced to about 23 percent in 2009/2010....