Organization and Performance of Cotton Sectors in Africa ... - infoDev

Box 4.1 Is This Typology Specific to Africa?The typology presented in this chapter grew out of work in East and SouthernAfrica (ESA), and needed only minor modifications to usefully incorporateWCA. Two questions thus emerge. First, are the sector types identified herefound in other areas of the world, and does an assessment of their strengths andweaknesses stretch beyond African borders? Second, does the rest of the worldexhibit sector types not found in the typology, and do these types provide anyglimpses into the likely future evolution of African systems? More to the point,do other sector types provide clues about what types of change policy makersand stakeholders should be encouraging in their sectors?Characterizing cotton sectors worldwide is quite complex and wouldrequire further investigation. Yet a number of trends can be observed in theinstitutional evolution of cotton sectors throughout the world:■■■■Cotton ginning is not by nature a heavy industry. Hence, there are numerousexamples of farmers grouped in associations, as well as farm-basedagribusinesses, that are engaged in cotton production and ginning insome of the major exporting countries, such as Australia, Brazil, and theUnited States. There are similar cases in Africa, such as SICOSA in Côted’Ivoire, which is the ginning company established by a cotton farmerunion (URECOS-CI) at the end of the 1990s. In other cases, ginning is aservice provided on a fee basis (toll ginning) to farmers, who retain ownershipof the final products (lint and seeds).There are few remaining examples of state-owned enterprises buying rawcotton from farmers through a single-channel (national monopoly) system.Even former Soviet republics in Central Asia, which are largeexporters of raw cotton, have, with the exception of Turkmenistan, movedaway from the national monopoly system to various degrees. These countriesinclude Kazakhstan, Tajikistan, and Uzbekistan.Local monopolies seem to be transitional arrangements in the evolutionfrom a single-channel system rather than a permanent sustainable organizationalmodel. Most cotton sectors in the world can be characterized aseither concentrated or competitive.Cotton production and ginning activities are very seldom integrated withdownstream industries such as spinning, weaving, and textile manufacture,except in some particular locally favorable conditions (China, India,and Turkey).It can be inferred from this short review that change in African cotton sectorsis moving in similar directions to what can be observed among other majorcotton producers in the world: retreat of governments and state cooperativesfrom industrial and commercial activities, growing empowerment of farmergroups in the management of the cotton sectors and in ginning and exportingactivities, and sharply increased investment in local cotton industries by(continued)50 POULTON AND TSCHIRLEY