Covid-19: Increasing economic resilience of the agriculture sector
Taking proactive measures to increase economic resilience, enhancing capacity to deal with situations associated with the pandemic and reducing vulnerability of farming communities is crucial to sustaining food security and socio-economic development.
The nationwide lockdown strategy includes several protective measures that result in restricted access to agricultural products, inputs, markets, and extension and advisory services (EAS).
The restrictions significantly affect farming, including food supply and demand. Meanwhile, protectionist policies and shortage of workers has already created problems in the agricultural sector.
Taking proactive measures to increase economic resilience, enhancing capacity to deal with situations associated with the pandemic and reducing vulnerability of farming communities is crucial to sustaining food security and socio-economic development.
Findings of various reports show that the impact of coronavirus on agriculture is huge. The country's fish and dairy producers are already bearing its brunt. For example, crab, shrimp, and fish producers faced several export bans resulting in significant economic loss.
Exports from Bangladesh make up over 70 percent of the crabs in the Chinese market. An export ban in China means a substantial loss for the Bangladeshi crab industry.
The current market price of milk is 40% lower than that of January. The virus can have a catastrophic impact on the dairy sector. In addition, prices for vegetables, cattle, and other agro items are also falling.
Small-scale farmers are vulnerable to the impacts of Covid-19 as they might be barred from working on their land or accessing markets to sell their produce, buy seeds, and other inputs.
Moreover, closing of transport routes, restrictions and quarantine measures, shortage of labour, and spikes in product prices are obstructive for fresh food supply chains and might also result in increased levels of food loss and waste.
Panic is an additional concern, as panic-buying disrupts food distribution.
As Covid-19 spreads, staples are stockpiled, leaving markets empty. Evidence indicated that quarantines and panic-buying during the Ebola outbreak in Sierra Leone (2014-2016), for example, led to a spike in hunger and malnutrition.
The virus could affect food demand in various ways. Usually, when reduced income and uncertainty make people spend less and result in shrinking demand, sales decline. So does production.
In the period of lockdown, people visit food markets less often, affecting their food choices and consumption. Food demand is linked to income. Hence, poor people's loss of earnings could impact consumption.
Agricultural production and trade are likely to be affected by many policy measures (e.g. higher controls on cargo vessels) aimed at avoiding the further spread of Covid-19.
Production could be hampered due to restrictions of free movement of people as well as shortage of seasonal workers for paddy harvesting. These barriers ultimately affect market prices.
Agricultural restrictions hinder trade and mobility of commodities, including food, feed, and input supplies, as suspending nationwide transportation might affect farming and food trade.
The slowdown in fertiliser, fuel and other input movements, and their reduced availability, is a growing concern for the upcoming season.
Studies show that trade barriers will create extreme volatility.
The outbreak is causing significant economic slowdowns and downturns, which are associated with rising hunger levels, as FAO reports.
Th government must adopt efficient measures to enhance its capacity to deal with current situations and reduce the vulnerability of farmers, labourers, and agri-business communities.
Meeting the immediate demand of affected growers is crucial. Emergency seed, fertilisers, feed, medicine, and information needs must be ensured by The Department of Agricultural Extension (DAE), Department of Livestock Services (DLS), Department of Fisheries (DoF) and allied organisations.
These organisations are at the frontline of the response to Covid-19 to ensure farming production and food security.
They must take initiatives for raising awareness about the coronavirus in rural areas and ensure improving communication about access points for farming inputs, distribution times, and measures to reduce the risks.
The DAE, DLS and DoF should launch programmes of assessing the field situation and advocate for urgent solutions to farmers' needs and keeping the government informed, thus allowing rapid and adequate decision-making for ensuring health and food supply.
They can also play a crucial role in building partnerships to overcome market disruptions and ensure supply chain functioning.
Promoting public health measures such as maintaining physical distancing and equipping staff with protective measures such as masks, hydro-alcoholic gels are important.
Likewise, boosting economic protection programmes to protect incomes and purchasing power are critical.
The prime minister of Bangladesh rolled out Tk. 50 billion stimulus for the agriculture sector to mitigate the impact of a nationwide shutdown due to the Covid-19 outbreak.
The network of EAS actors including NGOs, private sector, producer organisations, and farmer groups have proven very instrumental in providing for conditional or unconditional cash transfers, public works programmes that help reduce unemployment or policies aimed at stabilising food prices and protecting incomes from damaging out-of-pocket healthcare costs by ensuring coverage of essential health services.
Active measures (such as providing subsidies for producers and reducing import tariffs) are necessary for ensuring reprieve from trade restrictions to keep food, feed, and input supplies. Governments could temporarily reduce VAT and other taxes, review taxation policy to imported goods to compensate for potential cost increases, and assess exchange devaluation's potential impacts.
The DAE, DLS and DoF should adapt the "go digital" strategy to enable information flow for avoiding accidentally tightening food-supply conditions in spite of physical distancing and mobility constraints.
Resolving logistics bottlenecks and efforts to slow the spread of the virus is significant.
The government requires stimulus and safety-net measures (like health screening before leaving agricultural-based industries) to reduce impacts on farm product delivery, pickup workers, and processors.
The Ministry of Agriculture (MoA), DAE, DoF, and Bangladesh Agricultural Development Corporation (BADC) must implement measures for mitigating impacts incurred by the slowdown in agricultural inputs movement and availability.
The MoA, DAE, DLS, and other organisations must employ firm initiatives for rebuilding the livelihoods of rural people. These measures include facilitating linkages with social protection and insurance schemes and promoting local and homegrown production of nutritious varieties and species.
Other actions are strengthening the capacity of youth and women on issues related to farming and facilitating the rebuilding of social relationships and conflict management. Governments must strengthen the capacities of EAS to respond to the post-pandemic crisis.
Conducting a Covid-19 impact assessment is of paramount importance to estimate the pandemic's effects on lives and livelihoods of people to identify promising policy options.
It is also crucial to determine what assistance the Bangladesh government requires from development partners such as the World Bank.
Additionally, formulating (district/regional) agricultural emergency preparedness plan is important for addressing the current and imminent economic slowdowns and downturns.
The Covid-19 poses a significant challenge to people and the planet. Meticulous planning is critical to contain the spread of the virus and to safeguard the economy.
In the short term, governments must meet the farming community's demands and take immediate measures to counteract current economic adversity.
In the medium- to long-term, governments have to invest wisely to diversify the agrarian economy from commodity dependence, which reduces financial vulnerabilities and builds capacity to withstand and recover following economic slowdowns and downturns.
The author is Associate Professor of Agricultural Extension and Information System, Sher-e-Bangla Agricultural University.