RICE SHORTAGES IN WEST AFRICA: POTENTIAL FOR POLITICAL INSTABILITY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP83S00855R000100010006-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 21
• Document Creation Date: December 21, 2016
• Document Release Date: September 17, 2008
• Sequence Number: 6
• Publication Date: July 1, 1982
• Content Type: REPORT

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Directorate of
Intelligence
Secret
Instability
Rice Shortages in West Africa:
Potential for Political
ON FILE DEPARTMENT OF AGRICULTURE RELEASE
INSTRUCTIONS APPLY
State Dept. review completed
Secret
ALA 82-10099
Ju
c-py ly 1982 2 8 8
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Directorate of Secret
Intelligence
Rice Shortages in West Africa:
Potential for Political
Instability
An Intelligence Assessment
East Africa Division, ALA
This assessment was prepared byl lof
the Research Branch, Office of African and Latin
American Analysis. Comments and queries are
welcome and may be addressed to the Chief, West-
This paper has been coordinated with the
Directorate of Operations and with the National
Intelligence Council.
Secret
ALA 82-10099
July 1982
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Rice Shortages in West Africa:
Potential for Political
Instability
Key Judgments We believe the inability of West African governments to ensure a steady
supply of inexpensive rice in urban areas will be an increasingly important
cause of political instability in the region throughout the remainder of the
decade. Rice has replaced more traditional foods as the major dietary
staple of the growing and politically important urban populations in 13 of
18 West African and Sahelian states. Domestic production in many
countries has not kept even remotely close to skyrocketing demand,
however, forcing governments to spend scarce foreign exchange on in-
creased rice imports.
Urban populations throughout the region have proved ready to take to the
streets to protest rice shortages and sharp increases in the retail price of
rice. Protests in Liberia against proposed price increases in 1979 turned
violent when the army was called in to maintain order, and the lack of rice
in urban markets was an important factor in the fall of the government in
Guinea-Bissau in 1980. The government in Sierra Leone faced a serious
challenge in 1981 when labor unions called a general strike because of high
rice prices and deteriorating economic conditions. In Nigeria, the high
price of imported rice and the obvious corruption in the issuing of lucrative
rice import licenses may become potent issues in next year's election if the
government is unable to control prices.
Even though it is technically feasible to substantially increase domestic rice
production, we believe that rapidly growing demand spurred by unchecked
population growth and uncontrolled urbanization will prevent most, if not
all, West African nations from achieving rice self-sufficiency by the end of
the decade. The current gap between domestic production and consump-
tion-nearly half of requirements in some years-is too large to be easily
eliminated. Even more prosperous nations such as Nigeria and Ivory Coast
lack the massive technical, financial, and managerial resources necessary
for increased use of fertilizers, irrigation, and other technical means to
improve yields and increase domestic production. Small farmers-the
backbone of West African agriculture-are likely to continue growing only
enough rice for their own needs as long as governments offer higher
producer prices for more lucrative export crops such as coffee and cocoa.
Most West African governments will continue to be pressed by volatile and
Information available as of 30 June 1982 has been used in
the preparation of this report.
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ALA 82-10099
July 1982
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politically important urban populations to subsidize consumer rice prices, a
policy that strains budgets and sustains the diversion of resources from the
farming sector.
The problems of meeting domestic demand through imports are complex.
The United States-one of the world's largest rice exporters-will be
called upon to increase the level of emergency relief and concessional sales
to West Africa's impoverished nations. Whatever the feasible extent of US
assistance, however, it alone will not solve the growing food problem in
West Africa.
The Soviets and Libyans are unlikely to be able or willing to meet West
Africa's massive rice or other food needs. They are in a position, however,
to benefit from long-term instability in the region, which will provide
opportunities for them to take actions in West Africa aimed at discrediting
the United States, undermining Western influence, and weakening moder-
ate governments.
Secret iv
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Consumption Skyrocketing
Domestic Production Lagging
Heightened Instability
6
1. Major Rice Growing and Consuming Areas in West A
frica
2
2. Liberian Rice Production, Consumption, and Import P
atterns
10
3. Nigerian Rice Production, Consumption, and Import
Patterns
11
4. Sierra Leonean Rice Production, Consumption, and Im
port Patterns
13
1. West African Rice Consumption
2. West African Domestic Rice Production Available for
Consumption, Rice Imports, and Rice Consumption, i
Metric Tons, 1960-78
n 1,000
3. The Changing Rural/Urban Balance in West Africa,
1950-2000
3
4. West African Urban Annual Growth Rates Compared
Regions of the World, 1950-2000
With Other
3
5. Rice Self-Sufficiency for West African Rice Developm
Association Members and Selected WARDA Nations,
ent
1960-78
4
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 Figure 1
West African Rice Consumption
Algeria
Romania ~
Yugoslavia
Saudi
Arabia
troonl
Yaounde
Central African
Republic
Rwanda
Burur
South Lesotho
Africa
Red
..Sea
6 Comoros
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Primary urban staple
Secondary urban staple
Minor urban staple
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International agricultural organizations point out that Africa has the
world's lowest food production growth rate and that food production is
likely to continue to lag far behind Africa's skyrocketing population
growth. These points, with which we agree, imply that Africa faces the
prospect of severe food shortages throughout the remainder of the century.
In West Africa, where political instability is already a problem, we believe
that the increasing inability of governments to ensure a steady supply of
cheap rice-one of the fastest growing urban dietary staples in the
region-could act as a spark for widespread urban protests and violence.'
Although we recognize that rice shortages are only one factor affecting
political stability, we believe that projected shortages are sufficiently
important to the region and to US interests to warrant closer analysis. We
plan to explore other specific economic, social, and agricultural issues
affecting the political stability of the region in subsequent papers.
' In this paper West Africa includes Benin, Cameroon, Cape Verde, Chad, The Gambia,
Ghana, Guinea, Guinea-Bissau, Ivory Coast, Liberia, Mali, Mauritania, Niger, Nigeria,
Senegal, Sierra Leone, Togo, and Upper Volta.
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Rice Shortages in West Africa:
Potential for Political
Instability
Introduction
Rice has become the major urban dietary staple in
almost three-fourths of the countries of West Africa,
according to US Department of Agriculture statistics.
According to these same sources, the ability of the
region to meet its rice needs-already low-is declin-
ing as urban demand continues to outstrip domestic
production. In our judgment, governments increasing-
ly will face periodic shortages of rice that may weaken
already unstable regimes. Rice consumption has sky-
rocketed in the last 20 years, partly because govern-
ments-in an attempt to maintain peace in politically
important urban areas-subsidize the price paid by
consumers. Urban West Africans, in our opinion,
have come to view cheap rice as a right rather than a
privilege and have taken to the streets to protest both
shortages and price increases. Rice shortages and
price hikes were important factors in the coups in
Liberia and Guinea-Bissau in 1980, and in the general
strike in Sierra Leone in 1981.
West African leaders have stated publicly that they
have little political alternative but to import ever
greater quantities of rice to meet the growing urban
demand. Observers of the region believe that the
growth of domestic production of rice has not kept
pace with that of demand for some time because
governments traditionally have paid farmers higher
prices for such export crops as coffee and cocoa than
for food crops. In the face of high oil and debt
payments, however, these nations-many among the
poorest in the world-find it increasingly difficult to
buy rice through commercial channels. We believe the
reluctance of West African nations to agree to de-
mands by the International Monetary Fund and other
potential donors that rice subsidies be curtailed or
eliminated will make it more difficult to line up
outside financial assistance. Throughout the rest of
the decade, we expect that West African countries
will be forced to turn to the world's major rice
producers-particularly the United States-to pro-
vide emergency food aid and rice at concessional
terms.
Figure 2
West African Domestic Rice Production
Available for Consumption, Rice, Imports,
and Rice Consumption, 1960-78
Thousand Metric Tons
1960-64 65-69 70-74 75 76 77 78
Avg. Avg. Avg.
Consumption Skyrocketing
Rice is rapidly replacing more traditional West Afri-
can foods-such as cassava, yams, millet, and sor-
ghum-as the main dietary staple of urban West
Africans. Rice consumption in West Africa has more
than doubled since the 1960s, according to the West
African Rice Development Association (WARDA).z
By the late 1970s regional consumption was over
2 million metric tons annually, while in Nigeria,
' Systematic and reliable data on West African rice production and
consumption are lacking. West African governments often either do
not collect data, lack the resources needed to systematically collect
accurate data, or falsify their reports for political purposes. As a
consequence, the data are presented to indicate trends-about
which there is general agreement-rather than precise conditions.
Secret 25X1
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Domestic
Production
Imports
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Major Rice Growing and Consuming Areas in West Africa, 1978
Countries with over 100,000 hectares
under rice production-100,000
hectares
Guinea 472
Ivory Coast 428
Sierra Leone 416
Nigeria 253
Liberia 202
Mali 184
Guinea-Bissau 109
Countries importing over
1,000 metric tons of rice-1,000
metric tons
Nigeria
Sierra Leone
Ivory Coast
Guinea
Senegal
Liberia
Ghana
Mali
456.5
363.9
317.8
279.6
241.9
193.2
166.4
121.4
which registered the largest volume increase, con-
sumption climbed to 1.5 million tons in 1980. Per
capita consumption also has increased. Regional per
capita consumption is over 19 kilograms per year;
Sierra Leoneans eat 123 kg per year, a rate equal to
consumption in many Asian countries.
Agricultural experts agree that this dramatic increase
in rice consumption is largely the result of explosive
population growth and uncontrolled urbanization. UN
statistics indicate that populations have been growing
at a regional average of between 2.5 and 3 percent a
year since 1950. At the same time, more and more
rural West Africans are lured to the cities by the
prospects of employment, education, and higher
Major rice-consuming countries
of West Africa-kilograms per year
per capita
Sierra Leone
Liberia
122.9
111.5
69.0
60.1
55.5
45.8
44.8
41.8
Countries in which rice
consumption was over 100,000 metric tons
-1,000 metric tons
Nigeria 680.8
Senegal 237.5
Ivory Coast 141.5
Ghana 129.0
wages. Urban areas throughout the region are ex 7,
panding at an average of 5.5 percent yearly, while the
capital cities are growing even faster. According to
UN data, Lagos grew from 1.4 million in 1970 to 2.6
million in 1980 and may reach 4.5 million by 1990.
During the same period Abidjan's population doubled
to 3 million and may climb to over 5 million by 1990.
Studies of urban life in West Africa indicate that
families, particularly those in which most members
work, prefer rice because it is easy and quick to
prepare and has a longer shelf life than other foods.
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Figure 3
The Changing Rural/Urban Balance
in West Africa, 1950-2000
Figure 4
West African Urban Annual Growth Rates
Compared With Other Regions of the World,
1950-2000
Annual Percentage Growth
Many new city dwellers also view rice as a status
symbol separating them from their rural homelands,
where they consumed more traditional West African
foods. According to US Government and open
sources, urban West Africans have developed strong
taste preferences for higher quality imported rice
rather than domestic rice; urban Nigerians, for exam-
ple, are willing to pay a high premium for unbroken,
long grain rice imported from the United States and
Thailand.
Domestic Production Lagging
Significant increases in domestic rice production have
lagged far behind the soaring urban demand for rice.
WARDA estimates that although the amount of
domestic milled rice available for consumption grew
to over 1.5 million tons annually in the late 1970s-
compared to about 1 million tons annually in the
1960s-this increase was not nearly enough to keep
pace with the rate of increase in demand. Consump-
tion during the same period increased from about 1.5
Latin America North America 25X1
I Source: United Nations
million tons annually to over 2.3 million tons annual-
ly. As a result, WARDA reports that average regional
self-sufficiency has now fallen below 70 percent in
most years and even lower during years when domes-
tic production plummets because of bad weather as it
did in Nigeria in 1977 and 1978.
The imbalance between supply and demand is further
aggravated because most domestically produced rice
is not marketed in urban areas but goes to meet the
rural demand for rice. The region's 700,000 rice
farmers, many of whom farm no more than 1 hectare,
historically have produced only enough rice for the
needs of their family. US Embassies throughout the
region report that much of the increased domestic
production is consumed by growing rural populations,
traded locally, or stored as a hedge against hard
times. In Senegal, for example, Embassy reports
indicate that, even during good years, over 90 percent
of the harvest goes to meet rural demand.
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2000
West Africa ~ East Asia Europe
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Figure 5
Rice Self-Sufficiency for West African Rice
Development Association Members and
Selected WARDA Nations, 1960-78
Percent Self-Sufficient
I I I I I I I
1960-64 65-69 70-74 75 76 77 78
Avg. Avg. Avg.
aWARDA estimates for Nigeria have been adjusted
to correct for reporting errors.
Source: West African Rice Development Association
WARDA
[vory Coast
587051 7-82
Government Policies Backfire
Government attempts to encourage farmers to grow
more rice have been hindered by conflicting policies
and mismanagement. Despite government statements
proclaiming the need for food self-sufficiency and the
ample evidence that farmers would grow more rice
and other food staples if offered higher prices, govern-
ments, according to academic studies and Embassy
reports, find it more expedient to raise much needed
foreign exchange by offering farmers higher prices for
cash crops-such as coffee, cocoa, and groundnuts-
than for food crops. In addition, governments tradi-
tionally have over-taxed rural residents to finance
industrialization. West Africa's small farmers-wide-
ly dispersed and poorly organized-lack the political
influence of urban residents, allowing West African
leaders to invest development revenues in more highly
visible and politically appealing urban projects.=
Farmers willing to produce surplus rice for sale have
more profitable alternatives than selling to official
government agencies. Many avoid accepting low gov-
ernment prices by negotiating with private traders,
who often offer better deals and pass the higher cost
directly to the consumer. This has become the domi-
nant marketing mechanism for domestic rice in West
African urban centers. The journal West Africa re-
ports that in Mali, where official producer prices have
been traditionally low, 60 to 80 percent of the food
provided by the domestic market is supplied through
private traders. Others smuggle rice into neighboring
countries where their rice may command a higher
price. The US Embassy in Monrovia reports that a
significant proportion of Liberian rice, for example, is
smuggled into Ivory Coast, Sierra Leone, and Guinea.
In general, government crash programs and pilot
projects to modernize rice production have produced
disappointing results. Some West African leaders
such as Sekou Toure in Guinea have attempted to
raise domestic production by creating large state-run
farms and collectives and by subsidizing the use of
more modern farming methods. Other more moderate
leaders-such as former President Tolbert in Liberia,
President Shagari in Nigeria, and President Stevens
in Sierra Leone-have sought both to develop large-
scale farms and to increase the productivity of small
farms by providing loans, input subsidies, and im-
proved extension services. Whatever the development
approach followed, however, poor transportation net-
works, high fuel costs, and a lack of adequate process-
ing and storage facilities throughout the region hinder
rapid and dramatic improvement.
Furthermore, a detailed academic study of rice pro-
duction in West Africa suggests that widespread and
substantial government investment in modernization
and mechanization of rice production is at best a
dubious economic proposition-partly because of er-
ratic rainfall and the lack of irrigation. The same
study argues that with the exception of Sierra Leone,
where a low wage rate structure encourages labor-
intensive production techniques, and in Mali, where
the French invested heavily in the infrastructure
needed for large-scale farming, West African nations 25X1
would be better off investing scarce development
funds to improve production of other food crops.F__1
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Corruption
The soaring demand for rice has encouraged various
forms of corruption and hoarding that have the net
effect of keeping prices high and supplies down in
urban areas. These trends have become potentially
sensitive political issues. The Nigerian press, for
example, has reported extensively since 1980 on irreg-
ularities in the award of rice import licenses in
Nigeria. Indeed, Nigerian President Shagari's pro-
spective opponents in elections scheduled for 1983
were handed an opportunity to criticize the regime in
1981 when the National Assembly published a list of
his supporters and cronies who received rice import
licenses. The rice riots in Monrovia, Liberia, in 1979
were motivated in part by the public view that
President Tolbert and his family-who owned exten-
sive agricultural holdings-would be among the pri-
mary beneficiaries of proposed increases in consumer
and producer prices.
The effectiveness of government marketing boards
has been limited by the corruption that pervades these
institutions.
boards serve as convenient sources of financial patron-
age for government leaders. In addition, staff person-
nel, trying to cope with excessive inflation and fre-
quently supporting an extended family, often use their
positions for personal gain. US Embassy reporting has
documented that before Senegal's national grain mar-
keting board was disbanded in 1980-following
charges of mismanagement and unresponsiveness to
farmers' concerns-corruption extended from the
weighers in the villages to truckers to senior officials
such as former President Senghor's nephew,__~
private traders, and even officially licensed brokers,
commonly hoard rice to drive up the price on the open
market. Throughout the region, traders are able to
take advantage of the inability of governments to
assure a steady supply of rice at lower, officially
posted prices. Governments, partly because they buy
so little of the domestic crop and partly because they
are unable to purchase and store enough imported
rice, are limited in their ability to enforce official
prices. Nor do government edicts announcing lowered
official rice prices have much impact. Head of State
Rawlings in Ghana and President Stevens in Sierra
Leone, according to embassy reporting, recently have
discovered that pronouncements outlawing hoarding
do little to bring down prices or increase supplies in
urban markets. As a consequence, consumers must
either endure long lines for what little rice-usually
imported-is available at the lower official price or
pay two to three times more on the black market.F_
Prospects Bleak
Although national leaders will continue to espouse
self-sufficiency, in our judgment most West African
countries-faced with continued population growth
and rapid urbanization-will be forced to increase
their dependence on imported rice in the near future.
While world rice exports, based on UN Food and
Agricultural Organization projections, should just
about balance import demands in the next five years,
West Africa's impoverished nations will find it in-
creasingly difficult to compete in the open market.
The region's poorest nations already have been forced
out of the commercial markets and are now almost
totally dependent on concessional rice sales and West-
ern relief assistance. Even Nigeria and Ivory Coast-
prosperous by West African standards-have pur- 25X1
chased rice on concessional terms and in the future
will have to make difficult choices on how to spend
increasingly scarce financial resources.
The region theoretically has the potential to raise
production significantly by better use of such modern
agricultural technologies as fertilizers and irrigation;
but, in our judgment, the prospects for rapid improve-
ment are poor because of the lack of financial re-
sources, technology, expertise, and infrastructure.
Many of the high yielding seed varieties used in the
Asian rice revolution, for example, are not suited to
West Africa, which lacks extensive irrigation. In 25X1
addition, environmental factors such as weeds, pests,
diseases, and recurring droughts hold down West
African yields to about two-thirds the world average.
Finally, institutional constraints such as the lack of
extension services and credit discourage small farmers
from applying new technology. In our judgment, West
African nations will require sustained and substantial
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these handicaps. Even with this assistance, however
progress for most of the region will be slow.
The West African Rice Development Association
estimates that regional self-sufficiency will continue
to fall in the 1980s. The gap between consumption
and demand-according to one USDA projection-
may be as high as 7.5 million tons by 1990, with the
region able to supply less than one-fourth of its needs
from local sources. Even these estimates may be
overly optimistic, if the region experiences a return of
the prolonged drought conditions of the late 1960s
and early 1970s.
Limited Options
In our judgment, West African leaders have almost
no hope of meeting the widening deficit between
consumption and production without encountering
serious political risks. Efforts to improve production
through more market oriented policies will almost
certainly prompt resistance from important urban
constituencies who are already hard pressed to main-
tain current living standards. As a result, we believe
governments are unlikely to divert significant re-
sources from more politically volatile and powerful
urban constituencies to poorly organized and political-
ly weak rural interests. Indeed, we expect that lead-
ers-probably citing the Liberian example-will con-
tinue to resist demands from the International
Monetary Fund and other Western donors to bring
local rice supply and demand more in balance by
lowering subsidies and increasing producer prices. To
maintain the status quo, however, will almost certain-
ly result in the continuation of periodic shortages,
widespread black-market activities, and corruption.
Nevertheless, there are indications that the failure of
past policies and government mismanagement of
state-run marketing boards are forcing some West
African leaders to go against their better political
judgment and allow market forces a freer hand in
determining the marketing and pricing of rice. The
US Embassy in Niamey reports that Nigerien Presi-
dent Kountche is allowing private merchants to pur-
chase rice and other grains in neighboring Nigeria
and sell them for more than the government boards
are offering local farmers. In addition, he is personal-
ly urging farmers to sell at least some of their crop at
official prices. Malian President Traore, again ac-
cording to US Embassy reporting, appears to have
decided to maintain the official consumer price of rice
but not to enforce it. A critical factor in all these
decisions is the leader's willingness to risk the political
consequences of higher prices in exchange for a steady
supply of rice.
Heightened Instability
In our judgment, the inability of West African gov-
ernments to meet the growing urban demand for rice
will contribute significantly to the erosion of political
stability in the region. In the face of continually 25X1
declining living standards, we believe that urban
populations will be less willing to tolerate food short-
ages. Recent historical experience and trends appear
to leave no doubt that problems associated with rapid
population growth, uncontrolled urbanization, and the
widening gap between rich and poor will continue and
make the urban unemployed a more active and explo-
sive force in West African politics throughout the
remainder of the century. Based on past experience in
almost every country in the region, we believe that
civil servants, workers, students, and professionals are
likely to push harder to protect existing benefits as
well as make new demands on strained budgets as
economic conditions worsen.
We further believe periodic rice shortages or sharp
price increases may rally opposition forces and pro-
yoke widespread protests against West African gov-
ernments. Weak governments with few resources and
little popular support will have a difficult time weath-
ering widespread urban rioting. Threatened leaders-
feeling they have little alternative but to follow a
carrot-and-stick approach-probably will declare
martial law and call on the army to maintain order
while promising to reestablish a steady supply of
cheap rice. Experience suggests, however, that repres-
sion probably will generate more resentment and
unrest, especially if promises go unfulfilled. Civilian
opposition groups or the military-pointing to a gov-
ernment's inability to feed the urban population as
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another example of government corruption, misman-
agement, and inefficiency-may be convinced that
the time is right for seizing power. We believe that
even those governments that ride out an immediate
crisis will find it difficult to fulfill the politically
necessary promises to lower rice prices and increase
supplies made during the crisis. Moreover, with their
authority and power increasingly questioned, the re-
gimes' ability to respond to future challenges will be
diminished
Implications for the United States
In our view, as West African leaders become more
aware of the difficult political choices associated with
the rice problem, they will increasingly look to the
United States for help in meeting their growing
demand for rice, as well as for technical agricultural
assistance to spur stagnating domestic production.
Economically strapped countries-such as Niger,
Senegal, Liberia, and Sierra Leone-will remain un-
able to make large purchases of high-quality, expen-
sive US rice for the foreseeable future, but probably
will increase their requests for emergency relief and
sales on concessional terms. Leaders of these countries
are certain to cite humanitarian concerns, the need to
limit Soviet and Libyan meddling in moderate West
African governments, and the likelihood of wide-
spread urban protest if significant assistance is not
given. We believe that the reliability of the United
States as a friend is likely to be measured by the
willingness of Washington to step in quickly and come
to the aid of these moderate governments. Nigeria-
the largest volume importer in the region-and Ivory
Coast offer much more attractive markets for US
commercial sales of rice, but lowered foreign ex-
change reserves may limit these countries' ability to
continue to buy large quantities of imported rice.
Based on their past actions, the Soviet Union and
Libya will be quick to capitalize on any popular
unrest. The Ghanaian media reported a Libyan dona-
tion of rice and other foodstuffs to Ghana in January
1982 to ease food shortages following the coup. Our
analysis of their past behavior and their own current
food problems .and foreign exchange priorities sug-
gest, however, that the Soviet Union and Libya will
probably remain unwilling and unable to meet West
Africa's growing and long-term rice or other food
needs. Nonetheless, even largely symbolic acts such as
Qadhafi's donation might enable the Soviets or Liby-
ans to ingratiate themselves with impressionable and
insecure governments badly in need of foreign sup-
port.
At the same time, we estimate that the Soviets and
Libyans, for propaganda purposes, will also draw
attention to any US failure to provide aid. Under such
circumstances, we believe, pro-Western African lead-
ers would be vulnerable to criticism from the opposi-
tion-perhaps encouraged by Moscow or Tripoli-
that the country's woes are largely a product of its
close ties to Washington and the West.
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Appendix
Sketches of Key Countries
Periodic rice shortages and government attempts to
raise consumer rice prices could contribute to political
instability throughout West Africa, but we believe the
threat is particularly great in three countries-Libe-
ria, Sierra Leone, and Nigeria. Rice is the primary
rural and urban dietary staple in Liberia and Sierra
Leone, and past shortages or government-announced
price hikes have provoked widespread political unrest.
In our judgment, the continuing inability of these
moderate governments to increase domestic produc-
tion significantly or to control urban demand presents
a serious and long-term threat to their political stabil-
ity. Nigeria, the largest country in the region and the
second-largest importer of US rice in the world, faces
the prospect of being forced to import as much as 1
million tons by 1985 to meet the demands of its
growing and politically important urban population.
Moreover, the need to pay for higher imports could
force the government to divert funds from ambitious
development plans.
Liberia
Rice is the primary staple for both rural and urban
Liberians, and the country now has the second-highest
per capita consumption rate in West Africa. Demand
for rice grew 8.5 percent in 1981 and shows little sign
of slackening in the foreseeable future. Although 90
percent of Liberia's agricultural households produce
rice, the country is unable to meet the growing urban
demand. Most rice produced in Liberia is consumed
in rural areas, and the US Embassy reports that less
than 1 percent of domestically grown rice finds its
way into the official channels of the Liberian Produce
Marketing Corporation. Government-sponsored pro-
grams designed to increase production-which has
leveled off in recent years at about 125,000 milled
tons annually-have been hindered by the low pro-
ducer prices, widespread smuggling of domestic rice
to neighboring countries, and government misman-
agement.
Faced with stagnating domestic production, succes-
sive Liberian governments have increased imports to
meet demand. The US Embassy has reported that in
1981 alone about half of Liberia's rice needs had to be
imported, most for urban consumption. The severe
lack of foreign exchange and the mounting volume of
imports-104,000 metric tons in 1981-however, re-
strict the government's ability to buy rice in commer-
cial markets; about one-third of the rice imported
from the United States in 1981 was under a PL-480
agreement reached in January 1981.
The Politics of Rice. The political insensitivity of the
Tolbert government to the rice issue was a critical
factor in its downfall in April 1980. The mere an-
nouncement that the government was considering
raising producer prices from 12 to 18 cents per pound
and consumer prices from 20 to 30 cents per pound in
April 1979 provoked demonstrations throughout
Monrovia. Tolbert weathered the crisis only by can-
celing the price increases and calling on the military
to restore order. Opposition groups seized the rice
issue to point to Tolbert's personal corruption-the
family was one of Liberia's leading agricultural pro-
ducers-and ducers-and to illustrate the government's misman-
agement of rice production and marketing.
The US Embassy has reported that the Doe govern-
ment-which seized control a year after the Monrovia
riots-spent $4 million in its first year in power to
subsidize the retail price of rice. The cost of subsidies
could have reached $9 million in 1981 according to
Doe, but the government ended rice subsidies in mid-
1981 as a condition for receiving a $75 million loan
from the IMF. As a consequence, the price of a 100-
pound bag of rice rose from $20 to $24 in Monrovia
and even higher in outlying areas. The Embassy
reported considerable public grumbling.
Prospects. The Monrovia riots and Doe's coup clearly
established that Liberians are willing to challenge the
authorities over the supply and price of rice. We
believe even a temporary shortage of cheap rice could
provide a serious challenge to the military government
if it is unable to make any headway in reversing the
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Liberian Rice Production, Consumption, and Import Patterns
Area under rice (1,000 ha) 125.9 134.9
173.8
191.0
200.5
206.3
202.1
Paddy production (1,000 mt) 117 148
215
229
245
256
251
Yield of paddy (kg/ha) 930 1,093
1,216
1,199
1,222
1,241
1,241
Milled equivalent of paddy (1,000 mt) 78.5 98.9
143.9
153.4
164.2
171.5
168.0
Estimated rice consumption per capita (kg) 86.4 89.9
109.5
109.4
102.5
118.1
111.5
Rice available for consumption (mt) 57.2 72.1
111.0
141.2
128.7
138.1
144.9
Estimated total consumption (1,000 mt) 89.3 109.5
156.1
171.8
166.2
198.0
193.2
country's economic slide. Continued public dissatis-
faction with the supply or price of rice gives civilian
opposition groups-already frustrated with declining
economic conditions and the slow pace of the return to
civilian rule-a potential rallying point for mobilizing
demonstrations against Doe's government, given a
sufficient catalyst. Within the government, we believe
disgruntled military men could use the wides read
unrest to justify replacing the moderate Doe.
Liberia, in our judgment, will be forced to rely
increasingly on US PL-480 rice aid. The Embassy
estimates that rice import requirements may climb to
over 120,000 metric tons in 1982, and, given the sorry
state of the Liberian economy, prospects are dim for
large commercial sales. While we believe the pro-
Western Doe realizes that neither the Soviet Union
nor Libya is able or willing to meet Liberia's rice
needs, he could always threaten to approach them in
order to put pressure on Washington. The Soviets or
Libyans-especially in light of the chilly relations
between Monrovia and Moscow and Tripoli-could
seek to take advantage of any eruption of popular
discontent by trying to develop clandestine ties with
disgruntled civilian or military factions.
Nigeria
Nigeria imports more rice than any other West
African country and by 1985, according to both US
Government and private industry sources, may be
importing 1 million metric tons annually-500,000 of
which may be from the United States. Rapid urban-
ization-Nigeria has the largest urban population in
black Africa-and higher incomes derived largely 25X1
from oil production have produced an explosion in the
demand for high-quality imported rice. Unlike many
other West African countries, Nigeria does not subsi-
dize consumer prices, but the government has been
forced to spend increasingly scarce foreign exchange
on rice imports. The increasing volume of these
imports has provided numerous and lucrative opportu-
nities for high-level corruption. Steep rice prices and
extensive local reporting of rice dealings have tar-
nished the public images of the President and the
ruling National Party of Nigeria.
Increasing Demand, Increasing Imports. Rice is now
grown in all 19 states; and rice production, according
to a report presented at a recent meeting of the Food
and Agriculture Organization, has almost tripled in
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imported for about $25 per 110-pound bag often sold
in markets for over $160 per bag.
Shagari's opponents have leveled charges in the public
media that corruption extends to the highest levels of
the government, while
rumors are circulating in Nigeria that tie the
President himself to the rice trade. We believe that an
inconclusive, full-scale National Assembly investiga-
tion into licensing procedures did little to convince the
public of the government's innocence. Opposition
parties, according to various Embassy reports, will
capitalize on this issue in general elections next year
as part of their efforts to picture Shagari and the 25X1
Prospects. Based on past performance and projected
demand, the Embassy predicts, and we agree, that
Nigeria will be forced to continue importing rice for
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Nigerian Rice Production, Consumption, and Import Patterns
Area under rice (1,000 ha)
168.6
220.8
268.5
261.0
172.0
244.0
253.0
Paddy production (1,000 mt)
197
299
453
643
232
400
417
Yield of paddy (kg/ha)
1,162
1,343
1,683
2,464
1,348
1,639
1,648
Milled equivalent of paddy (1,000 mt)
129.9
197.3
298.7
424.4
153.1
264.0
275.2
Estimated rice consumption per capita (kg)
1.8
2.4
2.9
6.1
5.5
5.9
8.5
Rice available for consumption (mt)
97.2
145.8
200.5
450.2
372.8
124.9
224.3
Estimated total consumption (1,000 mt)
98.2
146.8
203.1
456.9
418.2
466.5
680.8
the last three years. The same report indicates, how-
ever, that demand has been growing by an estimated
20 percent annually since 1974 and that rice now
accounts for about 7 percent of Nigeria's total food
consumption. In an attempt to achieve self-sufficien-
cy, the government has embarked on several ambi-
tious plans to boost food production and reduce the
country's $2 billion food import bill, halt the drift of
rural Nigerians to urban areas, and revive a once-
25X1 thriving agricultural export sector. But technical and
administrative constraints-such as the difficulty and
inefficiency in supplying fertilizers and poor coordina-
tion of extension services-still hinder the govern-
ment's attempts at achieving self-sufficiency. In the
meantime, Lagos continues to import record amounts
25X1 of rice-600,000 tons last year, compared with
100,000 tons in the 1960s.
Rice and Corruption. For the last two years, the
Shagari government has issued a limited number of
licenses-mainly to influential supporters of the Pres-
ident and the National Party of Nigeria (NPN) -to
import rice. By restricting the amount of rice import-
ed and available in markets, import license holders
have been able to drive prices up. In 1981 rice
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the foreseeable future, even if the current targets for
increased local production are met. Without some
slowdown in rural migration, rice imports may rise to
1 million tons by the mid-1980s, absorbing approxi-
mately $500 million in foreign exchange that would
otherwise be available for economic development.
Given the strong preference of urban Nigerians for
long-grain, high-quality rice, Nigeria is likely to
import increasing amounts of rice from the United
States. The United States exported $223 million
worth of rice to Nigeria in 1981-a 142-percent
increase over 1980. In addition, Nigeria probably will
look to the United States for increased technical
assistance in improving Nigeria's domestic rice pro-
duction.
We believe that continued high prices and govern-
ment manipulation of the rice trade could help fan
urban discontent and, if economic conditions continue
to worsen, could even threaten the stability of the
three-year-old civilian regime. Faced with declining
living conditions, Nigeria's volatile electorate is un-
likely to continue to accept the government's claims
that imports must be severely restricted to preserve
foreign exchange, protect domestic producers, and
discipline consumption habits. Although we doubt
that rice shortages or escalating rice prices alone will
bring down the government, they will help the Presi-
dent's opponents focus popular attention on govern-
ment mismanagement and corruption.
Shagari may be forced to choose between two politi-
cally unappealing alternatives. We believe that if he
ends the lucrative rice-licensing scheme to reduce
consumer prices he risks alienating influential party
and financial supporters. On the other hand, some
voters may be influenced against Shagari and his
party if prices remain high and if the public continues
to believe that a handful of loyal NPN supporters are
benefiting at the expense of the urban consumer. =
Sierra Leone
In our view the inability of the Stevens government in
Sierra Leone to ensure a steady supply of cheap rice
presents a serious threat to the already shaky govern-
ment. Sierra Leoneans consume more rice per capita
than other West Africans. High rice prices and other
economic issues prompted labor leaders to call a
general strike last year that forced Stevens to cut by
half the official price of rice. The government, howev-
er, will have a difficult time enforcing official prices,
and Stevens's opponents will be likely to cite this
failure as another reason for replacing the 77-year-old
leader.
Rising Demand and Stagnant Production. Rice,
Sierra Leone's main agricultural crop, is grown on
over 70 percent of all cultivated lands and employs 85
percent of the country's farmers. Academic studies of
rice production in West Africa indicate that Sierra
Leone is one of the few West African nations capable
of producing rice economically and achieving self-
sufficiency. Production increases, however, have not
kept pace with growing demand. Many small farmers
grow rice only for their own families, preferring to
grow coffee and cocoa for sale because government
pricing policies favor these export crops. In addition,
diseases and pests, adverse weather, and the general
lack of use of fertilizers hold down production.
The Rice Dilemma. Stevens-perhaps more than any
other West African leader-was shaken by the 1980
overthrow of the Tolbert government in Liberia.
Extensive press and public reporting indicated that
Stevens and Tolbert were close and that Stevens was
well aware of parallels between Liberia and Sierra 25X1
Leone. Rice is an urban and rural staple in both
countries, and Stevens and Tolbert were criticized
openly by domestic opposition groups for spending
lavishly to play host to OAU summits while living
conditions in their countries deteriorated. These press
sources reported that Stevens feared that Sierra Leon-
eans-following the Liberian example-might take to
the streets if the government were unable to assure a
steady supply of cheap rice. Finally, the same sources
suggest that Stevens was aware of smoldering discon-
tent among military personnel who might use the rice 25X1
issue to gather popular support for seizing power as
did Liberia's Sergeant Doe.
Stevens has been unable to develop a coordinated and 25X1
coherent rice policy. According to numerous agricul-
tural assessments, the government lacks the long-
range planning capability necessary to assure a steady
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Sierra Leonean Rice Production, Consumption, and Import Patterns
Area under rice (1,000 ha)
296
326
423
435
463
410
416
Paddy production (1,000 mt)
312
427
580
609
642
624
633
Yield of paddy (kg/ha)
1,081
1,312
1,408
1,401
1,385
1,522
1,522
Milled equivalent of paddy (1,000 mt)
205.7
281.4
383.1
401.9
423.7
411.8
427.9
Estimated rice consumption per capita (kg)
82.9
103.7
128.5
117.5
125.1
132.3
122.9
Rice available for consumption (mt)
164.5
210.7
308.6
325.1
337.3
359.7
345.7
Estimated total consumption (1,000 mt)
179.1
246.1
336.9
328.9
358.4
383.6
363.9
supply in the marketplace. Moreover, Stevens has
been reluctant, when approached in the past, to
implement measures necessary to increase local pro-
duction. Government-sponsored agricultural pro-
grams have floundered due to poor management and a
lack of financial and technical resources. The govern-
ment expects a poor crop this year and, according to
the US Embassy, will be forced to import 80,000 tons
of rice in 1982 compared to an estimated 20,000 to
25,000 tons in 1981.
Prospects. In our opinion, President Stevens will have
a difficult time recovering the control and popularity
lost after the 1981 disturbances. The government
headed off more serious trouble last year only by
backing down on a number of issues, promising
economic improvement, and declaring martial law.
However, private traders-who dominate the market-
ing of domestic rice-were not party to the 1981
negotiations, and the Embassy recently reported that
current prices are double the official price set last
year. The government also has been pressed by the
IMF to raise producer prices and cut subsidies. Sierra
Leone agreed to the "economic" pricing of rice in
1981 as a condition for receiving IMF assistance and
recently passed on to consumers a 22-percent increase
in the cost of imported rice.
The political risks of raising consumer prices, in our
view, are high. Opposition groups, emboldened by last
year's strike, are likely to use the hardships caused by
austerity measures to rally popular support against
the government. As Stevens becomes increasingly 25X1
unable to balance competing demands for rice and
other essential imports, we believe he probably will
step up his appeals to the United States and other rice
exporters for more concessional sales and relief aid.
Stevens's inability to secure rice aid almost certainly
will be viewed by his growing number of opponents as
an indication that he has lost the support of even his
traditional benefactors and should be replaced.
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