Editorial by Madani Tall, World Bank Country Manager for Senegal
After the euphoria surrounding the Summit of the Organization of the Islamic Conference held in Dakar on March 13-14, reality, temporarily forgotten in the bustle to ensure the success of that gathering, popped right back up again.
Like Niger, Mozambique, Cameroon, Burkina Faso, Egypt, Slovenia (84 central union committees in 29 European countries) or Côte d’Ivoire, Senegal has also had its share of ‘demonstrations against the high cost of living’. When faced with a sticky situation, governments are always sorely tempted to, shall we say, look for ‘easy’ ways to control soaring prices and growing perils. The trouble with such measures, however, is that even when they do work, they’re only effective for a short time. Senegal is no different, and ear-pleasing measures such as “temporary tax cuts” and “establishment of controlled-price stores” are being bandied about. There is no denying that the price shock of $100-a-barrel oil has had a negative impact on the overall economic situation, especially for households, in view of an inflation rate of nearly six percent that has not been experienced since the 1994 devaluation of the CFA franc. It is also true, however, that Senegal has failed to push through the in-depth reforms that, if successful, might have cushioned the impact.
Madani M. Tall, World Bank Country Manager for Senegal
We need to face facts and take a look at agriculture in particular, which has been neglected in favor of super-protected industries that are not competitive and do not even generate all that many jobs. By postponing the sustained application of reforms aimed at restructuring this sector, and especially groundnut production, we’ve created this paradox: food prices in Senegal are 24 percent above the African average and the highest in the ECOWAS zone with the exception of Nigeria and Cape Verde! For a country with a port that supplies even the landlocked countries, this is an irony worth noting. Yet, the internal situation holds lessons even for the government and its development partners: staple food prices are 11 percent cheaper in Kaolack than in Dakar. The reason is simple: households in Kaolack benefit from the competition posed by Gambia. What is the point, then, of levying surtaxes on imported vegetable oil and sugar, which only reduce the purchasing power of the poorest households? It is becoming urgent that we closely scrutinize the internal factors contributing to price hikes.
There is no need for rash measures dictated by high oil prices. Such measures would be neither effective nor lasting. We need to ‘make haste slowly’ by aiming at least at the medium term. There is no magic wand that will turn rice importation into cereals’ self-sufficiency. There is only sweat and rational reform, which are not mutually exclusive. If they are to be effective, however, producers and consumers must have a shared vision of agricultural policy in the broad sense, and must arrive at a broad consensus on such issues as seed production, land management, agricultural sector financing, the modernization of cropping practices, and so much more.
This shared vision is also needed in the education sector, which absorbs the lion’s share of the country’s resources without producing the desired results. When a nation allows its children to miss out on one-third of the instructional hours owed to them by their teachers, it is laying the groundwork for its own long-term decline. And that has nothing to do with $100-a-barrel crude oil.
Madani Tall is the World Bank Country Manager for Senegal
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