Department of Agricultural, Food, and Resource Economics Feed the Future Innovation Lab for Food Security Policy

Yénizié Koné, Véronique Thériault, Alpha Kergna, and Melinda Smale, 2019. Fertilizer Subsidy in Mali: Origins, Context and Evolution,  Feed the Future Innovation Lab for Food Security Policy Research Paper 142e. East Lansing: Michigan State University.

Abstract

The present research aims to trace the main historical references for agricultural subsidies,
including fertilizers, in Mali. It gives an overview of the major historical dates that have
influenced the use of fertilizer subsidies, to capitalize learnings and lessons learned from past
experiences to improve current practices. The methodological approach is based on a review of
the literature, use of available secondary data and interviews with key individuals who have
worked on fertilizer use and distribution in Mali.

The analysis of the results shows that the fertilizer subsidy has always been an integral part of
the agricultural development strategies of the successive governments of the Republic of Mali
from 1960 to 2019. Regardless of the adopted economic system (socialist or liberal) and the
vicissitudes of history, the practice of fertilizer subsidies has never disappeared from the
financing strategies of agriculture in Mali.

In general, fertilizer subsidies have been perpetuated over time, sometimes reducing the
constraints imposed by donors. Moreover, they have recently been justified by the need, on the
one hand, to encourage the use of fertilizers to increase agricultural production and
productivity in order to ensure food security and to protect farmers against the volatility of
fertilizer prices, the adverse effects of droughts on crops and incomes, on the other hand.

Thus, in the early years of independence, under the prevailing socialist economic system, large,
uncontrolled fertilizer subsidies were allocated to rural development operations (ODRs). Their
mismanagement has led to unsustainable debt for the state without a real impact on the living
conditions of the people. For this reason, as part of structural adjustment policies, fertilizer
subsidies have been discouraged or even eliminated for most agricultural sectors. But in the
wake of the global food and nutrition crisis of 2007, they were rehabilitated and then put back
on track to increase agricultural production and productivity.

Currently, the fertilizer subsidy program implemented through paper and electronic te chnical
delivery systems is becoming increasingly controlled to ensure traceability and transparency.
However, the cost of this fertilizer subsidy program is increasing and the impact on beneficiary
populations remains mixed. Hence the need to reconcile fertilizer subsidies with sustainable
investment needs in agriculture, including through public investment (e.g., research and
development, extension services and irrigation infrastructure).