Agriculture and Trade Opportunities for Tanzania: Past Volatility and Future Climate Change

Authors

  • Syud Amer Ahmed,

    1. Development Research Group—Agriculture and Rural Development, The World Bank, Washington DC, USA
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  • Noah S. Diffenbaugh,

    1. Department of Environmental Earth System Science and Woods Institute for the Environment, Stanford University, USA
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  • Thomas W. Hertel,

    1. Department of Agricultural Economics, Purdue University, Lafayette, IN, USA
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  • William J. Martin

    Corresponding author
    1. Development Research Group—Agriculture and Rural Development, The World Bank, Washington DC, USA
    • Ahmed and Martin: Development Research Group—Agriculture and Rural Development, The World Bank, 1818 H St NW, MSN MC3-307, Washington, DC 20433, USA. Tel: +1-202-473-6454; Fax: +1-202-522-1151; E-mail: sahmed20@worldbank.org. Diffenbaugh: Department of Environmental Earth System Science and Woods Institute for the Environment, Stanford University, CA 94304, USA. Hertel: Department of Agricultural Economics, Purdue University, Lafayette, IN 47907, USA.

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  • The authors are grateful for helpful feedback from Madhur Gautam, Sergiy Zorya, two anonymous referees, and the participants of the 13th Annual Conference on Global Economic Analysis held in Penang, Malaysia in June, 2010. The views and opinions expressed in this paper are solely those of the authors. This research was supported by the Trust Fund for Environmentally and Socially Sustainable Development.

Abstract

Given global heterogeneity in climate-induced agricultural variability, Tanzania has the potential to substantially increase its maize exports to other countries. If global maize production is lower than usual owing to supply shocks in major exporting regions, Tanzania may be able to export more maize at higher prices, even if it also experiences below-trend productivity. Diverse destinations for exports can allow for enhanced trading opportunities when negative supply shocks affect the partners' usual import sources. Future climate predictions suggest that some of Tanzania's trading partners will experience severe dry conditions that may reduce agricultural production in years when Tanzania is only mildly affected. Tanzania could thus export grain to countries as climate change increases the likelihood of severe precipitation deficits in other countries while simultaneously decreasing the likelihood of severe precipitation deficits in Tanzania. Trade restrictions, like export bans, prevent Tanzania from taking advantage of these opportunities, foregoing significant economic benefits.

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