Improving Agricultural Market Performance:
Creation and Development of Market Institutions
76
Even within a given trade bloc, a lack of capacity in Customs administration at border posts, as
well as unofficial policies enacted at the central Government level may impede trade. For
example, “Starting in 2002, Nigeria began to impose high import tariffs (up to 50%) or outright
import bans on a number of important product groups, including used cars, cloth, new and
used clothing, poultry and a wide range of meat products, rice, palm oil, and sugar. As formal
imports were severely diminished by these restrictions, Benin began to import these same
goods and re-export them through informal channels to Nigeria. Benin’s imports rose from
US$623 million in 2001 to US$725 million in 2002 and US$2.2 billion in 2012, a compound
average growth rate of 12.15% per annum, while exports grew from US$374 million in 2001 to
US$448 million in 2002 and US$1.4 billion in 2012, a compound average growth rate of
12.75% per annum. An estimated 85% of Benin’s gasoline consumption is imported informally
from Nigeria, and Benin also serves as a conduit to other countries for refined petroleum
products.124
Although the African Union has announced plans to create a single African market, realization
of this goal is a long way off in view of the limited volumes of trade taking place within existing
regional economic communities.
While this is only a small sample of the challenges that may be encountered, the examples
above provide insight into the nature of the problem of coordination and highlight the need for
systematic approaches.
3.5 Coordination and Reform of Agricultural & Food Market Institutions in
the OIC
Chapter 2 has already discussed how food market institutions developed over time,
highlighted those that were the result of government policy, and which were the result of
private action. It is now useful to examine how states in particular have worked to adapt these
institutions to provide better coordination, efficiency, and to respond to a changing global
market.
Only the largest or most developed of the OIC Member Countries appear to have a fully-
developed and integrated approach to food market regulation and promotion. As noted
earlier, many of the nations cited in this report simply do not have the administrative depth
required to comprehensively address the needs and opportunities of the food market system.
Several of the larger countries have indeed worked to coordinate all the activities of the agri-
food chain across bodies. As one example, all imports into Pakistan are governed by the
Import Policy Order issued by the Ministry of Commerce. The Pakistan Standards and Quality
Control Authority acts as the national standardization body. Pakistan’s food imports are
regulated by the federal Government and food safety standards are regulated by the provincial
Governments. Also, Pakistan adheres to the Harmonized Coding System for classification of
imported goods. The Ministry of Food Security and Research has drafted a proposed National
124 Krakoff, C. (2014), “Benin Special Economic Zone Opportunity Assessment,” unpublished report prepared for The World
Bank Finance and Private Sector Development Unit Economic Sector Work on Cross-border Competitiveness Platforms
along the Benin-Nigeria Border, March 30, p. ii.