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Title:Impact of Deregulation on Parastatal Grain Trade: The Ethiopian Experience
Author:Lirenso, Alemayehu
Periodical:African Rural and Urban Studies
Geographic term:Ethiopia
Subjects:market economy
grain marketing
Law, Human Rights and Violence
Politics and Government
Agriculture, Natural Resources and the Environment
Economics and Trade
Development and Technology
Abstract:In the 1980s, the Agricultural Marketing Corporation (AMC), a parastatal established in 1976 in Ethiopia to promote public grain marketing and distribution, was one of the largest parastatals in sub-Saharan Africa. This article, which is based on a study undertaken in 1991-1992 in Arsi and Shewa, two surplus grain producing regions, and Addis Ababa, which is a major grain demand centre, examines the impact of the 1990 deregulation of grain marketing on parastatal grain trade in Ethiopia. It shows how the shrinkage of the AMC purchase network, a postderegulation phenomenon, led to a decline in AMC's share in the grain market due to a reduction in grain purchases and sales. It also led to underutilization of marketing infrastructure owned by the AMC and its subsidiaries, the SCs (service cooperatives) and 'kebelie' (or Urban Dwellers' Association, UDA) shops, disappearance of the role of SCs in grain marketing, and poor performance of the State-owned flour mills relying on the AMC for their grain supply. The article also pays attention to a number of new marketing strategies adopted by AMC in an attempt to cope with the increasingly competitive situation. Finally, future policy is considered. One of the conclusions is that the continuation of some limited and selective form of State participation in food marketing is essential. App., bibliogr., notes, ref.