Agriculture Finance Yearbook 2015: innovations and research in agriculture finance
The 2015 Agricultural Finance Yearbook, which is the eighth edition in the series, analyses the challenges faced by farmers and those involved in providing finance at both the overall sectoral level and in specific industries within the sector. The first chapter of the Yearbook includes an analysis of the impact of fiscal policy on the agricultural sector. An important lesson of this analysis is that tax exemptions for agriculture have not been effective in supporting farmers. The agricultural sector, and especially smallholder farmers which dominate agriculture in Uganda, require support from the government, but given the scarcity of budgetary resources, it is imperative that public spending is allocated efficiently to those public goods and services which will yield the highest social returns. The second chapter of the Yearbook reports on the results of research into recent innovations in support for smallholder farmers and the provision of rural finance. One of the important findings in this chapter is that the smallholder sector could achieve substantial gains in yields and incomes if it receives a comprehensive package of support, covering both production and post harvest storage and handling. Chapter 3 looks at contract production and value chains, focusing on sugar, Irish potatoes and chili. The structure and organisation of the value chains for these three crops differs greatly and this is reflected in the different opportunities for farmers to access financial services. Finally, Chapter 4 looks at how farmers and financial institutions can mitigate the risks that they face. The design of risk mitigation measures must take account of the specific characteristics of agricultural value chains.