The fundamental of the development strategy exposed in this delivery is the "Synergetic Impact Factor": The accelerating impact exercised on the economy by the several component economic activities included into the scheme. Click the finger at the right side to visualize the "Synergetic Impact Factor" in action: Component economic activities interacting each with the others to driving upward the economy. You may need to hit your browser's refresh / reload button to see the arrows in action.

This delivery was first published in French under the title : "VIVRE DE LA TERRE ET PROSPERER" in "LA CROIX DU BENIN" N°521(March)-N°522(April)-N°523(May),1989.

INTRODUCTION

"Misfortune will befall any nation, which neglects agriculture." Declared one day President Felix Houphouet-Boigny of Cote d'ivoire; a wise African leader.

In the case of Benin, however, our country-folk have, year in year out, in good times and bad, supplied the whole population with agriculture products. That is a remarkable achievement, accomplished in difficult conditions, for which the entire nation should always express its profound gratitude. If we Beninese, however, have not neglected agriculture, has the country fully benefited from it? It is easy to reply negatively to this question. In effect, agriculture development in Benin is aimed at feeding the local population. The rare cash crops (cotton, oil-palm) would not allow us to argue otherwise.

A tradition established since the colonial era led Beninese to prefer a career in the public service. Governor Reste, of colonial DAHOMEY, was recalled to FRANCE in 1934, by the Ministry of the Colonies, at the request of Dahomean intellectuals and scholars. They reproached to Governor Reste, amongst other things, his attempt to develop and promote forcibly the cultivation of coffee. From 1936, Governor Reste was able to practice, in Ivory-Coast, his talents as agriculture's promoter. We may remember that, in 1956, at the time when the self-government law (LOI-CADRE DEFFERRE) came into force, Beninese politicians willingly accepted the transfer of the agriculture school of Porto-Novo/ Benin to Bingerville/ Ivory Coast

Such stories reflect a state of mind, which still persists.

And yet, agriculture development, well programmed and methodically implemented, could provide individuals with comfortable incomes and initiate an era of general prosperity for the nation. The demonstration of that assertion is the aim of this delivery, which is structured into three main sections:

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A - AGRICULTURE AS FOUNDATION TO ACHIEVING SUSTAINABLE ECONOMIC DEVELOPMENT

The development of the Republic of China (ROC.- also called TAIWAN) serves as example.(1) Taiwan is a small island if measured by surface area: 36,000 square kilometers (that is to say a little less than one third Benin' size). It lies off the coast of the continental Peoples' Republic of China. Its population is about 19 million (1987), which gives an average of 525 people per square kilometer; or 2,100 inhabitants per square kilometer of cultivated area.

In 1946, the population level was 6 million. This grew by more than 33% in five years with the influx of refugees from continental China, following the collapse of the Nationalist Army of Marshal Chiang-Kai-Shek in face of Mao-Tse-Tung's troops.

The economic situation was far from brilliant. The Kuomintang's leaders, refugees from continental China, were confronted with two urgent matters. First, to feed the growing population and second to consolidate the country's coastal defense systems to preventing the disembarkation of Maoist troops. These leaders knew perfectly well they could resist the attempts of the mainland's communists to destroy their so-called nationalist regime only if they succeeded to developing the island.

After a close analysis of the situation, Taiwan's leaders realized the country had a solid agriculture infrastructure inherited from the Japanese colonization (1895-1945) that are efficient irrigation systems, strong agriculture associations (responsible for the popularization of private farming in contrast to the state-run practice established elsewhere), a hardworking peasantry and performing research institutes dedicated for years to the "green revolution".

The only reason why such assets fell short to establishing a powerful agriculture was the crop-sharing contract imposed on the peasants by the landowners.(1)(2). The latter used to claim 75% of the production. The suppression of this usurious practice was the key to unleashing the rocketing evolution of Taiwan's agriculture. Taiwan's leaders did not hesitate. "Land for those who cultivate it", was their rallying slogan .

They put into force a Land Act in three stages with a compensation scheme for the former landowners. That was a wise decision, which proved subsequently very useful for the economic development of the island. Further, the Land Act helped the Kuomintang, the leading Taiwanese party directly "imported" from mainland China, to become popular with the peasantry. They learnt their lesson avoiding to repeat the political mistake, which had been disastrous to their earlier regime in continental China.

Thus the Land Act, requested and imposed by the Americans as a compulsory decision to supporting the regime, set the island's developing on a regular high growth rate path unprecedented in history. Only South Korea's economic development could be compared to it.

The Americans funded the launching of the Land Act. A Chinese-American Commission of Rural Reconstruction was created and endowed with exceptional powers, independent from and above all Chinese governmental decisions making bodies. In this way, from 1951 to 1953, 267 million of convertible US dollars poured into agriculture development. That is 50% of the total of American aid to Taiwan - agriculture being considered as the absolute priority.

The results met the expectations of Taiwan's leaders. Agriculture production increased by 10% between 1947 to 1953 and by 5.3% in fifteen years running - from 1953 to 1968. Farmers' incomes increased due to the combined effect of improved production's yields and the decrease of overhead costs of land purchasing and rental. Due to the resulting prosperity and the Chinese propensity to save, farmers invested up to 21% of their incomes into economic areas outside agriculture development: in agro-allied industries and light industries, which started supplying rural development with various equipment and materials. The former land owners also join the fray and became enthusiastically caught up in the investment fever.

Nevertheless, the fundamental thrust came from the rural dwellers themselves. They, first, invested a large portion of their savings, and second, they accepted cuts to their incomes originating from low prices paid for their production under a scheme established by the government. Indeed, pricing under the scheme was sometimes 20% less than world prices.

For its part, Taiwan's government initiated and executed an extensive program to developing communication networks, highways, rural and national roads and railway tracks. Rural electrification was extended to promote the establishment of factories in the country side - in contrast to the South Korean model that favored the establishment of giant corporations in the vicinity of cities - the Cheabols . The government also set up a credit policy to assist small operators. It established logistics for the supply of raw materials and organized several agencies in charge of popularizing farming and land development techniques. And most importantly marketing channels were organized.

In brief, nascent industrialization was largely financed by agriculture's incomes.

A wealthier peasantry, with relatively high purchasing power in comparison with the international average, purchased equipment, seeds, fertilizers and other inputs for land development together with household goods for its own comfort. Thus the farmers became the driving force for the country's global economy.

Consequently, a domestic consumer market emerged, which was supplied by national industries. The country became self-sufficient in products such as fertilizers, textiles, cement and other necessary consumer goods. Watchers of the world political scene were in agreement that Taiwan took off at the end of the 1960's.

Taiwan's policy-makers demonstrated that a land development program methodically implemented was the prerequisite for a successful industrialization policy.

From the end of the 1960's, light industry's share in national production started to decline and Taiwanese investors became increasingly involved in sophisticated industries. Electronic components, oil based-chemicals and all kinds of chemical industries became the main areas for investment. And, finally, Taiwan successfully ended up with heavy and sophisticated industries - having started with light industries.

Other countries like the former USSR or ALGERIA, which tried to do things the other way round showed less convincing results.

To sum up by 1987 taking 1952 as the starting year :

Taking 1957 as the starting year, the export Import evolution reads as follow :

The trade balance in 1987 showed a surplus amounting to US dollars 15 billion.

No one can deny this achievement is a true and exemplary success story accomplished by a country not endowed with strategic natural resources.

What are the main reasons for this?

Taiwan' successive governments established investment incentives with a five year tax free plan for new industries. This helped attracting foreign investment. From 1952 to 1987 US dollars 6 (six) billion poured into the country. The open door policy was the reason why Taiwan did not suffer heavy public indebtedness, which is nowadays the nightmare of African countries.

The close link between agriculture and industry played a fundamental and prominent part in the success story. The second section of this delivery dealt with that in details..

Thus, the development strategy experienced by Taiwan confirms the assertion made at the beginning: A well planned and implemented land development program is the launching pad for an integrated development scheme linking agriculture and industry. Now let us briefly consider two European cases

Those examples show that agriculture development is really a gateway to prosperity. It is high time for Benin to adopt a new approach to agriculture development and imitate the Ivorians who earn each year a fat income amounting to US dollars 1 or 2 billion selling two cash crops: coffee and cocoa. Of course Benin's path towards prosperity won't be similar to those mentioned above. Each country is unique, sociologically, politically and historically. Nevertheless Benin can draw much from the above mentioned experiences. In the following sections are considered ways and means to fulfilling that vision.

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B- LAND DEVELOPMENT AS SOURCE OF INCOME FOR INDIVIDUALS AND THE STATE

In previous section A, crops and cultivation practices used to boost-up Taiwan's agriculture were not described. In this section some crops are reviewed, which could help establish a linkage between agriculture and industry to assure Benin's economic takeoff.

To make a profit, in any field of economic activity, it is necessary to detect opportunities, to choose according to consumers' demand, to specialize, produce and merchandise the best products at least cost.

In agriculture new opportunities mean new varieties of plants to produce new products through industrial processing. To garner maximum revenues, it is imperative to avoid selling bulk agriculture raw materials (3). It is an absolutely necessity to be active at every stage of the production chain - plantations, industrial processing and international marketing. That is the only way to escape or control international speculation. In following chapters, further consideration is given to the problem.

TABLE 1 gives an overall view of the industrial utilization of several main agriculture's productions that show agriculture development leads to a diversified economy.

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An industrialization strategy based on the regular supply of local raw materials to processing units helps to establish strong linkage between agriculture and industry in contrast to industrialization, which relies on imported raw materials.

In TABLE 1, let us consider corn a popular diet in Benin and several African countries. Benin's yearly production averages 400,000 metric tons that is fully consumed. There is nothing left over for industrial processing or export.

As can be seen on TABLE 1, cornstarch is a raw material for textile, chemical and pharmaceuticals' industrial processes. One sees corn's cultivation therefore offers good opportunities to diversify the economy of an African country.

Let us consider, as example, a non-irrigated corn plantation. Taking into account a high yield variety corn seed and modern cultivation methods, it would be easy to obtain a yield of 7,500 kg per hectare and the running expenses would read as follow in US dollars:

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Considering the average crop's yield as equal to 7.500 metric tons (7,500 kg) per hectare, Benin's current production of 400,000 metric tons a year (for two harvests) would be from an area of 26,667 hectares. Let us consider the cultivated area increased fivefold - Benin's territorial area is 11,260,000 hectares; 60% of which are suitable for cultivation i.e. 6,756,000 hectares - the resulting yearly crop shall be about 2,000,000 metric tons for two harvests or 1,000,000 metric tons per harvest. This would leave Benin with a sizable surplus to export to neighboring countries (more than 160,000,000 people) as grains, flour or semolina. Further, Benin could also setup various industries based on cornstarch.

Cultivating 10 hectares each, 13,333 small farmers could manage the 133,335 hectares (26,667 x 5) needed to producing 2 million metric tons of corn per year. The yearly Gross Profit standing around: US$ 30 millions = [112 x 2 (harvests) x 10 x 13,333.]

The global annual gross revenues would be around: US$ 140 millions = [525 x 133.335 x 2 (harvests).] That amount, standing only for revenues generated by corn's cultivation - ex plantations that came in addition to revenues generated by industrial transformations and other economic activities such as storage.

On its part Benin's government would garner more tax revenues and duties from the industrial processing of corn into various added value products - in addition to the ones originating from services: packaging, storage and transport.

Don't you think, my fellow countrymen, in view of the prospect offered by these figures, that we should reconsider our approach to agriculture development?

There are similar profit-making possibilities with other conventional crops such as tomato, which is a traditional diet foodstuff in Benin, not to speak of sorghum, banana, citrus fruits. Indeed, tomato could be processed into tomato paste, canned peeled tomato, dried tomato, instant dried tomato powder. There is a booming world market for such tomato products. Further, In addition to developing current crops Benin could innovate with new ones - winged beans, for instance.

Indeed, new plants are now available that will be increasingly required in the future to produce industrial products. The Jojoba plant is a striking example of such plants, which can survive drastic climatic conditions. It is considered as tomorrow's vegetable petroleum. Once processed jojoba's nuts produce an oil and a natural resin that are basic raw materials for further applications in food industry, pharmaceuticals and cosmetics. It also provides lubricating oil for high performance motor engines (air-carriers' engines) as a replacement for whale oil.

The third section of this delivery have such new plants as backdrop. How Benin could stage, diversify and boost its agriculture development? How to finance the scheme?

As Benin lacks savings, it would have to stage an open door policy to attract foreign investments together with enacting adequate measures and law safeguarding the interests of nationals. For many reasons, beyond the scope of this delivery, we all know that we Beninese or Africans in general lack propensity to save. Nevertheless, Benin has plenty of non cultivated arable land - Benin's territorial area is 11,260,000 hectares; 60% of which are suitable for cultivation. Benin could establish limited companies for rural development (LCRDs). The word "cooperative" is intentionally avoided. The shareholders of these LCRDs being rural folks, giving their land as a contribution in kind. Financial contributions from other national and foreign investors would cover the purchase of equipment and pay for working capital. This scheme needs deep consideration.

The management of a LCRD would be supervised by agriculture' specialists and seasoned managers. They should have a financial interest in the venture either as shareholders or as beneficiaries under a profit sharing scheme to avoid the disastrous civil servant's mentality that pervades African enterprises. LCRDs would enter into purchasing/ supply contracts with processing units established according to the same legal pattern as the LCRDs. In both cases, the State might take minority shares in equity but the management should always be under the control of private nationals and foreign shareholders. These purchasing/ supply contracts would ensure that the LCRDs and the processing units could plan ahead their forecast revenues and spending.

During the first years of the developing, a state-controlled central board would be in charge of international marketing of products in partnership with foreign companies and institutions active in the international marketplace. Some brainstorming about this question of partnership is necessary to finding the best way to entering the merchandising international business. For the acquisition of seeds and other necessary agricultural inputs, one could consider, initially, international cooperation through the several United-Nations' agencies together with bilateral cooperation between States.

Through experience gained as Investment and Business Planner the author of this delivery learnt the following lesson:

It is so much easier to find foreign partners and financing. That is the reason why we shall close this section with the cases of two success stories that show what could be achieved with an open door policy to attracting foreign investments.

The success of two countries stands as a challenge to Benin and other African countries.

1- Mauritius is a tiny island off the southern coast of The Malagasy Republic, in the Indian Ocean. Area : 2,045 square kilometers; population : 1,000,000 inhabitants. Until the end of the 1960's, the island was just getting by with revenues from a single cash crop - sugar cane. Refined sugar securing 100% of the country's foreign exchange earnings.

From 1971, Mauritius' leaders set up a free enterprise investment code and classified the whole country as an industrial free zone. Since then, foreign investment poured in and this year 1987 more than 60% of the country's foreign exchange earnings come from an astounding network of export-oriented industries.

This industrial revolution, which started eighteen years ago, deeply changed the economic and social landscapes of the island. Mauritian factories market, nowadays, an astonishingly broad variety of products. It would be utterly fastidious to list all of them. Let us just acknowledge that the global result achieved by the Mauritius' free zone is unique. It attracted investors from United Kingdom, The Federal Republic of Germany, The Netherlands, Hong-Kong, Singapore, India, Pakistan.

Since the establishment of the free zone, the number of industrial enterprises grown to over 400 for an export turnover amounting to more than US dollars 394 million, which leaves a profit balance of US dollars 85.8 million. Jobs created increased from 600 (1971) to 102,860 (1987). That is unquestionably a tremendous achievement. Please note the number of industrial jobs created up to 1987 is exactly the number of civil servants employed by the State of Benin.

2- Now let us consider the second example: The City State of Singapore. Area: 581 square kilometers. Population: 2,308,000. Thirty years ago: an economy in a deep coma. Today: a booming stock market, an international harbor specialized in containers transshipment for Southeast Asia; a first rated air transport company, a giant oil refinery, several industrial processing units including electronic and computer components' industries and a trade surplus of US dollars 15 billion in 1987.

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C - APPROACH TO A NATIONAL DEVELOPMENT PROGRAM, LINKING AGRICULTURE, INDUSTRIES AND SERVICES

There is no doubt the basis for any success story is a detailed and accurate idea of the aims; appraisal of existing conditions and of the means available to reach the targets; scouting for additional support if necessary; a rigorous implementation schedule; building up various strategies and the will to keep on persevering.

When such a strategy is known - and this applies to individuals as much as to a community - people of goodwill show their willingness to cooperate. They are convinced their contributions would be well used and not squandered.

All the success stories mentioned above respond to such strategies.

As a close observer of the developing of African countries one is struck by the fact that their development projects are not linked together. They are implemented without any inter-coordination; each project is established as a single and independent entity; project managers snubbing each other.

Benin is not an exception.(4). That paradox is one of the reasons for the failure we Africans are experiencing with our development policies. Benin lacks developing programs with the inherent synergetic capacity to create enterprises from a fusion of agriculture, transformation of resulting crops and services.

It has been stressed out considering the Taiwan's example that one of the most important factors that triggered the island's tremendous economic success was the interrelation between agriculture development and the industrialization process - at least at the beginning of the developing.

Therefore, it is obvious that to carve the road towards prosperity Benin needs to implement a developing strategy that closely links agriculture development, transformation of crops together with the setup of related services.

This section exposes an approach to such a strategy. It must be stressed this is only an approach, sketched with ideas pertaining to a particular sector.(For the complete scheme go to the second part of this delivery). The implementation of the scheme would necessitate a detailed study and analysis of each component economic activity of of the scheme taking into account the existing economic, sociological and political situation of the country . A panel of national executives and experts, with well-established credentials in their respective fields of knowledge and expertise - composed of geographers, agriculture experts and economists, development planning specialists, sociologists and financiers - should be in charge of the final drafting of the scheme in close relation and coordination with the country's political decision-makers and in dialogue with the populations.

After these preliminaries, let us now consider a component part of the proposed integrated scheme based on vegetables oils and fats.

Indeed, vegetable oils and fats are products that are capable of triggering a developing process characterized by a self-inducing and Accelerating Impact Factor. Indeed, the spectrum of related economic activities ranges from agriculture - in the strict sense - to on the spot energy's generation, which in turn are related to:

Animated arrows in TABLE - 3 highlight the Self-inducing and Accelerating Impact Factor / Synergetic Impact Factor of all the component activities of the developing scheme. The primary sector (agriculture), the secondary sector (industry) and tertiary sector (services) interacting harmoniously with each other.

TABLE - 3
Fertilizers Manure			Oil Meals				Animal Breeding
	Agriculture Schools		Crops Processing		Edible Oils		Industrial Oils
	Nurseries		Plantations		Chemical Industries		Mechanical Industries
	Research Institutes				Agro-Allied Foods Industries		Power generating sets / Renewable Energy
Hydraulic Power			Irrigation				Rural Electrification

The foodstuffs sector is implicitly part of the scheme and due attention is given to it in part - 2 However, the nucleus of the scheme is represented by vegetable oils and fats.

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Let us now consider, step by step, each component of the scheme.

AGRICULTURE

Appropriate oil-yielding varieties - both perennials and annuals - to be selected to obtain, after processing of crops, edible and non-edible industrial oils and fats, which are raw materials for further industrial processing. A tentative planning looks as follows:

INDUSTRIAL PROCESSING

Taking into account selected crops included in the scheme and the balance between perennial and annual plants, versatile processing units to be established that could process different species of vegetable oil seeds. Efficient technology processes adapted to tropical areas to be chosen - oil-expelling or/ and solvent extraction processes. The end products are:

Storage facilities capable of handling several similar production' units to be set up. The processing units to be located on site near the plantations and be self-sufficient in energy as below explained in the section about On the Spot Energy Generation. Social logistics - housing, schools, hospitals - to be considered.

AGRO-ALLIED AND FOOD INDUSTRIES

Edible oils and fats obtained from various species of oil-yielding seeds are raw materials for the setup of agro-allied and food industries :

CHEMICAL INDUSTRIES

Crude non-edible oils and fats obtained from appropriate plants could be used directly as fuel in automotive engines - see section about On The Spot Energy Generation -, for electricity generation and as raw materials for pharmaceuticals and leather industries. Soap manufacturing is a well-known economic activity that uses vegetable oils and fats in line with detergents, paints, printing inks and varnishes sectors.

Alcohol and fatty acids' industries cover a wide spectrum. The opportunity exists, in this sector, to manufacture several kinds of products with high-added value for the international market to earning hard currency, if standards are respected from the outset.

To investigate, select, coordinate and utilize to the optimum non-edible oils and fats' raw materials will be a tremendous task that is rewarding as the sector generates substantial profits.

ANIMAL BREEDING

Another principal oilseed product, besides oils and fats, is the residue obtained after oil extraction. It is called oil-cake or oil-meal depending on the manufacturing process and the percentage of oil remaining in the final product. They are also labeled vegetable proteins if appropriate for animal feeding. They are good and cheap animal fattening ingredients.

A program of animal farming - cows, goats, pigs, poultry, Etc., - to be integrated in the scheme to provide:

ON THE SPOT ENERGY GENERATION

The technology to utilizing crude vegetable oils as fuel in automotive and power generating engines is now well established. That is a very important breakthrough, mainly for the developing countries; because without energy, there is no economic development. It is the primordial factor. The lack of abundant and cheap sources of energy has been, until now, the bottleneck to implementing projects in developing countries. The supply of energy in developing countries being worsened by the high cost and environmental consequences of classic energy sources - hydro, wood, nuclear, mineral oil. Etc.

Now, with vegetable oil as energy fuel, one could foresee a solution to the energy crisis in developing countries. A country that carries out the strategy would have access to a renewable energy free from external pressure.

Indeed, the scheme described in this document is self- sufficient in energy. Oil produced from particular species of vegetable seeds could be used as energy fuel:

An energy supply's policy based on the generation of energy on the spot - through the utilization of non-edible vegetable oils and fats - will be vital to launching rural hydrological programs on large scale. A controlled irrigation system could be set up to avoid dependency on rain seasons. Therefore, planting and harvesting of crops could be programmed and the quality of crops better controlled.

Rural electrification would become commonplace. There will be no need to establishing lengthy conducting lines deployed over thousand of kilometers together with innumerable supporting pillars and distribution stations to connect electricity to villages. The village plantations of vegetable oil seeds would provide energy fuel to run crops processing factories.

A mechanical industry could be established to assemble automotive engines, power generating sets and unsophisticated motor vehicles.

An energy supply's policy based on vegetable oils fuel would doubtless have tremendous sociological impacts. Particularly, if well carried out, it would be a decisive factor in stopping the rural exodus of young people to cities that is one of the plagues of African nations.

RESEARCH INSTITUTES

Research institutes specialized in the following areas to be established:

There is no doubt the execution of the scheme hereby described would help any sub-Saharan African country achieve a high rate of economic growth. A decade would be enough to establish sound foundations for prosperity for all. Click here to read more about how to implement the scheme.

This contribution opens the debate. Throughout this delivery ideas and proposals were exposed, without any polemical attitude, for a better economic future for Benin. In this time of global economic war (5), which makes ideological debates and conflicts obsolete and anachronistic, only those who are prepared and organized for the "battle" will win and prosper. We Beninese have assets enough to enter the fray.

At the beginning of this paper the dynamism of Benin's rural folk who supplied the whole nation, year upon year, with food crops was praised. It is fair also to mention the resourcefulness shown by our mothers, spouses and sisters, come hell, rain or shine. There is no doubt that Benin is endowed with dormant potential that needs only to be invigorated and directed towards clear, explicit and well explained targets to allowing the country to follow up the lead initiated by countries whose success stories were described in this publication.

Contrary to the common belief, the author of this delivery is of the opinion that there is no poor Nation. One should erase that untruth from one's thinking. Underdevelopment and its consequent poverty are not fatal. Transition from poverty to prosperity is just a question of method, efficient organization, hard work, rigorous behavior and thinking and good political choices. The combination of these will break the vicious circle of poverty and establish foundations for a prosperity to be enjoyed by every class of society in the nation.

© Dr. BM QUENUM
Investment and Business Planner
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(1) Taiwan. Le prix de la réussite René Dumont - Cahiers libres/Editions La Découverte.
(2) Le tiers monde dans la crise. C. Ominami- La Découverte.
(3) L'Afrique ménacée. B.M. Quenum - Entente Africaine. N°42 Septembre 1980.
(4) L'écodéveloppement en question. J.C. Heymans et B. Sinsin - Tropicultura N°6,3,
Juin 1988.
(5) Penser la guerre économique. Jean-Jacques Rosa - Figaro économique 21-22 Janvier 1989.
©2000 Dr. Bienvenu-Magloire Quenum. All rights reserved
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