Alternative Instruments for Ensuring Food Security and Price Stability in Zambia

Abstract

Given heavy dependence on rainfed maize production, Zambia must routinely cope with pronounced production and consumption volatility in their primary food staple. Typical policy responses include increased food aid flows, government commercial imports and stock releases, and tight controls on private sector trade. This paper examines recent experience in Zambia, using a simple economic model to assess the likely impact of maize production shocks on the domestic maize price and on staple food consumption under alternative policy regimes. In addition to an array of public policy instruments, the analysis evaluates the quantitative impact of two key private sector responses in moderating food consumption volatility— private cross-border maize trade and consumer substitution of an alternate food staple (cassava) for maize. The analysis suggests that, given a favorable policy environment, private imports and increased cassava consumption together could fill roughly two-thirds of the maize consumption shortfall facing vulnerable households during drought years.