Informal trade expanding as hunger tightens grip on region

Cross-border informal trade in Southern Africa was picking up as people in food deficit areas began to take advantage of crop surpluses in neighbouring countries, according to a Famine Early Warning Systems Network (FEWS NET) report. By the end of May, close to 15,000 mt of basic foodstuffs was recorded by an informal cross-border trade monitoring initiative. "This represents a 15 percent rise in the trade over the amount captured in April. [Although] this increase can be partly explained by the additional monitoring that has been effected along the borders of Zambia and Mozambique, as well as along the Zimbabwe/South Africa border ... overall, the volume of maize traded at 10,600 mt was 17 percent higher than last month," the report commented. Aid agencies have estimated that some 10 million people across Southern Africa might require food aid in the year ahead, mostly due to harvest failures brought on by erratic weather and the impact of HIV/AIDS. Researcher Nick Maunder remarked that "informal trade can be very significant [in reducing household vulnerability]". "Basically, in a normal [harvest] year there's not a lot of trade going on - it's too expensive and the infrastructure is so poor that it costs a lot to move commodities in bulk - [as a result] the informal trade would be around 5 percent of consumption needs. But if you have a particularly bad deficit in a country then you do see informal trade really pick up, as people take advantage of the opportunity [to buy food in neighbouring countries]," he explained. An example of this was Malawi, which has had a particularly bad harvest. "Informal trade is huge - probably about half of the import requirements are coming in informally," Maunder said. The FEWS NET report noted that of the "nearly 10,600 mt of maize trade captured during May, exports to Malawi (9,576 mt from Mozambique and 256 mt from Tanzania) accounted for 92 percent". World Food Programme spokesman Mike Huggins told IRIN that "if people have the means they will cross the border" to purchase food. The FEWS net report said government policies also dictated the extent of informal cross-border trade. Zimbabwe, which aid agencies fear will account for a significant proportion of the 10 million people needing food aid this year, has a stringent policy regarding informal imports. "Despite having experienced consecutive seasons of poor harvests, the Zimbabwean authorities have consistently maintained the strict controls that were placed on informal food imports. Zimbabwe imposes import levies for any trader or consumer that crosses into its borders with more than a single bag of maize grain, maize meal or rice ... As a result, informal food trade between Zimbabwe and its neighbours is not conducted openly, and occurs at very low volumes at a time," the report noted. In May, just 500 mt of "informal food imports into Zimbabwe was recorded in the first month of informal trade monitoring at the Beitbridge border post".