Previous chapters have concluded that information plays an essential role in a market economy. Moreover, for reasons of equity, in order to promote development on as wide a basis as possible, and to overcome possible abuse of market power through preferential access to information, it is desirable that market information be available to all who can use it.
It is, however, a big leap from identifying a need for market information provision to actually meeting that need. In recent years, many countries have experienced great difficulties in making that leap, and relatively few developing countries presently have Market Information Services that offer commercially useful information on a timely basis. Public-sector MIS suffer from all of the problems faced by bureaucracies in poorer countries. They nearly all face staffing constraints. Most lack resources to carry out day-to-day operations and this tends to lower staff motivation. While the weaknesses of bureaucracies are often not particularly visible to the outsider, the failures of an MIS are there for all to see. Notice boards which are rarely updated and have not been given a coat of paint in a decade, newspaper columns which do not appear and daily radio broadcasts which suddenly become weekly broadcasts are all obvious evidence of problems. Once an MIS begins to go downhill it becomes very difficult to reverse the direction, and many MIS are now services in name only.
Chapter 4 addressed the issues that must be faced if an MIS is not to suffer the same fate as so many others. A gradual approach is strongly recommended. Having decided to set up a service, governments, in their initial enthusiasm for the subject, often want to maximise coverage, both of products and markets. This enthusiasm for a comprehensive approach is frequently nourished by donors, who want to see impressive results from their assistance in as short a period as possible. However, such an approach is often adopted at the expense of long-term sustainability. Governments’ recurrent budgets are unable to maintain the level of staffing input in the initial design. Staff are transferred to other responsibilities and are either not replaced or are replaced with untrained workers who cannot be trained due to lack of resources. Computer and other equipment is not replaced when it breaks down, again because of insufficient allocation in the recurrent budget. Costs of information collection and dissemination go up; for example, due to devaluation increasing fuel costs or as a result of state-run radio stations or newspapers suddenly demanding payment to carry market information.
Many MIS are designed with the main aim of providing statistical information to government departments rather than commercially useful information for market participants. Using the typology adopted in Chapter 2, they have more of an “historical” orientation than a focus on “current” needs. There is always a danger that new MIS will follow this path, particularly when based in Ministries which historically have had a strong focus on statistics and a limited appreciation of commercial realities. Awareness of this as a possible problem is perhaps the best defence against it. MIS designers should endeavour to position the new Service in the section of a Ministry which is most aware of the needs of farmers and the commercial community.
A Market Information Service with the necessary commercial focus should initially concentrate on just one or a few principle wholesale and assembly markets. Product coverage should be limited to those crops which have a sizeable number of producers, are seasonally important and which are much in demand. Speciality crops, such as herbs, where demand is relatively small and where measurement of the price is complicated by lack of standard units, should be avoided. The MIS should plan to provide information on a daily basis, even if this necessitates staff working outside normal office hours. The need to provide up-to-date price information is particularly essential in the case of perishable produce and where prices change continuously. Only when a service is able to carry out these limited activities on a visibly sustainable basis should expansion be contemplated.
This publication has raised the possibility that Market Information Services could be provided by the private sector. The advantages of private or even semi-private MIS are that they are not constrained by public-service regulations which effect terms and conditions of staff and the ability of a service to remove unsatisfactory workers. Moreover, private-sector MIS can, by definition, generate revenue whereas government services often find that any financing they obtain for an MIS has to be paid into the government’s central revenue account. The disadvantage of a private-sector operation is that it is likely to cease operation as soon as it becomes unprofitable, even if this is only a short-term unprofitability. Despite sustainability problems, governments can be expected to have a longer term commitment to providing market information.
In countries where there are a large number of small producers, market information should ideally be available to all, not just those who can afford to pay for it. If a private service were able to attract sufficient sponsorship it could consider making price information freely available through radio broadcasts and newspaper insertions. Unfortunately, relatively poor farmers and traders do not have the sort of purchasing power likely to attract sponsors or advertisers. It may just be possible to overcome this problem by directing part of the information provided towards consumers, although the difficulties associated with this have already been noted. There is also the possibility that a private MIS could sell (by Internet, other electronic means or phone) detailed information to the larger, most commercial farmers, while providing a limited range of free information through the media for smaller farmers.
Whichever method of information provision is adopted in a particular country, it is important that regular, timely and reliable market information is collected and made available and that the users, particularly farmers, are assisted with interpretation of the data. Mistakes have undoubtedly been made in the past; it is hoped that this publication will mean that some of those mistakes can be avoided in the future.
