A new study finds that Tanzania is one developing country that could actually benefit from climate change by increasing exports of corn to the U.S. and other nations. The study, published in the Review of Development Economics, shows that Tanzania has the potential to substantially increase its maize exports and take advantage of higher commodity prices with a variety of trading partners due to predicted dry and hot weather that could affect those countries' usual sources for the crop.
In years that major consumer countries such as the U.S., China and India are forecast to experience severe dry conditions, Tanzania's weather will likely be comparatively wet. Similarly, in the relatively few years this century that it is expected to have severe dry weather, Tanzania could import corn from trading partners experiencing better growing conditions.
Abstract
Given global heterogeneity in climate-induced agricultural variability, Tanzania has the potential to substantially increase its maize exports to other countries. If global maize production is lower than usual owing to supply shocks in major exporting regions, Tanzania may be able to export more maize at higher prices, even if it also experiences below-trend productivity. Diverse destinations for exports can allow for enhanced trading opportunities when negative supply shocks affect the partners' usual import sources. Future climate predictions suggest that some of Tanzania's trading partners will experience severe dry conditions that may reduce agricultural production in years when Tanzania is only mildly affected. Tanzania could thus export grain to countries as climate change increases the likelihood of severe precipitation deficits in other countries while simultaneously decreasing the likelihood of severe precipitation deficits in Tanzania. Trade restrictions, like export bans, prevent Tanzania from taking advantage of these opportunities, foregoing significant economic benefits.
Reference
Syud Amer Ahmed, Noah S. Diffenbaugh, Thomas W. Hertel, William J. Martin. (2012). Agriculture and Trade Opportunities for Tanzania: Past Volatility and Future Climate Change. Review of Development Economics, 16 (3): 429 DOI.
The paper can be downloaded here (journal subscription access only).
The study is covered in Science Daily here.
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