ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Report No: AUS0002794 Roadmap for Sustainable Livestock Value Chains in Southern Africa May 2022 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA © 2022 The World Bank 1818 H Street NW, Washington DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved This work is a product of the staff of The World Bank. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. 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ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Acknowledgements This Roadmap was developed jointly by the World Bank Agriculture and Food (AGF) Global Practice and International Finance Corporation (IFC) team led by Tahira Syed, comprising Peter Goodman, Zano Mataruka, David Evans, and Hope Pachena, under the overall guidance of Marie Françoise Marie-Nelly, Country Director for Botswana, Eswatini, Namibia, and South Africa; Holger Kray, Practice Manger, Agriculture and Food Global Practice; and Samuel Akpene Dzotefe, Manager IFC. Additional advice and guidance were provided by Asmeen Khan, Bekele Debele, Guido Rurangwa, and Thomas Buckley, from the Southern Africa Country Management team throughout the preparation of various outputs and the Roadmap. The Roadmap is informed by a compendium of country notes and analytical outputs prepared by a team of World Bank and IFC staff and consultants. In addition, several just-in-time outputs were prepared to contribute towards ongoing program development dialogues in Botswana and Namibia. The Botswana country notes on livestock sector assessment and climate risk assessment were prepared by Tebogo Seleka and Patrick Malope from the Department of Agricultural and Applied Economics, Botswana University of Agriculture and Natural Resource. The note on one health assessment for Botswana was prepared by Kerapetse Sehularo from the Department of Veterinary Sciences, Botswana University of Agriculture and Natural Resources. The Namibia country notes livestock sector assessment and climate risk assessment, and one health assessment were prepared by Albertus Kruger, independent consultant, agriculture and livestock. The country notes on competitiveness analysis of the beef value chains in Botswana, Namibia, and South Africa were prepared by Hope Pachena with contributions from Tebego Seleka, Patrick Malope, and Albertus Kruger. Emerging from the country notes, four (4) consolidated notes were prepared by World Bank and IFC staff and consultants as follows: 1. Livestock Sector Assessment for Botswana and Namibia – led by Tahira Syed and Dipti Thapa with contributions from Peter Goodman and Ana Cristina Canales Gomez 2. Competitiveness Analysis of Beef Value Chain in Botswana, Namibia, and South Africa – led by David Evans and Hope Pachena 3. Climate Resilient Livestock in Botswana and Namibia – led by Peter Goodman and Tahira Syed with contributions from Ana Cristina Canales Gomez 4. One Health in Botswana and Namibia – led by Ana Cristina Canales Gomez with contributions from Peter Goodman and Tahira Syed The final Roadmap benefited from three (3) peer reviewers – Caroline Plante and Pierre Gerber (Agriculture Global Practice) and Ivan Ivanov (IFC) – who provided technical review and advice towards finalization of the Roadmap. ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Contents Executive Summary.................................................................................................................................. i Introduction ............................................................................................................................................ 1 Sector Context......................................................................................................................................... 1 Section One – Sector Outlook ................................................................................................................. 4 Shift towards Responsible Livestock Production .................................................................................... 4 Global Production and Consumption trends ...................................................................................... 4 Africa Production and Consumption Trends ....................................................................................... 5 Global Trade Flows.............................................................................................................................. 6 Southern Africa Trade Flows ............................................................................................................... 7 Farm Structure and Productions Systems........................................................................................... 9 Systemic Issues for Sustainable Livestock............................................................................................. 10 Climate Vulnerability and Risks......................................................................................................... 10 One Health in Botswana and Namibia .............................................................................................. 12 Animal Health in Botswana and Namibia ......................................................................................... 17 Business Environment and State-Owned Enterprises ...................................................................... 22 Section Two – Competitiveness and Market Opportunities ................................................................. 23 Growth Potential............................................................................................................................... 23 Market Structures ............................................................................................................................. 24 Market Players .................................................................................................................................. 25 Regional and Intra-regional potential ............................................................................................... 26 Post Covid-19 Transition and Recovery ............................................................................................ 26 Section Three – Actions and Prioritization............................................................................................ 28 Botswana............................................................................................................................................... 29 Production/Productivity and processing .......................................................................................... 30 Market diversification ....................................................................................................................... 32 Policy and institutional reforms ........................................................................................................ 32 Climate resilient livestock ................................................................................................................. 33 Financial diversification .................................................................................................................... 34 Prioritization of Actions for Botswana .............................................................................................. 35 Namibia ................................................................................................................................................. 36 Production/Productivity and processing .......................................................................................... 37 Market diversification ....................................................................................................................... 39 Policy and institutional reforms needed ........................................................................................... 39 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Climate smart and resilience ............................................................................................................ 40 Financial diversification .................................................................................................................... 41 Prioritization of Actions for Namibia ................................................................................................ 42 Regional ................................................................................................................................................ 43 Cooperation for improved productivity ............................................................................................ 44 Harnessing regional market opportunities ....................................................................................... 45 Pathway to low-carbon livestock ...................................................................................................... 47 Opportunities for One Health ........................................................................................................... 48 Prioritization of Actions for Regional Integration ............................................................................. 49 Annex 1. Cattle diseases present in Botswana and Namibia: zoonotic, transboundary, and diseases of productive impact ................................................................................................................................. 51 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Acronyms AfCFTA African Continental Free Trade Area AHT Animal Health Technician AMR Anti-Microbial Resistance AMTA Agro Marketing and Trade Agency BAITS Botswana Animal Information and Traceability System BMC Botswana Meat Commission BNBPU Botswana National Beef Producer Union BNVL Botswana National Veterinary Laboratory BRC British Retail Consortium BSE Bovine Spongiform Encephalopathy CAADP Comprehensive Africa Agriculture Development CBT Commodity Based Trade CEDA Citizen Entrepreneurial Development Agency CSA Climate Smart Agriculture DVS Department of Veterinary Services EU European Union FAN Meat Farm Assured Namibian Meat FMD Foot and Mouth Disease GAP Good Agricultural Practices GDP Gross Domestic Product GHG Green House Gas HACCP Hazard Analysis Critical Control Point IHR International Health Regulations LMIA Livestock and Meat Industries Act LITS Livestock Identification and Traceability System MADFS Ministry of Agricultural Development and Food Security MITI Ministry of International Trade and Investment MIRA Meat Industry Regulatory Authority MLGRD Ministry of Local Government and Rural Development MT Metric Ton NAAP Namibia AMR Action Plan NCA Northern Communal Area NDB National Development Bank NDCs Nationally Determined Contributions N-REWS Namibia Rangeland Early Warning System PPP Public Private Partnership PPR Peste des Petits Ruminants R&D Research and Development REC Regional Economic Community SADC Southern Africa Development Community SACU Southern Africa Customs Union SANS South African Standards SIAPS Systems for Improved Access to Pharmaceutical Services SVCF South of Veterinary Control Fence VCF Veterinary Control Fence UK United Kingdom ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Executive Summary Livestock is an important source of livelihoods for countries in the Southern Africa region. In Botswana, smallholder communal/traditional farming is the primary production system with nearly 97 percent of farms Botswana and Namibia have classified as smallholdings and just 3 percent as medium extensive, dualistic livestock to large commercial farms. Whereas, for Namibia, 55 production system that percent of smallholders are located north of the divides the beef industry into veterinary cordon fence in the Northern Communal Area. two value chains – Both countries have extensive livestock production system that comprises a small, relatively well developed commercial and communal. and organized commercial sector with privately owned farms dominated by medium and large farms; and a large communal sector on state-owned land dominated by Both countries enjoy smallholders. These different land tenure arrangements comparative advantages, but essentially divide the beef industry in both Namibia and productivity has stagnated Botswana into two distinct value chains – commercial and communal. due to repeated climate shocks, animal health and Both countries enjoy comparative advantages within disease outbreaks, and Southern Africa for having relatively well-organized beef industry that meets quality requirements and SPS weakened systems. standards of high-end target markets and have good animal identification and traceability systems. Still productivity has stagnated over the last decade partly due Business environment to repeated droughts leading to a consistent decrease in remains constrained with the supply of animals, with both countries unable to meet limited private capital flows export targets, therefore leading to the underutilization of processing facilities and consequently low profitability to various value chain in processing. Several systematic constraints restrict segments. modernization and liberalization of beef industry. Climate vulnerability and associated risks impact multiple segments of the value chain. Animal health issues, Without bold and provision of disease prevention and control services, and transformative reforms, enforcement of traceability systems directly affect competitiveness and market diversification. The overall industry modernization and business environment and private capital flows to various export orientation will likely segments of the value chain are limited due to prevailing remain limited. high degree of direct government involvement and state- owned institutional architecture. Historically, the protectionist approach to support beef value chain was well-situated in the context of Botswana and Namibia. However, to meet current market demands, there is an established need to reform and modernize the industry. Both countries aim to transform towards economic, environmental, and social sustainability, in view of shifting global and regional trends in demand for products that are more considerate to the environment, food-producing animals, and the people behind these products. Several challenges exist in each country. While Namibia has world class i ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA veterinary systems based on incident specific data collected by veterinarians, Botswana’s animal health management and traceability systems have not performed as well, and disease outbreaks have interrupted trade. Namibia beef prices are globally and regionally competitive however feedlot finishing remains uncompetitive due to high feed costs. Botswana’s production system is not globally competitive. When seen independently, both countries lack the scale to achieve viable volumes for exponential market access. Cross-country collaboration through co-investments and harmonized support services, especially for smallholders, on veterinary, traceability, disease surveillance and control, and research and development, are key missed opportunities. There is a general lag in availability of reliable data on productivity performance matrix including cattle fertility and growth rates. Both countries lack market intelligence mechanisms to align productivity. Enhancing sustainability of the beef value chains in Botswana and Namibia will hinge on rapidly changing current production systems without compromising quality and safety of produce, protecting the natural environmental resources, improving social and economic conditions of smallholder producers, and safeguarding animal health and welfare. This Roadmap presents a transformation pathway that builds on smallholder inclusion in the value chain, improved productivity, and increased resilience to climate change. Roadmap for Sustainable Livestock Value Chains Achieving sustainable livestock sector will depend on a large set of interventions along specific value chains. This Roadmap is the first analytical exercise of its kind that First combined analysis of compares and combines beef value chain in Southern Botswana and Namibia beef Africa – covering two main exporting countries – Botswana value chain with country- and Namibia. and cross-country actions The Roadmap aims to provide a framework of action for for modernization and country-specific and cross-country collaboration for competitiveness. modernizing and enhancing competitiveness of beef value chains in Botswana and Namibia. The Roadmap is not prescriptive, instead it presents the overall framework as the basis for World Bank and Government dialogues in Botswana and Namibia as well as cross-country and regional dialogue on analytics and investments. Informed by several country notes, and other outputs, the Roadmap proposes priority actions for strengthening beef value chains with a particular focus on regional collaboration and integration for increased competitiveness in the Southern Africa region. Key policy and institutional reforms are recommended to create a level playing field for private sector participation, greater orientation towards export markets, increasing productivity, and adding value, while placing emphasis on the sustainability of the livestock sector. The prioritization of actions is based on series of consultations and key informant meetings with government and industry stakeholders. The proposed timelines for actions are grouped into immediate-short term actions that can be completed in less than 2 years and medium-long term actions that will require 2 years or more to be completed. The priority actions are meant to facilitate deeper analytics and investment dialogue with key stakeholders from public and private sector. Key Findings and Messages Botswana and Namibia recognize the challenges beef industry faces at national and regional scales. However, government commitments remain unfulfilled due to following constraints: ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA 5. Outdated policy and legislative frameworks continue to create inefficiencies along the value chain segments, especially for input supply, quality of logistics, labor, and support infrastructure. 6. Sustainable beef industry in Botswana and Namibia will need to be driven by modernizing and updating current systems, institutional structures, and regulatory mechanisms, through a mix of policy reforms and improved business environment for private sector entry. 7. Building an inclusive beef sector will require better outreach of extension for grazing management, veterinary services and food safety inspection in communal areas and further development of options for marketing beef from FMD infected zones. 8. Responsible development must recognize the public health externalities of the livestock sector and embrace a one health approach based on collaboration between government departments responsible for human health, animal health, wildlife and environmental. 9. Slow pace of ongoing legislative and policy reforms is outpaced by global and regional shifts in the beef industry hindering the liberalization objectives for beef industry and continue to burden public financial resource. 10. Regulatory alignment of food safety, animal health, and rules of origin can foster regional integration and improve competitiveness of beef value chain, thus leveraging their comparative advantages to access sophisticated markets. 11. Investments in improved quality and access to infrastructure, improved logistics and transportation performance along with strengthening the regulatory framework for procurement and building relevant government capacity to manage infrastructure contracts. 12. Regional/transboundary integration and collaboration can improve sustainability and comparative advantage to achieve economies of scale and leverage negotiation power. Recommended Actions Improved sustainability of the beef value chains in Botswana and Namibia will depend on several actions at national scale as well as through collaborative actions that create mutual benefits. The recommended actions and prioritization complement ongoing efforts in Botswana and Namibia and redefine the focus on enhancing the economic (competitive and private sector led financing), environmental (improved natural resource use and management), and social (smallholder inclusive) sustainability of livestock sector in each country. National Scale Actions At the national scale, the recommended areas of intervention are improving production/productivity and processing operations; increasing market diversification; completing and enforcing policy and institutional reforms; achieving climate resilient livestock sector; and increasing financial diversification. Within each area of intervention, the recommended actions correspond to specific type of interventions that include activities relating to policy/legislation; organization/governance; infrastructure/equipment investment; operations/scale up. Improving productivity/production and processing Given the dualistic production system with distinct difference between commercial and communal producers in both countries, improving productivity and/or production systems will require actions at multiple levels in each country. Key actions are as follows: ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Types of interventions Policy/legislation Governance Investment Operations/scale up Market share of From oxen to Small-scale Community-led Botswana BMC weaner production processing facilities & breeding programs technology adoption Quarantine & Performance-based for meat from Community-led certification rating system & infected zones initiatives for disease compliance for meat private finance control and create from infected zones along supply chain Globally compatible incentives for service branding and labeling provision Inter-ministerial system cooperation on One Health Differentiate Small-scale finishing Small-scale Community-led processing of high- systems processing facilities & quarantine feedlots grade meat technology adoption Namibia Private finance for for meat from Community-led Quarantine & cold chain, infected zones initiatives for disease certification transport, and control and create compliance for meat logistics Irrigated agriculture incentives for service from infected zones for feed & fodder provision Inter-ministerial Create new brands cooperation on One Health To realign production and supply systems, Botswana would need to support communal farmers shift production from oxen to weaner and establishing community-based breeding programs, whereas Namibia would need to support communal farmers through small-scale finishing systems for better condition of the cattle before slaughter, establishing community-based quarantine feedlots, and growing more feed and fodder crops through irrigated agriculture. For improved processing, both countries would need to establish small-scale processing facilities for meat from infected zones. In addition, Botswana would need to reduce the current market share of BMC to allow other competitors, whereas Namibia would need to differentiate processing of high-grade meat and establish multiple graded scales for other beef products. To improve animal health, welfare, and traceability systems, both countries need to establish community-based initiatives for disease control and create incentives for service provision in rural areas as well as address branding and packaging operations. Botswana would need to allow brand and packing improvement and categorize products, including grass-fed and other high-value products, under a globally compatible branding and labeling system. Namibia will need to create new brands that cater to specific markets, match consumer preferences, and include safety and nutrition labels. To adopt commodity-based trading options, both countries would need to improve technology adoption for treating meat form infected zones, put in place proper quarantine and certification compliance for live cattle and beef export. Ensuring access to finance for small and medium producers would require Botswana to adopt performance-based rating system and promoting private finance along supply chain. For Namibia, promoting small-scale processing and packaging units and upgrade local abattoirs, and promote private finance for cold chain, transport, and logistics solutions would be the key steps. Both countries would also need to integrate One Health and formalize inter-ministerial cooperation through memoranda of understandings. Botswana would need to prepare an AMR action plan and establish coordination body, whereas Namibia would need to commence implementation of its AMR National Action Plan. ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Increasing market diversification For Botswana, optimizing its comparative advantages in high-quality products and increasing competitiveness would mean it’s ability to access markets that could fetch higher prices and could provide secondary or tertiary sales channels. On the other hand, Namibia has done relatively better on market diversification and accessed high-end markets like Norway and USA. Further market diversification, especially for small producers, in each country would need additional steps. Still several actions are needed in each country to increase respective market diversification as follows: Types of interventions Policy/legislation Governance Investment Operations/scale up Export Market intelligence Reduction in time-to- diversification system market Botswana strategy Public-private partnership platform Discontinuation of Expansion into Namibia market support African and Middle schemes Eastern markets Botswana would need to step into a post-BMC era where a functional market intelligence system that informs research and private investment decisions. Namibia would need to allow appropriate brand, packaging, logo, etc. for Namibian beef to strategically expand diversification into African and Middle Eastern markets and discontinue market support schemes to improve its market efficiencies. Similarly, Botswana would need to update the export diversification strategy and establish a public-private partnership platform to expand exports to emerging economies, other African countries, and specialized markets. Botswana would also need to reduce its time-to-market through investments in cluster-based connectivity, transport, and logistics infrastructure. Completing and enforcing policy and institutional reforms Both countries have recently embarked on multiple policy and institutional reforms. Going forward, its critical to not only complete these reforms but also ensure adequate (re)alignment of institutional mechanisms to enforce policy changes. Both countries would need to take necessary measures within their respective context as follows: Types of interventions Policy/legislation Governance Investment Operations/scale up BMC Transition Act, Realigned DVS with Discontinued Conversion of amended Livestock outsourced non‐ temporary temporary and Meat Industries core activities slaughtering facilities slaughtering facilities Botswana Act, & enactment of into private abattoirs Meat Industry Improved central Animal quarantine Regulator Act procurement operations by private mechanism & stock operators management system Modernized veterinary testing facilities ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Types of interventions Policy/legislation Governance Investment Operations/scale up Revised Communal Redefined role of Irrigated agriculture Designated share of Namibia Land Act & land AgriBusDev awards to private products from lease duration from investors in communal areas for 3-5 years to 10-year communal areas purchase by renewable leases processors and retailers discontinued small stock marketing scheme Botswana would need to enact the BMC Transition Act, amend the Botswana Livestock and Meat Industries Act (LMIA), and establish the Botswana Meat Industry Regulator Act (MIRA). Namibia would need to complete the review of Communal Land Act and adjust the land lease duration from 3-5 years to 10-year renewable leases. Namibia would also need to discontinue the small stock marketing scheme and prioritize irrigated agriculture awards to private investors in communal areas. To complete the institutional reforms, both countries need to take quick steps. Botswana needs to realign DVS organization and outsource non‐core activities to private sector. Botswana would also need to discontinue all temporary slaughtering facilities at the end of their license terms and allow animal quarantine by private operators of controlled facilities. Namibia would need to specifically redefine the role of AgriBusDev in irrigated agriculture schemes. Similarly, both countries would need to take specific measures to facilitate entry of private investors. For Botswana, key areas where private sector investment would need to be prioritize include conversion of temporary slaughtering facilities into private abattoirs and modernization of veterinary testing facilities. Botswana would also need to establish an improved central procurement mechanism and stock management system to create better prospects for other processors and consistent availability of products at retail points. Key areas for Namibia to prioritize private investments would include designating specific percentage of products from communal areas for purchase by processors and retailers as support permits to import from the south of the veterinary cordon fence. Namibia would also need to strategically facilitate partnerships among buyers and producers to ensure competitive prices for producers, traders, and other value chain actors. Achieving climate resilient livestock sector For Botswana and Namibia, climate change poses a serious challenge for their livestock sectors and each country have shown increasing commitment to build resilience by reducing their vulnerability to future shocks. There are, however, no quick fixes and both countries would need to undertake following actions to address the impacts on productivity losses in beef industry: Types of interventions Policy/legislation Governance Investment Operations/scale up Community-led Surveillance Geo-clustered Breed selection programs on program for extension and strategies & services Botswana integrated crop- monitoring cattle & advisory services livestock systems & wildlife movements rangeland Incentives for private management plans operators to lease underperforming or idle public infrastructure ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Types of interventions Policy/legislation Governance Investment Operations/scale up Community-led Smallholders’ Programs on biogas, Communal grazing Namibia programs on integrated crop- capacity to adopt early warning quarantine feedlots, & conservation groups to enforce grazing plans livestock systems & system agriculture practices rangeland management plans Training for animal Pilot investments for health agents clean energy Both countries would need to support community-driven, pilot programs on integrated crop-livestock systems, provide support for preparation and implementation of rangeland management plans, and consistently invest in knowledge and capacity building. In addition, Botswana would need to establish a pilot surveillance program to monitor cattle and wildlife movements and establish geo-clustered extension and advisory services for communal farmers. Namibia would need to establish pilot programs on biogas, quarantine feedlots, and conservation agriculture practices, raise awareness and capacity of smallholders to adopt early warning system, and promote bush thinning together with regenerative grazing practices. Both countries would need to systematically adopt climate-integrated approaches for planning and implementing livestock support programs. Botswana would need to improve its breed selection strategies and providing adequate breeding services with increased preference for climate-resilient breeds. Similarly, Namibia would need to launch a consultative process to form communal grazing groups and assist them in developing and enforcing grazing plans. To promote business that adopt climate-smart practices, Botswana would need to incentivize private operators by allowing subleases of underperforming or idle public ranches, farms, and other livestock support infrastructure, and adopting climate smart technologies and practices. Similarly, Namibia would need to promote business establishment and entrepreneurial training for animal health agents and establish pilot investments for clean energy for feedlot operations. Increasing financial diversification There remains a disconnect between available public sector funding and public investment needs at different points of the value chain in both countries. Key actions are as follows: Types of interventions Policy/legislation Governance Investment Operations/scale up Outsource LITS Implementation of Financing plans with Private and blended Botswana rollout to private National clear public, private, financing of sector Agricultural Strategy and blended funding technology-driven & Beef Cluster solutions Strategy Discontinued public- Expanded eligibility Prioritized public Namibia only funding of of commercial finance for essential supply chain banks public-goods and infrastructure Both countries need to rational public spending in livestock sector. Specifically, Botswana would need to develop financing plans with clear public, private, and blended funding sources to implement the National Agricultural Strategy and Beef Cluster Strategy. Botswana would also need to disengage from purely public funding of supply chain to explore financing of technology-driven solutions through blended and purely private finance. Similarly, Namibia would need to prioritize public finance for essential public-goods and infrastructure (e.g., rural access roads, water supply and irrigation infrastructure, etc.) while also discontinue public funding of supply chain to explore financing of ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA technology-driven solutions through public-private and private only financing. To redirect financing of different value chain operations Botswana would need to outsource its LITS rollout to private sector for collecting, uploading era tag data to central database and integration of multiple databases whereas Namibia would need to expand funding by other eligible commercial banks instead of just Agribank. Other actions would include Botswana prioritizing financing of farm quality assurance standards by small and medium-sized cattle farmers and Namibia introducing an agriculture index- based insurance framework. Regional Scale Actions Namibia and Botswana are well-positioned to benefit from regional and global trading partners through systematic modernizing and harmonizing different value chain operations to further enhance their collective credibility and trust in existing and new markets. Transboundary coordination will exploit synergies that will enhance results, particularly in terms of traceability system, animal health measures, and food safety. At the regional scale, the opportunities for achieving greater sustainability are embedded in: (i) cooperation for improved productivity; (ii) harnessing regional market opportunities; (iii) adopting a pathway to low-carbon livestock; and (iv) integrating One Health opportunities for sector growth. Cooperation for improved productivity Both Botswana and Namibia can collectively, as well as independently, benefit from cooperation given their geographical, cultural, and political contexts. Both countries also face similar constraints albeit in varying degrees and often through varying responses. Still, the structure of production processes, large segments of informal/communal farmers versus smaller shares of commercial operations, heavy toll of climate change impacts on grazing lands and water resources, and frequent and persisting climate shocks combined with animal disease episodes, are common challenges for both countries. Following specific actions are proposed: Priority on harmonization of SPS standards and other legislative reforms to incorporate regional planning Joint pilot programs and collaboration for modernizing and upgrading infrastructure e.g., testing laboratories, could attract private investments Joint sub-value chains that can mutually benefit input supplies for production systems e.g., vaccines & dozing, animal handling & transportation equipment Harmonized animal health and food safety system e.g., FMD control through joint surveillance and reporting of wildlife and cattle movements in border-proximity and cross-border regions Joint monitoring through a common database for surveillance and reporting measures Joint approach to quarantine, and certification of cattle from respective red zones Harnessing regional market opportunities With rapid urbanization and rising incomes, demand for high-quality beef and meat products, is also growing and both Botswana and Namibia are uniquely placed to make good use of these opportunities. However, lack of timely and accurate market information remains a common challenge to both Botswana and Namibia with little information available on trend analyses, price shifts, and changes in producer-trader relations, etc. A coordinated approach could add to the comparative advantages for Botswana and Namibia, provided collective measures are taken through following actions: ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Joint livestock auction platforms for accessing new marketing and fetch better prices Harmonized traceability and modernizing along a block-chain approach Consistent and harmonized grading criteria for an objective price determining systems Joint ventures for branding and packaging operations Pathway to low-carbon livestock Botswana and Namibia have systematically heightened their commitments to adopt climate-smart agriculture as integral part of the National Development Plans and other economic and sectoral development policies and strategies, both lack appropriate capacities to identify areas of carbon competitiveness, and the cattle and meat value chain actors remain unable to measure and verify carbon reductions. Following specific actions can be supported through regional cooperation: Joint public-private initiatives for improving national quality infrastructure e.g., institutions that test, measure, and certify, etc. Coordinated framework for climate-smart livestock enterprises with new business opportunities & joint venture options for private sector Targeted system-wide innovations and certification programs for comprehensive animal life-cycle assessment for improved productivity Joint Process Verification Program to analyze what practices can be implemented to qualify for the program benefits One Health opportunities As Botswana and Namibia, emerge from Covid-19 pandemic and the global impacts on national economies, investment climate, and interconnectedness of public and environmental health, there are opportunities that catapult both countries’ transformative aspiration. One Health approach is one such opportunity, where both countries can not only excel but set exemplary framework for other countries in the region. Key joint actions are as follows: Joint mapping of the ongoing policy and institutional reforms to identify entry points for integration of One Health approach Capacity building through inter-university undergraduate diploma and other certificate programs on One Health Leveraging existing capacities in human and environmental health to achieve similar improvements in animal health services Establishing joint programs for human-animal-environment nexus learning streams Conclusion Botswana and Namibia have established themselves as major players in the region and beyond as quality beef producing countries. To enhance this well-deserved reputation and establish both countries as champions of sustainably produced, low-carbon, high-value products, both countries need to take transformative measures independently and collectively. The recommended actions presented above are aimed at facilitating the transformative agenda and setting the stage for implementing these actions through dialogue with investment partners. ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Introduction 1. The World Bank Agriculture and Food (AGF) Global Practice in cooperation with the International Finance Corporation (IFC) carried out this study to support and inform the ongoing World Bank Group country engagements in Botswana and Namibia. The Roadmap provides a framework for action to strengthen the cattle and beef value chains in Botswana and Namibia. A compendium of country notes, consolidated notes, and just-in-time outputs were prepared that informed the final output in the form of a Roadmap for Sustainable Livestock Value Chains in Southern Africa. 2. The Roadmap is divided in three sections: sector outlook, current competitiveness and market opportunities, and priority actions. Section one presents sector outlook and provides a brief description of global, African, and Southern African state of livestock sector. Section two presents current competitiveness and emerging market opportunities for potential expanded market share within country-specific and regional value chains. Section three presents priority actions to inform decision processes within Botswana and Namibia as well as areas where joint action could enhance the market share and competitiveness of both countries at continental and international scale. Sector Context 3. Livestock is an important source of livelihood for countries in the Southern Africa region. In Botswana, smallholder communal/traditional farming is the primary production system with nearly 97 percent of farms classified as smallholdings and just 3 percent as medium to large commercial farms. Whereas, for Namibia, 55 percent of Namibian smallholder livestock farmers are located north of the veterinary cordon fence in the Northern Communal Area (NCA). Smallholders in both countries are subsistence-oriented, keeping livestock primarily for own consumption, also because of a lack of lucrative marketing opportunities. The smallholder, communal farmers face several barriers to participate in the high value export beef value chain. As a result, the industry consists of two very different set of actors – a well-developed and organised commercial sector with privately owned farms, and a very large communal sector on State owned land. As a result, farmers north from the communal areas incur high transaction costs for animal quarantine and vaccinations, combined with high transportation costs and limited logistics connectivity severely limiting their market participation. While Namibia has achieved sound progress in compliance with international sanitary and phyto- sanitary (SPS) standards compared to the peer countries, both Botswana and Namibia experience low labor productivity due to limited human capital. 4. GDP contribution of the livestock sub-sector witnessed a consistent decline between the 1980s to 2019-2020 from about 5 percent to 2.82 percent for Botswana and from 5.6 percent to 2.6 percent for Namibia. Two factors contributed to this declining share to GDP: (a) growth in other economic activities, initially mining followed by services industries; and (b) an overall decrease in agricultural production. However, an upward trend is now being seen in agriculture’s contribution to the GDP. A normalized comparative advantage analysis revealed that when compared Botswana and Namibia’s exports of livestock remain competitive to peer countries. 5. The livestock sector suffers from several challenges, climate change among the most severe challenges. Botswana is classified as semi-arid with 70 percent of the land area covered by the Kalahari sands. Rainfall remains low and erratic with average rainfalls of 550 mm. Similarly, Namibia is one of the driest countries in sub-Saharan Africa. Frequent periods of droughts have caused tremendous losses to livestock sector in both countries and continue to be the main threat to production systems with increased frequency and intensity of extreme events. In Botswana, approximately 40 million hectares (ha) of land is available for grazing for both domestic animals and wildlife and about 15 million ha are held under tribal land tenure. On the other hand, in Namibia, approximately 60 million ha is available, but most of the land is severely degraded with nearly 40 million ha covered with thickened bush that reduces the amount of forage available for livestock production. On average the 1 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA sustainable stocking rate throughout Namibia has halved over the last 100 years and the livestock farmer has a degraded resource base 1, which is no longer resilient to severe droughts as experienced in the last decade. 6. Despite a relatively small share in global beef sector, there are distinct advantages that feature Botswana and Namibia as success stories. The governments in Botswana and Namibia have historically played a catalyst role in the industrialization of meat sectors. While government-led interventions have been critical in providing public goods such as veterinary services, and their effectiveness at controlling the spread of animal diseases through disease zoning and animal traceability has been critical in establishing their credibility with their developed trading partners. The livestock sector in Botswana and Namibia are well advanced in terms of being able to meet sophisticated animal health, traceability, and quality standards of sophisticated export markets. 7. Botswana and Namibia have essentially proven that African countries are not only able to but can consistently meet the stringent standards to access export markets. The livestock industries in both Botswana and Namibia are well organized and regulated, meets high quality requirements and SPS standards, with good animal identification and traceability systems albeit these are stronger in Namibia than in Botswana. In 2019, Botswana was the 9th largest exporter of beef to the European Union (EU). The earning from beef exports have declined from US$ 130 million in 2010 to about US$ 80 million in 2018. The Namibian cattle industry is valued at approximately N$4.6 billion (US$ 314 million) which amounts to 4.3 percent of all goods and services produced by Namibia annually. In 2018 a total of 1.4 million heads of livestock (cattle, goats, sheep, and pigs) were produced in the commercially oriented southern livestock areas. 8. High cost of value addition and processing of meat products signals the need to revamp the industry in both Botswana and Namibia to retain their comparative advantage in the southern Africa region. When compared, the state-run operations for meat processing in Botswana and Namibia, there are marked differences in operational efficiency. Namibia has maintained its operational costs at 8 percent of its weighted export price in comparison Botswana at 33 percent. However, due to high cost of sales, the transfer of benefits to producers in Namibia are estimated at only 55 percent of its export earnings while state-based processors in other countries transfer between 66 percent and 75 percent of their export earnings. The discussion about productivity and market reforms in both countries are guided by the current structures of industry and market players. In recent years, Botswana has faced growing pressure from the farmers’ association and the Botswana National Beef Producer Union (BNBPU) who lobbied to increase cattle prices and liberalize the cattle export market to allow producers to access the live cattle market in South Africa that offers higher prices. This led to the Government-initiated broad reforms program to liberalize the beef sector in recognition to the sector’s potential for contribution to its economic diversification plans and in 2018 the privatization study recommended key actions to restructure the Botswana Meat Commission (BMC) as well as realign policy environment for private investors 2. Similarly, in Namibia, while there is some competitive space for private sector, presence of Meatco (also a parastatal) has limited the competition. Investment capacity remains limited due to regulation and policy environment and presents a key reason for constrained investment by private operators. Given its current state of limited market diversification, Namibia has not capitalized on the full market potential of trade agreements to which it is a signatory, primarily due to the limited local production capacity, 1 Namibia Country Note on Livestock Sector Assessment 2 Ministry of Agriculture and KPMG 2018: Feasibility study for liberalization of Botswana beef export market 2 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA increasingly realizing that future trade negotiations need to be aligned with export opportunities for its meat products 3. 9. Regional integration and cooperation between Botswana and Namibia offer another avenue for addressing production scale and volume challenges. Given that the quality and access to infrastructure, public financing towards improving logistics and transportation performance needs to be prioritized along with strengthening the regulatory framework for procurement and public-private partnerships in infrastructure as well as building relevant government capacity to manage these infrastructure contracts. An important component of planning and designing infrastructure improvements should include intra-regional connections and spatial planning to facilitate links between growth poles in Botswana and Namibia through cluster configurations that link services to communal production hubs to unlock local growth opportunities in each country. 10. Achieving sustainability in livestock systems is a wide agenda. This Roadmap narrows down the goal of achieving sustainability within beef value chains in Botswana and Namibia. To meet the needs of the present demands for cattle and beef production without compromising quality of produce, requires transforming these systems to efficient production of safe, high-quality products, while protecting the natural environment, improving social and economic conditions of commercial and smallholder farmers, and local communities, and safeguarding animal health and welfare. Given these aspirations, the prioritization approach adopted in this Roadmap is holistic and cross-sectoral focusing on actions that are environmentally sound, socially responsible, and economically viable. 3 Meat Board of Namibia, 2019. A competitiveness analysis of the Namibian meat industry 3 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Section One – Sector Outlook Shift towards Responsible Livestock Production 11. Globally, meat, as high-quality protein source, is an integral part of many food cultures and a critical source of nutrition. However, when unchecked, the production, supply and processing, and marketing and consumption practices can generate significant negative impacts on the environment, animal and human health, as well as animal welfare. What is needed is to quicken the shift toward responsible meat production and processing operations within the cattle and meat industry as part of a sustainable food system. No change is small; given the size and footprint of the meat industry, even small shifts in adopting improved production and processing have the potential for considerable aggregate positive impact. 12. For the broader livestock sector, and specific value chains within it, the transformation pathway must build on a triple-win approach of higher productivity, increased resilience to climate change, and low-carbon through lower greenhouse gas emissions. Increasing productivity can potentially also close intersectoral productivity gaps and thereby reduce inequality. Such approach will also require substantial increase in financing to provide farmers with the resources they need to adopt climate-smart, green technologies. Rationalizing public financing and generating private capital are key drivers of change. While governments carry an ethical public good responsibility towards citizens, they must signal to the private sector by setting clear policies and enabling environment for investments into low-carbon, resilient value chains that are inclusive of smallholder. 13. This section includes a summary of country notes prepared for Botswana, Namibia. A competitiveness analysis note was also prepared for South Africa given that South Africa remains a key market for Botswana and Namibia cattle and other beef products. The summary consists of key data and trends of production and consumption, trade flows and the state of beef industry in Southern Africa region. The current state of the overall livestock sectors in Botswana and Namibia and the specific structure for beef (cattle and red meat) value chains are presented. This section also presents key findings from the competitiveness analyses of beef value chains in Botswana and Namibia, and a controlled analysis of South Africa red meat industry 4, that describe the global trends, Africa-wide scale of the industry and the growth potential for Southern Africa. The current state of private sector in beef industry and the constraints to business opportunities are presented to show the binding limitations that contribute to underperformance of the industry and curtail market-led growth in the region. Global Production and Consumption trends 14. Global consumption trends are driving transformation of food systems. A closer look at the trade dynamics of beef shows that consumer demand is shifting production practices and reshaping markets, albeit the shift is gradual and only just beginning in several African countries. Consumers increasingly demand products that can be traced back to their origin and demonstrate their impact on natural resources and livelihoods. 4 The Roadmap primarily covers Botswana and Namibia. However, a controlled analysis of South Africa red meat industry was conducted given the linkages of the Namibia beef industry with the South African beef industry – particularly with respect to large scale of importation of weaners from Namibia and the dependency of both Namibia and Botswana on South Africa for feed/grains. 4 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA 15. Consumption of beef and associated products in many Asian and developing markets has increased due to population growth and increases in income levels. In contrast, consumption in many developed markets has remained constant or declining. Forecast per capita consumption is expected to remain largely unchanged with production increases related to population growth (see Figure. 1). 16. Globally beef production is a marginally profitable activity. This is the case even when scale is achieved in countries such as Brazil. Competitiveness also varies across countries linked to base conditions such as land ownership and the level of un-costed farm family labor. Reform of the agriculture sector typically involves decoupling of farmer total receipts from being 100 percent determined by market income. This facilitates some degree of price fluctuation (determined by market conditions) while maintaining some stability of farm incomes through some form of alternative payment. Figure 1. Global beef consumption trends and forecast 5 Africa Production and Consumption Trends 17. Within Africa, average per capita consumption varies considerably with an average of 6 kg against a world average of 9.1 kg. Total consumption in 2018 was 7,184,000 MT an increase of 7 percent since 2014 (see Figures 2 and 3). In line with global trends, African beef consumption is also driven by population growth and raising income levels. Forecast consumption is expected to increase by 2-4 million MT to 2030 and around 10-12 million MT by 2050. 5 FAOSTAT 5 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Figure 2. Top 10 beef producing (MT) countries in Africa 6 Country 2000 2019 Change % South Africa 582,000 1,033,310 78% Tanzania 230,000 479,071 108% Kenya 256,619 462,125 80% Chad 176,760 456,896 158% Ethiopia 294,000 391,684 33% Nigeria 279,000 329,616 18% Sudan 388,300 296,000 -24% Zambia 52,800 191,349 262% Mali 56,312 187,914 234% Uganda 96,750 166,670 72% Figure 3. Top 10 beef consuming (,000 MT) countries in Africa 7 Country 2014 2018 Change % South Africa 994 981 -1% Kenya 468 572 22% Chad 365 444 22% Tanzania 324 418 29% Ethiopia 428 405 -5% Nigeria 445 390 -12% Sudan 365 382 5% Uganda 204 259 27% Zambia 74 187 153% Madagascar 164 181 10% Global Trade Flows 18. Global trade in beef products stood at 12.1 million MT in 2019 with a value of USD 56.4 billion. Countries in Sub-Saharan Africa exported 71,700 MT of beef in 2019 which is around 0.6% of global trade. Total imports for 2019 was 285,000 MT with Brazil and India being the main exporting countries. India provides mostly low-cost manufacturing beef. 6 FAOSTAT. 7 Ibid. 6 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Figure 4. Global beef trade flows as of 2019 8 Southern Africa Trade Flows 19. Within the Southern Africa region, exports of beef, fresh or chilled (HS 0201) averaged US$43.2 million between 2015 and 2017 (only 26.6 percent of total exports). This suggests that only a small portion of region’s export capacity is being utilized to meet regional demand. The region averaged US$6.9 million in imports from the non-African countries over the same period (accounting for 19 percent of total imports), which suggests that the demand for red meat is much higher than what is being exported regionally. Given how small both intra-regional exports are, the regional demand for beef remains relatively small and is being met using a small fraction of Southern Africa’s export capacity as well as some small amounts of imports from outside of the region. Figure 5. Trade flows within Southern Africa 9 20. The current levels of regional and intra-regional exports as a share of total exports for sub- Saharan Africa, are much below those seen in Asia, Europe, and Americas (Figure 6a). However, intra- 8 Chatham House: Global trade flows – resourcetrade.earth 9 Chatham House: Southern Africa trade flows – resourcetrade.earth 7 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA regional trade among SADC countries is higher than other regions in Africa (Figure 6b). South Africa has industrialized faster than its neighbors and its products dominate regional value chains. Figure 6. Intra-regional export as percentage of total exports 10 a. Regional export as a percentage of total exports b. Intra-regional export among different RECs 21. Exports from Botswana and Namibia continue to be dominated by flows to South Africa and Europe. Export to South Africa accounts for more than 83 percent of the South African beef imports since 2014. In 2018, Botswana commanded a 49 percent share of South African beef imports followed by Namibia at 24 percent and Brazil at 11 percent. South Africa maintains dominance as both a major importer and exporter of beef. Informal trade of live cattle, across the Southern Africa region is also expanding however, exact data on the estimated level of informal trade volumes are not available for Botswana and Namibia. For instance, Namibia annually exports an estimated 250,000 beef weaners to South Africa, making it a major exporter to South Africa. Nearly 40 percent of the South African beef herd is owned by the emerging/communal farmers and most of the beef from this sector is largely not marketed through commercial channels operated by large farms. 22. Namibia has marginally diversified its meat products export basket in recent years, but it still consists of a relatively concentrated set of products. Namibia has the highest level of export specialization in frozen beef carcasses, chilled or frozen sheep carcasses, and fresh or chilled lamb carcasses. South Africa remains Namibia’s top export destination for frozen beef and sheep meat, live beef weaner, while the UK is the main market for fresh or chilled beef. Looking at market share penetration levels, Namibia has steadily maintained a strong position in the Norwegian and South African markets. On the other hand, Botswana beef exports have declined steadily since the 1970s with real value of exports of boneless beef declining by 68 percent and export volume by 53percent during the period from 1976 to 2010. Overall earning from beef exports have declined from US$ 130 million in 2010 to about US$ 80 million in 2018. 23. Namibia’s trade performance, given its strong quality compliance credibility, can be compared to countries like South Africa, Australia, New Zealand, and Uruguay. The country’s broader export composition in terms of product groupings looks very similar to that of Australia and over recent times 10 2019 SADC: Regional agro-processing value chains 8 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA the export basket has only marginally diversified. Namibia has the highest level of export specialization in frozen beef carcasses, chilled/frozen sheep carcasses and fresh/chilled lamb carcasses. Farm Structure and Productions Systems 24. Botswana and Namibia have extensive livestock production systems that are dualistic– on the one hand, there is a relatively well developed and organized commercial sector with privately owned farms dominated by medium and large farms and on the other hand there is a very large communal sector on state-owned land dominated by smallholders. These different land tenure arrangements essentially divide the beef industry in both Namibia and Botswana into two distinct value chains – commercial and communal. 25. In Botswana, communal cattle production remains dominant accounting for 82 to 86 percent of cattle between 1979 and 1993, in comparison to the commercial system that accounted for 14 percent to 18 percent during same years. Between 1995 and 2007, the communal system’s share of cattle population rose to 92 – 97 percent, while the commercial system contracted 3 – 8 percent. The lowest share of the communal production system (of 78 percent) was recorded in 2015. Figure 7. Botswana percentage shares of cattle population by production system 11 26. In Botswana, smallholder communal/traditional farming is the primary production system with nearly 97 percent of farms classified as smallholdings and just 3 percent as medium to large commercial farms. A consistent decline is seen in the number of communal holdings with 1,360,467 cattle heads in 2015 to about 934,732 in 2019. 27. Similarly, in Namibia, the share of communal production is relatively high as compared to the commercial production. With nearly 55 percent of smallholder communal farms located in the Northern Communal Areas (NCA) that produce approximately 70 percent of young calves aged 6 to 12 months. A persisting decline is seen over the recent years in livestock sector performance resulting in declining production capacity (Figure 8). 11 Computed by authors based on data from Statistics Botswana (2020). Date for 1991-1994, 2001, 2005 & 2014 not available. 9 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Figure 8. Namibia cattle location and production trends Cattle Location Cattle Production 7,000,000 350,000 6,000,000 300,000 5,000,000 250,000 4,000,000 200,000 3,000,000 150,000 2,000,000 100,000 1,000,000 50,000 0 0 2016 2017 2018 2019 2017 2018 2019 2020 North of VCF South of VCF Total Domestic Slaughter Lives Export Systemic Issues for Sustainable Livestock 28. For both Botswana and Namibia, the beef industry constitutes the largest segment of the agriculture sector earning significant foreign exchange and providing a direct source of income for a large portion of rural populations. However, productivity has stagnated over the last decade with consistent decrease in supply of animals for slaughter to meet export targets leading to significant underutilization of processing facilities and consequently low profitability in processing. One of the key constraints that systematically effects the productivity and market potential in Botswana and Namibia, is climate vulnerability and associated risks that pose serious challenges to beef value chain. Animal health issues, provision of disease prevention and control services and implementation of the Livestock Identification and Traceability System (LITS), are another important set of issues that directly affect competitiveness and market diversification of meat products. The overall business environment and availability of private capital flows to various segments of the value chain are limited due to prevailing high degree of direct government involvement and state-owned institutional framework that has become both ineffective and costly. Climate Vulnerability and Risks 29. Extensive production systems in arid and semi-arid systems require investment in water conserving high efficiency irrigation technologies, while degraded rangeland with bush encroachment problems adds further pressure to the set of challenges. The current climate conditions in both Botswana and Namibia pose serious threats to the livestock industry. Recent estimates 12 show that approximately 40 percent (809,000 livestock units) in Botswana and 43 percent (883,000 livestock units) in Namibia’s livestock units are affected due to water scarcity and frequent drought conditions (Figure 9). These conditions suggest a serious threat to the livestock industry with direct implications for livelihoods of smallholder as well as commercial farmers in each country. 30. Governments in both countries have consistently supported the livestock sector through a number of initiatives with the aim of improving productivity and mitigate against impacts of climate shocks such as prolonged and repeated droughts, and floods. Both countries have put in place drought relief programs, mostly financed with public resource, that include transfers to crop and livestock farmers, water supply programs (for human consumption and to enable farmers to gain access to new 12 United Nations office for Disaster Risk Reduction (UNDRR) and CIMA Research Foundation, 2019. Building Disaster Resilience to Natural Hazards in Sub-Saharan African Regions, Countries and Communities. 10 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA grazing areas), and food transfers for households whose livelihoods have been threatened. Additional support to farmers, especially stallholders, is also being provided in both countries. For instance, the Botswana government provided free vaccination and subsidized feed during periods of drought. Additional support was provided in the form of subsidized artificial insemination as targeted strategy for improved progeny of the indigenous Tswana breed. Similarly, during the extreme drought of 2019, the Namibia government prepared a national scale Drought Response Plan to provide food and fodder along with livestock marketing incentives (such as support for lease of grazing, transport to and from grazing, fodder, and licks subsidies to sustain small stock and core breeding herds), water provision through water tankers, certified seed etc. Both countries understand that given their geo-agrological locations, and semi-arid to arid climatic conditions, the cyclic occurrences of droughts-floods-droughts will only increase with increasing temperatures. Figure 9. impacts on livestock under current and future climate conditions 13 31. Within Southern Africa, as in the rest of Africa, agricultural production systems are deeply entrenched in use of natural resources primarily water and land. Agro-processing operations are also inherently connected to food security, land, and environmental factors, posing risks to production systems. To achieve sustainable economic development in Southern African countries, consistent investments in infrastructure and support operations such as irrigation, fertilizers and seed varieties, veterinary services, continues to remain a focus of national development planning. The region’s competitiveness and industrialization objectives are consistent with calls to improve investment in human capital as well as better use of natural resources. However, one cannot be at the expense of the other and a comprehensive approach to economic development is not achievable without social and environmentally responsible investments that prepare countries to deal with current and future climate challenges. This will require a combination of efforts from the industry leaders in various livestock value chains along a smart business stewardship model (Figure 10) that builds on integrated management for maximizing productivity and profitability gains through low-carbon and responsible environmental outcomes. 32. Despite a robust animal tracking and traceability system in place, albeit mostly in commercial farming, constraints related to animal health are yet to be fully mainstreamed within both commercial and communal production systems. There is no defined human-animal-environment nexus planning that can support the industrial growth and business promotion. The present policy framework is disjointed and doesn’t address nexus planning through integrated programs specially designed for the smallholder farmers despite most production comes from communal operations. 13 UNDRR and CIMA, 2018 11 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Figure 10. Smart business stewardship model 14 One Health in Botswana and Namibia 33. This section discusses One Health – an approach that recognizes the nexus between human health, animal health and the health of the environment in which they coexist, including zoonotic diseases. . As the focus of this Roadmap is on sustainable livestock, animal health status, systems and services will be considered in a separate section, while the current section will provide an overview of the relevant aspects and entry points that cut across animal, human and environmental health, including transboundary diseases, food safety and antimicrobial resistance (AMR), conducive to the establishment of a One Health approach in Botswana and Namibia. 34. One Health Concept and Relevance to Botswana and Namibia – the term One Health refers to an integrated, unifying approach that aims to sustainably combine and optimize the health of people, animals, and ecosystems (Figure 11), to prevent, detect, respond to and recover from infectious disease. It recognizes the connections and interdependency between the health of humans, domestic and wild animals, plants, and the wider environment (including ecosystems), and the health threats that lie in their interface. 35. The One Health approach aims to mobilize multiple sectors, disciplines, and communities at different levels of society to work together to foster well-being and tackle threats to health and ecosystems, while addressing the collective need for clean water, energy and air, safe and nutritious food, acting on climate change, and contributing to sustainable development (Tripartite 2021). The importance of a One Health approach is underlined by the fact that 60 percent of pathogens that cause human diseases originate from domestic animals or wildlife, 75 percent of emerging human pathogens are of animal origin and 80 percent of pathogens that are of bioterrorism concern originate in animals. Emerging infectious 14 Adapted from FAO 2019 12 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA diseases (EIDs) are increasing in occurrence and increasing in social and economic impacts, leaving the world exposed to permanent latent pandemic threats. And the yearly probability of occurrence of extreme epidemics could increase up to threefold in the coming decades 15. In 2020, the global economy contracted by 4.3% due to COVID-19, which amounts to about USD 3.6 trillion worth of goods, services and other output lost (Figure 12). Figure 12. EIDs impact snapshot 36. Old and new health threats, resulting in pandemic risks, demonstrate how our changing interactions with animals and the environment can impact development outcomes. Interactions amongst people, animals and the environment have changed: the human population is expanding, intensive farming practices are growing, environmental disruptions and deforestation are worsening, and movement of animals and animal products has shifted due to increased trade (CDC). 37. One Health Vulnerabilities in Botswana and Namibia – Key vulnerabilities to One Health related risks in Namibia and Botswana include inequality, climate change and livestock-wildlife interactions. Both countries are characterized by a dual economy in which communities in communal areas in comparison to other parts of the country (i) are more dependent on and exposed to livestock and consequently zoonotic diseases; (ii) are more affected by wildlife-livestock interactions increasing the risk of transmission of zoonotic diseases such as rabies and anthrax from wildlife populations to livestock and humans; (iii) are highly dependent on rangelands, the stock carry capacity of which is declining because of drought and inadequate grazing management; (iv) have lower access to human health, water and sanitation, and veterinary services and lower standards of food safety inspection in non-export abattoirs and markets; and (v) have lower incentives to invest in One Health because of lower access to beef export markets and low security of tenure associated with communal land tenure. This combination of inter-related vulnerabilities increases the risk of zoonotic disease and foodborne diseases primarily for communities in communal areas but also for the rest of the population and neighboring countries because of transmission through rural-urban migration and food supply chains. 38. Hotspots of Emerging Infectious Diseases – The heat Figure 13 EID Hotspots maps of predicted relative risk distribution of zoonotic EID events 16 show that Namibia and Botswana are relatively low risk compared to many parts of Africa (including part of South Africa) where risks may be increased by factors such as high population density, urbanization and low sanitary standards in urban food markets, deforestation and biodiversity loss, and conflict that affects health service delivery. Nevertheless, the 15 Marani et al. 2021 16 Adapted from Allen et al., 2017. Nature 13 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA aforementioned vulnerabilities, suggest that the risks in these two countries are still significant (Figure 13). 39. One Health Status in Botswana and Namibia – The World Bank Operational Framework for One Health 17 (Figure 14) summarizes the capacity assessment, planning tools, implementation resources, expert networks, reporting systems and regulatory frameworks to support a One Health approach. Figure 14. WBG Operational Framework for One Health The World Health Organization’s (WHO) Joint External Evaluation (JEE) of International Health Regulations (IHR) is one of the core assessment to inform One Health planning. It is a voluntary, collaborative, multisectoral process to assess country capacities to prevent, detect and rapidly respond to public health risks. The last JEE was conducted in Botswana in 2017 and Namibia in 2016 18. Botswana has a well-developed public health emergency preparedness and response system in need of relevant overarching plans, policies, and the institutionalization of cross-sectoral relationships. Namibia has a relevant regulatory framework to support health regulations, coordination, advocacy and communication at national, regional and district levels. Both countries would benefit from further clarifying and institutionalizing the roles and responsibilities of stakeholders across health systems and establishing One Health platforms to cement linkages and foster cooperation, particularly between human and animal (domestic and wild) health systems. 40. Overall, while there are differences in the extent to which the two countries have advanced on the One Health agenda, the assessments point to several broad areas for advancing the One Health agenda (Table 6). 17 World Bank’s Operational Framework for One Health, 2018 18 A summary of JEE evaluation scores and priority recommendations for Botswana and Namibia are presented in the Consolidated One Health Note for Botswana and Namibia. 14 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Table 6. One Health Development Issues Common to Botswana and Namibia One Health Legislation Review and amend legislation to align it with OH approach Inter-sectoral • Formalize coordination between government departments through MOUs coordination • Joint participation in preparation and implementation of preparedness and emergency response plans including through joint simulation exercises. Health Information • Build linkages between human health, animal health, wildlife and systems environmental health surveillance and reporting systems SOPs. Human capacity • Continuing education for veterinarians • Greater participation of private and para veterinarians in service delivery • Recruit and train epidemiologists specialising in risk management. • Motivate IHR focal point, health, and extension workers at community level AMR • Preparing national action plans and establishing AMR coordination bodies Food Safety • Address fragmentation of food safety functions between agencies • Upgrade food safety inspection to non-export abattoirs in communal areas to replicate that in EU export abattoirs. 41. Inter-sectoral coordination – Interagency and cross-sectoral collaboration and partnership is a key objective in a One Health approach to infectious disease control at the human-animal- environment interface. Namibia has made progress in adopting a One Health approach in recent years. Following the JEE in Namibia in 2016, the country invested resources to attend to the recommendations from the JEE report, launching a National Action Plan for Health Security was in 2020; a National IHR Focal Point Network was updated in early 2021 and 15 IHR focal persons were identified from various ministries and agencies using the One Health approach. In Botswana, the 2017 JEE provided an opportunity to galvanize cooperation between participants that included the Ministry of Health, DVS, the Department of Wildlife, Academia and relevant development partners 19. However, both countries need to formalize inter-ministerial cooperation through memoranda of understandings. 42. Anti-Microbial Resistance (AMR) –There are a number of ongoing activities across sectors to improve antimicrobial utilization (AMU) as part of the draft National Action Plan (NAP) of Botswana, which are already leading to improvements in antibiotic use and surveillance (Tiroyakgosi, et al., 2019). Namibia has consistently improved its performance on AMR, improved awareness of it and promoted responsible use of antibiotics. Despite significant progress, both countries need to formalize their actions into National Action Plans and a strong regulatory framework that subsequently needs to be implemented and enforced. 43. Food Safety – Food safety issues in both Botswana and Namibia have gained increased focus and both countries have undertaken varied steps to address legislation and policy steps for safe production, handling, processing, preparation and serving of food products. Within the beef industry, food safety compliance is accorded high priority as it directly impacts the meat export. 19 https://www.afro.who.int/news/botswana-conducts-joint-external-evaluation-assess-countrys- international-health-regulations 15 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA 44. In Botswana, food safety is the responsibility of various ministries, such Box 1. Food safety compliance systems in Botswana as, Ministry of Health and Wellness, Ministry of Agricultural Development 1. Compliance systems are designed to meet export and Food Security (MADFS), Ministry of market requirements and are driven by EU food Local Government and Rural quality standards and guidelines that are followed Development (MLGRD) and Ministry of with strict measures in export abattoirs International Trade and Investment 2. Both countries implement the Hazard Analysis (MITI). The Department of Veterinary Critical Control Point (HACCP) in conformity with the Services (DVS) under the MADFS, is requirements of South African Standards (SANS), the responsible for regulating the quality British Retail Consortium (BRC), the EU Food and safety of meat and meat products, Legislation, and Global Standards Foods. regulating the exportation and importation of livestock related 3. Several line ministries and departments have products, veterinary drug control and oversight and monitoring roles often duplicating use, and monitoring of drug and reporting lines and responsibilities pesticide residues in livestock, meat, and meat products. The 2007 Livestock and Meat Industries Act (LMIA) updated the 1977 Diseases of Animals Act. Other key regulations include the Stock Feed Regulations, the BSE Control Regulations, the Prohibition of Use of Anabolic Hormones and Thyrostatic Substances Regulations, and the LITS Regulations. The Ministry of Health and Wellness is responsible for enforcement of the Food Control Act, Labelling of Pre-packaged Foods Regulations, Labelling of Food Additives Regulations. The MLGRD enforces food inspection, sampling and investigations, and issuance of food trade licenses under the Trade Act of 2019 (Government of Botswana, 2019) and the Local Government Act of 2004 (Government of Botswana, 2004). 45. Finally, the Botswana Bureau of Standards (BOBS), an ISO 9001:2000 certified statutory body under the MITI, is responsible for standardization, testing of goods, certification, metrology, quality management systems, environmental management systems, and information and training. Given the extent of institutional coordination required for effective food safety control, the multi-ministerial and departmental responsibilities remain fragmented and not fully harmonized at national scale with continuing lack of evidence-based food safety management systems, save at EU approved export abattoirs, where HACCP system and its pre-requisite programs are strictly adhered to. For this reason, the safety of most foods consumed in Botswana cannot be assured except for meat and meat products from the EU approved export abattoirs that enter the local market. 46. Namibia has gained global recognition for its good standards of animal welfare ‘from farm to fork’ strategy implemented through a nationwide set of farming standards. The Farm Assured Namibian Meat (FAN Meat) 20 standards provide the institutional structure for implementation and the Meat Board of Namibia – an independent body representing all major meat industry stakeholders – is responsible for administration of FAN Meat standards through the Directorate of Veterinary Services (DVS) within the export abattoirs and the country’s livestock producers. In Namibia, food production is primarily the responsibility of Ministry of Agriculture, Water and Land Reform, which is responsible for enforcing food safety regulations at production and primary handling level, including silos, slaughterhouses, and pack houses. The Focal Point for all food safety issues is the Ministry of Health and Social Sciences. This acts as the point of information by other governments involved with food trade with Namibia on matters relating to compliance to food safety, in line with Codex 20 Meat Board of Namibia (2010) FAN Meat Standards for Producers. Windhoek: Meat Board of Namibia 16 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Alimentarius Commission requirements. The Namibia Standards Institute under the Box 2. Namibia FAN Meat Compliance Ministry of Trade and Industry (MTI) is FAN Meat products are readily eligible for export to responsible for implementing the Standards international markets. FAN Meat standards compliant Act, which controls standards such as farmers adopt an integrated ‘good practice’ approach additives, processing aids, and all products that builds on: traded in Namibia. Food safety issues in fish and fishery products up to catch and landing 1. Proof of good farm management practices is controlled by Ministry of Fisheries and 2. Environmental stewardship Marine resources, while standards of fish offered for trade, whether processed or not 3. Animal welfare and health scorecard is the responsibility of Ministry of Trade and 4. Safe handling and transport of livestock Industry. Food safety standards of plant and animal products exported from Namibia is 5. Growth-promoters free pasture and feed the responsibility of Ministry of Agriculture, Water and Land Reform. Registration of food business operators, including food retail and abattoirs for meat destined for national markets is done by regional authorities. The public health act, which is administered by Ministry of Health and Social Services, is aimed at regulating all matters relating to consumer food safety. The Namibia Food Safety Policy seeks to ensure food safety for all consumers in the Republic of Namibia and provide sufficient food safety guarantees on all food products traded nationally or exported to other countries. It addresses the issue of overlapping mandates on food safety by various ministries, and aspects that are currently not regulated by any agency by coordinating public and private stakeholders under a sound regulatory framework. Animal Health in Botswana and Namibia 47. The PVS Pathway is a voluntary process that empowers national Veterinary Services by providing them with a comprehensive understanding of their strengths and weaknesses revealing gaps, inefficiencies, and opportunities for innovation. It is also a key instrument in the assessment, planning and implementation of a One Health approach at national level as it will contribute to strengthening health systems at the human-animal-environment interface. The last PVS assessment follow-up was conducted in Botswana in 2019 21. Overall, Botswana, has a well-established set of veterinary institutions to regulate and deliver animal health services and between 2010 and 2019 increased its performance score in 18 of the 45 OIE PVS core competencies that cover human physical and financial resources; technical authority and capability; interaction with stakeholders and access to markets. Botswana has developed an improved animal identification and traceability system (BAITS) and well-developed systems for tracking animal disease status and while there are still challenges in terms of strengthening reporting, the system provides the basis for FMD control and access to EU markets. 48. The last PVS assessment was conducted in Namibia in 2009 and has been followed up by a PVS Gap Analysis. Overall, Namibia has very competent VS with extremely well-trained professionals, and a well-established set of veterinary institutions to regulate and deliver animal health services. During the last 15 years Namibia has addressed a deficit in the number of local veterinarians through investment in tertiary education. Namibia has world class identification and traceability systems 21 A full list of OIE PVS core competencies, a summary of OIE PVS evaluation scores for Botswana and Namibia, and the detailed priority recommendations for both countries are provided in the Consolidated One Health Note for Botswana and Namibia. 17 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA (NamLITS) and well-developed systems for tracking animal disease status. These successes, particularly in relation to FMD control, provide Namibia access to sophisticated export markets. 49. Animal Health Information and Traceability Systems – Namibia has world class veterinary systems based on incident specific data collected by veterinarians. The Animal Health Technician (AHT) sub-system involves (i) an Animal Health Declaration which is completed by AHTs after visiting a farm or a community and (ii) an Animal Health Inspection form which is administered by the AHTs based on annual farm inspections and data made available on the Wide Area Network operated by LITS - coverage is very good (80 percent of animals) but accuracy is not as high because data is based on reports from farmers. The accuracy of the sub-system could be improved with better training of AHTs and farmers. In Botswana, a transition period from bolus to the BAITS ear tags animal identification system started operating effectively in 2016 and is now supported by established law. Holdings, keepers, and animals are registered in the BAITS database, with livestock owners being responsible for ear tagging their animals. Where livestock keepers are unable to manage their responsibilities, local youth have been employed to run “BAITS cafes” where producers are assisted in the computer entry process. 50. Animal Disease Status in Botswana and Namibia – The beef industry in both countries remains exposed to serious animal disease risks that reduce productivity including zoonotic diseases such as anthrax and rabies that have serious public health impact, transboundary disease that affect the access to export markets and other diseases that reduce productivity. Namibia and Botswana are the only countries in Africa to have controlled transboundary diseases to the extent that they have been able to access EU beef markets, yet they still face considerable challenges in extending disease control to communal areas. The full list of cattle diseases, including zoonotic, transboundary, and those of productive impact, can be found in Annex 1 of this document. 51. Zoonotic Diseases – Namibia has listed a number of zoonotic notifiable diseases including anthrax, bovine spongiform encephalopathy (BSE), brucellosis, psittacosis (ornithosis), rabies, Rift Valley fever, salmonella enteritidis, mange mites and tuberculosis (TB). The zoonotic diseases of the greatest public health importance are listed and prioritized for prevention and control and surveillance systems for more than six zoonotic diseases are in place. There is a national animal disease prevention plan for rabies, anthrax, brucellosis, and Rift Valley fever. A rabies elimination strategy developed in 2011 is the best model of the One Health approach in Namibia because it brings together the animal health, human health, wildlife and security sectors. However, such inter-sectoral cooperation is otherwise lacking and there is a need to establish formal mechanisms for sharing information on zoonotic diseases and outbreaks between the animal, human and environment / wildlife sectors at national and regional levels and to establish proper linkages between public health and animal health laboratories (JEE 2016). The concentration of zoonotic diseases is relatively high in the NCA including canine rabies (Figure 15). 52. Botswana has listed seven zoonotic diseases of particular interest: rabies, brucellosis, bovine tuberculosis, cysticercosis, Rift Valley fever and anthrax. The DVS conducts annual immunization of cattle against anthrax and rabies countrywide and conducts general surveillance for all the seven identified diseases. The Department of Public Health coordinates the Integrated Disease Surveillance and Response (IDSR) public health surveillance program that includes four zoonotic diseases. Apart from ad-hoc arrangements, there is no formal policy, strategy, or plan for arranging a multidisciplinary response to zoonotic outbreaks and there is a need to formalize the sharing of surveillance data between animal and public health sectors and to establish interagency multisectoral rapid response teams (RRTs) in disease outbreak management (JEE 2017). 53. Transboundary Diseases – In both Botswana and Namibia notifiable transboundary diseases include Foot and Mouth Disease, Blue Tongue and Lumpy Skin Disease, Contagious Bovine Pleuropneumonia (CBPP), and Bovine Spongiform Encephalopathy (BSE). In Botswana, for domestic animals, FMD was last reported in 2022, Blue Tongue, and Lumpy Skin Disease were reported as 18 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA present in 2019. CBPP was last reported in 1995 and BSE has never been reported. In Namibia, for domestic animals, FMD was last reported in 2022, Lumpy Skin Disease was last reported in 2021, Blue Tongue and CBPP were last reported in 2017, and BSE has never been reported. 22 13. Figure 15. Rabies hotspots in Namibia 54. Foot and Mount Disease (FMD) – FMD is a disease of great economic importance in For Namibia and Botswana as it significantly affects livestock productively and negatively impacts trade in animals and animal products. Both Botswana and Namibia implement FMD control measures to ensure market access of Botswana beef and beef products in the lucrative market of the European Union. 55. Measures are compliant with the OIE Terrestrial Animal Health Code (TAHC) Chapter 8.8 (Infection with FMD Virus) which defines the requirements 23 for FMD free countries or zones where vaccination is not practiced and FMD and FMD countries or zones where vaccination is practiced. The challenge for both countries is to extend the geographical area under FMD free without vaccination status to communal areas, that currently have infected status, in line with the Progressive Control Pathway for Foot-and-Mouth Disease (PCP-FMD) (Figure 16). 56. Botswana has a National FMD Control Strategy in place. The control strategy of FMD includes movement restriction, vaccination, surveillance awareness campaigns, and disease control infrastructure development and maintenance. Movement restriction is applied on cloven hoofed animals. To implement this strategy, the country has been divided into disease control zones (Figure 17). The zones are also subdivided into free and infected zones. The free zones are free of FMD without vaccination. In the infected zones vaccination against the disease is practiced. Cloven hoofed animals and their products are not allowed into the free zones from the infected zone, except where beef has passed maturation requirements and is boneless. 22 OIE World Animal Health Information System (WAHIS) [Data from OIE PVS 2019, OIE WAHIS & Namibia DVS 2017] 23 This includes requirements for early detection, surveillance, reporting, vaccination, protection zones, preventing entry into FMD free countries or zones, movement control, establishment of FMD free compartments within countries or zones, recovery of FMD free status after an outbreak, transfer of from infected to free zones, importation, and inactivation of infected material. 19 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Figure 16. Progressive Control Pathway for Foot-and-Mouth Disease The Progressive Control Pathway for Foot-and- Mouth Disease (PCP-FMD) developed by FAO and EuFMD and endorsed by the OIE, is a risk and evidence-based framework to guide endemic countries to progressively improve the management of FMD risks and reduce disease impacts and viral circulation. Source: EUFMD 57. The 2019 OIE PVS notes that in Botswana, occasionally a FMD outbreak has occurred near the border between Ngamiland and the “green” zone, but that Botswana has in these cases successfully applied provisions of Terrestrial Animal Health Code chapter 8.8.6 and 8.8.7 by installing a Containment Zone and regaining free status within shortest possible time Figure 17. Botswana veterinary disease control zones (data as of 2019) 20 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA 58. In Namibia, the Veterinary Cordon Fence (VCF) essentially divides the country into two regions, the area north of the VCF commonly referred to as the northern communal areas (NCA) and the area south of the VCF (SVCF). There are three FMD risk management zones (Figure 18) namely the Infected Zone, Protection Zone and FMD Free Zone: (i) The infected zone is high risk due to the presence of free-roaming African buffalo. FMD vaccinations in cattle is tri-annually or biannually depending on location; (ii) The protection zone is free of free-roaming buffalo and borders the infected zone and areas bordering high risk neighboring countries. FMD vaccination in cattle is biannual in some regions; (iii) FMD Free Zone - this is an area south of the VCF where no FMD vaccinations are permitted and is free of free roaming wild African buffalo. Surveillance is done through regular inspections. Movement of cloven-hoofed animals or untreated meat products across the VCF, from the infected and protection zones to the free zone, is prohibited. Animal products such as meat from abattoirs that are under supervision of DVS as per OIE standards are allowed to move out of the region. Figure 18. Foot-and-Mouth Disease Zones in Namibia 59. FMD occurs regularly (annually) in the Zambezi region and occurred in 2015 in the north- central regions after an absence of around 40 years. The impact along with the (unrelated) closure of two export abattoirs in the NCA (Oshakati and Katima Mulilo) was tremendous with annual Meatco slaughtering in NCA falling from 16,500 to 550 cattle, a fall in producer sales to Meatco of N$80 million (US$ 5.4 million). The Meat Board of Namibia estimated the potential cost of an FMD outbreak under various scenarios ranging from N$332 million (US$ 22.6 million) for an outbreak in four NCA regions to an outbreak in selected locations south of the VCF at N$2.19 billion (US$ 150 million) over a 12- month period. 60. Namibia has the capacity to respond rapidly to FMD outbreaks north of the VCF. FMD was detected in Zambezi region in July 2017. The response consisted of movement controls, decontamination, mass vaccination, disease surveillance and awareness creation. Following detection of the outbreak, a surveillance and booster vaccination campaign was launched within 10-kilometer radius of the focus starting from the periphery. 95 percent of cattle from the surrounding crush pen areas were vaccinated by August and a third routine FMD vaccination for the Region was implemented in October. The FMD free zone is also recognized as being free of CBPP and BSE. 21 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Business Environment and State-Owned Enterprises 61. Business environment and predictability of policies often acts as prerequisites to promoting private sector entry. In Southern Africa, agribusinesses originating from South Africa, dominate investment in several SADC countries. Another set of issues that hinder private investors is the predictability of national policy and legislative structure that at best offers only limited cover for foreign investors, leaving large unmet gap in support areas like infrastructure, and extension and advisory services. In Southern Africa, as in many other parts of Africa, small markets with few commercial farmers and large, often unorganized smallholders, create its own challenges. Governments try to provide fiscal cover to stallholders to meet their poverty alleviation mandates, but often end up creating price distortions in the form of subsidies and other interventions in market price systems. Examples of these distortions include allowing ad-hoc import and export bans, requiring cumbersome permits and licenses, as seen in both Botswana and Namibia, resulting in and unpredictable trading environment for investors. 62. Agro-processing for red meat is dominated by state enterprises in both Botswana and Namibia, with BMC and Meatco in Namibia maintaining lead in high capacity agro-processing facilities (abattoirs and feedlots). The BMC cattle abattoir holds a processing capacity of 650 head per day (cattle and small stock) across two abattoirs with an annual capacity of 11,700 tonnes whereas the Namibian Meatco has processing capacity of 28 600 tons per annum. In 2017/18 production year it processed 19 504 tonnes with a processing capacity utilization of 68 percent. 63. There are several policy distortions that create disincentives to private investment in the livestock sector in both countries. An archaic policy and legislative framework continue to create inefficiencies along the value chain segments, especially for input supply, quality of logistics, labor, and support infrastructure. Export bans, burdensome procedures for acquiring permits for processing and export operations, and multipoint price distortions, create a cumulative disincentive for private sector businesses where risk sharing, and public-private-partnerships (PPPs) are severely limited. For instance, the 1965 BMC Act in Botswana, granted complete monopoly to the BMC over export of cattle, beef and associated products. The legislation prohibits allowing private business operations for beef and live cattle export stating that private sector participation is limited to only when in possession of an export permit issued by the government. Although BMC was created as a single conduit for Botswana’s exports to United Kingdom, the prohibition of live cattle exports was never intended to establish BMC as an exporter of live cattle. Live cattle export bans were only to act as instrument for insulating BMC from likely competition with private businesses to achieve its export quota, instead the requirement of export permits rendered private sector entry almost impossible. 64. Against a growing lobbying from farmers and other stakeholders, the Botswana government relaxed restrictions on export of live cattle in 2019, thus allowing export of weaners to South Africa by private operators. This was an ad hoc policy measure that did not address the long-term removal of market distortions. While the ad hoc measure was initially envisaged to last March 2020, it was extended till July 2021 and later, due to continuing lobbying by farmers and business operators, it continues to remain in effect but only as an ad hoc measure. It is unlikely that a full-scale support to private businesses will become viable unless the government address such patchy and ad hoc mode of policy making and puts in place conducive measures that are favorable to private investors. 65. Namibia, on the other hand, fairs slightly better when it comes to farmers’ and private producers’ decision to export live cattle versus raising them to slaughter weight for sale to Meatco. Cattle producers in Namibia make their decision on factors like their immediate cash needs versus capital investments for raising cattle up to slaughter weight and prevalent market price for weaner versus oxen. In times when market price for weaner is above 63 percent of the slaughter price, most producers decide to sell weaners. This trend has relatively maintained over time and more recently in 2020, the sale of Namibian weaners significantly surpassed due to prevailing live cattle prices in the region that ranged between 68 to 70 percent higher than slaughter prices. 22 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Section Two – Competitiveness and Market Opportunities 66. Despite the relatively small size of the beef industry in Botswana and Namibia, their combined potential for achieving production scales can unlock access to new high-end markets. Given the industry size, production capacities, agro-ecological conditions, and market structures, Botswana, and Namibia, cannot compete purely on price. Their unique production landscape, where cattle production takes place in a vulnerable natural environment, with a large segment of smallholder producers, requires a differentiation strategy based on environmental sustainability a logical choice for increasing competitiveness. A combination of good agricultural practices (GAP), good logistics and transport practices, good veterinary practices, and good branding and marketing practices would comprise the necessary actions needed within each country’s context to support their individual and, where possible, collective strategies for marketing products that are safe, of high quality, and meet animal welfare standards. To transform production into low-carbon, climate smart systems, reduced pressure on natural resources does not necessarily mean reducing herds, rather better herd management is the objective. Grazing management approaches that focus on restricted movement of the entire herd as opposed to the traditional approach of allowing the animals to roam freely is one such strategy to increase the amount of volume produced per hectare while reducing the environmental footprint of beef production. 67. Comparing the performance of beef sector in Botswana and Namibia, reveals that Namibia has adopted relatively better environment-based product-differentiation leading to significant growth in exports in terms of volume. Namibia also exports more higher-value fresh-chilled boneless cuts, sells more into high-end markets, and sells at prices that are 20–40 percent higher than those received for Botswana beef. With a larger share of the total kill sold as “quality differentiated” Namibian beef cuts, branded and packaged for retail, exporters have been able to pay their farmers premiums of US$28 million per year above the prices received by comparable South African farmers. 68. Namibia exports circa 250,000+ beef weaners to South Africa annually. This presents an opportunity to slaughter and process the weaners in Namibia for export to Europe, USA, and China and in turn benefit from high prices paid for processed meat. This can be possible if Namibia can produce fodder for backgrounding and fattening of the weaners in Namibia. As an exporter of live beef weaners and processed beef, Namibia beef prices are globally and regionally competitive. Cattle breeding operations (rangeland) are likely to be competitive however feedlot finishing currently uncompetitive due to high feed costs. On the other hand, Botswana production system is not globally competitive. BMC buys slaughter cattle at low prices from producers and sells at high prices in export markets. Size of industry in Botswana and Namibia remains relatively small. Individually, each country will only be able to capture a small market share, but jointly the combined potential can become notable in terms of volume and scale of production leading to a strengthened position for accessing high end markets better negotiated terms. Enforcement and effective implementation of food safety measures, and SPS standards across the value chain remains underfunded in both countries. The full scope of widespread SPS activities is likely to remain prohibitively costly for governments alone to support. A significant share of investments can be transferred to private sector as well as through blended financing instruments. Growth Potential 69. Both Botswana and Namibia, enjoy preferential access to a set of markets as signatories to several international trade agreements. This status, however, has not been optimally utilized due to limited production volumes and supply-side constraints. The growth potential for expanding trade into Africa remains uncertain due to changing trade patterns and presence of other large suppliers in the 23 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA continent. Some increase is seen in the share of cattle sold for the domestic market, signaling increase in domestic demand for beef and other products. 70. Despite the preferential access, neither Botswana nor Namibia have fully capitalized the market potential from the trade agreements that these countries are signatory to. Meeting production volumes remains the most significant challenges in meeting throughput and supply volumes. As a result, both countries struggle to fill their quota, due to domestic supply-side constraints. Supply of cattle to the domestic processing units have consistently dwindled, leading to declines in beef exports and thus reducing industry’s competitiveness. 71. In May 2019, the African Continental Free Trade Agreement (AfCFTA) officially went into force. The agreement, signed by all but three of Africa’s fifty-five nations, establishes the largest free trade area in the world since the creation of the World Trade Organization in 1995. Once the remaining countries join, AfCFTA will cover more than 1.2 billion people and over US$3 trillion in GDP potential creating opportunities in the African beef market for Namibia and Botswana. 72. There are opportunities to enhance trade within the region and there are demonstrated successes in global markets – the sesame seed exports from Tanzania or the beef exports to global markets from Botswana and Namibia. With the right policy and incentive framework, combined with transparent and widely accepted enforcement measures, cattle and meat industry can play valuable role in protecting and restoring grazing lands, conserving biodiversity, land & water resources, and reducing & mitigating GHG emissions. Both Botswana and Namibia have taken steps to address key legislative and policy constraints to further liberalize beef industry, but these efforts remain limited due to slow institutional realignment, in some cases major restructuring (e.g. BMC) and phasing out of redundant institutions (e.g. Market Support Schemes). Market Structures 73. Large market players in meat industry are often better positioned at servicing both emerging and established commodity markets through global regional sourcing requirements. These large market players operate with buying offices and distribution nodes in other countries and have established market agents working on their behalf for pricing and other negotiations. This is, in effect, creates a parallel international trading structure that can, under optimal conditions, effectively connect global and international demand into the regional and intra-regional supply and production chains. 74. For Southern Africa, agricultural value chains, particularly livestock products, are being transformed with South Africa driving the demand for products and deepened integration with distribution and retail in most countries of the region. Supermarket networks, especially those originating from South Africa like Shoprite, Woolworths, Pick-n-Pay, Spar, etc., are leading retail markets of high-quality goods, despite some trade obstacles, thus creating a shift in the market structure and evolving it into a regional platform with large buying power concentrated among few distributors and retailers. However, these retail networks are often criticized for not procuring more from the local producers or market secondary products that are processed with local primary produce. The challenge behind this remains the food safety and quality concerns that limit procurement of fresh produce from local and in-country suppliers. 75. Meat producers face tight challenges of sourcing but have enjoyed a winner-takes-all advantage if they successfully reach scale in-country. Agro-processors of grains and horticulture produce have relatively more options and require less vertically integrated commitment to producers – they can rely on the trader / spot market system and source regionally in the event of shortfalls. However, this advantage is not translating into prioritizing production of crops such as animal feed and fodder crops that can lift up livestock production systems through regional value chains. While a strong agro-processing industry could act as a mitigating strategy for the development of livestock sector, it still requires high degree of investment in primary agricultural production from within the 24 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA livestock value chain. Unless Botswana and Namibia address the binding policy and institutional constraints that inhibit private investments for livestock development, the share of public spending will remain high. 76. Another area constraining market performance is limited logistical connectivity withing the region and with the international markets. For Botswana and Namibia, most trade logistics rely on South Africa’s connectivity, while inter-country road networks are relatively adequate, the auxiliary network and distribution facilities including cold chain storage and transportation of meat and meat products, that meet health and safety standards, from processing facilities to ports, remain limited. Several of these operations and logistics could be opportunities for private investments as means of more viable facilities that support the industry. But the present business environment has not been conducive enough to generate broad interest among private investors despite the appreciation that domestic fiscal scale could never be adequate. Market Players 77. Both Botswana and Namibia, in comparison to their neighboring Southern African countries, enjoy a relatively stable political and governance conditions that play a critical role for achieving consistent progress towards economic and social capital development plans. Translating their strengths into a holistic and sustainable livestock stock sector development in each country would build on the political willingness to expand private sector participation in the sector. Targeted business support, extension services, will need governments to prioritize improvement of physical and support infrastructure. The overall market reach for both Botswana and Namibia remain low with only slight improvements in value addition and product diversification, which was also found to be one of the constraining factors for large producers such as BMC in Botswana and Meatco in Namibia. Namibia’s cost to export is high while time to export is relatively low as the country maintains its quality margin of fresh beef exports. On the other hand, Botswana continues to face challenges in maintaining consistency on its time to export even with higher costs to export. 78. State enterprise monopolies in processing and marketing affect the meat industry in both countries albeit with different degrees. Constraints such as export bans, export permits, and taxes hinder meaningful private sector participation are common to both Botswana and Namibia. The Botswana Meat Commission and the Meatco in Namibia hold almost exclusive share of the market creating price disincentives for producers while failing to achieve their respective policy objectives. 79. When it comes to product diversification as a strategy to achieve market diversity, the R&D and brand promotion practices are not informed by a systematic market intelligence gathering and analysis, due to inadequate capacity within the main exporter – BMC and Meatco. While in recent years the meat products export basket has marginally diversified, it still consists of a relatively concentrated set of products in Botswana and Namibia like other exporting countries. Botswana’s beef exports are currently almost exclusively concentrated on chilled and frozen boneless beef cuts. Namibia has the highest level of export specialization in frozen beef carcasses, chilled or frozen sheep carcasses, and fresh or chilled lamb carcasses. South Africa remains Namibia’s top export destination for frozen beef and sheep meat, while the UK is the main market for fresh or chilled beef. Looking at market share penetration levels, Namibia has steadily maintained a strong position in the Norwegian and South African markets. However, the overall market reach remains low with only slight improvements in value addition and product diversification, which was also found to be one of the constraining factors for large producers such as Meatco. For Namibia, the cost to export remains high while the time it takes to complete export operation is relatively low as the country maintains its quality margin of fresh beef exports. For both countries, high concentration on a limited number of export markets poses risks, as was evident from the sharp drop in revenues as a result of the EU ban. 25 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Regional and Intra-regional potential 80. South Africa’s rapid industrialization in comparison to its neighbors, interacts with the extent of country products gaining place in regional value chains. Notwithstanding, the country-specific limitations to production and processing capacities, the competition for export markets remains constrained in Southern Africa. More often than not, national development programs make national priorities a precedence over regional outcomes because accounting for regional externalities as national benefits is neither easily accruable nor wins any political interests within the countries. The continuing policy differences among countries exacerbate difficulties of trade among the countries especially exchange of supply inputs and other associated products that feed input processed goods. 81. Both Botswana and Namibia, when considered independently, are small exporters in markets that are multifaceted, highly competitive, and are often dominated by large beef producers. It is therefore logical to consider cooperation with Namibia and other regional exporters from SACU and/or SADC, to improve comparative advantage and to achieve scale and negotiation power. Cooperation and joint ventures in other areas could provide an overall boost to the industry in each country as well as align good practices and standards along inputs and production operations of the value chain. In addition, cooperation on R&D, disease surveillance and control, and cross-border alliances of small and emerging farmers and other industry associations could benefit the value chains in both countries. 82. Another approach to enhance regional integration is removal of regional non-tariff measures and introduce regional standards and rules of origin. National governments and regional economic communities (RECs) need to ensure that non-tariff measures remove barriers to market integration, infrastructure, and industrial development of countries, and create room for cross-border and multi- country partnerships for joint programs. Both Botswana and Namibia, as neighbors and as major beef industry players in Southern Africa, are yet to agree and take steps towards joint industrial development even as several opportunities are acknowledged. Creating transboundary economic corridors through roads and rail networks, processing zones with specialized warehousing and cold storage infrastructure, are areas to consider. Supporting governments in developing insights into behavior of firms in a given value chain can help governments to revamp their policies for attracting investment into selected sectors of the economy. Stimulating growth of cross-border value chains is still nascent in many Southern African countries ad they are yet to reap full benefits from the SADC Free Trade Agreement. Post Covid-19 Transition and Recovery 83. The 2022 World Economic Forum’s Global Risks Report 24 presents a candid analysis of the long-standing complacencies, and the disconnected and divisive political environment that contributed to a mismanaged response to the Covid-19 pandemic at a global scale. In 2020, the national governments were attempting to protect lives and livelihoods, the state of affairs showed a massive lack of national and global under preparedness to external shocks across the board. In 2021, as the pandemic continued with no clear end in sight, governments converted their emergency response to deploy measures that can halt economic distress while continuing measures to support social development. 84. There are no real success stories on how countries in the region have managed financial losses and human capital losses resulting from the pandemic. Continuing human impacts on damage to ecosystems and ineffective coexistence with animal ecosystems are only going to prolong the effects 24 2021 WEF Global Risks Report 26 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA of economic and social losses caused by the pandemic. Countries in Southern Africa, as in the rest of the world, experienced significant setbacks to their social and economic gains prior to the years leading into pandemic. In response to the pandemic, countries had to unlock domestic fiscal space and put in place a series of economic stimulus and relief packages to mitigate the impact of pandemic. However, while the pandemic has stretched the already constrained fiscal space is many Southern African countries, there are also renewed opportunities for private sector investments as part of economic recovery pathways. Such pronouncements are included withing Botswana and Namibia’s post-pandemic recovery and development plans. For instance, the Botswana Economic Recovery and Transformation Plan envisages economic diversification as a key pathway to reclaiming pre-pandemic growth levels and embark on the path to high-income status by 2036. Livestock sector, and meat industry in particular, feature centrally in the economic recovery plan of Botswana. The government plan calls for rationalizing and reducing the burden on public finance, limits government involvement in meat value chain, and level the field for private sector participation through key reforms. Similarly, Namibia plans to follow a forceful economic recovery path to pre-pandemic levels of development with further plans to drive an even more ambitious economic development. Namibia declared 2021 as ‘year of resilience’ setting into motion several steps towards higher order economic and social development. Measures like updating the national fixed asset register, institutional reforms, and rationalization of state enterprises, and creating domestic funds e.g., the Sovereign Wealth Fund for Namibia as responsive and preemptive steps to prepare for future shocks and better steward natural and public resources. 85. While the ambition and drive to look beyond pandemic recovery is praiseworthy in both Botswana and Namibia, the real test of embarking on such a growth path will require multiple actions in the short to medium term – over a course of 3 to 5 years period – to set the course for transformative growth in the long-term. For the livestock sector, and for cattle and meat industry in particular, there are several barriers to overcome before the recovery efforts can translate into development pathway. 27 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Section Three – Actions and Prioritization 86. Achieving sustainable livestock sector will depend on a large set of interventions along specific value chains. The cattle and beef value chain in Southern Africa is an important candidate for creating climate-smart and competitive future of the industry. Specific actions are needed to improve resilience and competitiveness within the value chain, its structure, conduct of actors, and policy and institutional functions to support value chain performance. 87. This section builds on the existing and ongoing government plans as well as the efforts to reclaim pre-pandemic levels of growth to launch post-pandemic, long-term transformative efforts. The opportunities for liberalization and market expansion in Botswana and Namibia are at crossroads as the economic diversification plans in each country prioritize livestock and meat value chain. This section presents the priority actions for each country and also offers recommendations for joint actions that could enhance the market share through regional collaboration. 88. This section presents the priority actions as part of the Roadmap that directly respond to production, processing, investments and marketing constraints. The priority actions informed by various country notes and other outputs prepared as just-in-time notes (Figure 19). The proposed actions are aimed at strengthening beef (cattle and meat) value chains within Botswana and Namibia, with some actions proposed as regional integration for increased competitiveness in the Southern Africa region. The priority actions, where relevant, also include key policy and institutional reforms to address higher-order constraints for promoting a level playing field to private sector participation and greater orientation towards export markets. Figure 19. Analytical work informing the Roadmap 89. This Roadmap is not prescriptive, instead it presents the overall framework as the basis for World Bank and Government dialogues in Botswana and Namibia as well as cross-country and regional dialogue on analytics and investments. 28 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Botswana 90. Botswana operates under dualistic production system with distinct difference between commercial and communal producers. Production performance in Botswana can be enhanced with directed support measures. Globally, the concept of intensive feedlots where cattle are fed, is gradually losing in popularity, albeit there are still emerging markets (e.g., China) that this trend is yet to gain popularity. The shift away from intensive feedlots is mostly due to risk of high incidence of disease, high cost of feeding, and detrimental effects on environment and animal welfare. Botswana must also adapt its production systems in view of these shifts in demand. Cattle supply is highly seasonal in Botswana, causing most butcheries to operate at half their capacity for a significant part of the year. The current trend toward increased feedlots is partially due to the seasonality of cattle supply. Similarly, inputs to production systems, such as supplements and feed are mostly imported and distributed through private feed retailers. In some areas, feed is made available at subsidized prices to communal farmers however the demand always exceeds limited supply rendering these interventions less effective. Lack of knowledge and training to farmers, as well as their limited purchase capacity hinders adoption of licks for meaningful increase in production. 91. Breed improvement is another area of focus for improved production. Botswana has three local breeds with Tuli breed being the most productive. However, crossbreeding is common with foreign breeding lines and there is no set mechanism to capture the full extent of crossbreeding practices in the country and most farms random perform such tasks, risking dilution in the advantages of the local breeds. In the absence of a regulatory framework and strict enforcement, crossbreeding and controlled bull movement remain problematic. To market the exclusive, high-end, naturally produced beef, breed origin information is an inclusive part of the branding strategy. Current capacities for breed certification and limitations in local testing facilities to comply wide range of certification requirements, adds to the time in export and often cause delays high costs. 92. When it comes to financing the production systems, a disconnect exists between available public sector funds and the industry requirements at different points in value chain. The National Development Bank (NDB) and the Citizen Entrepreneurial Development Agency (CEDA), both provide concessional finance to livestock sector, with government providing significant direct commercial support to BMC. CEDA also maintains a grant facility, but demand is seldom fully addressed and a large segment of CEDA loans to livestock operations remain unpaid. The need to divert financing to other parts of the value chain, including small abattoirs and processors, is yet to be optimally addressed. A significant portion of financing can be leveraged from private sector, but the current policy and business environment restricts the scale at which private-led business can be established for a meaningful transition. 93. Along the processing side, the BMC continue to dominate export processing with little to no room for the private sector in investing in export led beef processing. While the BMC thrived until the 1980s, its performance has steadily declined since. Increasing domestic demand, increase in number of non-BMC cattle buyers limiting supplies to BMC, declining cattle population, and low and stagnant offtake rates are key contributary factors to this decline. Since the 1990s, the BMC has consistently experienced revenue losses leading to the Government bailouts. Continuing delays in payment to producers, inability of the BMC compete with local abattoirs, declining slaughter rates, and restrictions on the exportation of live cattle, all have rendered BMC ill-equipped for ultra-commercial competitive environment. While efforts to restructure BMC have been ongoing since 2018, it is yet to fully conclude. In the meantime, financial liabilities of BMC continue to grow. Even if the government is able to complete BMC restructuring, address legacy issues of institutional reforms, clear pending invoices, and takes decisive measures, it will some time before investor and stakeholder confidence is fully restored in government’s policy decisions. Aside from BMC-led slaughtering and processing, secondary processing operations in Botswana are concentrated among few large processors. Outside of BMC, deboning carcass and cutting the meat into portions and cuts, and further processing the 29 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA meat into canned beef and sausages, etc., takes place in a small number of approved facilities. As in production systems, processing operations also suffer constrained profitability due to BMC’s dual objectives of operating commercially whilst fulfilling a social role in respect of the smaller livestock holders. 94. In recent years, the government has attempted to address the closed-market structure of meat industry and developed a Beef Cluster Initiative. A process of legislative realignment is launched to address removal of BMC monopoly and establish as independent regulator in the form of Meat Industry Regulatory Authority (MIRA). Going forward, as a key driver for economic diversification and contribution to claim back losses from the economic recession due to COVID-19, several bold and transformative steps are needed to place the cattle and beef value chain at the forefront of driving economic recovery in the livestock sector. Addressing market diversification objectives will require a shift towards not only export-market orientation, but also a systematic reevaluation of existing market share with current products and space for introducing new products. Identifying new markets to win equitable share of existing products as well as introducing new product lines that are informed by consumer demands in emerging economies. 95. A rethink is needed for long-term sustainability of production and processing systems that are conducive to climate change impacts and generate equitable benefits for commercial and smallholder. In view of the multifaceted production system challenges, following actions are recommended to address input and production constraints. Production/Productivity and processing 96. Improving production of cattle and meat in Botswana includes actions that interjects with both production and processing aspects of the value chain. Key actions will need to include: 97. Production/Productivity Improvement – production/productivity is closely linked with farm- level decisions, especially for the large segment of communal farmers. A guided approach to instill understanding of animal husbandry including feed and pasture management practices combined with shifts in market trends and consumer preferences, is needed to steer the behavioral changes among producers. A key shift for communal farmers would be to promote weaner production (i.e. cow-calf production: a first stage in beef production), and gradually move away from the traditional oxen-based production goals. In addition, a community-driven initiative on enhancing breed quality would be needed to link the production system with other support systems such as animal health and recording systems. Demonstrative evidence of adopting holistic approach takes time hence piloting such initiatives and using these to promote shifts in the production cycles is at best a medium to long term intervention that can be strategically promoted by the private sector facilitated by government. Private abattoirs can integrate the communal cattle owners into their businesses by setting-up sustainable cow-calf production models with the communal farmers. This will entail intensive training programs, breed improvement programs, establishing the required infrastructure. 98. Differentiated processing – currently most processing, especially targeted at export operations, is in control of the BMC. Initially, the BMC-led processing was encouraged to establish market confidence in quality and authenticity of meat products. But over time, this curtailed any diversification effort to developing processing as a strong segment of Botswana’s meat value chain. As a result, there are multiple obstacles that have reduced the size of market share and a differentiated approach is needed to reevaluate the original decision of market control for the country. While the restructuring of BMC is ongoing, the new-BMC needs to be carefully assessed in terms of the role it will play in opening a competitive environment to let other players enter and thrive. As a strategic step, Botswana needs to diversify the processing capacity in the meat industry. This will mean putting in place clear policy directives that effectively reduce the current market share of BMC and allows other competitors to enter, even for exporting to preferential and pre-ordained export markets of UK, EU, South Africa, etc. Concurrently, the government can allow small-scale processing facilities for produce originating from red zones to promote higher degree of social and economic 30 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA benefits accruing to the smallholders. A graduated approach towards establishing small to medium processing facilities for secondary and tertiary grade produce can be supported through private abattoirs and processors. This can be achieved by deregulating the industry and letting market forces determine weaner prices including beef prices. 99. Animal health, welfare, and traceability – another area to directly support production/productivity side concerns relates to having strong mechanism for tracking and tracing animal movements, their health status, and quality of water and grazing available to them that qualifies them as high-grade produce. The current tracking and traceability system needs to be benchmarked against global standards, technologically advanced, and effectively accessible to producers especially smallholders. There is an urgent need to revise and modernize the Botswana Animal Information and Traceability System (BAITS) and align it with global standards of Livestock Information and Identification and Traceability Systems (LITS). The upgradation and modernization process should also identify areas that should be outsourced to private sector such as collection and central processing and uploading of movement, tagging, and vaccination records. Establishing a strong BAITS will also require strengthening animal health monitoring and reporting capacity within the DVS as a decision support system that quickly and effectively bridges information gaps linked to verification and certification procedures. A strong mechanism will be required for community-based initiatives to control the spread of FMD and other diseases for effective implementation of the BAITS. 100. Product branding and identity mechanisms – Botswana needs to categorize its products – especially meat products aimed at high-end markets – under a coordinated and globally compatible branding and labeling system. This means allowing appropriate brand, packaging, logo, etc. for Botswana beef, including for grass‐fed beef, and other products as part of the differentiation of processing chains. Creating new brands, that cater for specific markets, match consumer preferences, and include safety and nutrition labels, is needed. A regular review of branding and labeling practices as well as incorporating modern standards in packaging operations are potential areas where private businesses can be promoted. 101. Commodity Based Trading (CBT) for red zone – promoting participation of smallholders and communal farmers, especially from the infected zone, requires adopting fit-for-purpose innovations and technological options that can be adopted to the context of Botswana. For years, Botswana has continued to follow a policy of full eradication of the FMD in line with recommendations of OIE. There is a need to rethink this singular focus to explore strategies that might better serve the Botswana conditions. A complete eradication strategy, while ideal, is not likely in the immediate to medium term given the interdependencies that exist due to traditional co-existence of livestock and wildlife animals in certain parts of the country. The Ngamiland is an example of this co-existing system, and it is understandably also considered the epicenter of FMD outbreaks. In such areas, a disaggregated approach is needed to promote technologies for treatment of meat from infected zones for sale in free zones and even certain export markets that buy meat products for further processing. Technologies like heat-treatment are proven and could be promoted as public-private investments. Instead of culling, destroying of infected produce, or using it for canned food, exploring additional market channels could provide direct benefits to smallholder farmers. This will however need proper certification and quarantine compliance mechanisms for live cattle from the red zone to be disclosed along with its traceability data. 102. Access to finance – production systems are not without financial constraints especially when it comes to adapting agricultural practices among smallholders. To diversify financing solutions the production supply chain must include a broad range of finance providers. Lack of working capital for growing herds to slaughter weights is one of the key areas that limits potentially commercial and emerging farmers to contribute to productivity gaps. Botswana must promote access to finance for small and medium-sized cattle producers by setting performance-based rating system that awards practices such as implementation of farm quality assurance standards. 31 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Market diversification 103. Botswana’s market diversification goals are two-pronged: optimize Botswana’s comparative advantages in high-quality products; and increase its competitiveness through accessing markets that could fetch higher prices and could provide secondary or tertiary sales channels. To achieve this goal, following key actions will be needed: 104. Improved market structures and systems – Botswana has historically designed its market strategy to serve UK and European markets. While Botswana has excelled in meeting very stringent standards that are difficult for other competitors in the region and globally, the sales and marketing structure has almost exclusively focused on the preferential trade through BMC. Going forward, and in line with the government’s plan to reform BMC, the country needs to review the current structure to make it conducive for international sales and marketing in a post-BMC era. To achieve this, a well- performing system of market information, and research and development (R&D) will be needed. Therefore, Botswana must establish a market intelligence and analysis system that operates in partnership with private sector and informs R&D and decision support for evaluating and adapting marketing strategies. 105. Renewed marketing strategy – Botswana upholds a positive image as a politically stable country in the region. This stability of the country doesn’t always correspond to its openness as a business destination for large investors. Private sector competitiveness depends on an enabling environment which, for livestock sector, is constrained due to existing policies and institutional structures. Botswana needs to learn from the experience of other countries in promoting open competition and create conditions for private sector investments in its primary sectors that can contribute better to economic growth. Within the broader livestock sector, the cattle and meat value chains actors need to operate in an environment of higher confidence which can requires establishing a public-private partnership platform led by private sector value chain players – both large and small – and that serves as an interlocutor for informing government’s decision processes. Such a platform can be tasked with important roles including, identifying new markets, and market expansion strategies for export diversification with greater focus on consumer groups in emerging economies, other African countries, and specialized markets such as for halal products. In addition to the platform, the government needs to divert public funds to pubic-goods that create the enabling conditions for private financing such as investments in under-developed regions with improved infrastructure that reduces time-to-market through localized, cluster-based investments for connectivity, transport, and logistics support. While initially, such infrastructure improvements could be supported through public financing, with sufficient scale, private financing could be possible in the medium to long-term. Policy and institutional reforms 106. Several policy and institutional reforms are underway in Botswana, but the key reforms that directly impact the cattle and meat value chains, are still to be fully implemented. Below is a select list of actions: 107. Policy and legislative reviews – Botswana has taken serious steps to address key policy and institutional constraints to cattle and meat industry growth. To reduce the burden on public financing, limiting government involvement in meat value chain, and level the field for private sector participation, it is important to complete the going policy review and legislative reforms process – namely the approval of BMC Transition Act, amendment to the Botswana Livestock and Meat Industries Act (LMIA), and approval of Botswana Meat Industry Regulator Act (MIRA). These reforms are in line with the government’s acknowledgement that while Botswana’s livestock sector can potentially contribute to country’s economic diversification and growth agenda, the current structural issues remain a binding constraint to a liberal and modern industry outlook. 32 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA 108. Institutional realignment and policy enforcement – attending to the legislative review will need to be complemented with substantial institutional adjustments and where needed, even rationalizations and restructuring. The role of DVS over the years has expanded to a degree where some tasks have spilled beyond its mandate. In parallel to the legislative review of the LMIA, the role of DVS and its structure also needs a review. The government must realign DVS organization and strategy to meet user needs and outsource non‐core activities to private sector. In addition to DVS realignment, a transparent and appropriately communicated system is needed for monitoring consistent enforcement of safety codes at abattoirs and slaughtering slabs using private meat inspectors to generate confidence in certification and verification procedures among producers from both domestic and export markets. This will also mean that where concrete actions are needed to maintain compliance, steps are taken decisively and through well-articulated procedures that are accepted by the stakeholders. An example of such measures includes enforcing discontinuation of all temporary slaughtering facilities at the end of their license terms. The ongoing ad hoc arrangements have created an impression of indifference among such license operators that could lead to serious non-compliance and distrust on government’s ability to enforce its policies. Dismantling the market monopoly of BMC is not likely to be achieved overnight. Instead through a guided consultative process, a graduated approach is needed to allow private operators of controlled facilities to quarantine animals over 14 to 21 days before certification of export. 109. Facilitate private sector entry – another area of promoting effective private sector investments would be to facilitate conversion of temporary slaughtering facilities into private abattoirs. Upon expiration of temporary licenses, and given interest from private investors, the government could allow establishment of private abattoirs. This policy will specifically address better control and quality compliance for domestic beef market that is catered by local, private abattoirs. Another support action for domestic and export market expansion is through appropriately financing modernization of the Botswana National Veterinary Laboratory to conduct residual testing currently being outsourced to laboratories in UK. While the current capacity of the Laboratory is sufficient, the laboratory remains limited in collecting samples from remote areas, turnover results within stipulated time, and adequately integrate the animal tracking system and veterinary databases, which are maintained separately. The longstanding BMC control over the export market for Botswana beef has also skewed the supply chain and procurement structures, leading to further disconnect between suppliers, storage, and other market segments. Establishment of an improved central procurement mechanism is needed along with a stock management system to create better prospects for other processors and consistent availability of products at retail points. It will also contribute directly to improved stock management by addressing a key supply constraint of ready‐to‐slaughter cattle and provide incentives for producing higher quality cattle. Climate resilient livestock 110. Climate vulnerability of Botswana’s agriculture and livestock sector has increasingly become a priority policy focus given that continuing variability in precipitation and rising temperatures are causing rapid shifts in vegetation dynamics, thus directly effecting adaptability of livestock. Issues like land degradation due to poor rangeland management is only going to increase the stress on livestock sector. In view of growing impacts on the cattle and meat value chain, following key actions will be needed: 111. Improved rangeland management – Botswana has initiated an integrated rangeland management initiative; however, its effectiveness will depend on proper enforcement and monitoring. In areas where continuing overgrazing is a serious issue, support for the establishment and capacity building of community-based organizations to prepare and implement community-based rangeland management plans to align stocking rates with available grazing is needed supported by a pilot surveillance program to monitor cattle and wildlife movements. Where community-based organizations do not exist to prepare and manage such plans support will be needed for their establishment and capacity building e.g., in Ngamiland district. Other areas such as Kweneng and 33 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA southern districts are also likely to receive increased climate stress leading to livestock mortality and culling due to a combination of heat stress, reduced availability of drinking water, grazing and feed, increased distances to water for livestock, as well as greater spread of diseases. To effectively address these challenges, measures like establishing geo-clustered extension and advisory services for communal farmers for promoting integrated crop-livestock good practices and use of efficient water management technologies is urgently needed. 112. Integrating climate action – building strong resilience to climate vulnerabilities will need to become an integrated approach to planning and implementation of livestock sector support. Producers, especially smallholders, must be supported and proactively encouraged to adopt improved practices and genetic, climate tolerant varieties and breeds. Improving breed selection strategies and providing adequate breeding services with increased preference for climate-resilient breeds, is a key area for improving Botswana’s production rates and cattle and meat industry’s competitiveness. 113. Climate smart business – in addition to providing direct support to producers, promoting climate-conscious businesses is also needed. Rationalizing infrastructures and service provision for private investors should include steps such as subleasing of underperforming or idle public ranches, farms, and other livestock support infrastructure to private operators. Such steps should be combined with measurable targets to generate climate resilience outcomes for these operations through incentives for modernizing and technology adoption. Financial diversification 114. Cattle and meat production is expensive, especially for commercial operations, with health and safety compliance, and high-quality produce requirements. In addition to upfront capital investments in land, infrastructure, herd management, and maintaining consistent production cycles that usually gestate over 3 to 5 years, working capital costs are also needed for support services such as quality feed and fodder, vaccination and health monitoring, and traceability etc. In Botswana, options to continue BMC-led centralized production and processing is no longer viable due to high management and operational costs with dwindling cattle numbers and declining throughput to meet required quota. Diversifying financial sources away from purely public financing to more private financing and some blended financing is more likely to salvage the support systems for growth in livestock industry. Several actions are needed to accomplish financial diversification as follows: 115. Rationalized public funding – with the onset of COVID-19 pandemic and like other countries, Botswana is also faced with some difficult policy choices for achieving a balance between fiscal efficiency and protection of livelihoods. Given the economic slowdown due to the pandemic, the government’s ability to continue with and implement the broad set of meat sector reforms is limited with significant decline in budget revenues. Under these circumstances, the government needs to shift its focus to prioritize social spending, and develop financing plans with clear public, private, and blended funding sources to implement the National Agricultural Strategy and Beef Cluster Strategy. While in the immediate term, such shift is rational, parallel steps will be needed to address the medium to long term recovery. Public funds need to be prioritized for farmer-led programs for improved education, hygiene practices, and early detection of diseases. An effective and transformative meat sector in Botswana can support the government’s economic diversification agenda with greater private sector participation. The government needs to disengage public financing in the supply chain and explore financing of technology-driven solutions with other finance providers to support the sector. 116. Redirect operations to private sector – creating space for private sector to come forward requires deliberate planning and execution. Identifying areas where public funding can gradually be phased out through planned outsourcing. For instance, the government needs to outsource LITS rollout to private sector for collecting, uploading ear tag data to central database and integration of multiple databases e.g. disease surveillance, vaccination records, etc. Private sector support must also 34 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA be sought to provide access to finance for small and medium-sized cattle farmers for implementing farm quality assurance standards. Prioritization of Actions for Botswana Immediate to Short Term (<2 years) Medium to Long Term (2+ years) Production/Productivity and Processing Production/productivity Promote a guided approach for communal Promote community-based breeding improvement farmers to shift production from oxen to programs linked to animal recording systems. weaner and traditional to holistic among communal producers Private sector driven models must be supported for sustainability. Differentiated Allow small-scale processing facilities for Reduce the current market share of BMC and processing produce originating from red zones allows other competitors to enter Animal health, welfare Revise and modernize the BAITS Launch community-based initiatives to & traceability control spread of FMD and other diseases Strengthen animal health monitoring and beyond the VCF. reporting capacity within the DVS Product branding and Allow appropriate brand, packaging, logo, etc. Categorize products under a coordinated and identity mechanisms for Botswana beef, including for grass‐fed globally compatible branding and labeling beef, and other products system Commodity based Promote technologies for treatment of meat Instill proper certification and quarantine trading for red zone from red zones for sale in green zones and compliance mechanisms for live cattle from even certain export markets the red zone Access to finance Promote access to finance for small and Diversify financing solutions the production medium-sized cattle producers by setting supply chain performance-based rating system One Health Formalize inter-ministerial cooperation on Aim to achieve a JEE score of 4 and PVS score One Health through memoranda of of 4 in each of the assessment categories by understandings. implementing the recommendations of the 2017 JEE report and the 2019 PVS report. Prepare AMR action plan and establish coordination body Market Diversification Improved market Review the current structure to make it Establish a market intelligence and analysis structure and systems conducive for international sales and system that operates in partnership with marketing in a post-BMC era private sector and informs R&D and decision support Renewed marketing Establish a public-private partnership Improve infrastructure that reduces time-to- strategy platform led by private sector value chain market through localized, cluster-based players investments for connectivity, transport, and logistics support Update strategies for export diversification with greater focus on consumer groups in emerging economies, other African countries, and specialized markets such as for halal products Policy and Institutional Reforms Policy and legislative Complete the going policy review and BMC Transition Act, amendment to the review legislative reforms process Botswana Livestock and Meat Industries Act (LMIA), and establish the Botswana Meat Industry Regulator Act (MIRA) 35 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Immediate to Short Term (<2 years) Medium to Long Term (2+ years) Institutional Realign DVS organization and strategy to Establish a transparent and appropriately realignment and policy meet user needs and outsource non‐core communicated system for monitoring enforcement activities to private sector consistent enforcement of safety codes at Enforce discontinuation of all temporary abattoirs and slaughtering slabs using private slaughtering facilities at the end of their meat inspectors license terms Allow private operators of controlled facilities to quarantine animals over 14 to 21 days before certification of export Facilitate private sector Facilitate conversion of temporary Establish an improved central procurement entry slaughtering facilities into private abattoirs mechanism Modernize Botswana National Veterinary Laboratory Climate Resilient Livestock Improved rangeland Support the establishment of community- Establish geo-clustered extension and management based organizations for preparation and advisory services for communal farmers implementation of rangeland management plans supported by a pilot surveillance program to monitor cattle and wildlife movements Integrating climate Adopt climate-integrated approach to Improve breed selection strategies and action planning and livestock sector support providing adequate breeding services with increased preference for climate-resilient breeds Climate smart business Allow subleasing of underperforming or idle Provide direct support to producers adopting public ranches, farms, and other livestock climate smart technologies and practices support infrastructure to private operators Financial Diversification Rationalized public Develop financing plans with clear public, Public funds need to be prioritized for farmer- funding private, and blended funding sources to led programs for improved education, implement the National Agricultural Strategy hygiene practices, and early detection of and Beef Cluster Strategy diseases Disengage public financing in supply chain and explore financing of technology-driven solutions with other finance providers Redirect operations to Outsource LITS rollout to private sector for Provide access to finance for small and private sector collecting, uploading era tag data to central medium-sized cattle farmers for database and integration of multiple implementing farm quality assurance databases e.g., disease surveillance, standards vaccination records, etc. Namibia 117. For Namibia, timely and rapid off-take of livestock from the rangeland is of critical importance. An effective marketing system is required that supports marketing of livestock when they are still in good condition and good prices can still be realized; ensure that already limited forage is available to the remaining core group (breeding herds) of livestock that cannot be easily marketed; and to prevent land degradation of the resource that is already under pressure, due to the drought. 118. Currently, Namibia operates along two vague, and often overlapping, marketing systems. While marketing of livestock and linked products south of the VCF is well developed to access 36 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA international markets, conditions in the NCA, restrict market access due to FMD in both the protected and infected zones. For identifying new markets and rearranging how current products can be realigned to the new markets to identifying new products for improved share within existing markets, a rethinking of current market diversification strategy is needed for Namibia along four areas to improve market orientation in export operations: (i) existing markets with current products; (ii) existing markets with new products; (iii) new markets with existing products; and (iv) new markets with new products. 119. Strategies and programs to address production constraints will need to flow from the higher order market objectives but will have to be balanced with climate conditions, integrated feed crops, and irrigated agriculture systems where hydrological studies indicate that sufficient water is available. For instance, promoting feedlots in the NCA that respond to the fodder needs of livestock farmers along a geo-cluster, should be explored through feasibility studies. The government recognizes the potential of feedlots and would like to promote fodder production within irrigated agriculture projects under the Green Schemes 25. However, given the high costs and growing concern among high-income markets to move away from large feedlots towards grass feedlots, an appropriate strategy for Namibia would be to promote grass feedlots of small to medium sizes in partnership with private sector. In addition, promoting adoption of licks for meaningful increase in production along with practical knowledge and training for farmers, would be needed. 120. Namibia can optimally achieve local value-addition and competitive price structures that are comparable to the trade related country benchmark (Red Meat Abattoir Association Carcass Prices) for all classes and grades. However, this will require a rethinking of investment in Namibia’s natural production environment to maximize value added to production. For the long-term sustainability of the livestock sector, a balanced marketing structure needs to be prioritized that optimally utilizes export abattoirs. In addition, Namibia can further enhance its global competitiveness in cattle and meat value chains by addressing the non-tariff and logistics barriers that hinder access to competitively priced inputs. Strategies for market diversification into African markets as well as the Middle Eastern markets will require not only realigning current market strategy but also explore areas where strategic partnerships with Botswana could boost production volumes of inputs such as increased animal feed and fodder through the Green Schemes. 121. Within Southern Africa, Namibia stands out on its clear statement of commitments under updated the Nationally Determined Contributions (NDCs) for climate-smart livestock practices. Several of these commitments need to be translated into implementable investment packages that can potentially be financed through private sector and through joint ventures with Botswana. Examples of such investment schemes may include improved feed management, improved animal health, improved rangeland management, and use of drought-tolerant breeds to reduce the industry carbon footprint. Production/Productivity and processing 122. For Namibia, production and processing are closely linked with the current state of structural and institutional arrangements to improve the overall performance of cattle and meat value chain. Key actions will need to include: 123. Production/productivity improvement – through ongoing programs such as the Green Schemes, producers should be promoted to grow feed and fodder crops through public private 25 Green Schemes constitute irrigated-agriculture program of the Namibia government aimed at reducing poverty by increasing agricultural production, job creation, and exports. 37 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA partnerships and blended finance and as a direct support measure to Namibian meat industry. To address animal health and cattle quality for export and other markets, Namibia needs to shift away from operating large-scale feedlots that are increasing capital intensive and uneconomical to sustain operations overall longer term. Promoting small-scale finishing systems to improve condition of the cattle before slaughter could serve the industry’s needs better as a multitude of small-scale feedlots would also provide business opportunities to emerging producers and private investors. In addition, an effective strategy to optimize throughput for abattoirs, pilot community-based quarantine feedlots should be established to supply NCA abattoirs and local markets. This can potentially provide the triple wins of smallholder-led enterprises, rural job creation, and direct private investments in production operations. 124. Differentiated processing – most finishing and processing, especially for export operations, is done by Meatco. While centralized processing has gained Namibia good reputation for quality and authenticity of meat products, it has limited diversification of other grades of meat products that can potentially serve domestic and African markets. A differentiated processing of high-grade meat is needed that establishes multiple graded scales for other meant products not destined for EU markets. Similarly, while Meatco can continue to be the main meat processor for high-grade meant, processing of other grades of meat products should be, over time, handed over to small-scale processing facilities, especially for meat from NCA through private abattoirs and processors. 125. Animal health, welfare, and traceability – Namibia has well-established reputation for meeting good SPS compliance and operating with advanced traceability systems. Most established mechanisms work well but there is a need to improve awareness, understanding, and compliance among smallholders especially in the NCA including provision of adequate resources for the control of FMD in this zone by the VS. A pilot initiative on establishing community-based animal health delivery system that incentivizes young entrepreneurs as rural service providers, can be launched. This will have a twofold objective of focused support to NCA and promoting agri-entrepreneurs and job creation for young farmers. 126. Product branding and identity mechanism – Namibia has established branding strategy for its products through coordinated and globally compatible branding and labeling system. However, a consistent upgrading of branding strategy is still needed to allow emerging consumer demands such as low plastic use and elimination of single-use plastics from the food industry. Similarly, creating new brands, that cater to specific markets, match consumer preferences, and include safety and nutrition labels, is needed. To ensure consistent enforcement of branding and product identification, Namibia needs to register all NCA meat retailers including all abattoirs, traders, butcheries, supermarkets and shops, restaurants, informal traders, and meat vendors, with Meat Board. 127. CBT for NCA products – While Namibia, like several other countries, is also making efforts to shift towards commodity-based trading, caution must be exercised. Namibia should explore markets outside the NCA based on CBT, especially to countries with equal or poorer FMD status than the NCAs. However, shift shouldn’t come at the expense of long-term objective of investing in measures that guarantee the NCA products are also free from the virus causing the disease through some form of processing. 128. Access to finance – Namibia has systematically launched several initiatives to promote private sector participation in its beef industry, albeit with mixed results. The two main government sponsored initiatives are the Market Share Promotion (MSP) Scheme and the Green Schemes 26. 26 The MSP is implemented by the AMTA, whereas Green Schemes operate under oversight for the AgriBusDev, a parastatal organization. 38 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA However, the government needs to accelerate transfer of the remaining Green Schemes to private sector to complete financial transition from public to private investors under properly laid out rules. In addition, Namibia needs to create additional measures directed at smallholders by promoting their access to finance for small-scale processing and packaging units. To boost production and processing and increase share of smallholders in these operations, the government needs to upgrade abattoirs at local (municipal) level with training in business management and hygienic meat processing and marketing. To facilitate greater private sector investments in production and processing operations, other entry points should be explored such as promoting private sector investment opportunities for cold chain, transport, and logistics solutions. Green Schemes are clear candidates for adopting some of these shifts and promote private sector involvement in processing operations. A specific action would include allowing processing facilities for secondary and tertiary grade produce to private abattoirs and processors. Market diversification 129. For Namibia, market diversification strategy focuses on the country’s competitive advantage in producing quality and niche products for preferential high-end markets like Norway and USA. However, lately government has made concerted efforts to access non-EU markets within Africa and middle east. Further market diversification, especially in the interest of NCA producers is needed through following key actions: 130. Improved structures and systems – Namibia still needs to address production constraints through investments in product diversification and local value addition, while maintaining export quality. It also needs to ensure that climate resilience if front-centered in industry operations and investment decisions. As a medium to long-term measure Namibia can realign the current structures and systems to better leverage Namibia’s competitive edge in trade agreements e.g., the African Continental Free Trade Area (AfCFTA), by developing strategies for market diversification into other African markets and Middle Eastern markets. Namibia has made good progress on transitioning former structures into improved systems that meet the export market requirements such as the Namibian LITS. However, some of these still operate with limited access and compliance. As an immediate measure, and to enhance the effectiveness of Agro Marketing and Trade Agency (AMTA), Namibia needs to shift AMTA role from procurement, storage, and marketing to facilitation and incentivization for private sector participation. 131. Renewed marketing strategy – Looking at market share penetration levels, Namibia has steadily maintained a strong position in the Norwegian and South African markets. However, the overall market reach remains low with only slight improvements in value addition and product diversification, which was also found to be one of the constraining factors for large producers such as Meatco. Namibia needs to review and update its marketing strategy. In the immediate term, Namibia needs to rationalize public spending in sub-optimal interventions that are not performing. This means that Namibia will need to discontinue existing market support schemes to address inefficiencies namely, Small Stock Marketing Scheme. Policy and institutional reforms needed 132. Namibia has taken several decisive policy and institutional reforms over the recent years. However, to further enhance the global competitiveness of the livestock value chain and support beef industry’s transition to inclusive and green growth, following actions are needed: 133. Policy and legislative review – Namibia has embarked on transformational realignment of its current policy and legislative framework. Some of these steps are more critical and interlinked with downstream policy shifts. For example, completing the review of Communal Land Act reform is on critical path given that it directly affects the communal farmers. Without reforming the Communal Land Act, the growth of the commercially oriented communal farmers will remain constrained given the complicated and time-intensive process for obtaining leasehold. Actions like promoting 39 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA community-based group rights for rangeland management, will be dependent on realigning the current land tenure arrangements. Supporting differentiated lease terms could directly benefit smallholders through measures like increasing the period of land leases from 3-5 years to renewable 10-year leases that can better enable their participation in productive streams. A systematic critical review is also needed of the ongoing initiatives to assess their effectivity in terms of benefits to smallholders, outreach for private sector investments, and environmental benefits. Screening from these viewpoints would mean taking decisive measures such as phasing out or discontinuation of the Small Stock Marketing scheme, and prioritizing Green Schemes awards to private investors for irrigated agriculture projects in the NCA. 134. Institutional realignment and policy enforcement – as part of the ongoing legislative and policy reforms, corresponding institutional adjustments will also be needed to ensure mechanisms to enforce and monitor enforcement are correctly calibrated. For instance, to ensure Green Schemes achieve their envisaged outcomes, the role of AgriBusDev needs to be reevaluated and redefined, and priority accorded to schemes that produce feed and fodder as direct inputs to livestock and beef industry. 135. Facilitating private sector entry and investments – Namibian beef industry continues to operate under an unequal distribution of productive assets such as land and water availability, that pose barriers to entry and growth for entrepreneurs and small- and medium-enterprises. Adding the constraints posed by state enterprises that enjoy market monopoly and other advantages, further limits private sector entry and investments. To remedy this situation and actively promote private investment flows, Namibia needs to strategically promote buyers and producers’ partnerships for competitive prices for producers, traders, and other value chain actors, thus creating a relative level- playing field. Another deliberate strategy is to allow designate percentage of NCA products for purchase by processors and meat retailers as support permits to import from the south of the VCF, as a calculated and risk-aware step towards addressing communal farmers constraints in accessing private finance. Climate smart and resilience 136. Climate change poses a serious challenge for the Namibian livestock industry and the government amplified its efforts to introduce strategies and actions that will enable the livestock producer and farmer to not only adequately adapt to the adverse impacts of climate change, but to support resilience by reducing their vulnerability to future shocks. Key priorities like rangeland management, drought tolerant breeds, and sustainable bush control and utilization are underway. However, several additional actions are needed to directly address the impacts on productivity losses in beef industry. In this regard, following actions are recommended: 137. Improved rangeland management – continuing rangeland degradation poses a triple burden on Namibian livestock sector in terms of reducing farmers productivity, leading to stock reductions, and ultimately impacting farmers’ profitability. Urgent actions to halt and reverse rangeland degradation require an integrated and multi-pronged approach. This will include establishing pilot programs on integrated crop-livestock systems that involve biogas, and conservation agriculture practices. Another set of actions will include raising awareness levels among the communal farmers on good rangeland management practices through directed extension and advisory service. This will need to include an enhanced understanding of adoption of Namibia Rangeland Early Warning System (N-REWS), especially information tools such as vegetation condition deviation maps, forage availability maps, photo guide to estimate forage availability, fodder flow planner application, and livestock auction prices. These tools are intended as decision support mechanism but are currently not well-understood and needs some customization for different farmers groups and networks like Namibia National Farmers Union (NNFU) according to their herd size, location, and other socio- economic characteristics. Similarly, there are recognized benefits of practices like bush thinning, especially in heavily encroached landscapes, for targeted restoration of rangeland condition and 40 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA productivity. Promoting bush thinning together with regenerative grazing practices can ensure that carbon is incorporated into the carbon cycle. As plant density and biodiversity increase so does carbon sequestration through safe underground storage. 138. Integrating climate action – recurring and long-droughts often challenges rangeland restoration efforts. Delivering consistent and clear communication is critical for developing effective grazing plans especially during and after drought periods. Currently, there is no legal framework to enforce development of communal grazing plans, putting nearly 30 million hectares of communal land at risk of irreversible degradation and increased vulnerability. Namibia needs to address this critical gap through establishing communal grazing groups through a national consultative process and assist with developing and enforcing grazing plans in different parts of Namibia. In addition, promoting other technologies such as biogas has multiple benefits as part of integrated crop- livestock approaches for improved feedlot operations, especially within small-scale feedlots, can potentially provide sufficient slurry for surrounding households to use for horticulture and crop production. 139. Climate smart businesses – Namibia needs to strategically shift its business promotion efforts to be climate-smart. For instance, promoting climate smart businesses could be promoted through creating pilot investments for providing clean source of energy for operating feedlots and a high- quality, effluent organic fertilizer, through biogas plants adjacent to community/quarantine feedlots. Private investors could receive enabling concessions like rapid processing of permits and other business setup procedures when investment plans are clearly climate-aware or provide carbon offsets. At the level of communal farmers, promoting business and entrepreneurial training to animal health agents could be a targeted strategy to support young, rural entrepreneurs establish their own businesses and reduce chances of their exodus from rural areas. Financial diversification 140. Aside from financial support offered by commercial banks in Namibia, mainly to title deed farmers, the Agribank also offers financing and loan products to emerging and communal farmers. However, these products still don’t fully meet the needs of Namibian farmers. Diversifying financial sources through increased private capital and blended public-private financing could provide systemwide growth opportunities in the Namibian beef industry. Key recommended actions are as follows: 141. Rationalizing public funding – the 2018 labor force survey suggests that Namibian economy is marked by high levels of informality, with nearly 57 percent of total employment being in the informal sectors marred with low productivity and higher income disparities. Under such conditions, rationalizing public spending and increasing the share of private financing in key growth sectors like agriculture are essential. Emerging out of the Covid-19 pandemic impacts on economy, Namibia needs to prioritize public finance for essential infrastructure (e.g. rural access roads, water supply and irrigation infrastructure, etc.) as part of its enabling environment efforts to attract private investments. Similarly, measured steps towards discontinuing public financing from input and other supply chain operations to actively promoting technology solutions in supply chains supported by private sector could better support the sector in the long run. 142. Redirect operations to private sector – Namibia needs to diversify financing sources with special focus on access to finance for communal farming operations. A key strategy in this regard would be to expand eligible banks from just Agribank to other commercial banks that can offer blended financing products and guarantees. To reduce lender risks and better reach smallholders’ financing needs, Namibia is also considering taking innovative financial diversification options such as introducing an agriculture index-based insurance framework integrated with required infrastructure for data collection and weather-based insurance products. These are welcome steps however proper feasibility will be needed to design fit-for-purpose products for Namibian context. 41 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Prioritization of Actions for Namibia Immediate to Short Term (<2 years) Medium to Long Term (1-2+ years) Production/Productivity and Processing Production/productivity Promote small-scale finishing systems to Promote producers to grow feed and fodder improvement improve condition of the cattle before crops through public private partnerships and slaughter blended finance Pilot community-based quarantine feedlots should be established to supply NCA abattoirs and informal markets Differentiated Establish small-scale processing facilities, Allow differentiated processing of high-grade processing especially for meat from NCA meat that establishes multiple graded scales for other meant products Animal health, welfare Improve awareness, understanding, and Establish community-based animal health & traceability compliance among smallholders delivery system that incentivizes young entrepreneurs as rural service providers Product branding and Allow emerging consumer demands such as Create new brands, that cater to specific identity mechanisms low plastic use and elimination of single-use markets, match consumer preferences, and plastics from the food industry include safety and nutrition labels Register all NCA meat retailers including all abattoirs, traders, butcheries, supermarkets and shops, restaurants, informal traders, and meat vendors, with Meat Board CBT for NCA products Explore markets outside the NCA based on Invest in measures that guarantee the NCA CBT, especially to countries with equal or products are also free from the virus causing poorer FMD status than the NCAs the disease through some form of processing Access to finance Accelerate transfer of the remaining Green Upgrade abattoirs at local (municipal) level Schemes to private sector with training in business management and hygienic meat processing and marketing Promote smallholders’ access to finance for small-scale processing and packaging units Promote private sector investment opportunities for cold chain, transport, and logistics solutions Allow processing facilities for secondary and tertiary grade produce to private abattoirs and processors One Health Formalize inter-ministerial cooperation on Aim to achieve a JEE score of 4 and PVS score One Health through memoranda of of 4 in each of the assessment categories by understandings. implementing the recommendations of the 2016 JEE report and completing outstanding Commence implementation of AMR National actions on recommendations from the 2008 Action Plan. PVS report. Market Diversification Improved market Allow appropriate brand, packaging, logo, etc. Develop strategies for market diversification structure and systems for Namibia beef into other African markets and Middle Eastern markets Renewed marketing Review and update existing marketing Discontinue existing market support schemes strategy strategy to address inefficiencies Policy and Institutional Reforms Policy and legislative Complete review of Communal Land Act Promote community-based group rights for review rangeland management 42 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Immediate to Short Term (<2 years) Medium to Long Term (1-2+ years) Increase the period of land leases from 3-5 years to renewable 10-year leases Discontinue the small stock marketing scheme Prioritize Green Schemes awards to private investors for irrigated agriculture projects the NCA Institutional Reevaluate and redefine the role of realignment and policy AgriBusDev in Green Schemes enforcement Facilitate private sector Allow designate percentage of NCA products Promote buyers and producers’ partnerships entry for purchase by processors and meat retailers for competitive prices for producers, traders, as support permits to import from the south and other value chain actors of the VCF Climate Resilient Livestock Improved rangeland Establish pilot programs on integrated crop- Improve awareness and capacity of management livestock systems that involve biogas, smallholders for adoption of N-REWS quarantine feedlots, and conservation agriculture practices Promote bush thinning together with regenerative grazing practices Integrating climate Establish communal grazing groups through a Promote biogas as part of integrated crop- action national consultative process and assist with livestock approaches developing and enforcing grazing plans Climate smart business Promote business and entrepreneurial Create pilot investments for providing clean training to animal health agents source of energy for operating feedlots Financial Diversification Rationalized public Prioritize public finance for essential Promote technology-driven solutions in funding infrastructure (e.g. rural access roads, water supply chains supported by private sector supply and irrigation infrastructure, etc.) Redirect operations to Expand eligible banks from just Agribank to Explore introducing an agriculture index- private sector other commercial banks based insurance framework Regional 143. Global trade partners, especially in the larger and more advanced economies, have strong incentives to support modernization at different points in the value chain, and the regional scale. National governments should take full advantage of this to promote joint ventures, technology transfer, and export market access. 144. Southern Africa, particularly Botswana and Namibia contain strong opportunity for the marketing of beef free of diseases as well as meat from animals produced on grazing alone or grass feedlots. Monitoring of the production and trading systems is key to rigorously enforce traceability of all products. Harmonizing the current traceability and tagging systems could benefit from modern technologies e.g. smart-phone platforms, geo-spatial tracking, etc. to improve trading in meat and other animal products. Harmonizing regional standards is important because there are significant potential gains associated with more efficient trade. Stricter and less harmonized requirements are more costly to comply with while agreed upon standards increase trade. Both Botswana and Namibia can benefit from a harmonized food safety standards system to improve their comparative access into well-functioning global trade in food products. 43 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA 145. The varying stages of development in each country’s livestock traceability system make harmonizing animal trade standards challenging. Regional government partnership for harmonized standards and adoption is essential to the credibility and effectiveness of supply chain technologies. Many of the potential benefits (e.g. product safety) of e-Traceability cannot be sustained without transboundary coordination. Traceability systems must be technologically appropriate in terms of simplicity, accessibility, and cost; and must be credible to all market chain participants. Properly designed traceability systems allow private incentives to offset costly public surveillance, penalties, and direct assistance partially or fully. Any perception of lowing standards, or worse falsification, will eliminate the primary driver of this technology’s adoption and diffusion. As traceability directly influences production and logistical service decisions, which means, from a process point of view, that it also drives many material efficiencies gained along supply chains. A system-wide renewal of existing cattle traceability and compliance systems is urgently needed to identify key areas where improvement is needed withing the existing LITS regulations, implementing electronic ear tags, and incorporating consistency in country-scale enforcement of food safety regulations. In addition, prerequisites for smallholder inclusion in traceability systems must be clearly defined and popularized. Each country will need to strengthen local institutions to provide enabling factors and coping strategies to smallholders for effective adoption. High costs, for small producers, to deal with vertically coordinated global commodity chains are a potential threat to the future of smallholder production systems. There are specific concerns about the marginalization of smallholders in the global economy due to the entry barriers associated with traceability requirements. At another level, there are logistical concerns due to the costs of monitoring and organizing scattered remote smallholders who are involved in extended and complicated supply chains. Effective smallholder inclusion in certification / traceability schemes requires strong institutional support in facilitating continued access to higher value markets. Leveraging joint ventures to unlock private investments could include support packages of credit and technical assistance designed specifically for small and medium producers and value chain entrepreneurs, preferably in partnership with private sector actors. Most of these concerns are manifested in Botswana and Namibia and increasing reflected in national plans and strategies. 146. A system-wide improvement in current livestock sector could be achieved with a clustered investment approach that includes planned advanced purchase and trading system, coupled with the provision of basic veterinary services and the creation of grass feedlots. Allowing small to medium scale rural abattoirs under private operations along with bi-product collection and processing businesses for off-fall and hide, and skin tanning facilities, would create an integrated system that can serve to change the entire livestock farming and meat processing value chains for the benefit of farming and rural communities in both countries. 147. Both countries need to increase export marketing and sales capacities within BMC and Meatco respectively to allow targeting new markets for diversified export product range. However, this has to be an initial strategy that systematically creates space for allowing private business entry into newly identified markets. Cooperation for improved productivity 148. Multiple factors play an integral role in promoting and sustaining cross-border value chains, most important being connectivity and access through transportation routes, and border logistics to facilitate trade efficiencies. In Southern Africa, most countries neighboring South Africa have market linkages with it, but only limited collaboration with each other. With growing competition across all products and markets, and shifting global trends across many value chains, countries often miss out on opportunities that are better captured through joint-actions and harmonized trade facilitation systems, rather than through single-country systems. Despite a well-integrated regional planning framework through the SADC regional trade facilitation initiatives such as the Southern Africa Customs Union (SACU) and a broad stroke endorsement by the member countries of the SADC Industrialization Strategy, only limited progress is seen when viewed from specific value chain structures and 44 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA constraints. Addressing multiple challenges imbued in quality, price, delivery efficiency, targeted marketing and export policies, and market diversification, require rapid transitions and decision-flows for adjusting supply chain operations to feed into production processes that in turn transform with export-led growth objectives. 149. For Botswana and Namibia, importance of beef value chains – in particular cattle and meat products – are uniquely situated in their cultural, and political history with several constraints and opportunities being similar albeit their responses vary. Along production cycle, the make up of production processes, large segments of informal/communal farmers versus smaller shares of commercial operations, heavy toll of climate change impacts on grazing lands and water resources, and frequent and persisting climate shocks combined with animal disease episodes, are some of the challenges that both countries face but their responses differ. Below key actions are recommended as potential joint response to the productivity constraints for beef industry: 150. Production policies shift from protectionist to regionally aligned – this would mean that as part of their ongoing policy and institutional review processes, both Botswana and Namibia, prioritize harmonization of SPS standards and other legislative reforms to incorporate regional planning for integration of domestic value chains into an interconnected regional meat value chain. Key firms in each county – BMC in Botswana and Meatco in Namibia – will need to reevaluate their production planning cycles towards targeted intra-regional trade of products. As a pilot initiative on joint productivity programs, priority must be given to cattle and meat production in communal areas to generate positive outcomes to smallholder producers in each country. For consistency and efficiency of production operations, both countries need to invest in proper infrastructure. There is potential for collaboration on modernizing and upgrading infrastructure like testing laboratories with private investment. 151. Promote mutually beneficial input sub-value chains – trading improved live cattle for breeding purposes, deploying accredited service providers for vaccines, artificial insemination, etc. and other inputs like vaccines and dozing, animal handling and transportation equipment, etc. are potential sub- value chains that can directly enhance livestock production systems in each country. Finding avenues for promoting joint sub-value chains that serve as inputs to production systems, can boost efforts in both countries. 152. Harmonization of animal health and food safety systems – challenges like disease control, inspection, certification measures and veterinary services are common challenges for governments and often trigger system-wide disruptions to production operations. Botswana and Namibia both achieved good outcomes from the in-country systems albeit that room for improvement still remains and some challenges are more pronounced than others in each country. A clear area for potential regional cooperation is FMD control through joint surveillance and reporting of wildlife and cattle movements in border-proximity and cross-border regions. Initiatives like programs for purified FMD vaccines, and distinction of infected cattle from non‐infected ones in border-proximity and cross- border areas, are possible steps that can be taken. This will also mean that surveillance and reporting measures will need to be aligned between Botswana and Namibia through a common database. In addition, both countries can adopt clustering approaches for smallholders and emerging farmers located in border-proximity and cross-border areas to systematically address service delivery gaps and potentially gain mutual benefits from adopting a joint approach to quarantine, and certification of cattle from infected zones for export markets in Southern Africa region. Harnessing regional market opportunities 153. SADC’s Industrialization Strategy calls upon member countries to address several barriers to markets including addressing ‘behind the border’ constraints that limit market access and diversification. As with other products, market demand for beef and other meat products is transforming towards more quality-oriented, better labelling, and environmentally friendly packaging, over traditional products. Intra-regional trade in SADC region continues to remain sub-optimal and 45 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA most export demand for red meat is subdued because of influx of cheap poultry and red meat into the region through South Africa 27 which, to some extent, impact of the export potential of other countries in the region. Maintaining such national trade protectionist policies pose structural challenges to promoting regional value chains where inter-regional trades occurs under streamlined, minimum barriers. 154. There are unexploited opportunities for Botswana and Namibia within the SADC region as well as non-SADC African countries. With rapid urbanization and rising incomes, demand for high-quality beef and meat products, is also growing and both Botswana and Namibia are uniquely placed to make good use of these opportunities. Both countries have established themselves as success stories on meeting stringent SPS and quality standards and maintaining consistent disease-free produce to export beef to developed markets. Another set of constraints related to lack of an integrated market intelligence system that limits both countries’ market opportunities at regional and pan-Africa scale. Lack of timely and accurate market information remains a common challenge to both Botswana and Namibia with little information available on trend analyses, price shifts, and changes in producer- trader relations, etc. A coordinated approach could add to the comparative advantages for Botswana and Namibia provided collective bold measures are taken. A few priority actions are recommended below: 155. Innovations for market access – both countries can gain from introducing innovative measures within their ongoing marketing strategies. For instance, developing joint livestock auctions of cattle could create new marketing opportunities and fetch better prices within the pan-Africa region especially in post-climate shock periods when countries are faced with supply constraints in other parts of the continent. Similarly, both Botswana and Namibia enjoy stable political climate and relatively predictable policy regime, even as the latter remains heavily skewed in favor of public enterprises. Private capital ventures appreciate political and policy consistencies in making investment decisions. While both countries are in the process of revisiting their public policies to reorient these in favor of private investments, agro-processing could be a strategic area where e policy-reorientation can be prioritized to gain regional integration. For instance, developing consistent and harmonized grading criteria could support the development of objective price determining systems that boost private sector confidence and incentivize producers. Combined with harmonizing the current traceability and modernizing along a block-chain approach, could further improve Botswana and Namibia’s performance on this critical aspect. Another set of actions could promote new businesses in red meat processing if both countries allow joint ventures for branding and packaging operations. 156. Investment-friendly policies – creating an enabling environment for regional (intra-African) trade in agricultural commodities is a key commitment under the Comprehensive Africa Agriculture Development (CAADP) scorecard. Both Botswana and Namibia have made progress, with Namibia slightly higher than Botswana, on realigning country policies towards improved enabling environment 28. However, there is room to improve performance of country policies and explore policy alignments between Botswana and Namibia on several areas like border-zone and border- proximity infrastructure, reducing cost of inter-country trade, joint transportation, and logistics operations, etc. Similarly, bordering countries need to ensure that regulations are applied in an efficient manner. Better alignment of costs and time associated with the certification of produce, the 27 South Africa maintains bilateral agreements with Europe and USA e.g. Economic Partnership Agreement (EPA) and American Growth and Opportunity Act (AGOA), that enable imports of cheap poultry and red meat into the SADC region through South African ports. 28 2022 CCADP Review Report: 46 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA procurement of trade and export certificates, the procurement of phytosanitary permits, etc. could be some of the direct measures for boosting private sector investments. 157. Market intelligence system – Market information systems play an important role in smallholder inclusion – providing them bargaining power and addressing issues of disenfranchised farmers’ groups and monopoly price takers, etc. At the Southern Africa scale, lack of updated market information in the region – both at domestic and regional levels – continues to be a key constraint. Botswana and Namibia can benefit from streamlined market intelligence systems and coordinate analysis and R&D capacity outside of BMC and Meatco operations. For each country, good market information will directly enhance production cycles, create incentives for farmers to increase production, and operators to invest in processing activities. The SADC intends to establish a Southern Africa Regional Bureau for Agricultural Market Information as part of its Industrialization Strategy, however, not much progress is made to date. Botswana and Namibia can take lead on this initiative in collaboration with SADC to implement a regional market information system that can break new grounds and set an example for other Southern African countries. Pathway to low-carbon livestock 158. At the global scale, countries are increasingly adopting strategies to shift livestock sectors from resource-intensive systems to integrated agrifood systems that include actions for climate change mitigation and adaptation. However, for most countries in the South, striking a balance between livestock-dependent livelihoods, nutrition, and food security needs and taking measures to reduce GHG emissions remains a challenge. When compared, agricultural production of food of animal origin, especially red meat, has a higher environmental impact than production of food of plant origin. Globally, cattle production is the main contributor to GHG emissions from agriculture with about 5.0 gigatonnes CO2-eq, which represents about 62 percent of sector's emissions 29 from a variety of sources within the life cycle of beef production, including the production of enteric methane, methane and nitrous oxide from manure and fertilizers, combustion emissions in the farm and emissions incorporated in the consumption of energy and materials. In Southern Africa region, nearly all agrifood production is inherently connected to food security, land and environmental factors, and availability of pasture for grazing, making it critical to design integrated solutions to reduce emissions from livestock that include multiple action areas implemented in a conjoined manner. 159. Transition to a low-carbon livestock sector in general and cattle and beef production in particular, is not only possible, but is also increasingly being promoted among measures for responsible and sustainable development that meets consumer needs. The challenges associated with transition from current production systems to a low-carbon model come from national governments’ and other industry stakeholders’ inability to accurately measure and verify carbon reduction in product value chains. Botswana and Namibia are no exception to these challenges. While both countries have systematically heightened their commitments to adopt climate-smart agriculture (CSA) as integral part of the National Development Plans and other economic and sectoral development policies and strategies, both lack appropriate capacities to identify areas of carbon competitiveness, and the cattle and meat value chain actors remain unable to measure and verify carbon reductions. Joining forces to address some of these challenges could provide better results for both countries. Key actions would include as follows: 160. Decarbonization of supply chains – basically the national quality infrastructure – namely, the institutions that test, measure, and certify – can benefit from public-private partnerships where private sector can assist governments with developing methodologies for carbon measurement and 29 FAO Global Livestock Environmental Assessment Model (GLEAM) 47 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA verification, provide data collection and certification services, and build capacity of value chain actors on increased supply chain transparency. Therefore, promoting PPPs for improving national quality infrastructure e.g. institutions that test, measure, and certify, etc., could be a strategic area for collaboration. Developing a joint GHG accounting system to brand regional beef products could be a key step in this direction. Understanding the diversity and complexity of livestock agrifood systems in the context of Botswana and Namibia, also means that a better understanding is needed on which technological innovations such as improved feeding, genetics, animal health, general husbandry and information technology are better suited for different value chain actors and producers’ groups. In promoting intensification measures, it is important to design measures that respond well to the countries’ context. For instance, there is an inherent risk of disrupting natural cycles, such as separating cattle production from feed and fodder production, resulting in nutrient imbalances, and when transporting cattle to markets. Promoting similar business opportunities and joint venture options to private sector could provide a coordinated framework for climate-smart livestock enterprises like biogas and solar power at abattoirs and feedlots, establishing small- and medium- scale grass feedlots, etc. Other examples could include aligning community-based programs for regenerative grazing practices in border-proximity clusters for soil carbon sequestration and rangeland restoration can help put carbon back in the ground. 161. Climate-smart production – resilient livestock agrifood production systems to climate variability will require rapid adaptation of current production systems in both Botswana and Namibia. To gain economics of scale for adaptation, doing things together and doing similar things will have greater impact for both countries. This also means introducing targeted system-wide innovations and certification programs that are based on comprehensive assessment of the life cycle of animals e.g., criteria associated with feed, fuel, fertilizers, and function (yield) of livestock, etc. For farmers and packers who adopt emissions reductions, both countries can establish a joint Process Verification Program to analyze what practices can be implemented to qualify for the program benefits in the form of technical and financial support. Opportunities for One Health 162. In the aftermath of Covid-19 pandemic and its global impacts on national economies, investment climate, and interconnectedness of public and environmental health, have created a renewed motivation for countries and regions to adopt the One Health approach 30 as a human- animal-environment nexus. Southern African is at a fairly nascent stage of incorporating One Health approaches and countries are still only beginning to understand: (i) what One Health approach is; (ii) what direct and indirect benefits accrue from this approach; and (iii) how it fits within the existing policy and institutional frameworks. It is not therefore surprising that both Botswana and Namibia have no formal mechanism to implement One Health programs in either of the public health, environmental management, or livestock and animal health systems. Given that the understanding and relevance of One Health is only just taking roots in Botswana and Namibia, key actions are proposed that can quicken the integration: 163. Knowledge sharing on policy realignment – since both countries are at different stages of internal review of current policy and institutional frameworks serving the livestock sector, a clear area of collaboration comes from learning and knowledge sharing on the policy regulatory mapping can 30 WHO defines One Health as an approach to designing and implementing programs, policies, legislation, and research in which multiple sectors communicate and work together to achieve better public health outcomes. Food safety, control of zoonoses (diseases that can spread between animals and humans, such as flu, rabies, and Rift Valley Fever), and combatting antibiotic resistance, are key areas of work relevant to One Health. 48 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA support integration of One Health approach. For example, there are inconsistencies and inequities in the development of health systems in Botswana that translate in environmental services lagging behind. Looking through the One Health lens could assist Botswana in aligning its environmental services with animal health services along the lines that Namibia has achieved. 164. System-level improvements – both countries have made great progress in building human capacities within the respective health systems. These efforts have proven good results in address health emergencies – with Covid-19 being the most recent. Similarly, both countries have established strong capacities in environmental health management through graduate-level programs in environmental sciences. Leveraging existing capacities in human and environmental health to achieve similar improvements in animal health services can better prepare both countries in preventing and responding to future infectious diseases and corresponding economic, social, and environmental consequences. Fostering resilient human-animal communities is a clear area where mutual efforts can result in knowledge exchange through inter-university undergraduate diploma and other certificate programs on One Health covering human-animal-environment nexus learning streams. Prioritization of Actions for Regional Integration Immediate to Short Term (<2 years) Medium to Long Term (1-2+ years) Cooperation for Improved Productivity From Prioritize harmonization of SPS standards and pilot joint productivity programs, priority must protectionist to other legislative reforms to incorporate regional be given to cattle and meat production in regionally aligned planning communal areas policies Collaborate on modernizing and upgrading infrastructure like testing laboratories with private investment Mutually Promote joint sub-value chains that serve as beneficial input inputs to production systems e.g., vaccines & sub-value chains dozing, animal handling & transportation equipment Harmonization of Promote cooperation on FMD control through Adopt joint approach to quarantine, and animal health joint surveillance and reporting of wildlife and certification of cattle from red zones and food safety cattle movements in border-proximity and cross- systems border regions Develop a common database for surveillance and reporting measures Harnessing Regional Market Opportunities Innovations for Develop joint livestock auction platforms for Develop consistent and harmonized grading market access accessing new marketing and fetch better prices criteria could support the development of objective price determining systems Harmonize current traceability and modernizing along a block-chain approach Allow joint ventures for branding and packaging operations Investment- Improve performance of country policies and friendly policies explore policy alignments to attract private investors Market Jointly take lead on this initiative in collaboration intelligence with SADC to implement a regional market system information system Pathway to Low-Carbon Livestock 49 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Immediate to Short Term (<2 years) Medium to Long Term (1-2+ years) Decarbonization Promote PPPs for improving national quality Promote a coordinated framework for climate- of supply chains infrastructure e.g., institutions that test, smart livestock enterprises with new business measure, and certify, etc. opportunities and joint venture options for private sector Climate-smart Introduce targeted system-wide innovations and Establish a joint Process Verification Program to production certification programs that are based on analyze what practices can be implemented to comprehensive assessment of the life cycle of qualify for the program benefits animals Opportunities for One Health Knowledge Promote learning and knowledge sharing on the sharing on policy policy regulatory mapping can support realignment integration of One Health approach System-wide Knowledge exchange through inter-university Leverage existing capacities in human and improvements undergraduate diploma and other certificate environmental health to achieve similar programs on One Health improvements in animal health services 50 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Annex 1. Cattle diseases present in Botswana and Namibia: zoonotic, transboundary, and diseases of productive impact Table [X]. Cattle Diseases Present in Botswana (Domestic) Zoonotic Diseases Transboundary Diseases Production Disease Notifiable Last Reported Notifiable Last Reported Notifiable Last Reported Diseases Present in 2019 Rabies 2019  Blue tongue 2019  Foot and mouth disease 2019  Lumpy skin disease 2019  Mycoplasmosis 2019  Heartwater 2019 Diseases Absent in 2018 Anthrax 2014  Bovine tuberculosis  Brucellosis (Brucella abortus) 2017  Brucellosis (Brucella melitensis) 2007  Paratuberculosis Rift Valley Fever 2017 Salmonellosis Trypanosomiasis 2001 Contagious Bovine Pleuropneumonia 1995  Rinderpest 1899  Bovine genital campylobacteriosis Bovine anaplasmosis 2016  Bovine babesiosis 2013 Bovine viral diarrhea 2005 Haemorrhagic septicaemia 1995 Infectious bovine rhinotracheitis 2010  Theileriosis  Trichomoniasis 1995 Source: Botswana OIE PVS (2019) Table [X]. Cattle Diseases Present in Namibia (Domestic) Zoonotic Diseases Transboundary Diseases Production Disease Notifiable Last Reported Notifiable Last Reported Notifiable Last Reported Diseases Present in 2017 Anthrax 2017  Bovine brucellosis 2017  Echinococcosis 2017  Rabies 2017  Rift Valley Fever 2017  51 ROADMAP FOR SUSTAINABLE LIVESTOCK VALUE CHAINS IN SOUTHERN AFRICA Bovine cysticercosis 2017   Foot and mouth disease 2017  Blue tongue 2017  Contagious Bovine Pleuropneumonia 2017  Lumpy skin disease 2017  Bovine anaplasmosis 2017  Bovine babesiosis 2017 Bovine genital campylobacteriosis 2017 Dermatophytosis 2017 Heartwater 2017 Infectious bovine rhinotracheitis 2017  Trichomoniasis 2017 Diseases Absent in 2017 Bovine tuberculosis 1995  Bovine paratuberculosis 1998 Enzootic Bovine Leucosis 2009 Rinderpest 1907  Haemorrhagic septicaemia 1998 Source: Namibia DVS Annual Report 20179 52