Liberalization of Peru's formal seed sector

Abstract

During the 1990s, the Government of Peru began to aggressivelyprivatize agriculture. The government stopped loaning money to farmers' cooperatives and closed the government rice-buying company. The government even rented out most of its researchstations and many senior scientists lost their jobs. As part of this trend, the government eliminated its seed certification agency. Instead, private seed certification committees were set up with USAID funding and technical advise from a US university. The committees were supposed to become self-financing (bycertifying seed grown by small seed producers) and each committee was supposed to encourage the development of a group of small seed-producing firms, clustered around the seedcertification agency. The amazing thing is that many of the seed committees actually accomplished these goals. The agronomists who staffed the committees stood by their jobs,even after US funding ended, even though the committees' income was (at best) modest, and occasionally under the threat of violence from the extreme left. Some seed certificationcommittees failed and others did not. Some of the problems with Peruvian agricultural liberalization can be seen in regard to the seed programs of maize, rice, potatoes, and beans. For example, the government abandoned most research, yet could not resist creating certain distortions in the seed market (e.g.,buying large amounts of seed and distributing them for political ends).