Spillovers from Foreign Land-Based Investments in Agriculture: Evidence from a Nucleus-Outgrower Scheme in Zambia

Nucleus-outgrower schemes (NOSs) are supposed to be a particularly effective private-sector mechanism to support smallholder farmers and contribute towards mitigating the problematic aspects of pure large- scale agricultural investments. Using two rounds of panel household surveys in Zambia, this study examines the impacts of the NOS of one of the largest foreign land-based investments in agriculture, Amatheon Agri Zambia (AAZ) Limited, on smallholder agricultural technologies adoption, sustainable land management (SLM) and productivity. The findings indicate that participation in the NOS increased the adoption of full- suite conservation agriculture (CA) practices. However, the impact on the adoption of other technologies, specifically the use of improved seed varieties, is less obvious and depends on the type of support provided and scheme design details such as crops promoted. The results also indicate that even if the impact on overall productivity is modest, the programme improves maize productivity during its initial phase compared to the later phase when the programme shifted its focus towards oilseed crops. In sum, the study suggests that NOSs, despite associated risks, have the potential to make substantial contribution to sustainable agricultural practices and to some extent improve productivity of smallholder farmers.