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AfDB Transforming Africa’s Agriculture for inclusive growth and food security
The African Development Bank (AfDB) has come with concrete proposals aimed at helping Africa address the key challenges that are hampering its agricultural sector and food security in the continent.
Agriculture is Africa’s backbone, and it holds great promise for future growth and job creation. It employs 65–70% of the African workforce and accounts for roughly a third of the continent’s GDP. Women make up more than half of Africa’s farmers and produce up to 90% of the continent’s food. Promoting agricultural production and food security is therefore one of the most effective ways to drive inclusive growth and reduce poverty.
However, the lingering volatility of food prices, which was one of the factors and vulnerabilities that caused the 2011–2012 food crises, has not disappeared in 2013 and is expected to remain in the coming years. In that regard, “the current food insecurity the Sahel is experiencing is much more a reflection of the region’s chronic, long-term vulnerability, than the result of a sudden, short-term shock such as a single drought in 2011,” said Chiji Ojukwu, AfDB’s director in charge of Agriculture and Agro-Industry.
On the other hand, Africa is extremely vulnerable to environmental shocks. Many poor in Africa will continue to be hard hit by a number of ongoing shocks, such as natural disasters (including droughts and floods) and conflicts.
On top of those external factors, internal infrastructure deficiencies prevent Africa from realizing its full agricultural and food security potential. Africa, especially sub-Saharan Africa, is characterised by minimal water storage capacity, resulting in gross underutilization of Africa’s abundant water resources. Inadequate energy supply constrains productivity and also processing and storage of produce. Africa’s very low connectivity density in paved road and rail network contributes to high postharvest losses and lack of access to markets.
Those very high post-harvest losses of agricultural produce, sometimes up to 40%, are mainly due to lack of transport, processing and storage facilities and links to markets.
Limited access to financial markets and credit, particularly for the smallholder farmers who produce the bulk of the food on the continent, is limiting their productive capacity as a result of limited access to technology and inputs.
Africa has also to adapt to climate change. Though climate change is not necessarily a new phenomenon, the African agriculture sector is struggling to adapt mainly due to the continent’s limited capacity and technology.
While the private sector is an engine of growth and job creation, it is yet to be exploited in the agriculture sector in Africa. The limited returns and relatively high risks associated with agriculture production are some of the challenges that need to be overcome.
As regards land tenure, the policy in most countries not only limits investment in the agriculture sector particularly for the local populations and hence productivity, but also fuels the land-grab debate.
Last but not the least, trade barriers result in pockets of food deficit and pockets of food surplus and waste at national and regional level that could be eased by free and cheap movement of food products and produce.
In order to address all those challenges, the African Development has launched a series of actions and initiatives aimed at boosting food security.
Under its strategy for 2013-2022, “At the Center of Africa’s Transformation”, the AfDB recognizes that unlocking Africa’s agricultural potential and tackling food insecurity requires sustained multisectoral interventions, using an integrated value-chain approach, including research and development, production (irrigation), processing (community units, storage), logistics and marketing (rural markets).
The AfDB is supporting agricultural transformation mainly through infrastructure development. Since 2008, and the rolling out of its Mid-Term Strategy, and then its Agriculture Sector Strategy 2010-14, AfDB’s agriculture portfolio has increasingly focused on developing agriculture infrastructure, with over 80% of the agriculture approvals being allocated to rural and value chain development infrastructure.
The AfDB is also supporting the “African agribusiness and agro industry revolution” in a move towards the value-chain approach. It recognizes that processing of agricultural products can meet the demand of social development, while ensuring year-round commodity availability. This could be achieved by:
- innovative technology (e.g. use of new crop varieties and GMOs);
- modern technical education to improve availability of manpower for high value added work;
- partnership with international supply chain companies to strengthen linkages with global markets; and
- modern infrastructure (e.g. construction of community access and feeder roads).
The AfDB is also evaluating potential benefits of activities to promote trade such as agricultural commodity exchange markets (e.g. access to real-time commodity pricing, and electronic payment systems allows small holders to become viable businesses). It is also focusing on efficient labour and logistics infrastructure (transport and storage).
New initiative launched in 2013
The AfDB believes it is critical for African agricultural markets to be connected in order to explore trading opportunities and enable exports to become far more competitive. This will be achieved by linking farmers to regional transport corridors through regional roads to encourage intra-regional food trade. The AfDB is also working with Regional Economic Communities to address non-tariff trade barriers and developing regional programs to address the effects of chronic drought in the Horn of Africa and in the Sahel region.
As regards job creation, African agriculture can absorb large numbers of new job seekers. For this to happen, constraints to land, capital, and skills must be addressed, and features to make programs friendly to the needs of the young enhanced. Existing programs in finance, land, and education and extension can be adjusted to address the specific needs of rural young people. The agriculture that attracts young people will have to be profitable, competitive, and dynamic.
The AfDB has launched in May 2013 an Agriculture Fast Track Multi Donor Trust Fund, a Project Preparation Facility to exclusively support public-private matchmaking in the agriculture sector. The Fund is one of the components of the G8 New Alliance on Food Security and Nutrition launched in 2012. The Fund is being established with initial financing from USAID and SIDA. Two new nominees for grants from the Fund have been selected on the occasion of World Food Day 2013.