The 2019 Annual Meetings of the African Development Bank Group will be held from 11-14 June 2019, in Malabo, Republic of Equatorial Guinea. Find out more
The African rural world is one I know well. I grew out of rural poverty myself and went to a rural school without electricity and lived in a village where we had to walk for kilometres to find water. We had to study after dark with candles or kerosene lanterns. By God’s grace, I made it out of poverty to where I am today. But for tens of millions of those in similar situations, especially in rural Africa, the outcomes are not like mine. For most, the potential has simply been wasted.
Some 60% of Africans live in rural areas. Such areas are dependent overwhelmingly on agriculture for livelihoods. The key to improving the quality of life in rural areas is therefore to transform agriculture. But the low productivity of farming, the poor state of rural infrastructure, digital exclusion and poor access to modern tools and agronomic information make the quality of life very low in these areas.
Unfortunately not much has changed since I was at my rural school. Economic opportunities are even shrinking for many, with high poverty levels, leading to the repeated inheritance of poverty. As a result, rural youths are discouraged, disempowered and vulnerable to recruitment by terrorists who find decimated rural areas ideal for their activities.
We must pay particular attention to three factors: extreme rural poverty, high rates of unemployment among youths and environmental degradation – what I refer to as the "triangle of disaster". Wherever these three factors are found, civil conflicts and terrorism take root, destroying people's ability to work farms and access food markets.
We must invest urgently and heavily in Africa's rural areas and turn them from zones of economic misery to zones of economic prosperity. In particular, we must create jobs and stable societies in order to disrupt terrorist recruitment campaigns that are taking root in these rural areas. So, we must connect economic, food, and climate security together to have a chance of economic prosperity.
We need to jumpstart the transformation of the agricultural sector. The African Development Bank is leading the way by investing US $24 billion in agriculture in the next 10 years.
In doing so, the Bank wants to encourage agriculture to move away from giving the appearance of a development sector for managing poverty and subsistence to an industrialized food planting and processing business for creating wealth for the owners and decent jobs for the workforce.
Africa imports US $35 billion of food net annually, expected to rise to US $110 billion by 2025, if current trends continue. Meanwhile, by growing what we do not consume and consuming what we do not grow, Africa is decimating its rural areas, exporting its jobs, eroding the incomes of its farmers, and losing its youth through voluntary migration to Europe and elsewhere.
Imagine what US $35 billion per year will do if Africa feeds itself: It is enough to provide 100% electricity in Africa. And US $110 billion savings per year in food imports is enough to close all infrastructure deficits in Africa.
So we must think differently. Africa produces 75% of cocoa but receives only 2% of the US $100 billion a year chocolate markets. The price of cocoa may decline, but never the price of chocolates. The price of cotton may fall, but never the price of garments and apparels. In 2014, Africa earned just £1.5 billion from exports of coffee. Yet Germany, a leading processor, earned nearly double that from re-exports.
This is also because the EU imposes a 7.5% tariff charge on roasted coffee, but exempts non-decaffeinated green coffee. As a result, most of Africa’s coffee exports to the EU are unroasted green coffee beans sold as an unimproved commodity, but European manufacturers reap the rewards.
To transform its rural economies, Africa must embark on agricultural industrialization and add value to all its agricultural commodities. Governments, while persuading developed countries to change their import priorities for agricultural products, should provide incentives to food and agribusiness companies to locate in rural areas.
We must get youths into agriculture and see it as a profitable business venture not a sign of lacking ambition. That's why the African Development Bank has rolled out its ENABLE Youth program to develop a new generation of young commercial farmers and agribusiness entrepreneurs. Our goal is to develop 10,000 such young agricultural entrepreneurs per country in the next 10 years. In 2016, the Bank provided US $700 million to support this program in eight countries and we've got requests now from 33 countries.
This is part of the African Development Bank’s larger programme: Jobs for Youth in Africa, with the goal of creating 25 million jobs within 10 years, and a focus on agriculture and ICT. We are investing in skills development in computer sciences, technology, engineering and mathematics to prepare the youths for the jobs of the future.
We know the technologies exist to transform African agriculture. But they remain, for the most part, on the shelves. I have always remembered what Dr. Norman Borlaug said: "Take it to the farmers". To achieve this, the African Development Bank and the CGIAR has developed the Technologies for African Agricultural Transformation (TAAT) – a new initiative to scale up appropriate agricultural technologies from the CGIAR and national systems, all across Africa. The Bank and its partners plan to invest US $800 million in the initiative.
The food and agribusiness sector is projected to grow from US $330 billion today to US $1 trillion by 2030, and there will also be 2 billion people looking for food and clothing. African enterprises and investors need to convert this opportunity and unlock this potential for Africa and Africans.
This is the transformation formula: agriculture allied with industry, manufacturing and processing capability equals strong and sustainable economic development, which creates wealth throughout the economy.
Africa can feed itself – and Africa must feed itself. And when it does, it will be able to feed the world. In this way today’s African farmers will contribute to feeding the world tomorrow. That is why the African Development Bank set “Feeding Africa” as one of its most important High 5 priorities.
It’s the Bank’s recipe for agricultural transformation of Africa, and we will not stop until we achieve it.