Transcript Document
AN OVERVIEW OF THE AGRICULTURE SECTOR IN AFRICA T. OLALEKAN WILLIAMS www.thecommonwealth.org PRESENTATION OUTLINE • CURRENT CONTEXT OF AFRICAN AGRICULTURE - Role, Key Challenges, Successes • KEY QUESTIONS • CHANGING ECONOMIC ENVIRONMENT FACING AGRICULTURE • PRIORITY ACTIONS TO STRENGTHEN AGRICULTURAL SECTOR Current Context (Role) • Agriculture in Africa accounts for: - 35-50% of GDP in Africa - 70% or more of total employment • Nearly 65% of Africans depend on agriculture as their primary source of livelihood • Smallholder farmers account for more than 90% of total agricultural production Current Context: Role (contd.) Upshot • Agriculture is a big sector in Africa and it does not take a large increase in agricultural growth to have significant impact on the national economy and average incomes Current Context (Key Challenges) • Poorly functioning markets • Limited access to finance • Poorly developed physical and social infrastructure • Inequitable access to productive resources • Risks associated with adverse weather and prices and lack of appropriate financial instruments (e.g. insurance) Current Context (Success Stories) Cotton in West Africa - 9% annual growth in production and exports over 40 years (1960-2000) - 200,000 farm households grow cotton, 30% of Mali’s population Current Context (Success Stories) Horticulture Exports from Kenya - Fruit & Vegetable exports quadrupled in real terms between 1974-1999, exceeding $150 m per year and becoming Kenya’s 3rd leading foreign exchange earner - 100,000 small farmers produce and export fruits and vegetables - Smallholders earn an average of $188 per year from export of fruits and vegetables Current Context (Success Stories) Cassava Transformation in Nigeria - Production tripled within a decade (1984-92) - Nigeria surpasses Brazil as world’s leading cassava producer - 60% of farm households plant improved varieties - Resulting price fall benefits consumers, making cassava a powerful anti-poverty weapon CRITICAL QUESTIONS • Are any of the successes of African agriculture replicable across wider areas to benefit larger numbers of people? • How do we generate new thinking, grounded in national and international realities, to revitalize African agriculture? • How can new strategies and alliances in favour of African agriculture be brought about? Changing Economic Environment International Environment • Heavy farm subsidies in OECD countries • Shifting composition of traded goods • Global consolidation in food retailing • Preferential access to markets in EU & USA - ‘Everything But Arms’ & AGOA High Price of Agricultural Protectionism in Rich Countries - US $1 Billion a day supporting their own agricultural sectors - Cotton production in West Africa supports 11 million people. When world prices sunk in 2001 due to US cotton subsidies, the region lost US $ 190 million Changing Economic Environment National Environment • Regulatory reforms (e.g. market liberalization) • New policy initiatives in Nigeria 2000 – Merger of NACB, PBN & FEAP to form NACRDB 2003 – Small & Medium Enterprise Development Agency of Nigeria (SMEDAN) 2005 – Pilot Microfinance Scheme Changing Economic Environment National Environment (continued) • Emergence of Supermarkets with fresh food retailing sections PRIORITY ACTIONS STRENGTHENING AGRIBUSINESS Public Sector’s Role • Tackle market failure to reduce the transaction costs and risks that inhibit the private sector and restrict access of farmers and SMEs to markets • Invest in core public goods that build enterprise competitiveness, e.g. infrastructure, R & E etc. • Reduce, simplify or remove regulations and costs that create a competitive disadvantage for farmers and SMEs Public Sector’s Role • Create policies that support pro-poor agriculture. Policies to reduce inequality to productive assets and to secure property rights • Fill the agricultural finance gap • Policies to support institutions (e.g. producer organizations, marketing associations) that will assist to connect rural poor producers to markets Private Sector’s Role • Development, organization and management of supply chains – hear and see the market • Investment in market expansion and competitiveness enhancing measures, e.g. processing facilities • Work with public sector to develop policies • Develop linkages with multinationals and large domestic companies Civil Society’s Role • Mobilisation and organisation of rural poor producers • Awareness raising to encourage stakeholder acceptance and adoption of new export requirements • Pilot testing of new ideas and projects with the poor • Advocacy – bring the demands and needs of the poor to the attention of governments and private sector Organizational structures to strengthen pro-poor agribusiness development • Contract farming involving out-growers and a linkexporter • Farmer-controlled enterprises - Linkage independent - Linkage-dependent • Cross-border agricultural supply chains • Clusters and networks linked with intellectual property rights Examples of ComSec technical assistance programs to strengthen agribusiness • Commonwealth Secretariat technical assistance to Nigeria to improve compliance with SPS measures for non-traditional exports • Commonwealth Secretariat support to The Gambia in agro-processing • Commonwealth Secretariat-FAO collaborative technical assistance in Eastern & Southern Africa THANK YOU FOR YOUR ATTENTION www.thecommonwealth.org