Key drivers of agricultural transformation in Africa:what role for farmers?
1. Key drivers of agricultural
transformation in Africa:
what role for farmers?
http://brusselsbriefings.net
2. • Mots de bienvenue
Elisabeth Atangana, Présidente, PROPAC
Ouverture/opening
• CTA
• PAFO
• AUC
• Minader
3. Envisioning the future of African agriculture
and the renewed role of farmer’s
organizations
3-5 December 2013, Yaoundé, Cameroun
http://acpbriefings.net
4. • No country has been able to sustain a
rapid transition out of poverty without
raising agricultural productivity
• Where agricultural productivity has grown
slowly, as in many parts of SSA, non-farm
activities have also tended to grow slowly
• Agricultural growth has been the precursor
to industrial growth in Europe and Asia
5. In Asia 3 preconditions for increased growth
and reduced poverty:
• Macroeconomic stability: low inflation,
currency overvaluation
• Economic freedom for farmers and
entrepreneurs
• Pro-poor public spending on agriculture,
public services, rural infrastructure
6. • Agricultural transformation taking place in
a challenging context: CC, impact of the
food, energy, and financial crises,
unsustainable use of natural resources
• Net food importer: 10% in 1994, 30% now
• 6% arable land irrigated against 22% in
the world on average (2009); 17 kg
fertilizer unit per ha (222 kg in Asia and
120 Kg in world average) CAADP
• Agriculture isolated from other sectors
7. Much higher real prices are also expected
to prevail for the two key inputs to
agriculture mentioned earlier, namely
energy and fertilizers. Energy prices are
now 250 % higher than in 2000, though by
2020 they are expected to drop back to
levels about 175 % higher than in 2000.
Fertilizer prices, now 170 % higher than in
1990 and 2000, are expected to drop to a
level about 80 % higher than in 2000.
8. • The double challenge:
– Raising productivity and positioning
‘wealth creation’ with inclusiveness
– Diversifying into higher value goods
within and outside agriculture
• Determining factors:
– Policies
– Markets (Domestic & regional)
– Finance
– Human assets and knowledge
9. Agriculture key in SSA economies
• ... Yet new opportunities: renewable
energy, provision of environmental
services, renewed focus on food
production, new non-farm rural jobs, more
opportunities offered by ICT’s ...
• Agriculture continues to be the main
source of employment (63 % of rural
household income in Africa, 62 % in Asia,
50 % in Europe and 56 % in LA)- Aging
10. • Coherent vision & agenda on Agriculture
(CAADP); last decade : rapid economic &
agricultural growth; improved governance
and pubic financing ( 6%)
• Macroeconomic stability, improved
investment climates, and agricultural
incentives
• Decrease in taxation of agriculture
• Largest share of arable land in the
world(16%) .... and largest share of
uncultivated arable land (79%) is in Africa
11. Research competitiveness of African
selected countries highlights the following:
• Farm-level production costs in Africa are
competitive
• Africa’s producers are generally
competitive in domestic and regional
markets
• In the short- to medium-term, regional
markets offer the most promising
opportunities
12. • Malian cotton production has grown at
9%/year for the past 40 years; Kenyan
horticultural exports have increased fivefold since 1975.
• Farmers and researchers have launched
hundreds of innovative soil and waterconservation initiatives to contend with
declining soil fertility and declining
fertilizer subsidies.
13. • Work by cassava scientists across Africa
has countered deadly disease and pests
attacks and new opportunities benefiting
tens of millions of small farmers and
making it one of the continent’s most
powerful poverty fighters to date
14. 1. WHY PUBLIC RESOURCE MOBILIZATION
The cornerstone of broad-based development
Public Resource Mobilisation
ODA < 50% tax revenue
ODA > 50% tax revenue
No available data
Source: Development Centre, based on AEO country survey’s, 2010.
15. 2. SOME STYLISED FACTS
Mobilising Africa’s public resources: can and must be achieved
Average
Median
Source: Development Centre, based on AEO country survey’s, 2010.
16. Demonstrate the economic value of
agriculture to the policy makers – also
critical to attract youth employment in
farming
Farmers to generate and co-generate
data in support of this value
Need to target the African consumer in
a more efficient way and allocate
sensitisation budgets within FOs.
Scope for PPPs alliances
17. Analysing the drivers of successes
Changing food demand and supply
patterns are expected to lead to more
South–South trade, boosting
opportunities in domestic and regional
markets.
Further exchange on best practices
(study tours…). 2014 Year of family
farming could be an opportunity
18. The potential of domestic and regional
markets is demonstrated and can allow
import substitution & re-conquer markets
Managing duality in agriculture as a
strength (small-scale and agribusiness)
and leveraging the strengths of both
– More agribusiness and financing fora needed
Stimulating the growth of rural towns and
intermediate cities and opportunities to
feed growing urban centres
19. • Formal education in agriculture is still low
and knowledge transfer is a problem
• Farmer’s driven research and increased
access to quality data (indigenous
scientific capacity to generate new
technology)
• Closing the gender gap in agriculture
– Demonstrating the gains
– Strengthening women farmer groups
20. Building knowledge base and knowledge
management skills
Developing formal learning and evaluation
mechanisms at FOs level
Increase productivity through availability &
use of high-tech research (high-yielding
seeds, fertilisers…) to achieve the CAADP
target fertilizer consumption of 50kg/ha by
2015
21. • Leveraging agribusiness potential and
demonstrating better value for money
• Links to innovative and inclusive
agricultural value chain
• Address post-harvest losses (training in
better harvesting methods, transport,
storage and processing)
Notas do Editor
Peter Timmer and Selvin Akkus, The Structural Transformation as a Pathway out of Poverty: Analytics, Empirics and Politics,
Centre for Global Development, Working Paper Number 150, July 2008
Source Henley and Van Donge 2012
S. Wiggins : to stimulate agriculture: create an enabling environment for investment and innovation; and invest in rural public goods.
CAADP fertilizer consumption target of 50kg/ha by 2015
Many challenges for African agriculture
African Agriculture is challenged by a number of threats such as food price spikes, land and water not adequately exploited, rising energy and fertilizer prices and the impact of climate change on agriculture production and livelihoods. Feeding more than 9 billion people by 2050 will require doubling food
production on a sustainable basis. Therefore, agriculture should be resilient - able to withstand or recover from stresses and shocks. Developing resilient agriculture will require technologies and practices that build on agro-ecological knowledge and enable smallholder farmers to counter environmental degradation and climate change in ways that maintain sustainable agricultural growth.
Financial markets and rural finance institutions are weak. Development of competitive output and input markets has lagged, and
services for smallholders remain poor. Progress in science and technology is inadequate and agricultural
research, agricultural extension, and agriculture education remain persistently underfunded. These
factors threaten to condemn African agriculture to slow and inadequate technical change, contributing to
a growing technology divide. Africa will have to address these issues if it is to capitalize on today’s better
agricultural opportunities
Because most African economies are open, international price increases are largely transmitted to the domestic economy. Food-importing countries were hardest hit, as they have few ways to prevent international prices from being passed on to consumers. Within these countries, urban populations and those rural poor who are net buyers of food were most affected. Food import bills rose for all net food importing countries in Africa. Many of these countries were at the same time even harder hit by the rise in global energy prices.
Potential of youth employment in the agricultural sector: Inclusive, remunerative, passing the knowledge
Fortunately the reforms undertaken — often painfully — in many African countries in the 1980s and 1990s have reduced some obstacles from what they were. While in the 1970s agriculture in Africa was on balance taxed by 15% or more — and for particular commodities in some countries by a great deal more than this, by 2005 the explicit and implicit taxation of agriculture had been reduced to less than 5%.
The growing opportunities for African Agricultural Development. Hans P. Binswanger-Mkhize, Derek Byerlee, Alex McCalla,
Michael Morris, and John Staatz. ASTI. 2011.
farm-level unit production costs in Mozambique, Nigeria, and Zambia are comparable to or lower than those in the Brazilian Cerrado and in Northeast Thailand, due to very low labor costs and limited use of purchased inputs
The competitiveness of Africa’s producers at the farm level makes
them generally competitive in domestic markets relative to imports. Since domestic and regional markets
for many of the targeted commodities are large and rapidly growing, and since significant imports are already taking place, prospects for import substitution are bright, especially for rice, soybeans, sugar, and maize
(iii) For the six commodities under consideration, African producers are more favorably positioned to serve regional markets than the countries that currently dominate international trade. Logistical costs are less when serving regional markets than when exporting overseas; moreover, as a result of population growth, income gains, and urbanization demand in regional markets is expected to grow.
Steven Haggblade and Peter Hazell. Successes in African Agriculture. Lessons for the future. IFPRI. 2010
The right-hand map shows countries in Africa where official development aid flows are smaller and larger than 50%. Basically, in half of African countries aid represents at least as much as half of collected taxes.
Indeed, mobilising Africa’s public resources is important because:
External dependence: The recent economic crisis has shown the dangers of the continent’s over-exposure to external resources. With their own budgets coming under heavy pressure, foreign donors looking for an exit strategy and the global recession are intensifying the debate over the legitimacy and effectiveness of aid. Domestic resource mobilization is a central part of the solution to closing the gap between the pressing investment needs of African states and the scarce levels of available domestic savings. (Monterrey consensus)
State building: There cannot be viable independent States without robust taxation systems. PRM is important to shift accountability away from donors and towards the country’s population. PRM is a way to ensure that states need to address the needs the needs of their population to function.
Aid effectiveness: PRM has the benefit of putting countries on the course to graduation from external aid. However, aid has and should retain a very important role to play during the medium-term. The key is that aid should be designed with an “exit strategy” at its core. When used to stimulate PRM, aid can have a high (up to x10) multiplier effect on States’ resources.
Ownership and governance: The advantage of aid spent on PRM is that as it is local governments who decide what to do with collected taxes. Hence, complete ownership of development priorities and strategies is assured by design. Whatmore, taxation tightens the social contract binding citizens with their States, and vice-versa, providing a natural platform to stimulate good governance.
Wallmart: Sourcing from women farmers groups
Cargill: training programmes in various commodities (Cocoa…) and women’s clubs (cotton made in Africa). 800 of these clubs reaching about 32,000 women
farmers.
DSM: Fortified crops and products to support nutrition security
(i.e. in Ghana since economic reforms in 1983, agriculture grown for the next 25 years at rates of more than 5% a year and is one of the six fastest growing agricultures in the world, ahead of Brazil and China). S. Wiggins. What prompted this? The reforms of the early 1980s that began with currency devaluation, control of rampant inflation and reform of the cocoa marketing board, seem to have led to the turn-round in Ghana’s agriculture and indeed the economy as a whole.