an overview of the agriculture sector in africa t. olalekan williams
TRANSCRIPT
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AN OVERVIEW OF THE AGRICULTURE SECTOR
IN AFRICA
T. OLALEKAN WILLIAMS
www.thecommonwealth.org
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PRESENTATION OUTLINE
• CURRENT CONTEXT OF AFRICAN AGRICULTURE- Role, Key Challenges, Successes
• CHANGING ECONOMIC ENVIRONMENT FACING AGRICULTURE
• KEY QUESTIONS
• PRIORITY ACTIONS TO STRENGTHEN AGRICULTURAL SECTOR
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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
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Current Context: Role (contd.)
• 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
Upshot
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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)
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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
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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
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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
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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?
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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
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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
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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
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Changing Economic Environment
National Environment (continued)
• Emergence of Supermarkets with fresh food retailing sections
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PRIORITY ACTIONS
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STRENGTHENING AGRIBUSINESS
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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
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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
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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
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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
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Organizational structures to strengthen pro-poor agribusiness
development
• Contract farming involving out-growers and a link- exporter
• Farmer-controlled enterprises - Linkage independent - Linkage-dependent
• Cross-border agricultural supply chains
• Clusters and networks linked with intellectual property rights
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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
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www.thecommonwealth.org
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