UN ECONOMIC COMMISSION FOR AFRICA DEVELOPMENT EFFECTIVENESS IN AFRICA Applying Mutual Accountability in Practice   Agricultural Performance and Trade Issues: Achievements, Constraints and Challenges UN ECONOMIC COMMISSION FOR AFRICA 11/20/2018

Importance of agriculture for achieving the MDGs in Africa PRESENTATION OUTLINE Importance of agriculture for achieving the MDGs in Africa Constraints, opportunities and challenges for the development and structural transformation of African agriculture Action frontiers and performance monitoring of mutual accountability for agricultural performance and trade issues in Africa 11/20/2018

IMPORTANCE OF AGRICULTURE (1) 70% of the poor in Africa live in rural areas Livelihoods of 90% of rural people depend on agriculture 60% of the total African labor force is employed in agriculture – plus non-farm urban employment linked to agriculture Backward and forward linkages between agriculture and other economic sectors are important for economic growth – inter-sector growth multipliers of 1-5 to 2.7 Go beyond a narrow perspective of agriculture as farming to a comprehensive approach to the food and agriculture system including: technology; input markets; farm production; product processing, marketing and trade 11/20/2018

IMPORTANCE OF AGRICULTURE (2) Structural transformation of the food and agricultural system in Africa is key for: Reducing poverty through broad-based economic growth Enhancing food security Developing the domestic/regional markets Creating value-added and employment Improving the export performance Agriculture features as top-priority productive sector in key initiatives for Africa’s development: AU/NEPAD, Millennium Project, Commission for Africa, and this Mutual Review 11/20/2018

CONSTRAINTS, OPPORTUNITIES AND CHALLENGES (1) Lack of sufficient and consistent priority given to agriculture by African governments and development partners Internal and external factors have impeded a cumulative process of agricultural transformation Internal constraining factors include: Ineffective or misguided policies Weak regional integration of commodity chains Poor access to financing and insufficient investment Poor infrastructure Inadequate development/management of the natural resources Poor access to agricultural innovation Recurrent risks of natural disasters (climate pests, etc.) 11/20/2018

CONSTRAINTS, OPPORTUNITIES AND CHALLENGES (2) African agriculture is seriously undercapitalised -- more domestic investment and development assistance is needed for improving the supply side There are encouraging success stories to build on, e.g.: Decline of malnutrition rates in West Africa due to significant increase in food and export crop production Nigeria is No. 1 producer of cassava in the world success of horticultural exports in such countries as Kenya Food and agriculture systems are constrained by missing or incomplete markets, e.g. for rural credit or transport. Food-surplus regions face difficulties in supplying food‑deficit ones 11/20/2018

CONSTRAINTS, OPPORTUNITIES AND CHALLENGES (3) New strategies are also needed to address 2 key constraints: Agricultural commodity price volatility and the related challenge of finding affordable price stabilization and insurance mechanisms Declining international commodity prices and the challenge of diversification, productivity increase and value-addition in agriculture African agricultural markets are fragmented in sub-optimal national/sub‑regional segments, relatively closed to each other, but open to imports from outside Africa Need to to accelerate and deepen regional integration of strategic agricultural commodity chains 11/20/2018

CONSTRAINTS, OPPORTUNITIES AND CHALLENGES (4) Externally, African agriculture has been hurt by protectionist (tariff and non-tariff) policies, domestic agricultural support, export subsidies and “dumping” by OECD countries Multilateral trade reforms under the Doha Development Agenda present both opportunities and risks for African agriculture Adequate mechanisms are needed to help African countries deal with short‑run adjustment costs and to offset negative effects from the erosion of preferences 11/20/2018

CONSTRAINTS, OPPORTUNITIES AND CHALLENGES (4) AU/NEPAD CAADP is a framework of consensual policies and priorities for African governments, regional organizations, farmers, private agribusiness, and development partners Endorsed by African Heads of State and Government, 2003; and supported by the Maputo Declaration on agriculture, and the Sirte Declaration on Agriculture and Water NEPAD has just completed a planning exercise resulting in sub-regional/regional Priority Action Plans and Early Actions for the implementation of the CAADP pillars: Land and water resources development Rural infrastructure and trade capacities for market access Food supply chains and responses to emergency food crises Agricultural research, technology dissemination and adoption 11/20/2018

ACTION FRONTIERS -- AFRICAN COUNTRIES Fulfill commitments to increased investment in agriculture and rural development Implement NEPAD CAADP, with emphasis on intra-regional trade and research and development efforts in agriculture Promote public and private sector institutional development and partnerships for agricultural price stabilization, risk insurance, credit, infrastructure and extension services Promote public-private partnerships for contract farming and private investment in agro-processing and extension services Participate in international co-operation to offset price fluctuations of key commodities of importance to Africa Establish an African-wide schools nutritional program 11/20/2018

ACTION FRONTIERS -- OECD COUNTRIES Deliver reform on the three key pillars of agricultural negotiations in the Doha Development Round – market access, export subsidies and domestic support Up-scale aid to the agricultural sector and provide support for the NEPAD CAADP Assist African countries to cope with trade adjustment problems resulting from commodity price trends and preference erosion Re-evaluate scope and effectiveness of international mechanisms to cope with external shocks caused by extreme price fluctuations of key commodities Assist African countries to advance trade facilitation efforts 11/20/2018

PERFORMANCE MONITORING NEPAD/CAADP provides for a monitoring and evaluation mechanism that can be used for tracking progress on most action frontiers for African countries This mechanism needs to be completed and supported within the framework of the ECA-OECD Mutual Review process THANK YOU. 11/20/2018