1. AN OVERVIEW OF THE AGRICULTURE SECTOR IN AFRICA T. OLALEKAN WILLIAMS www.thecommonwealth.org

2. PRESENTATION OUTLINE CURRENT CONTEXT OF AFRICAN AGRICULTURE - Role, Key Challenges, Successes CHANGING ECONOMIC ENVIRONMENT FACING AGRICULTURE KEY QUESTIONS PRIORITY ACTIONS TO STRENGTHEN AGRICULTURAL SECTOR

3. 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

4. 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

5. 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)

6. 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

8. 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 3 rd 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

9. 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

12. 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?

13. 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

14. 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

15. 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

16. Changing Economic Environment National Environment (continued) Emergence of Supermarkets with fresh food retailing sections

18. PRIORITY ACTIONS

19. STRENGTHENING AGRIBUSINESS

20. 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

21. 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

22. 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

23. 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

24. 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

25. 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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