Creation of agribusinesses and 'agripreneurs' key topics at AGRF

ABIDJAN — Experts and advocates pushed for the promotion of agriculture careers in Africa and more government-initiated investments at the 7th African Green Revolution Forum, urging governments and private investors to advance engagements beyond discussions through to implementation.

If left to eat local, the nutrition of the African continent would lie in the hands of roughly 53 million smallholder farmers who suffer from limited financing, inadequate access to markets, poor local infrastructure and strenuous labor that has thrusted many young people to major cities in search of a livelihood. Talk around African agriculture often focuses on the viewpoint of these smallholder farmers, and with good reason: experts say these farmers must urgently build resilience against climate change and adopt modernized techniques to improve yields as Africa’s population continues to boom.  

Developing agribusinesses could also promote food security and reduce unemployment rates, while also revolutionizing the sector by transforming raw goods into finished products and reducing post-harvest waste. Building more “Made in Africa” food brands is vital for Africa to fully capturing the projected $1 trillion African food market by 2030.

During a session on job creation and promoting entrepreneurship, global head of agriculture for Acumen investment fund, Noor Ullah, said not enough attention is given to the fundamentals of building a proper business. “We are in danger of focusing on the wrong thing and not targeting the building blocks which can be broken from the beginning,” Ullah said. To encourage private sector engagement, he also urged for long-term policies that demonstrate an enabling environment.  

Others said that many in the sector wrongly believed that investing in Africa’s rural economy was too uncertain. “I believe concerns about the risk are overblown in Africa,” Jennifer Blanke, vice president of agriculture, human and social development at the African Development Bank, told Devex. “People don’t know from the outside and are nervous about [investing], but there are risks in any emerging environment.”

The AfDB and other financial institutions, therefore, need to de-risk so the private sector will have some protection, she said. Risks ranging from fluctuating transaction costs to weak tax policies can defer investment. To combat this, the bank has announced various risk-sharing agreements, including with the Spanish Banco Santander, to facilitate an increase in agriculture financing.

Without de-risking schemes, many African banks and governments often have difficulties obtaining adequate financing, AfDB reported.

Government action central to success

Country-level support remains core to improving the agriculture sector with attention to rural development, roads, communications and access to inputs as top priorities. Governments must also reinforce rural education systems to facilitate smallholder use of available technologies.

“Basic education and capacity development are things that only the government can provide on their own,” Dr. Thomas Jayne, co-director at Alliance for Partnership, told the audience during a session on spurring modern farm development.

Research released during last year’s conference confirmed that countries that have dedicated 10 percent of their national budget toward agriculture posted higher agriculture productivity, stronger GDP growth, and sharp declines in malnutrition compared to countries that have not.

Seven African countries — Senegal, Ghana, Togo, Cameroon, Rwanda, Ethiopia and Angola — were applauded in a report launched at this year’s forum for their institutional and programmatic actions against malnutrition. These governments expanded beyond traditional national policies to cross-sectoral strategies to address hunger.

“High intersectoral coordination structures that put nutrition high on the national agenda leads to the funneling of money in a much more constructive way which reaches across the value chain,” report co-author and University of Pretoria food security professor Sheryl Hendriks told Devex.

Strategies such as national school lunch programs, national legislation and regulations, and the involvement of the private sector to fortify common foods are examples of how some nations have advanced agriculture development goals.  

Sound policies are critical for investors to build trust that countries are investment-ready, Blanke argued. “We need to get away from the idea that government can do everything,” and “need to have the private sector involved, so making sure that there’s not misappropriation of financing that comes into the sector, for example,” Blanke said.                                    

Making agriculture attractive to youth

On average, 12 million young people enter the African workforce each year with only roughly 3 million jobs available to them. While this causes a huge potential for high unemployment rates, Blanke also pointed out the opportunity for “agripreneurship” and agribusinesses to flourish.

“As long as youth are provided with skills to create new businesses and [an] underlying policy environment to make it easier to create businesses, you are capturing more of the value add and that’s where the jobs are going to be,” Blanke said.

The culture and image around agriculture in Africa has long been shaped by images of poor, rural farmers performing tiring manual labor for hours on end with little regard to other activities along the value chain, such as transformation, packaging, and retail, she told Devex. Former Sierra Leone Minister of Agriculture Sam Sesay insisted that Africa’s transformation will occur in agriculture — not manufacturing as seen in parts of Asia — so the region must promote more than cultivators.

Presently, youth typically resist agriculture for three reasons, Jayne argued: parents own a small amount of land, older siblings are already working the family-owned property and low productivity. “Youth are not inherently against farming; they are inherently against being poor,” Sesay said.

Integration of technology could also attract more youth to the sector. Since 2005, smallholder use of tractors has increased 10 times over. Mobile technologies, irrigation systems and biofortified seeds and fertilizers are examples of how technology can be incorporated at the farm level.

“Farmers will do better when they know how to do better,” former World Food Programme Executive Director Ertharin Cousin, said during a session. Low-skilled agricultural labor is unattractive to most over the long term, so training must be tailored to the needs of smallholder farmers, she said.

“It’s not just about helping poor farmers who need to be supported; it’s about developing a thriving business because it’s not just about Africa feeding Africa, but Africa feeding the world,” Blanke noted.

Stay tuned for more Devex coverage of the African Green Revolution and follow Devex West Africa Reporter Christin Roby @robyreports for updates.