I was in Mali recently where I met a woman, Maimouna Coulibaly, who several years ago left her job in the United States and returned to her home country to start a seed company called Faso Kaba. She quickly and confidently ramped up production, from 100 tons per year to over 1,000. She is eager to keep expanding, but she’s having a hard time finding financing.
I have heard different versions of this story over the last few months as I travelled around the continent: African farmers and agriculture businesses experiencing an initial burst of entrepreneurial success, reflecting the tremendous potential for agriculture as an economic driver, but then encountering obstacles that raise questions about how to sustain it.
The more I heard, the more I wished I could merge two important meetings taking place this week – the European Development Days in Brussels and theWorld Economic Forum (WEF) on Africa in Cape Town. The Brussels gathering will include a heavy focus on how development assistance can help improve food production and food security in Africa. In Cape Town, the focus is on attracting private investment to Africa’s rapidly growing economies. At the sidelines of WEF Cape Town, GrowAfrica particularly focuses on how to capitalise on the opportunities that abound in Africa’s agriculture sector.
These gatherings reflect the combination of forces African agriculture needs today – the support and expertise provided by development assistance in league with the investment and business acumen of the private sector.
I recently left Rwanda after six years as minister of agriculture and animal resources and I am now president of the Alliance for a Green Revolution in Africa(Agra) a group that views agriculture – the sector that employs the majority of Africans – as the key to driving sustainable, equitable growth across the continent. What excites me about this work is that agriculture in Africa today represents both an incredible development and a lucrative business opportunity. What is even more exciting is the agreement, but also the echo to do things differently; to stop piloting and go to scale with what works (and there is already a lot that works); and to treat agriculture, including smallholder agriculture, as a business.
The economies of many African countries are growing faster than anywhere else in the world – and agriculture, which accounts for a third of Africa’s GDP, is poised to be the next instalment of the “Africa rising” narrative. African leaders sent a signal last week that agriculture in the ascendant sector when, for the first time ever, they selected an agriculture minister, Nigeria’s Akinwumi Adesina, to head the African Development Bank.
Adesina has become an evangelist for turning Africa’s smallholder farmers – most of our food production occurs on farms that are less than a hectare in size – into businesses that generate growth at all income levels. And that’s why agriculture is such an important development opportunity: growth in the agriculture sector is 11 times more effective at reducing poverty than growth in any other sector.
Members of the African Union are increasingly committed to agriculture-led growth. Only last year, they renewed their vows to invest 10% of national budgets in agriculture with very clear targets to which they want to be held accountable for. In places like Ghana, Burkina Faso, Ethiopia and Rwanda, these investments already have been tied to dramatic reductions in poverty. The World Bank finds that poverty is down by 33% in Ethiopia since 2000, and agricultural growth is the main driver. In similar work in Rwanda, the Bank attributed 45% of Rwanda’s rapid poverty reduction in a relatively short period of time to growth of the agriculture sector and associated industries and services.
During my travels over the last few months, there was an unmistakable optimism everywhere I went. Mali, for example, boasts of having stopped importing cereal crops over the last five years and is looking to export as much as 500,000 tons of maize to its neighbours in 2015 alone. Last year, Tanzania’s farmers produced one of the biggest maize crops the country has ever seen.
But in many instances the progress is tempered by barriers, that need to be addressed. The bumper crop in Tanzania was a benefit mainly to farmers, who had access to storage facilities and links to market opportunities. Too many farmers were left singing about “the problem of a good year” – lots of surplus produce rotting before they see a market. In Burkina Faso, farmers need around 100,000 tons of certified seed annually, but seed availability is only 16,000 tons. Local companies – struggling to find capital to fill this demand – can currently produce only about 6,000 tons of this.
In Mozambique, I met an agriculture expert from an aid agency who said it took him years to understand that boosting yields on farms is only half the battle, and that unless one goes a step further to connect farmers to market opportunities, development assistance is often a dead end. Farmers on the other hand understand this in only one season. Without a market they do not only lose income, they risk all their capital. It becomes difficult for such farmers to invest in good seeds and fertilizers again – it makes no sense.
I understand that smallholder agriculture can be a difficult sell to the business community. But there are ways development assistance with the backing of hard working committed governments can bridge that divide. In Mozambique andGhana, for example an alliance of development partners and industry organizations have helped smallholder farmers partner with SAB Miller to grow cassava for the company’s new brands of cassava beer.
My experience as minister of agriculture in Rwanda and my recent travels across Africa have made it abundantly clear that if we link development assistance with market opportunities – if we combine the spirit of the European Development Days with that of the World Economic Forum – we can accomplish great things.
I urge our friends in the development community to embrace agriculture as an income opportunity for millions of Africans – and many are – and I ask our partners in the private sector to think about how development assistance can help smallholder farmers cross the chasm from farming as a struggle to survive to farming as a business that thrives; that they (private sector) in fact can be part of growing Africa.