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Irony of $30b mobilised for agribusiness as 282m Africans starve


By JACKSON MUTINDA
Monday February 6, 2023


A woman heading to her farm Lubango in Angola. The war in Ukraine has roundly been blamed for the food shortages being witnessed in the world, and especially Africa. PHOTO | OSVALDO SILVA | AFP

The war in Ukraine has roundly been blamed for the food shortages being witnessed in the world, and especially Africa. Energy, fertiliser and food costs have risen by between 40 percent and 300 percent since Russia invaded Ukraine in February 2022.

According to data from the African Development Bank, Africa imports more than 100 million tonnes of food annually, valued at about $75 billion, and the continent now finds itself in a lurch, as 30 million tonnes of the imports come from the warring Russia and Ukraine.

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Some of the most affected African countries are Egypt and Sudan. Egypt is the largest wheat importer in the world, and in 2022 it bought $8 billion worth of the grain.

Ever-increasing prices

The ever-increasing prices continue to exacerbate an already strained food supply chain, causing more hunger pangs across the globe.

Of the 690 million hungry people globally, 282 million are in Africa. Data shows the number of undernourished is growing faster on the continent than anywhere in the world.

Food insecurity on the continent is further worsened by climate change, which is costing the continent $7 billion-$15 billion annually.

Long drought spells in the Horn of Africa and the Sahel, locust invasions, and rising numbers of people displaced by climate change and conflicts have aggravated the situation.

In the Horn, which is experiencing the worst drought in 40 years — with at least 36 million people in Ethiopia, Kenya and Somalia in dire need of food — there has been a 33 percent increase in the number of children seeking treatment for illnesses related to acute hunger this year, as humanitarian conditions in overcrowded camps continue to deteriorate, says medical charity Médecins Sans Frontières (MSF).

Acutely food insecure

In drought-affected areas in the three nations, 22 million people are acutely food insecure and 5.1 million children are acutely malnourished, according to the UN World Food Programme.

MSF says hospital admissions of children suffering from severe malnutrition have spiked in Dagahaley, one of three refugee camps in the Dadaab refugee complex in north-eastern Kenya.

The WFP says that it urgently needs $2.4 billion to support 8.8 million people affected by drought in the area, which has witnessed the fifth consecutive below-average rains.

“Worryingly, forecasts paint a grim outlook for refugees this year,” MSF said last week. “The United Nations Office for the Coordination of Humanitarian Affairs has predicted a sixth consecutive failed rainy season from March to May 2023, exacerbating the scale and severity of the humanitarian emergency in the Horn of Africa. Humanitarian actors are concerned over expected funding cuts for refugees, which would force them to further downscale operations at a time when needs are rising fast.”

The Dadaab refugee complex hosts 233,000 registered refugees, many of whom have been living in the camps for over three decades, and more than 80,000 unregistered refugees.

In 2022 alone, more than 50,000 people arrived in Dadaab.

Zero Hunger goal

Experts say that Zero Hunger, one of the UN’s Sustainable Development Goals, cannot be realised unless Africa’s agricultural potential is harnessed.

Africa has 65 percent of the remaining arable land on the globe, enough to feed the world’s population by 2050. The African savanna is estimated at 400 million hectares, of which only 10 percent — 40 million hectares — is cultivated.

Feeding the world therefore requires that the global food systems be changed to fully unlock the food production potential of Africa. This is the clarion call of the United Nations. UN Secretary-General Antonio Guterres said governments must bolster agricultural production and invest in resilient food systems that protect smallholder food producers.

Feeding conflict

Mr Guterres says if people are not fed, “we feed conflict.”

“Food shortages can cause serious social and political problems,” he said.

Leaders who attended the event called on the African Union Commission and the African Development Bank (AfDB) to help mobilise more funding to top up the amount announced and report on the overall investment at the February African Union Summit.

Some 34 African heads of state and government, and leaders of international and bilateral development organisations, and the private sector attended the summit, whose theme was “Food sovereignty and resilience”.

Among the resolutions was the establishment of presidential delivery councils to oversee the implementation of the country-specific compacts and promote accountability.

Strong political will

AfDB president Dr Akinwumi Adesina said that Africa’s agriculture sector will depend on strong political will and commitment of governments, development partners, and the private sector and the scaling up of highly impactful continental programmes such as the Technologies for African Agricultural Transformation, a programme of the bank.

“It is time for Africa to feed itself. There is no reason for Africa to be a net food importing region. What we do with African agriculture today will determine the future of food in the world,” he said.

This was echoed by heads of state and government, with Kenya’s William Ruto saying: “The fact that we are discussing food — so many of us as heads of state — is not an interesting thing to do. Sixty years after independence, we should be discussing how agriculture is not just going to feed but create jobs.”

State interventions

With countries facing challenges from decline in commodity prices to currency depreciation and the macroeconomic and fiscal pressure of food imports, life is becoming hard for millions of Africans.

Dependency on food imports is depressing domestic currencies, driving up inflation and causing unemployment, especially among the youth.

“African countries need to pursue policies and programmes that will allow them to become a net food exporting region, while using agricultural industrialisation to add value to processed foods and export commodities. And we must support Africa to address huge challenges posed by climate change to the agriculture sector. We must build resilience of the food system,” Dr Adesina said.

Many of the African leaders supported this sentiment as they committed to use their national compacts to make agriculture work.

Demographic dividend

Leaders from the East African Community are banking on their countries’ demographic dividend to boost production and serve export markets.

Presidents Samia Suluhu (Tanzania), William Ruto (Kenya), Evariste Ndayishimiye, (Burundi), Felix Tshisekedi (DR Congo), and Rwanda Prime Minister Édouard Ngirente, committed to deploy adequate resources to mechanise and make agriculture a significant contributor to their countries’ GDP.

President Samia said her government has set aside 680,000 hectares to be allocated to women and youth for agricultural use.

“We introduced in our Agenda 2030 a policy which will ensure that by 2030 the agriculture sector in Tanzania contributes 10 percent to GDP. Who will help us achieve that? The youth. So, we have initiated a programme called Build a Better Tomorrow for youth and women,” she said at the heads of state panel.

Inputs trust fund

Tanzania has also established the Agricultural Input Trust Fund to help youth and women acquire inputs such as fertilisers, herbicides, pesticides, and incubation centres, where they will be trained.

President Ruto, too, emphasised the role of the youth and mechanisation and fertiliser to boost farm production.

“Tea, among the best crops we have, is giving us good returns. But for the 1.7 million acres under tea, we are getting the same income as 10 percent of what we have under horticulture. The difference is our fertiliser investment in horticulture,” he said.

There are close 700,000 tea farmers, against 50,000 in horticulture, but while the tea sector generates $1.2 billion annually, horticulture generates $1 billion.

He stressed the need for mechanisation, from irrigation to processing. “The participation of young people is significant, as you can see from returns from the two sectors: The more the young people are in a sector the greater the returns,” the Kenyan leader said.

All the speakers emphasised the importance of food security for political stability and security of nations.

Of women and Agriculture

The host president, Macky Sall, who is also the African Union chairperson, Nigeria’s Muhammadu Buhari, and Zimbabwe’s Emerson Mnangagwa all acknowledged the place of agriculture in the continent’s growth and stability.

“We must strongly support farmers, especially smallholder farmers, a majority of whom are women, and get more young people into agriculture. And we must take agriculture as a business, not a development activity, and boost support to the private sector. We must make agriculture and agribusiness very attractive to the youth. We must support women-owned and women-led agribusinesses,” said Dr Adesina.

He emphasised the role of infrastructure in transforming rural areas into agricultural production and processing zones.

Infrastructure

But a lot of infrastructure concentrates in urban areas, because the economic viability of infrastructure is low in the rural areas, because their source of livelihood — agriculture — is not viable.

“Infrastructure is very important and Africa has a deficit of $68 billion to $108 billion per year. The AfDB has, in the past six years, invested $44 billion on infrastructure: from power, to roads, to water, to sanitation, to digital infrastructure, to transport corridors to one-stop border posts. But a lot of infrastructure in Africa concentrates in urban areas, because the economic viability of infrastructure is low in the rural areas, because their source of livelihood — agriculture — is not viable. But we have special agro-industrial processing zones. These are going to change the density of infrastructure in rural areas around agriculture, power water, roads, irrigation storage, logistics.

“It will make agricultural processing and value addition profitable, close to where the food is produced. So, you don't need to move raw materials; you will move finished agricultural products,” he added.

He said the bank has in the past two years invested $1 billion on 23 projects on special agro-industrial processing zones in 11 countries. But participants sought support for agriculture-based small and medium enterprises (SMEs), burdened with an unmet financing need of about $100 billion annually.

Partnerships

The AfDB and the government of Canada announced the Agri-SME Catalytic Financing Mechanism, a blended finance facility that is expected to de-risk investment into small and medium agri-businesses and strengthen food systems across the continent.

With an initial contribution of $85 million from the Canadian government, the Mechanism will provide concessional finance and technical assistance to financial intermediaries, including agribusinesses, commercial banks, micro-finance institutions and impact funds.

The summit also saw the launch of the Mission 1 for 200, a joint programme of the AfDB and the International Fund for Agricultural Development to help 40 million African farmers produce 100 million tonnes of food for 200 million people.

Build resilience

Mission 1 for 200 is meant to build resilience by helping farmers adapt to climate change and reduce agriculture’s environmental impact and emissions.

The AfDB-supported Technologies for African Agricultural Transformation led by the African Agricultural Technology Foundation, is helping farmers and government research and extension agencies to disseminate climate-smart maize technologies, such as the elite Water Efficient Maize for Africa varieties, across 16 target countries in Africa. The benefiting countries are Kenya, Tanzania, Rwanda, Uganda, DR Congo, Ethiopia, Benin, Cameroon, Central African Republic, Ghana, Malawi, Mozambique, Nigeria, Togo, Zambia and Zimbabwe.

The AfDB says that when drought hit Southern Africa in 2019, it deployed drought-tolerant maize varieties, which were cultivated by 5.2 million households on 841,000 hectares. As a result, farmers survived the drought, expanding maize production by 631,000 tonnes, valued at $107 million.

Equity, equality goals

Also, in the mix is the Affirmative Finance Action for Women in Africa (Afawa) initiative, which has reached a landmark $1 billion in approved funding designated for lending to African women entrepreneurs. Afawa was launched in 2015 in Dakar during the first Feed Africa Summit (Dakar 1).

Dr Beth Dunford, the AfDB Vice-President for Agriculture, Human and Social Development said: “AFAWA’s benchmark reminds us that when we invest to grow Africa’s food systems, we must also invest in Africa’s women agripreneurs.”

Additional reporting by Pauline Kairu



 





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