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The future of Africa depends on agriculture
Agriculture is instrumental in Africa ' s poverty : it must also be instrumental in its wealth . Only through agricultural regeneration can growth , diversi cation and job creation occur for African economies , for no region of the world has ever industrialised without the agricultural sector being rst transformed . In short , the future of Africa depends on agriculture . But Africa cannot develop quickly if farming remains largely a subsistence activity . 60 % of the population are involved in farming , yet it accounts for less than one seventh of its GDP , and African agricultural yield is the lowest in the world . So Africa is late in developing but even this very fact offers a large scale opportunity for i nt e r n at i onal i nv e s t ors a n d bi g - t i c k e t entrepreneurs .
Economic diversi cation and lasting wealth creation begins with a vibrant agriculture sector . Between $ 30 and $ 40 billion a year over the next ten years is needed to transform African agriculture and create the vibrancy . It ' s a lot of money , but it is available , even within Africa , if the projects are good enough . And they ought to be good enough , since such investments will create new markets worth at least $ 85 billion per year in added revenue by 2025 . �at ' s a potential return of at least 100 %. But which producers will own , in uence and leverage these markets ? Most , surely , should be made in Africa ? We must own our development . �e commitments of last year ' s AGRF gave us a ying start with $ 30 billion over 10 years .
And with such transformation would come the reduction of Africa ' s net trade de cit in food , potentially bringing net savings of up to $ 100 billion per year . We must bring an end to the costly and damaging anomaly of the net de cit in food . No more should Africa produce what it does not or cannot consume , and no more should it consume what it does not ( but could easily ) produce . Other related measures would deliver similarly impressive albeit incalculable nancial impacts : scal inclusion , tax reform , domestic revenue mobilization , higher remittances , reduced corruption and better governance .
�ere are also still huge and unexploited growth opportunities in Africa . � e c o n t i n e n t i s endowed with 65 % of the world ' s uncultivated arable land and huge reserves of water . Sub Saharan Africa also has 10 % of the world ' s oil reserves , 40 % of its gold , and up to 90 % of its chromium and platinum . And those are just the known reserves – the whole continent is one of the world ' s largest unexplored resource basins . Africa may suffer from poverty but it is an unimaginably rich continent , even a�er �y years and more of commodity exploitation . But how to bring about this transformation ? How to close this potential deal of the century ? Public and private sector should be acting together . �ey are needed to provide signi cant opportunities for A f r i c a ' s e m e r g i n g i n n ov at ors and entrepreneurs , not to mention its nanciers , fund managers and nancial advisers .
Over the past few years , the Bank has been able to bring about a comprehensive re-evaluation of the potentially enormous role of agriculture in the transformation of Africa , and the AGRF has been a critical factor in the shared objective with the Bank of bringing about the green revolution in Africa . �e technologies to feed Africa exist already . �is is the period of climate change . High yielding drought-tolerant maize can allow farmers to grow a good crop even during droughts . Some cassava varieties can yield 80 tonnes per hectare . High yielding rice varieties that meet or beat international standards of imported rice now exist . Orange- eshed sweet potatoes allow us to address the problem of vitamin A de ciency . Tropical and drought-tolerant wheat varieties are being grown in Nigeria , Kenya and Sudan .
�ese technologies need to be scaled up for widespread adoption . �is will not happen by itself . It will require speci c incentives . In particular , the African Development Bank and the World Bank plan to jointly provide $ 800 million through “ Technologies for African Agricultural Transformation ”, a agship programme for the scaling up of agricultural technologies to reach millions of farmers in Africa over the next ten years For agricultural transformation more generally , the African Development Bank has committed $ 24 billion to agriculture over the next 10 years , with a sharp focus on food self-sufficiency and agroindustrialization .
It ' s also why we launched the Affirmative Finance Action for Women in Africa ( AFAWA ), to make an extra $ 3 billion available for women entrepreneurs , in order to improve food production levels on the basis that women are demonstrably more dependable and bankable than men . Getting our youth involved in agriculture as a business is crucial . �at is why the Bank launched the ENABLE Youth program . �is program will provide access to capital and capacity to “ Ag r ipre neurs ” to c re ate ab out 3 0 0 , 0 0 0 agribusinesses and 1.5 million jobs in 30 countries across Africa , with an estimated investment of $ 15 billion over the next ve years . With so many entrepreneurs now on the case of farming , an issue to resolve quickly is the current low level of commercial nancing for agriculture . Finance and farming have not been easy partners in Africa , and the farming sector receives less than 3 % of the overall nancing provided by the banking sector .
�e African Development Bank is promoting national risk sharing facilities in every country to leverage agricultural nance , similar to the Nigeria Incentive-Based Risk Sharing for Agricultural Lending ( NIRSAL ), a facility designed to reduce the risks of lending to Nigerian agriculture value chains . �e impact in Nigeria was massive . Over four years , 15 million farmers were reached , 2.5 million of them women . Food production expanded by over 21 million tonnes . Today , several African countries are adopting the approach , as well as others such as Afghanistan .
I predict that the next few years will see agriculture emerge fully from poverty and subsistence to become the next big booming business sector of Africa , with entrepreneurs , nanciers , inventors and innovators all gathering round a honey pot of bankable projects , programmes and opportunities . A�er all , who eats copper ? And who drinks oil ? Africans need to become producers and creators , and not just consumers , in the fast-moving enterprising business of food . �e African Development Bank will play its active role as a catalyst of this activity , and I am con dent that we will soon see Africa ' s rst tranche of billionaires coming from the farming and food sectors . www . farmersreviewafrica . com
FARMERS [ 11 ] REVIEW AFRICA
July - August 2017