Platform for African – European Partnership in Agricultural Research for Development

Friday, May 26, 2017

Annual Meetings of the African Development Bank

22-26 May 2017. Ahmedabad, Gujarat, India. In line with the central theme, “Transforming Agriculture for Wealth Creation in Africa,” many of the high-level meetings explored how India and Africa can work together in order to achieve their shared goal of rural and agricultural transformation, which would go a long way in reducing rural poverty and improving the quality of lives of rural people.
A series of regional sessions on India–West Africa Economic Cooperation; India–Central & South Africa Forum on Connectivity; India–East Africa Business Forum; and India–North Africa Trade Forum also feature prominently in the knowledge events of the meetings.

A special session on India-Japan co-operation for the development of Africa was held under the aegis of Japan External Trade Organization (JETRO), Japan International Cooperation Agency (JICA) and Japan Bank for International Co-operation (JBIC), in cooperation with their partner organizations in India on the promotion of African business through private-public partnerships between Japan and India in support of African businesses.

A ministerial roundtable discussion dwelt on developing partnerships between Africa and Asia trade and capital flows between the two continents. Entrepreneurship, private sector development in Africa, Asian lessons on human capital and technology in development as well as regional cooperation and trans-boundary challenges also came up for discussion. Bilateral meetings and briefings by organisations and businesses, as well as expositions were held on the sidelines of the meetings.

The AfDB Annual Meeting ended with call to see the potential of African agriculture
“With 65% of the world’s uncultivated land, Africa will determine the future of food for the world. There is gold in the dirt, if only we will see it. I am convinced that we must change the narrative about African agriculture, which will be a US $1 trillion business by 2030. And the entertainment world agrees with me. One of the results of this Meeting is that we have collectively seen the need to make dramas – not just documentaries – about agriculture, so as to engage a younger audience,” Akinwumi Adesina African Development Bank President 
Adesina summarized progress made in the Meetings on the roles of the private sector, young people and women in transforming agriculture to create wealth on the continent. He discussed the Bank’s support for agricultural research (not least through the newly launched Technologies for African Agricultural Transformation Initiative, TAAT), its support for women farmers, and its commitment to heighten the African presence along the entire length of the agricultural value chain, from farm to fork.

“That’s why the Bank will be investing US $24 billion in African agriculture in the next 10 years – a 400% increase on its support to date,” he said. “In Africa, for far too long, farmers have been abandoned. In India’s Green Revolution, farmers were given bold support – in Africa we must do the same.”
African Economic Outlook: the 2017 edition unveiled
Build on African entrepreneurs to succeed in the continent's new industrial revolution. This is what emerges from the 2017 edition of the African Economic Outlook, released on 22 May in Ahmadabad, India, on the sidelines of the AfDB's Annual Meetings. This flagship publication, which annually reviews all 54 African countries, is a joint effort of the Bank, UNDP and OECD.

Read the full report

Developing Africa’s Grey Matter Infrastructure
Building on the AfDB President Adesina’s strong commitment to unlock sustainable economic growth, participants agreed that investing in physical infrastructure cannot help Africa to move forward without building brainpower. Speaking at a side event on “Developing Africa’s Grey Matter Infrastructure: Addressing Africa’s Nutrition Challenges” for healthy children, families, and economies, they highlighted the importance and urgency of fighting the scourge of malnutrition on the African continent. The event also established a foundation for further high-level dialogue and leadership to end malnutrition for health and prosperity for Africans and Africa on the whole.
  • For Jennifer Blanke, AfDB Vice-President, Agriculture, Human and Social Development, “malnutrition is a major global public health concern whether it is from undernutrition, overweight/obesity or micronutrient deficiencies.” She also mentioned that ensuring good nutrition requires a multi-sector, collaborative approach and that the agriculture sector, among others, has a role to play in influencing nutrition outcomes.
  • During the debate, the panelists agreed that there is a direct link between productivity and growth of the agriculture sector and improved nutrition. “It has become evident that it is the quality of food and not the quantity thereof that is more important,” said Baffour Agyeman representing the John Kuffuor Foundation.
  • Commenting on the role of African Leaders for Nutrition (ALN) in encouraging investments in nutrition, Shawn Baker, Nutrition Director at the Bill and Melinda Gates Foundation, said, “ALN is a way to make the fight against malnutrition a central development issue that Ministers of Finance and Heads of State take seriously and hold all sectors accountable for.”
  • For Laura Landis of the World Food Programme, the cost of inaction is dramatic. “We have to make an economic argument on why we need action,” she said. “The WFP is helping, in cooperation with the African Union and the AfDB, to collect the data that gets not just the Health Minister moving, but also Heads of State or Ministers of Finance.”
  • In a word, said Gerda Verburg, Scaling Up Nutrition coordinator, “without better nutrition you will not end poverty. Without better nutrition you will not end gender inequality. Without better nutrition you will not improve health, find innovative approaches, or peace and stability. Better nutrition is the core.”
  • This is particularly true for fragile states, said Sierra Leone’s Finance and Economic Development Minister Momodu Kargbo. “Cooperation and coordination are key between government and development partners, he said. Development partners disregard government systems when implementing programs whereas they should align and carefully regard existing government institutions and ways of working,” he lamented.

Transforming African agriculture into a lucrative business 
Agriculture and agribusiness together account for about 45 percent of the economy of Sub-Saharan Africa. The share of agribusiness (including logistics and retail) in GDP averages 20 percent, while the share of agricultural production is about 24 percent for low-income countries, much of which is subsistence production. Much of Africa is physically close to big markets in the Middle East and Europe and some countries already capitalize on this through horticultural exports. Agriculture and allied industries are now favoured sectors for foreign direct investments (FDI). In 2014, Africa was the world’s fastest- growing region for FDI - a 65 percent increase over 2013.

In this new market environment, agribusiness companies are starting to respond to investment opportunities Africa has to offer. By 2030, agriculture and agribusiness combined could be worth over US$1 trillion to Africa from the current US$313 billion, offering the prospect of bringing more jobs, greater prosperity, less hunger, and enabling farmers to compete globally. However, notable constraints to agribusiness development still remain and explain a substantial part of the underperformance in Africa’s agriculture and agribusinesses. These include dominance of subsistence agriculture and the difficulties in some countries to position agriculture as a profitable business and source of wealth and employment. The Bank believes that it is crucial to transform African agriculture into a globally competitive, inclusive and business-oriented sector that creates wealth, generates gainful employment, improves quality of life and secures the environment. This event provided a platform for exchanging of views among key stakeholders on the subject matter.

Innovative Financing for Agriculture
There is a large financing gap for private sector-led development of agricultural value chains, with an estimated gap of US$50 billion for smallholder farmers. The IFC estimates that 84% of all SMEs on the continent, including those in agricultural sectors, have limited or no access to finance. The flow of private capital into the sector is constrained by low risk-adjusted returns, due to high transaction costs driven by small deal sizes, high delivery costs, and inadequate banking technology. These factors discourage banks from developing agriculture sector expertise, or investing in innovative delivery models. There is need to re-align incentives for commercial banks and other financial institutions to get into financing agriculture, by de-risking agriculture as an asset class and building banks’ capacity to serve smallholder farmers. In so doing more attention should be devoted to innovative financial services including technology-based financial services and insurance schemes which contributes to not only enhancing financial access to small-farmers but also enhance their resilience to the growing risks related to climate, market and political shocks.

The analysis of the Bank has shown that the recent growth of mobile money has allowed millions of people who are otherwise excluded from the formal financial system to perform financial transactions relatively cheaply, securely, and reliably. Mobile money has achieved the broadest success in Sub-Saharan Africa, where 16% of adults report having used a mobile phone in the past 12 months to pay bills or send or receive money (overall in Africa, 14% of adults used mobile money in the past 12 months). In Kenya, where the M-Pesa service was commercially launched in 2007, 68% of adults report using mobile money. Similarly, in Sudan, more than half of adults used mobile money. This re-alignment requires participation of the public sector to address the structural and capacity constraints in the sector. The Bank is proposing a new approach - the Risk Sharing Model - which aims to address some of these challenges. The Bank also intends to establish national/regional Agriculture Risk Sharing Facilities that will catalyse greater commercial banks’ lending to the agriculture sector by de-risking lending to agricultural SMEs.

This panel provided the opportunity for the Bank to formally present the planned approach to deploy innovative financing models to stimulate increased agricultural financing on the continent. The panel will also offer an opportunity to engage key stakeholders in the elaboration of these models to ensure successful deployment and sustainability. This event will be organized following a town hall (arena) setting style.

MODERATOR: Ms. Julie Gichuru, News Anchor, KBC
SETTING THE CONTEXT: Jennifer Blanke, Vice-President, Agriculture, Human & Social Development, AfDB

Hon. Henry Kiplagat Rotich, AfDB Governor for Kenya
Hon. Ambassador Claver Gatete, AfDB Governorfor Rwanda
Hon. Amadou Ba, AfDB Governor for Senegal

Women in Agriculture
The centrality of women’s role in African agriculture, as well as the importance of agriculture to women’s lives, are widely recognized. About 80 percent of women in the least developed countries who are economically active cite agriculture as their primary economic activity. However, a gender gap persists in the agriculture value chain. Further, given gender disparities in overall access to formal financing, with fewer women meeting lenders’ criteria, less commercial credit goes to women-run enterprises. Moreover, depending on the country, the rural wage gap between men and women in Africa is estimated at between 15 and 60 percent. It is therefore clear that one critical area in which Africa’s agriculture innovation system must go beyond traditional approaches to achieve transformative change is in how it treats issues of gender.
  • This panel provided an opportunity to delve into the problem of gender disparities while bringing together a range of stakeholders (African women farmers (organisations) and entrepreneurs, policy-makers, practitioners, researchers and other experts) to exchange views on how agricultural transformation can enhance decent employment opportunities for women in Africa.
  • The session discussed how to fully develop the capacity of women working in and around the agricultural sector for higher productivity, increased income and economic empowerment through sustained entrepreneurship. The discussion provide concrete and non-traditional approaches and solutions to the issue of gender in agriculture applicable to African circumstances, and also make suggestions on best practices from around the world.

SETTING THE CONTEXT: Mr. Charles Boamah, Senior Vice-President, AfDB
OPENING REMARKS BY: H.E. Macky Sall, President of Senegal

Agriculture is Cool: Engaging Africa’s Youth
Africa has the world's youngest population. There are 420 million youth aged 15-35 in Africa. Most of these young people lack access to meaningful economic opportunities. Of those not in school, one-third are unemployed and discouraged, another third are in vulnerable employment, and only one in six is in wage employment. On the other hand, the average age of farmers in Africa is 60 years for a continent hoping to feed itself and to eradicate malnutrition by 2025. In the agriculture sector, lack of access to land, finance, markets, technologies and practical skills are barriers to youth participation. In addition, there is a perception among the youth that farming is an unattractive career path.

Yet the agriculture sector holds the potential to create gainful job and wealth creation for the continent's young people. There are opportunities to empower the youth at each stage of the agricultural value chain as 'agripreneurs.' The ENABLE (Empowering Novel Agri-Business-Led Employment) Youth Program has shown evidence that with greater access to the agribusiness enterprise, the youth can be the driving force for the transformation of Africa's agriculture.

This three-part interactive event brought  into the spotlight the innovative concept of "Youth Agripreneurs" developed by the International Institute of Tropical Agriculture (IITA) in Nigeria as well as similar original ideas, to showcase success stories in Africa's agriculture sector. Following a short documentary highlighting the AfDB's role in attracting more investment for youth in agribusiness, the audience will hear direct testimonies from some of the bright young African Agripreneurs. Finally, there will be a panel conversation on the topic of youth in agriculture, and the celebration of Agripreneur excellence through an award ceremony (the call for business ideas will be launched and a winner selected before the Annual Meetings. It is envisaged that the Bank through the African Development Institute will send the winner to Korea for a study visit).

MODERATOR: Ms. Lerato Mbele, Presenter of Africa Business Report, BBC World News
REMARKS BY: H.E. John Dramani Mahama, Former President of Ghana

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