Agribusiness Offers Africa Lifeline Amid Corona

A tea farm in Kericho

Africa’s food import bill matches the size of Tunisia’s economy and could outgrow it as a result of a witches’ brew of Covid-19 crisis, desert locust invasion and natural disasters.

This triple whammy couldn’t have come at a worse time. Most African nations were already facing downturns amid public debt overhang – limiting their capacity to take on more commercial debt while spending the bulk of revenues on repayments and less on development.

According to the World Bank, Africa’s food import bill stands at $35-40 billion per year and growing – equivalent to the size of Tunisia’s economy.

The heavy bill is despite the continent boasting a comparatively bigger share of arable land, especially in sub-Saharan Africa alongside a big army of working-age population looking for jobs. The continent grapples with low agriculture budgetary allocations, lower mechanisation and productivity levels and less product value addition – a situation that has long hamstrung output yields, with most farmers stuck to traditional inefficient farming methods.

As a result, the continent continues to unnecessarily bleed hard currency in food imports to feed its fast-growing population, eroding forex reserves and exposing it to external shocks. At the same time, reliance on shipments makes African economies vulnerable to global food supply disruptions.

Closer home in Kenya the picture is not different. Despite agriculture accounting for more than a quarter of its GDP, Kenya is far off from food secure as sections of the country perennially get pushed into the jaws of famine, drawing humanitarian aid.

The average age of a Kenyan farmer is 59, limiting innovation in the sector as most youth continue to shun the sector, which is perceived to be dirty and unrewarding.

Yet some 1.2 million young Kenyans enter the job market every year, with the economy being able to create less than 100,000 formal jobs yearly, giving rise to mass unemployment.

To this end, agribusiness can offer this group a lifeline and put them on the path to wealth creation. It is encouraging that a few youths are seen to be warming up to urban farming, but they remain the exception. To move the needle, the country needs to build a critical mass of innovative young farmers, an ecosystem of agripreneurs.

Agri-business can be a rewarding venture for Kenyan youth and women, but only with the right training and access to funds.

Besides creating jobs and boosting food output, agribusiness could promote inclusive growth as well as support climate change adaptation and climate innovation. Also, it can strongly contribute to manufacturing, given the strong upward and downward value chain linkages of the agricultural sector.

Food security is one of President Uhuru Kenyatta’s four development pillars (Big 4 agenda). At the same time agribusiness is one of the key areas around which Kenya Climate Innovation Centre (KCIC) supports entrepreneurs through incubation, training and funding in efforts to promote innovative solutions geared towards addressing food supply.

For a bigger impact, KCIC has joined hands with the European Union and Ministry of Foreign Affairs of Denmark (Danida) to fund and train Kenyan youths under the AgriBiz programme. The project aims to modernise farming and livestock keeping among small and medium-sized enterprises (SMEs), away from traditional inefficient practices and towards innovation and technology-led approach with higher yields.

For sustainability, African governments need to raise agriculture budgets and provide structures geared towards enabling private agribusinesses to flourish and boost the volumes of foodstuff produced within the continent. Financiers and venture capitalists should also direct more of their funding towards agricultural projects and innovations, given that food is the society’s foundation upon which other advancements are built. In particular, climate-smart agribusiness projects and technologies should receive special attention in this age of climate change whose effects threaten to disrupt food production, especially among less developed agrarian economies.

Revamped local supply will not only ensure food security and fortification of hard currency reserves but it could also throw a lifeline to thousands of unemployed youth, enabling them to engage in productive activities. The continent should reap from a youthful demographic dividend.

The Horn of Africa countries have since last December been grappling with the worst desert locust invasion in 70 years, attacking the region’s breadbasket countries such as Ethiopia and Kenya and mowing down farmlands and pasturelands.

Also, parts of Africa have recently been hit by deadly floods while others have had to contend with prolonged dry spells, putting food production in jeopardy. Throw the coronavirus crisis into the mix and a looming food crisis no longer seems far-fetched. But this could be averted.

By their nature, young people can be very experimental and innovative and this trait should be guided into the agricultural field.

The article first appeared in the Business Daily

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