• Agribusiness: New technologies and innovative financing, new opportunities
  • Agribusiness: New technologies and innovative financing, new opportunities
  • Agribusiness: New technologies and innovative financing, new opportunities

Agribusiness: New technologies and innovative financing, new opportunities

Has the time of the green revolution sounded in Africa? New technologies and innovative financing mechanisms seem to offer new opportunities for a greater appreciation of agricultural potential on the continent. All the more so because there is urgency: the drought in East Africa threatens to plunge 17 million people into food insecurity.

By Dounia Ben Mohamed

 

On 31 March, the Food and Agriculture Organization of the United Nations (FAO) alerted: “Food crisis: 108 million people facing severe and acute food insecurity in several countries, the situation is worsening” . In a report published the same day, the institution draws particular attention to the situation in East Africa where a severe drought threatens to plunge 17 million people into food insecurity. “We have mobilized $ 165 million to help people affected by famine and drought in the Horn of Africa,” said Neven Mimica, European Commissioner for International Cooperation and Development, report. Four countries in particular are at risk of falling into famine: South Sudan, Somalia, Yemen and northeastern Nigeria. “The loss of resources and human resources will only increase if we allow the situation to deteriorate,” said José Graziano da Silva, Director-General of FAO. We can prevent people from starving, but if we do not intensify our efforts to save, protect and invest in rural livelihoods, ten million people will remain seriously food insecure. ” An urgency that reminds us of the continent’s inability to set up a modern agriculture and more resilient to the exogenous shock. To feed the populations of the continent more widely. Recalling that the annual cost of food imports is $ 35 billion in foreign currency, it will reach $ 100 billion by 2030.

60% of the world’s uncultivated arable land is in Africa

An aberration given the agricultural potential of the continent. A point on which all studies and analyzes converge. With 60% of the world’s unexploited arable land, a tremendous hydraulic potential, Africa has not only the ability to achieve self-sufficiency, but beyond that of feeding the planet. A challenge at the heart of all concerns. In Africa as well as on the international scene. Because the stakes are enormous: feeding 7 billion people every day on the planet. By 2050, the number will rise to 9 billion, while today, even some 805 million people in the world are not eating their way, according to the latest UN estimates. That’s one in nine. The challenge is to produce more, much more, and quickly, while preserving the ecosystem. Now, with the demographic aging that is affecting Europe, the climatic disruptions that disrupt agricultural production, the depletion of fertile lands …, it seems that the solutions are in Africa.

“Unleashing the African agricultural potential!

On condition of operating what is now called the green revolution. In other words, to move from the current agricultural model to agro-business, taking into account the social and ecological aspects. As a reminder, agriculture is today 16.2% of the GDP of the continent and more than 60% of the jobs. But despite ambitious agricultural policies, Africa’s agricultural potential remains largely underexploited. The fault of an agriculture which remains mainly traditional, in the hands of small producers who do not have the new practices in force, technical and financial means, to adapt and to increase the yields that remain too weak. Without integrated channels, in all trades throughout the value chain, no processed products, and therefore no added value. A diagnosis widely developed in a study by the African Development Bank, entitled “Feeding Africa: A Strategy for the Transformation of African Agriculture” and published in August 2016 – which was also the theme of the last Annual Meetings of 2017 ADB meetings held in Ahmedabad, India, last May. With certainty: agriculture is the key to accelerating growth, diversification and job creation in Africa. It is necessary, however, that it should have the means. In the preface signed by Akinwumi Adesina, President of the AfDB and Minister of Agriculture and Rural Development for Nigeria, he urged “to free Africa’s agricultural potential! »

ADB: US $ 24 billion over the next ten years to support agricultural transformation in Africa” ​​

The time has come for Africa to feed itself, “he urges. Agriculture should now be considered a business, not a way of life. African countries must pursue policies and programs that will enable the continent to become a net exporting region of food products, while using agricultural industrialization to add value to processed foods and export products. And we must support Africa to face the enormous challenges posed by climate change in the agricultural sector. It is our duty to strengthen the resilience of the food system “. And to announce that the institution, based on its strategy “Feeding Africa”, will invest $ 24 billion over the next ten years in support of agricultural transformation in Africa. “Our goal is to contribute to ending extreme poverty, eradicating malnutrition, ending dependence on food imports – and placing Africa at the top of value chains in the A comparative advantage. Time for agricultural transformation in Africa is now! »

Bypass intermediaries and sell products at exact market prices thanks to the mobile

For the current context offers new opportunities for better optimization of the sector. New technological performances, among others, allow farmers, via their mobile telephony, to bypass intermediaries and thus sell their products at the exact prices of the agricultural market; Access to improved seeds and good practices; the fruits of new research also spreading via telephony. Better management of production and avoidance of leaks is also possible thanks to new technological tools, such as digital thermometers and hygrometers, which transmit data via smartphones. Internet more widely provides easier access to information and research. The farmer who receives daily weather on his smartphone is better able to predict and therefore adjust his business. Elements that are changing, gradually, but concretely, agriculture on the continent. With initiatives such as those of the East African Stock Exchange which provides on-line services such as warehousing, logistics and market intelligence on stocks and expected returns from major crops.

Innovative solutions and Better adapted to needs

Also in terms of funding, African agriculture is changing its face. Innovative and better adapted solutions are needed. Alongside major international institutions such as the World Bank – which signed an agreement on the establishment of a risk-sharing mechanism in Washington on 14 February in Washington with the African Reinsurance Corporation (Africa Re) An experience account, it reduces the current level of premiums paid by insured farmers and encourages local companies to design affordable insurance products. The Fund for Agricultural Development Acceleration (FADA), approved by the AfDB Board of Directors on May 8, 2013, and announced on May 9, 2013, which aims to create a pool of projects and investment loans which attract private or institutional investors and which support the policy of transforming agriculture in Africa. Or, the European Investment Bank (EIB), which provides € 7 billion in loan volume per year, including 10% outside the EU and € 1 billion in Africa, by setting up specific instruments to equip Small farmers; while the African food market is a financing and investment opportunity of US $ 313 billion – US $ 1 trillion by 2030. So these are alternative solutions that are developing.

A model favored by the Member States.

The Business Partners (BP) model in South Africa has adopted an innovative financing model for small and medium-sized enterprises (SMEs) in the agricultural sector or for other sectors. It is based on a large-scale production line of SMEs, producing a large number of quality SMEs, which are accompanied financially. In addition, the concept involves companies that mitigate risks and ensure commercial success and repayment. Resumed today in Kenya, it could be adopted… By other countries. In the meantime, agricultural and rural banks are already playing a key role in rural economies, facilitating financial and economic operations. But they need to be reformed for greater efficiency. Some experts invite them to follow the example of Banrural, a traditional public agricultural bank transformed into a PPP bank for agricultural and rural development, innovative and sustainable. Public-private partnerships (PPPs) precisely address the challenge of agriculture on the continent. That is, PPPs provide the necessary funding while providing farmers with access to better seeds, training, inputs and markets in key market-oriented value chains. A model favored by the States today, whereas only five African countries devote at least 10% of their total expenditure to the agricultural sector (Burkina Faso, Ethiopia, Mali, Niger and Senegal).


 

Author: DBM // Photos: AFBD “Feeding Africa” ​​program © AFBD

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