African Agribusiness Can Grow To $1 Trillion by 2030 – World Bank
African agribusiness sector worth about $313 billion currently and providing for more than 70 percent of the jobs on the continent could triple in value by 2030 to become a $1 trillion market that will lift millions out of poverty, a World Bank report, Growing Africa: Unlocking the Potential of Agribusiness, says.
With such growth means Africa’s agricultural exports will dominate global markets; and the continent’s farmers will get a new lease of life as they become competitive in the global marketplace.
But this will not be easy. The world bank says every single player in the sector will have to play their part well for this feat to be achieved. The government, private sector and farmers will have to tap into available resources such the widely untapped water sources, arable land (over 450 million hectares) and rising agribusiness investors on the continent.
“Water scarcity has become a major constraint because of competition from rapidly growing industrial sectors and urban populations,” AfricaRenewal quoted the World Bank report says. “Yet Africa has both water and land in abundance.”
But the report also rigorously highlights many stubborn and recurring obstacles in the path of this agribusiness progress in Africa. It says structural reforms are needed to encourage investment in the sectors and a proper infrastructure plan needs to reduce wastage between the farm and the market place.
“Infrastructure is a high priority for jump-starting agribusiness throughout Africa. Best bets for infrastructure are irrigation, roads, and markets,” the report says.
Bright future but challenges remain
Increased access to financing for both local and foreign investors is also needed. There has been slight improvement in agricultural financing among some African countries in the last few years, but at only seven percent foreign direct investment (FDI) on the continent, it is a shadow compared to the 78 percent FDI that Asian farmers receive.
The report says rising global commodity prices could present a opportunity for the continent and foreign investors are noticing this. “the appetite is growing among investors, private equity, and investment and sovereign funds to tap into Africa’s agriculture and agribusiness markets.”
Investment aside, another lingering problem is land allocation and acquisition. Farmers in many countries cannot expand their farming because they have limited access to land, and discriminatory laws sometimes prevent women from gaining ownership.
Involvement of technology in African agriculture is also seen as one the main areas that could help improve farming yields. In an earlier World Bank report titled ICT for Agriculture in Africa, it says ICT could support agriculture at every stage: pre-cultivation, crop cultivation and harvesting and post-harvest. Geographical information systems (GIS) can be used for land-use planning and climate change adaptation, the Bank stated.
Already farmers in Kenya and Zimbabwe have deployed ICT in ways that have increased their income and productivity.