Productivity boost

The past two decades have delivered unparalleled progress and improvements in quality of life across the developing world. Agricultural growth in sub-Saharan Africa rose from an annual rate of 2.3 % in the 1980s to an average of 3.8 % for the years 2000 to 2005. This is good news. It has been shown that rural poverty is reduced by more than 1,83 %, for every one percent increase in agricultural growth (Fan, Johnson, Saurkar and Makombe 2008). No other sector has more impact on rural poverty.

The downside is that the continuous agricultural growth that Africa experienced so far was mostly based on expanding land use. Productivity hardly increased. This will have to change. There is a rich and diverse treasure trove of possible and meaningful innovations. While Africa should avoid mistakes made during the green revolutions in other parts of the world, there is no doubt that the continent must rely on improved seed, fertiliser and irrigation.

African food needs

Despite agricultural growth and the consequent improvement in food security, much remains to be done in sub-Saharan Africa. According to FAO data for 2010, around 73 % of the people lived on less than two dollars per day, almost 28 % did not consume enough calories, and 24 % of the children under five were underweight. Of 925 million hungry people in the world, 239 million lived in sub-Saharan Africa.

Many African farmers are net buyers of food; they spend more than 60 % of their disposable income on food. Accordingly, they struggle to meet other household requirements.

Due to insufficient domestic production, sub-Saharan African economies spend about $ 30 billion to $ 50 billion a year to import food. As a result, the continent lacks funds to invest in infrastructure and social and economic amenities. If domestic production does not increase dramatically, Africa is likely to spend about $ 150 billion on food imports by 2030. The continent’s population was 1 billion in 2009, and is expected to rise to 2.3 billion by 2050. It has been demonstrated in many parts of the world that increasing agricultural productivity helps to boost rural incomes, increase food availability and improve access. However, the yield levels of many food commodities produced in Africa are below international averages.

Africa’s low agricultural productivity has many causes, including
– lack of knowledge of up-to-date technologies and practices,
– low use of improved seed,
– low use of fertiliser,
– inadequate irrigation and
– lack of incentives for farmers in the absence of remunerative markets.
In many places, these sector-specific problems are compounded by overarching issues, including
– political instability and violent conflict,
– weak institutions of governance and ineffective policies or
rural people’s poor health.
No doubt, agricultural productivity must rise if Africa’s food needs are to be met in the future.

Climate change is likely to exacerbate matters further. For instance, the yields from rainfed agriculture are set to decline in some countries. Therefore African farmers need adaptation strategies like water harvesting, cultivating drought-resistant crops and ecological restoration.

Looking beyond farms

Small farms are typical of African agriculture. The transformation from traditional to modern agriculture will have to be achieved by boosting the efficiency of their operations. They need to move on from subsistence farming to market-oriented production.

That shift will improve food security at the national and household levels. So far, development strategies focus on Africa’s smallholder farmers. The idea is to reach many people and benefit many households. But the question does arise whether farms should stay small in the long run – and whether small-scale operations will really allow farmers to escape poverty.

The preconditions for successful agricultural transformation are:
– macroeconomic and political stability,
– sound policymaking,
– technology transfer,
– access to lucrative markets and
– the profitability of agriculture.

Moreover, non-agricultural employment must become available in rural areas. The reason is that marginal farmers will abandon the sector as it grows more productive. These people will need new jobs, and the transformation of the rural areas will give scope for providing such jobs. After all, boosting agricultural productivity is not just about farms. There is a need for broader strategies that encompass processing of goods and services that relate to agriculture.

The green revolution must go hand-in-hand with agro-industrial and agribusiness development. Otherwise, the result will not be broad-based economic growth and poverty reduction. Food security will be enhanced, jobs created and value added across the farming and non-farming sectors of any given economy.

To boost productivity, it certainly makes sense to consider the largely still untapped potential of ­genetical engineering while not forgetting about ­establishing appropriate regulations to safeguard possible dangers.

It is noteworthy that the Alliance for a Green Revolution in Africa (AGRA), which is supported by the Bill & Melinda Gates Foundation, is focussing on smallholders and understands the need to respect biodiversity. AGRA is essentially promoting 12 crops in Africa. It emphasises the availability of good seeds and supports 60 seed companies in 13 African countries. AGRA is also rolling out a financing scheme to allow smallholders to purchase complemantary inputs. It similarly supports promising market strategies.

As economies of scale matter throughout the value chain, it would make sense to find ways to promote more dynamic forms of organisation. Contract farming, cooperatives and large-scale farms need to be considered – not only for production purposes, but for marketing too.

Even though governments still focus on the smallholder model, combined with small traders and numerous state-run support services, the pressures for more dynamic organisational structure are evident in Africa today. Globalisation has created opportunities for a ­rapid growth in particular export niches such as flowers or vegetables, for instance. These products are grown on commercial farms, sometimes supplemented with smallholder contract farming. Earnings obtained from these high value crops improve rural households’ standards of living and enhance their food security.

The emergence of supermarkets throughout Africa is bound to start changing the relationship of retailers with farmers. Supermarket managers must ensure a constant flow of goods of standard quality. Accordingly, they take interest in the entire value chain. In principle, this trend offers opportunities for smallholders. All too often, however, they are unable to grasp them, not least because they consider big retail businesses a sector that does not concern them.

Education, research and innovation

Innovations matter to achieve agricultural growth. In 2008, the World Bank’s World Development Report emphasised that, when knowledge is successfully transformed, it yields innovations that enhance the competence, productivity, competitiveness and ultimately, the livelihoods of everyone in the value chain.

Indigenous knowledge is important, but it has to be supplemented by scientific knowledge. Research must cover new technologies, improved practices, natural resource management as well as the social, cultural and economic aspects of production, marketing and human livelihood.

Science-based technology is a key driver of agricultural growth. Unfortunately, public spending on African agriculture, including investment in research and development, have reached an all-time low of less than seven percent of agricultural GDP. The comparative ratios are 11 % for Asia and 13 % for Latin America. Unless the trend is reversed in Africa, there will be no long-term food security.

Farmers need education to understand their options and to pursue their own interests systematically. For China, data from various provinces showed that investment in rural education had the greatest impact on poverty reduction, immediately followed by investments in agricultural research and development (Fan, Zhang and Zhang 2002). For agricultural research to bear fruit, farmers need to be made aware of the results and understand them. Providing such knowledge is the job of agricultural extension services.

Agricultural research, moreover, must find solutions to the problems the farmers face. Farmers must be involved in planning, implementation and validation of the research agenda. This requires two-way communication on both sides. Extension-service staff are the intermediaries between scientists and farmers. It makes sense to use modern information and communication technology in this context.

It is possible to boost agricultural productivity in Africa. What is needed is coherent policymaking because the various factors that facilitate change are mutually reinforcing.