In Africa, Investing in Farming Pays Dividends Across Society

According to a new report, countries that put more money into agriculture saw hunger drop and GDP rise.
Kenyan farmer Polly Mukami picks tea. (Photo: Philippe Lissac)
Sep 11, 2016· 3 MIN READ
Sarah McColl has written for Yahoo Food, Bon Appétit, and other publications. She's based in Brooklyn, New York.

Last month, the United Nations called for $204 million in funding to address what The Associated Press called “Africa’s food security crisis.” Lingering drought in Southern Africa has hurt farmers badly this year, and 18 million people in seven countries require emergency food assistance.

The current weather situation is indeed bad, and the need is real—yet in a way, that’s the kind of story some Western readers may have come to expect out of Africa, a place where famines occur. But the need for food aid is only one part of the larger story about food, farming, and hunger on the continent. On Tuesday, a report released by Alliance for a Green Revolution in Africa told a different story about farming in sub-Saharan Africa: In the last 10 years, countries that have poured resources into agriculture saw increased crop yields, lower rates of malnutrition, and higher GDPs. The report’s authors declared it “the most successful development effort in African history.”

How did it happen? In 2003, the African Union’s Comprehensive Africa Agriculture Development Programme called on African governments to earmark 10 percent of their national budgets for agriculture. Thirteen years later, the countries that heeded the call—even while falling short of the 10 percent allocation—saw productivity on existing farms rise between 6 and 7 percent and GDP increase by about 4 percent. In most countries, agricultural growth also meant a reduction in poverty.

In a data-driven world of reports and mathematical averages, the numbers may seem small. Consider that GDP growth in the United States was about 2 percent in 2015, according to data from the World Bank.

“If an African country’s economy is growing at 3 percent or 5 percent, it’s a miracle,” said David Ameyaw, one of the report’s lead authors. “Coming from the ’70s to the ’80s, when these countries were experiencing negative growth, it means there has been a tremendous increase.”

In Kenya, where agricultural yield increased by 6 percent, Ameyaw said an individual farmer might have seen harvests grow nearly 300 percent thanks to increased access to fertilizers, hybrid seeds, and machines, like small tractors. With increased yields, farmers are faced with options. No longer farming for subsistence, they now have a commodity on their hands, and they are forming organizations to pool their resources. That means aggregating their product to supply buyers who purchase in bulk and allowing them to negotiate discounts for the inputs they buy in large quantities.

AGRA called these developments an “agriculture transformation,” one in which farmers in Africa are able to move from subsistence farming to agribusiness. The changes in the ag sector will spur infrastructure development and create more jobs at every link of a developing value chain, “from R&D to the table,” as Ameyaw said.

“Ten years ago, we needed to depend on multinational breeders to bring the seeds,” he said. “Now we are creating employment for someone who has finished his Ph.D. in breeding [at] Africa-based seed companies.”

That’s an opportunity, he added, to solve a challenging problem: More than 60 percent of Africa’s population is under the age of 25, and roughly 220 million young people will enter the workforce by 2035. Yet wage jobs won’t be able to absorb more than 25 percent of these new workers.

“Farming and self-employment will be called upon to provide gainful employment for at least 70 percent of young Africans entering the labor force” between now and 2030, according to the report, and more than half of those new workers will come from rural areas.

To lure them to agriculture, agriculture has to be profitable. But do the changes in Africa foretell a future of the industry dominated by homegrown Monsantos and Bayers? After all, some consider “agribusiness” to be a four-letter word. But it may be time to change that perception, according to Stephanie Hanson of One Acre Fund, a nonprofit that works with smallholder farmers in East Africa on financing and farm training.

“If you define agribusiness as how do you help a smallholder farmer move from a place where they’re food insecure to a place where the family is food secure, and there’s an income stream being generated from the farm—that’s the best kind of agribusiness you can have,” she said.

From there, she said, farmers can begin to diversify beyond staple foods into vegetables or to invest in chickens or a cow. That also allows them to diversify into nonagricultural rural income opportunities—what the AGRA report calls the “off-farm sector”—such as construction or motorbike transport businesses. Those small businesses are critical in rural communities, she said.

“One dollar in a rural community tends to circulate multiple times,” Hanson said. “If you have lots of these individual farmers earning some additional income and profit from their land, it starts to set up a chain of economic activity to rural areas.”

There’s still a long way to go. Many countries did not heed the African Union’s call to pump money into agriculture, and across sub-Saharan Africa, the GDP rate is expected to slide down this year. “Agriculture development is very uneven across the continent,” Thomas S. Jayne, a professor of agricultural, food, and resource economics at Michigan State University and a coauthor of the report, said in a statement. “Where there is the right mix of interventions, we see it delivering considerable economic opportunities and addressing fundamental development milestones, like improving nutrition. But where it is neglected, agriculture continues to be a barrier to generating more sustainable and equitable economic growth in sub-Saharan Africa.”

Hanson called the report “a wake-up call” to governments that demonstrates the tangible results that can come from increased spending in the agriculture sector. “I think it also shows the nonprofit sector and the social enterprise sector that we can’t expect governments to do everything,” she said, and that organizations like One Acre and others need to work together with governments to “address the full challenge that we’re facing in the agriculture sector in Africa.”

Such support from outside government, Ameyaw said, is the most important to continue to make progress in what is still the world’s most food-insecure continent.

“Government cannot do it alone. Private sector cannot do it alone,” he said. “For us to be able to continue to sustain the agriculture transformation that has started on this continent, there needs to be a strong public–private sector partnership.”