African Agriculture Facing Challenges of Entrepreneurship. We need to challenge the traditional sources of financing and investment in the agricultural sector and introduce alternative, innovative private sector financing methods.
Not a week goes by without a trade show or newspaper article dedicated to African agriculture. The topics range from the untapped potential of African agriculture and the challenges of rural development to the benefits of introducing agriculture that is better adapted to the impending climate changes. This is a refreshing and significant change of perspective. After all, African agriculture has been suffering for a very long time and is still haunted by the image of stagnation and backwardness. Reinforcing the significance of urban elites and the rural exodus that began in the 1970s and continued through the 1980s have contributed immensely to this image of the backwards African farmer, suggesting that the cities are the future of the continent.
One in four Africans is suffering from chronic malnutrition. This is a truly paradoxical situation given the resources our continent has.
However, the numbers today speak volumes about the importance and potential of African agriculture. The agricultural sector accounts for about 60 percent of jobs within the African continent and amounts to 25 percent of its GDP. At the same time, Africa has over 600 million hectares of arable land, which corresponds to 65 percent of the uncultivated farmland in the world. There is a lot of talk about land grabbing and the impact of large agro-industrial corporations, which should certainly not be underestimated. However, in this context people often forget that in Africa more than 80 percent of the 51 million farms are less than two hectares in size.
Harnessing this potential has become all the more urgent given the fact that Africa imported $35 billion worth of food in 2016. One in four Africans is suffering from chronic malnutrition. This is a truly paradoxical situation given the resources our continent has. Population growth is also forcing rural areas to become central to the development strategy of our continent. It is estimated that approximately 20 million people enter the labour market each year, of which 12 million live in rural areas. In order to integrate this labour force, agriculture and rural development must therefore become priority by transforming rural areas into economically prosperous areas.
The challenge is to create value chains that make it possible for smallholders and farms to build a competitive and sustainable ecosystem, which will lay the foundations for integrative economic growth in Africa. In my book ‘L’Afrique à l’heure des choix’ (has not been published in English, but loosely translates to ‘Africa’s Critical Choices’), I address several possibilities to change and modernise African agriculture, and I stress the importance of emphasising agricultural entrepreneurship.
It is paramount that we explain to our youth that farmers are entrepreneurs like any other. Like every entrepreneur, they have to manage the workflow, financial matters, the role of new technologies, the security and diversification of assets (preparation for set-aside farmland, use of parcels, etc.). However, promoting these jobs requires a massive investment programme to open new agricultural schools. Vocational training programmes need to be enhanced, just as we do for ‘normal’ entrepreneurship.
However, promoting agricultural entrepreneurship would not make sense without simultaneous safeguards and incentives (including legal and fiscal/tax benefits) to motivate farmers to create added value. Generally speaking, we need to challenge the traditional sources of financing and investment in the agricultural sector and introduce alternative, innovative private sector financing methods. Thanks to their holistic, collaborative and strategic approach as well as their multilateral management style, these innovative financing options contribute to increased productivity and agricultural development: Private investments are mobilised and market weaknesses are balanced out.
A reform of the land register and land rights is essential.
At the same time, the meteoric rise in mobile phone usage in Africa offers many opportunities for innovation that can change and improve the financing of rural development. Nigeria and Kenya, for example, were the first countries to introduce a system whereby subsidies for the purchase of fertiliser are distributed directly to farmers. This was made possible by partnering with mobile technology companies and network providers.
Finally, a reform of the land register and land rights is essential. Land titles granted as part of a system of land tenure are all too often a luxury for most African farmers and are also discriminatory against women. Proper introduction of these systems is an incentive for farmers to invest in their production resources and to introduce good work practices. Land ownership is always a hot topic in Africa; hence, protecting the land rights is paramount to building inclusive, resilient and sustainable communities.
Promotion of agricultural entrepreneurship requires deep rethinking and important reforms of our state policies regarding the education and training of young farmers, the reform of the land register, access to new financing methods, and increased use of new information and communication technologies (NICT) in the agricultural sector. This is the agricultural and innovative Africa we hope to see in the near future.
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