After two decades of trying to transform African agriculture into a thriving, bankable business, the sector is still struggling to deliver prosperity despite growing production.
Alliance for a Green Revolution in Africa’s (AGRA) 20-year review shows farm output has roughly doubled since 2005 and cereal yields have risen by about 40 percent, yet farmer incomes remain below the global average.
Here, AGRA President Alice Ruhweza discusses why production gains have not translated into prosperity and what must change.
Africa has increased food production, yet farmers remain poor and investors say they cannot find solid bankable agricultural opportunities. Where is the value being lost?
We have looked at these things separately, yet our assessment shows we need coordinated action. Some groups focus on production, others on markets and agro-industrialisation, and others on institutions. But everything has to move together.
The three traps are productivity, value and capability. Production is happening, but it remains trapped without value. Value creates jobs and economic growth, while institutions must be capable of driving the transformation.
So is Africa’s agriculture problem really a financing problem?
It is a narrative problem, a bankability problem, a business-case problem and an awareness problem. There is money, but investors say they cannot find bankable opportunities. One of our roles is to connect investors to these opportunities. Agriculture is a $1 trillion opportunity.
What makes an agricultural opportunity bankable?
There must be something at the end of it. If it is agritech, what is the technology going to produce?
Take Mission300 on energy access. Governments signed up and developed compacts, but the question became: energy access and then what?
Energy is important for health and education, but you also need a production sector. Agriculture is that sector. Linking energy access to productive activity creates a stronger business case.
Does that mean governments should invest less in agriculture and more in agro-industrialisation?
I don’t think governments should deprioritise agriculture. They should prioritise agro-industrialisation so that value creation generates jobs, many of them downstream rather than on farms.
The success of the green revolution was not just about producing more food. It was also about how many people moved out of agriculture into other sectors. The more we develop agro-industrialisation, the more jobs we create. That is the measure of success.
Why haven’t food crops attracted the same investment as export crops such as tea and coffee?
Agriculture became associated with poverty. Yet governments invest in crops such as Kenya’s tea and horticulture and Uganda’s coffee because they create jobs and earn foreign exchange.
Food crops have not been seen as capable of doing the same, but we must change that narrative. Cassava, for example, is food but can also be used for biofuel. If we see it only as food for the table, we will not invest in it. Seeing its wider potential creates opportunities for processing and agro-industrialisation.
Where does blended finance fit into this?
Private-sector money seeks returns. Unless you make a clear case for those returns, it will not invest. Public or philanthropic money can help de-risk investments, and AGRA has done considerable risk-sharing to encourage private capital to come in.
What is AGRA’s role in closing the financing gap?
Agriculture will not be transformed by AGRA alone. We need an alliance. Governments must create conditions for investment through predictable policies, infrastructure and access to land.
The private sector must bring resources, while organisations like ours can help governments develop business cases, connect them to investors and highlight opportunities.
The money is there, but it doesn’t know where the opportunity is.
Do you need to expand AGRA’s presence beyond its current countries to have a continental impact?
You don’t need to be everywhere to make a difference. Partnerships with organisations in North Africa and other countries can extend our reach, alongside advocacy and policy influence.
Our Youth Agribusiness Performance Index, for example, has been adopted by the African Union and will be measured in its biannual framework. This shows how policy influence can extend our impact without a physical presence in every country.
Ultimately, how should Africa judge whether its agricultural transformation has worked?
Our 20-year review concludes that there is progress, but it has not yielded prosperity. It must raise farmers’ incomes, create value that drives employment in other sectors, and build institutions capable of sustaining transformation.
When farmers prosper, Africa prospers. Ultimately, the measure of success must be whether we can see a farmer who has prospered.