Past the Pandemic: Investing in the Green Gold of Africa — what are the implications and opportunities?
We discuss in this article, how the COVID 19 disrupted Africa’s food security, causing a deepening crisis in food insecure places — however providing opportunity for growth.
One of Africa’s largest contributor of GDP is from agriculture. The sector has been identified as a strong emerging market, when developed further, has the opportunity to lift many out of poverty. On a continent where 60% of employment comes from agriculture, securing the sector well enough could translate into a ripple effect unto other sectors such as tackling undernourishment in health and education, transport, logistics — reflecting in the economic growth of many African countries.
However, despite the ambitious goals, of feeding 1.2 billion people by 2030 (a part of set of goals by the African Union in having the continent achieve self-reliance even by its 2063 target), the continent is beset with an array of challenges which includes a 33 million farmer workforce mainly lacking empowerment to sustain themselves and increase productivity.
Despite these existing complexities, agriculture in Africa is seen as lucrative investment by private entities. Taking a closer look at agriculture in Ghana, we zone in on the challenges in the agricultural space, the opportunities available and the effects of the COVID-19 pandemic.
How has Covid-19 affected the agricultural sector in Africa?
The pandemic has brought many disruptions — to transportation, supply chain sector and even food demand. Africa’s projected GDP growth of 3.2% for 2020 is now expected to slow to about 1.8% Lockdowns and general restriction of movement and human activity had people staying in one place and afforded many people to indulge themselves. Food demand increased initially however there were challenges getting crops from farms to markets. There were many stories of food wasting away in the large central markets and on farms.
However, with the rolling effect of job loss and reduced income, it became harder for many to buy food. In Ghana, a report indicated that an estimated 22 million people have experienced a reduction in household income since #Covid19 restrictions were introduced on March 16 2020. This is 77% of households. This leaves a lot of uncertainty and various scenarios as to how exactly the pandemic’s effect could still be, even a year on.
How can we build long term resilience to future crises through sustainable mechanization?
One thing the pandemic has taught us is that we need to rethink how we currently do many things. Our approach to buying, selling, interacting must be flexible, automated, scalable and reach more — essentially digitize many processes as much as we can. An example is how many businesses that relied heavily on physical human interaction were forced to move online to access their customers and reach out to new ones. But that is for the service end for the agricultural value chain. What about the farmer in the village? Educational Awareness of the pandemic via radio is great. We saw automated voice notes also being sent in local languages to farmers. Moving on, there needs to be more innovative approaches integrated within current structures to ensure we are more resilient and weather the storm. For example, the Ghana Commodity Exchange has been great in linking off-takers and food processors, manufacturers and maybe a similar remote system can be setup for rural farmers so they receive more market access.
Resilience goes hand in hand with self-sufficiency as well. The pandemic exposed import dependent countries especially ones that heavily import their food. Countries you wouldn’t expect like Singapore were really hard hit with shortage of certain food types. Ghana hasn’t been spared. So, we need to learn how to design effective systems that ensure more food can be grown and more importantly processed to satisfy our population and then export. Policy is a great way to do this and the governments goal to completely cut of rice imports by 2022 is great. It gives rice farmers an opportunity to gain. Next move could be creating enabling environments for rice companies to start up here, buying from farmers processing and packaging the rice for sale to Ghanaians and the regional market.
What are the new developments and emerging trends within the agricultural sector?
There are many technologies being administered all over the agricultural value chain. From the farmer receiving digital services on weather, renting equipment such as tractors, buying input, receiving a loan and even requesting for farm advisory services with satellite or drone imagery, checking plant health with their phone using AI all the way to receiving buyers for his/her crops, there is a lot going on. For instance, anyone from anywhere around the world can sponsor crops grown by rural smallholder farmers and receive their back plus returns after harvest. This what our company, Grow For Me does actually.
What are the areas of most potential in the next decade?
The intersections between agriculture, tech and service provision offer a lot of potential in the coming years. FAO has indicated that by 2030 there will be 13 billion people on the planet but there is a dwindling resources supplies for the food to feed these people. Land, water and pollution are major factors that all the world over are being discussed, fought over and increasingly becoming a concern. Technologies that enable the effective use of these resources such as AI, Data science and automation will ensure little effort can produce much to feed many. The last piece to the puzzle is services which ensures delivery of a product or even an experience. People pay good money for superior services in any sector. An example is Amazon whose revenues have gone up in the pandemic because of the services they provide in web services and home delivery. So, imagine an agribusiness that uses tech to deliver superior services and food products. Those business are winners/unicorns in the coming decade.
Strengthening technological effort and innovative capabilities in improving agribusiness potential in Africa
No doubt, there is much that governments must do to improve the fitness of Africa’s economies, including accelerating infrastructure development, deepening regional integration, shaping tomorrow’s talent, and ensuring healthy urbanization. To strengthen the effort of what private businesses, entrepreneurs and innovators are doing, we must band together as one to have a stronger voice to negotiate for better policies, set up support for research, innovation and development, infrastructure that is beyond roads, trains and water transport but includes high potential human capital, stable electricity and internet that highlights affordability, accessibility and availability. Coming together means we have a stronger voice that push for the enabling environments we desire to generate economic gains that have lasting social impact of lifting many out of poverty.
We encourage you to join us create that tomorrow by supporting Ghanaian farmers today whilst you receive fair returns. Visit www.growforme.com to sponsor your first crop as a first step contribution towards a resilient agricultural value chain for Africa.
