//  Organisation and participants

The workshop was organised by the European Commission's Directorate-General for Agriculture and Rural Development in collaboration with the Directorate-General Development and Cooperation – EuropeAid. Both Commissioners as well as the Executive Director of UNIDO attended the event which indicates the level of importance valued to the topic. Other participants included representatives from bi- and multilateral donors, academia, CSOs, private sector and financing institutions as well as practitioners implementing or promoting cooperation projects between public and private sector in African countries. Platform focal point Bernard Rey of the EC chaired a panel at which focal point Albert Engel of giz presented. Thomas Tiedemann of the secretariat attended as well.

//  Issues discussed

Insufficient attention to the role of the private sector 

In his opening address Commissioner for Agriculture and Rural Development Ciolos admitted that in past decades the EC had not paid sufficient attention to the private sector’s role in African agricultural development. With 25 per cent of the world’s fertile land, stronger investment into African agriculture was a must to satisfy the growing demand for food. As 70 per cent of African farmers were smallholders, approaches had to be designed which allowed smallholders to link to markets and enter value chains.

Public-private cooperation development

On three panels -- complemented by a number of case studies -- panelists and the plenary aimed at opportunities for agribusiness in Africa as well as challenges and approaches to developing public-private cooperation in agricultural development and to designing an agribusiness index. The composition of the panels and the topics of presentation represented the breadth of the issue under discussion: From a Shea butter cooperative in Mali and the funding tools of a financing institution like IFC to strong involvement of the Ethiopian government in organising the export of agricultural crops through a commodity exchange, the presentations illustrated the diversity of stakeholders, variety of approaches, and complexity of potential solutions.

Challenges to increasing investment

Panelists recalled the substantial challenges for increasing investment in African agriculture which included:

• Low productivity
• Post-harvest losses
• Political and social instability Unfavourable investment climates
• Lack of investment in infrastructure
• Inadequate financial services
• Shortage of skilled labor

Climate change, it was agreed, presented an additional formidable challenge for most African producers.

Distribution of risks and benefits

Nevertheless, ample business opportunities existed with the ongoing population growth, increasing urbanisation, an emerging middle class as well as the forecasted continent wide GDP growth of 5 per cent  p.a.. Yet – how are risks and benefits shared between African farmers and private sector investors? CSO representatives reminded donors that there should be clarity and honesty about the objectives of investments. Does the demand come from a farmer or from a company? Is the aim to improve rural livelihoods in Africa or to generate value for investors? The trade balance between African countries and EU member states regarding agricultural products quadrupled in recent years in favour of Europe, underlining the importance of assessing the objectives of initiatives.

Private sector does not replace policy

Albert Engel, giz Platform focal point, concluded that the most important point was linking farmers to farmers. He advocated for inclusive business models but also cautioned that public-private partnerships were not suitable at all levels and for all target groups. Private sector investment needed to be flanked by appropriate policies, it did not replace policy. Donor agencies should play a role as honest brokers for cooperation between the private and public sectors.

//  What is next?

The European Commission announced continued engagement on the issue. Commissioners Ciolos and Piebalgs would soon visit the African Union Commission to continue the discussion on investment in African agriculture. In his closing remarks, Commissioner Ciolos also declared the Commission’s readiness to achieve greater policy coherence and renounce instruments that have a detrimental effect on African farmers.

The UN Year of Family Farming in 2014 will also ensure continued focus on African smallholders and the question how they can best be linked to markets.

Donors will need to continue developing best practices for supporting public-private cooperation. While different approaches exist, such as the EC’s “blending” approach and the IFC’s GAFSP facility, no state of the art has yet been developed in terms of ODA leveraging private sector investment. Another challenge is how to bridge the gap between microfinance and large scale investments? Finally, donors were challenged to tackle the issue of scale – there was no time anymore to just work on pilot projects if Africa’s agricultural potential was to be fully developed.

// Download

Workshop programme__ PDF

// Source

Video-recording from the workshop

Workshop page on EC Website

The report highlights the great potential of the agribusiness sector in Africa by drawing on experience in Africa as well as other regions. This evidence demonstrates that good policies, a conducive business environment, and strategic support from governments can help agribusiness reach its potential. Africa is now at a crossroads, from which it can take concrete steps to realize its potential or continue to lose competitiveness -- missing  a major opportunity for increased growth, employment, and food security.

// Growth opportunities for agribusiness 

Agriculture and agribusiness together are projected to be a USD 1 trillion industry in sub-Saharan Africa by 2030, and they should be at the top of the agenda for economic transformation and development. Most African countries have a comparative advantage in agriculture. Africa has more than half of the world's unused arable land, and its impressive water resources have scarcely been tapped.

Nevertheless, in most African countries, agriculture and agribusiness have been losing in the competitiveness race, resulting in low and stagnant productivity.

//  Overcoming constraints

Authors of World Bank report argue that there is a way to overcome existing problems and to boost agricultural productivity: good policies, sustained public and private investments, and public-private partnerships backed by open, transparent procedures and processes along the entire value chain. Report provides detailed recommendations for agribusiness, supported by different examples and case studies, showing that Africa has many local successes on which it can draw, as well as successes in comparable regions, to guide governments and investors toward positive economic, social, and environmental outcomes.

//  Downloads

Growing Africa__ PDF 

// International expert consultation on food price volatility and food security

According to Joachim von Braun of the Center for Development Research (ZEF) and Maximo Torero of the International Food Policy Research Institute (IFPRI) became clear in the workshop that agricultural commodity prices were increasingly linked to fluctuations of these other markets, i.e. financial assets, stock exchange, real estate markets, and others" - food commodities as an asset class for investors.

Related to this "financialisation" was volatility which could have devastating effects. Sudden global food price increases were a threat for food security of millions of poor people that depend on affordable staples. Yet, there was no alert system linking price volatility to food and nutrition security. For this reason, more information and transparency was needed, the workshop concluded. "Information needs to refer to stocks where reliable data is still not available for many countries and not available on an intra-annual base."

Find all the presentations on the ZEF website.

//  Videos from the workshop

Introductory statement, Joachim von Braun, Director of ZEF

Maximo Torero, Director of Market, Trade and Institutions at IFPRI

David Hallam, Director of the Trade and Markets Division, FAO

Joseph Glauber, Chief Economist at the US Department of Agriculture

Matthias Kalkuhl, Senior Researcher in the project "Food price volatility and food security" at ZEF

Seid Nuru Ali, Ethiopian Economics Association Institute

//  Source

ZEF

//  "Shut up and listen!"

When most well-intentioned aid workers hear of a problem they think they can fix, they go to work. This, Ernesto Sirolli suggests, is naïve. In this funny and impassioned talk, he proposes that the first step is to listen to the people you're trying to help, and tap into their own entrepreneurial spirit. His advice on what works will help any entrepreneur.

Ernesto Sirolli got his start doing aid work in Africa in the 70's - and quickly realised how ineffective it was.

//  Source

TED

//  Enter the dragon, the elephant and the tiger

Together with Thomas Reardon, Kevin Chen and Bart Minten, Adriano examines staple food value chains in Bangladesh (with the tiger as the emblem), China (the dragon) and India (the elephant). They found that they had "generally been perceived as operating in a traditional mode, which is typically thought to be an extremely long and fragmented process", the study begins. This was not the case today, as the authors reveals. Documenting a "quiet revolution", they show that "staple food value chains were transforming across the region, with fewer intermediate actors, better integration, and higher receptiveness to technological changes."

//  Questions and methodology

Three research questions are asked:

1. Are staples value chains transforming structurally?
2. Is the conduct of staples value chains' actors transforming?
3. Is the performance of staples value chains leading to the inclusion of small-scale farmers, small-scale midstream actors, and workers, and (all else being equal) to lower food costs for consumers?

About 3,500 farmers, traders, millers, cold storage facilities and modern and traditional retailers of rice and potato value chains were surveyed in key rural producing centers that serve the large urban centers (Dhaka, Beijing, and Delhi) of Bangladesh, the People's Republic of China and India. The focus was on domestic value cchains and the main grain and vegetable rice and potatoes.

//  Findings

The survey concludes that a transformational modernisation was under way in these staple food chains, albeit at different speeds: "In the rice value chain transformation, the leader is China, which appears to be changing faster or has transformed further, especially in the remarkable development of its rice milling sector. In the potato value chain, India is taking the lead, with the spectacular rise of potato cold storage facilities (CSFs) in Agra."

Downstream, midstream and upstream segments of value chains were all examined in the book as well as the enabling role of governments. Asian governments have been active both through investments and subsidies, but a modernisation of input supply chains was necessary.

//  Implications__ Strategies for transforming the agrifood economy and for food security

The study has several policy implications:

1. No "silver bullet" for the challenges: A range of policy measures is needed at various levels of the supply chain in order to stimulate the efficiency and competitiveness of expanding staples markets.
2. Different policies are needed for the widely different zones and farm strata within them.
3. Linking two debates: Value chain transformation is important for food security and poverty reduction.
4. The successes in dynamic areas feeding major cities may provide lessons that could be applied elsewhere.

Especially the last point stresses the importance of governments and the private sector actively helping in transforming value chains.

//  Watch the video

//  Contents of the book

• Foreword
• Executive Summary
• Introduction
• Sector Overview, Study Areas, and Sampling Framework
• Upstream: Rice Farm Transformation
• Midstream: Transformation of the Rice Mill and Trader Segments
• Downstream: Rice Retail Transformation
• Performance of the Rice Value Chain: Rewards, Costs, and Margins
• Upstream: Potato Farm Transformation
• Midstream: Transformation of the Potato Cold Storage and Trading Segments
• Downstream: Potato Retail Transformation
• Performance of the Potato Value Chain: Rewards, Costs, and Margins
• Summary and Policy Implications

//  Read the book

The Quiet Revolution in Staple Food Value Chains: Enter the Dragon, the Elephant, and the Tiger

//  Download

Book__ PDF

//  Source

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