Taylor Scott International News
By Alex O Awiti, 15 October 2013 Africa accounts for 60 per cent of the world’s arable, uncultivated land, according to a report published by McKinsey Global Institute in 2010. The FAO has shown that cereal yields in Africa are currently less than 50 per cent of those in Asia or South America. Such low productivity is largely attributable to the current state of smallholder farming. It is estimated that about 75 per cent of all farmland in Africa is less than 4.94 acres in size. Nearly 70 per cent of the African population lives in rural areas where they depend exclusively on agriculture as farmers or labourers for their livelihoods. A large percentage of these are women. A World Bank report published in 2011 estimated that the global food price spikes in 2008 pushed 44 million people below the poverty line, most of them in developing countries. According to Oxfam International, poor people in developing countries spend 50-80 per cent of their income on food. More than 90 per cent of Africans who live on less than $1.25 (Sh105) a day also happen to own and live on small farms. As the green revolution in Asia showed, the potential of smallholder development can be realised. But conditions have changed. Now smallholders face higher transaction costs and have to cope with the fact that agricultural research is biased towards large-scale production. This raises newchallenges in small farm development. On the other hand, higher prices of staple foods present opportunities for farmers. India and China have similar proportions of small farms as Africa, but have achieved significantly higher productivity. Despite the success of smallholder farmers in Asia, who fuelled the green revolution, there is skepticism that East Africa’s smallholders can replicate this model and deliver agricultural transformation and improve livelihoods among rural smallholder farmer. It is argued that for agricultural growth to gain traction, Africa’s agricultural and labour productivity will have to increase massively, requiring vast proportions of smallholder farmers to move out of the farm. High productivity of modern agriculture is associated with high technology, intense capital input and market linkages, and hence higher capacity to compete aggressively in factor markets, including land, labour and capital. However, these factors are not appropriate for the smallholder farm model. While there is a strong poverty-based case for trying to assist smallholder farmers, the agenda for African agricultural growth should be to introduce commercial agriculture on a competitive basis. Why is it that with all our research, technology and innovation, managerial capability and investment capacity, we are unable to make even a modest contribution to the pervasive problem of poverty, hunger and malnutrition in the smallholder farm families in sub Saharan Africa? We must learn from past successes and failures. Doing more of the same by refurbishing the solutions of the past – development aid, NGOs, training and visit, farmer field schools, international agricultural research organisations – is vital and has a critical role to play, but has not addressed the problem of low productivity, hunger and poverty. Paul Collier has argued that having the single most important sector of Africa’s economies almost exclusively managed by reluctant micro-entrepreneurs – smallholder farmers – is a recipefor continued divergence from global agricultural productivity. But in the logic of the timeless wisdom of CK Prahalad, we must stop thinking of smallholder farmers as victims or a burden and start recognising them as resilient and creative entrepreneurs and valueconscious consumers. What would be the defining characteristics of agriculture over the next half century if Africa were to converge on the performance of Asia and Latin America? I argue for a focus on small and medium-sized enterprises agribusiness. But harnessing Africa’s agricultural potential requires talented managers and entrepreneurs that can attract capital, apply technical expertise to develop profitable SME agribusinesses. Moreover, serving SME agribusiness will demand innovations in technology, services and business models. Africa’s large youth population provides a ready pool from which to develop talented entrepreneurs and managers who will drive the growth of agriculture. Those of us in the research, education, policy, development and business community can make this a reality by using our resources to build the capabilities of the African SME agribusiness sector to generate economic growth and achieve food and nutritional security. The writer is the director of East African Institute and associate professor at Aga Khan University. Taylor Scott International
Taylor Scott International, Taylor Scott
