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FAO: Agriculture will make or break free African trade

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FAO: Agriculture will make or break free African trade

Changing agricultural food systems could unlock Africa's potential
Abebe Haile-Gabriel
From Africa Renewal: 
28 April 2021
A man with chicken eggs in his hands.
FAO
The African Free Trade Area aims to expand trade between Africa and promote economic growth. The agricultural sector provides the best possible basis for these expectations, says FAO Assistant Director-General and African Regional Representative, Abebe Haile-Gabriel.
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The African Free Trade Area (AfCFTA) has the potential to lift millions of people out of poverty and end food insecurity in Africa. However, its effectiveness depends on approval and implementation, and especially in the agricultural sector.

Abebe Haile-Gabriel
Mr. Abebe Haile-Gabriel, Assistant Director-General and Regional Representative for Africa Food and Agriculture Organization of the United Nations.

Africa relies on exports of agricultural products such as cocoa, coffee, cotton, tobacco and spices to the nations of the world to earn significant foreign exchange. But the continent imports important foods such as cereals, vegetable oils, dairy products and meat in large quantities.

Trade between African nations in agricultural products as a percentage of Africa's total agricultural trade remains below 20 percent long, one of the lowest in any region. Total trade between African nations was only 2 percent in the period 2015–2017, compared with 67 percent in trade between European countries, 61 percent in Asian countries, and 47 percent in the Americas, according to UN trade agency UNCTAD.

AfCFTA intends to reverse this trend. It has created the world's largest free trade area, representing the 1.2 billion consumer market, and mandates states to remove tariffs and non-tariffs in order to boost shipments and services between nations, and boost economic growth in doing so.

However, since the trade began under the AfCFTA on January 1, 2021, only 36 African Union member states have ratified the agreement.

The Importance of Agriculture

It is in agriculture that the AfCFTA's aspirations can be realized, especially by strengthening regional value streams integrated into priority products, led by a diverse private sector inspired by small business owners, commercial farmers, miners and operators.

One African market has the potential to create a better, more competitive business environment for agriculture, encourage more investment and ultimately a modern, dynamic, productive, inclusive, sustainable and sustainable agricultural sector that can lift millions of Africans out of poverty.

Strengthening the national capacity for food and commodity production for regional markets will provide a solid foundation for nations to boost regional trade. Policies and programs should encourage the private sector to increase new investment, add value to products, compete with imported goods, and create jobs.

Regional Guidelines

Many economic communities in Africa have already identified strategic products for further improvement in regional streams of quality improvement: East Africa has given priority to rice, beans and dairy products among others. West Africa has given priority to millet, livestock, fish and aquatic products, among others. The most important products in Southern Africa are soybeans and nuts.

This regional trend has the potential to include smallholder farmers including women and youth, as well as small and medium enterprises, and to link them to a major private sector that controls input and crop markets.

Enhanced integration of stakeholders in commercial value streams, ranging from farmers and miners, exporters and retailers, can create sustainable employment opportunities and enhance long-term, and uncontrolled productivity, food security and nutrition.

 

Many continental economic communities have already identified strategic products for further development in regional value chains: East Africa has given priority to rice, beans and dairy, among others. West Africa has given priority to sorghum, livestock, fish and fish products. Southern African priorities include soybeans and nuts.

In this International Year of Fruits and Vegetables, reduced tariffs on raw foods and the gradual removal of non-tariff barriers could make more African people more affordable and nutritious - a recent FAO analysis shows that nearly one billion people in Africa cannot afford good nutrition.

Change direction from normal

Increased trade between African nations is a shift in direction from normalcy. The success of the world's largest free trade area depends on the government and the private sector.

States and companies face major obstacles such as addressing conflicting natural and food security regulations and the need to affix identity cards, and they need to overcome inferior infrastructure such as telecommunications and road systems, and the need for better marketing information.

The Food and Agriculture Organization (FAO) of the United Nations and the African Union have recently launched a program to assist nations in rehabilitating a new market.

One of the main objectives of the  Framework for Boosting Intra-African Trade in Agricultural Commodities and Services is to help nations triple their trade in agricultural products and services, which is one of the commitments made by African governments under the resolution. Malabo Declaration adopted in 2014 (Malabo Declaration adopted in 2014).

Enabling a strong private sector is an important early step, as small to medium enterprises are critical to the structural reform of agricultural and food systems in Africa.

Governments need to design systems for buyers and suppliers, connecting small and medium producers, including smallholder farmers, to national and regional buyers. Women and youth deserve to be included in these efforts.

The transition from food production systems to improved, integrated, flexible and sustainable commercial systems needs to be improved in field-level production, inputs, machinery use and post-harvest management led by investment, technology, innovation and knowledge text.

It is estimated that freeing tariffs could bring prosperity benefits of up to $ 16.1 billion, and trade growth among African nations by 33 percent.

Looking ahead, one African market can create a more competitive commercial environment for agriculture, encourage more investment in a modern, dynamic, productive, inclusive, sustainable and sustainable agricultural sector that can lift millions of Africans out of poverty.

Bi. Haile-Gabriel is the Deputy Director-General and Regional Representative for Africa for the UN Food and Agriculture Organization

Abebe Haile-Gabriel
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