- Knowledge base
- Policy question
Two African Economic Research Consortium (AERC) events in 2015 highlighted the need to use a comprehensive lens in policymaking for Africa’s agricultural transformation. To make this transformation an inclusive process, several issues need to be dealt with at different levels. A favourable investment climate needs to be created and programmes developed to improve farmers’ skills and knowledge.
In 2015 INCLUDE attended two events of the African Economic Research Consortium (AERC) on agriculture and development in Africa. The first was the Senior Policy Seminar ‘Agriculture in Africa’s Transformation: The Role of Smallholder Farmers’ held in Maputo, Mozambique on 26 and 27 March, which was hosted by AERC and the World Food Programme (WFP). The second was the biannual research workshop on ‘Agriculture and Structural Transformation in Africa’ in Addis Ababa, Ethiopia from 29 November to 2 December, which was hosted by AERC and the United Nations Economic Commission for Africa (UNECA).
The different presentations and discussions in these events highlight the need to address agricultural transformation from different angles. On the one hand, general measures need to be provided through institutional arrangements, including better safety nets, market reforms and technology transfers. On the other hand, a more actor-oriented approach is required through a focus on the development of (young) smallholder farmers to make farming more attractive to them and to provide them with opportunities to develop skills, knowledge and other cognitive capacities. Hence, to make Africa’s agricultural transformation successful, a comprehensive policy approach at multiple levels is required.
The March seminar brought together an estimated 80 participants, including senior policy-makers, academics and other policy stakeholders, who deliberated on possibilities for, and the future of, smallholders farmers in Africa. Ninety per cent of Africa’s population derive their livelihood from agriculture, which makes it key to Africa’s inclusive development agenda.
The seminar was kicked off by Shenggen Fan, Director General of the International Food Policy Research Institute (IFPRI). He argued that the potential of the agricultural sector can only be realized when smallholder farmers either move up to become agricultural entrepreneurs or move out of the agriculture sector, potentially with the support of safety nets. Moving out releases land to those who are moving up, making smallholder agriculture more commercially oriented. Most important is the involvement of youth, which can only occur if farming becomes their passion: they have to be included and inspired to prevent them from leaving to work in other sectors.
Augustine Langyintuo from the World Bank argues that farmers need better protection against the vagaries of the market. In his view it is possible to empower farmers through institutional support and safety nets. However, for such policies to succeed it is important that evidence is shared of what works and how elite capture can be prevented. In addition, Raimundo Matule from the Ministry of Agriculture and Food Security in Mozambique advised taking social (gender) and cultural (land) dimensions into account as well.
Suresh Babu from IFPRI said that both technological innovation and institutional transformation are required and made a case for a focus on the political economy at three levels: the farm (engagement with the market), inside communities (farmers’ organizations) and at the national level (research and development and extension).
At the farm level, WFP’s Purchase for Progress (P4P) approach helps smallholders by combining a consistent demand for quality while also providing coordination and linking them to key supply chain services. As a result, these farmers develop the skills and knowledge and have an incentive to improve their agricultural production. The insights from this approach, which is used by WFP in 20 countries, were presented by Stanlake Samkange from WFP and Wisdom Akpalu from the United Nations University World Institute for Development Economics Research (UNU-WIDER) and University of Ghana).
In a comparative study of smallholders in Africa and other parts of the world, Janvier Nkurunziza demonstrated how especially African smallholder farmers have become more exposed and are vulnerable to the vagaries of international commodity markets since the economic liberalization policies adopted in the 1980s and 1990s. Therefore, one of the main conclusions in the report Ripe for Change, The Promise of Africa’s Agricultural Transformation is that development policies should acknowledge smallholders as important economic actors and create a protective environment to establish long-term profitable businesses.
The AERC biannual research workshop started with three paper presentations and their discussion, followed by a public/private sector policy roundtable panel discussion. Thereafter, Dr Marleen Dekker gave a presentation on INCLUDE’s activities and how they relate to the day’s deliberations, while Dr Witness Simbanegavi provided a wrap-up of the day’s proceedings. Drs Dekker and Simbanegavi are members of the INCLUDE secretariat.
Luc Christiaensen (World Bank) presented the paper ‘The Structural Transformation of Rural Africa: On the Current State of African Food Systems and Rural Non-Farm Economics’. He pointed to the importance of agricultural productivity for structural transformation and poverty reduction and asked why, despite two decades of sustained growth, has poverty not been reduced as much as had been hoped. Important findings are that poverty reduction is highest when growth comes from the agricultural sector. Yet not all agricultural development reduces poverty equally. Christiaensen concluded that poverty reduction can be enhanced by modernizing agriculture or shifting from agriculture to other sectors. This depends on the labour-productivity gap, which in his view is not as large as often thought. For agricultural transformation, first yields have to increase substantially and constraints on water, land, infrastructure and financial markets should be removed.
Discussant Prof Yaw Nyarko (New York University, USA) pointed out that structural transformation needs to occur in rural areas and technological innovations need to occur and be adapted on farms themselves. The improvement of productivity is key. An important role can be played by secondary towns, a concept introduced by Christiaensen in his presentation.
In his presentation ‘An African Green Revolution: Past Failures and Future Prospects’, Prof Keijiro Otsuka (National Graduate Institute for Policy Studies, Japan) addressed the lessons learned from green revolutions in other countries, such as the United Kingdom and Asian countries. One of these lessons is that skills and knowledge management are equally important as providing the material inputs. There needs to be suitable varieties of crops with care for the composition of soil and the management of water. Technological transfers to Africa can have potential, but depend heavily on the type of crop. In the case of rice production a technology transfer from Asia (particularly India) to Africa is advised, however such transfers are not helpful for the production of sorghum and millet.
Dr Adam Elhiraika from the United Nations Economic Commission for Africa (UNECA) agreed to the context specificity of the green revolution. Knowledge transfers are, indeed, essential, but there is a need to focus on differences between the areas of implementation. Moreover, these transfers do not always occur, such as revealed by the UNECA study on sugar production in Africa. Moreover, it is important to identify the objective of the green revolution: Should it be improved productivity or should this be combined with better nutrition, environmental sustainability and social protection?
The final presentation by Dr Alemayehu Seyoum Taffesse (IFPRI) was on ‘Pathways Less Explored – the Nature and Significance of Aspirations in Agricultural Transformation’. This paper discussed the constraints at the farmer level that can limit the success of public investment and reform. Although several institutional constraints, such as external circumstances and lack of opportunities, are often mentioned, alternative pathways are not yet used. Two important questions emerge: What is the reason for the lack of opportunities? And how do issues around identity and mental state (such as impatience, commitment, self-determination) impact on the lack of return on investment? These issues are discussed more generally in the latest world development report: Mind, Society and Behaviour. One of these issues, which is key to overcoming the constraints on agricultural development, is the perceived locus of control. This locus of control determines to what extent new technologies are adopted. In turn, this locus of control is influenced by the situation of poverty that households are in. Technology adoption is therefore related to poverty.
The discussion that followed acknowledged the role of aspiration in farmers’ opportunities and their investments. It was argued that it is important to acknowledge the role of aspiration in mainstream theory and policy debates. At the policy level, small incentives can be used to overcome this lack of aspiration and make interventions more effective.
Agricultural transformation is a topic of increasing interest. Apart from the two seminars, the African Development Bank also organized the ‘High-Level Conference on Agricultural Transformation’ in 2015. More readings on agricultural transformation can be found in the African’s Center for Economic Transformation’s African Transformation report and the web resources at the INCLUDE website.
As a follow-up to the biannual research workshop, the African Development Bank, AERC, Cornell University, the World Bank and the Partnership for Economic Policy organized the conference ‘Structural Transformation of African Agriculture and Rural Spaces (STAARS)’. This conference, which was held on 4 and 5 December, aimed to enhance the feedback between researchers and policy-makers on the following themes: agricultural productivity and innovation, technology adoption, labour productivity, factor market performance, non-farm labour and labour re-allocation, human capital investment and dynamics, financing and risk management, market access, and related fields of policy-relevant inquiry.
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A Goyal and J Nash