Brussels Briefing 48: Rural – Urban linkages in Africa

Brussels Briefing 48: Rural – Urban linkages in Africa
Opportunities for inclusive economic growth and agricultural transformation

Experts and policymakers will discuss “Strengthening rural livelihoods in the face of rapid urbanisation in Africa” at the 48th Brussels Development Briefing on Monday 20th March 2017, organised by CTA with BMZ/GIZ, the European Commission – DG DEVCO, Concord and the ACP Secretariat. This event will explore best practices, successful approaches and public and private sector opportunities that respond to the urgent need to transform Africa’s rural economies to increase productivity and create employment in the context of increasing urbanisation and changes to patterns in food consumption.

Urban scenes in Accra market. Image:  K. Pratt / FAO

It is estimated that by 2050, Africa will see its population double to 2.2 billion people, with the proportion of Africans living in rural areas falling to only 43%, down from 61% in 2010. However, the absolute number of people living in rural areas will actually increase from 622 million to 927 million (Proctor and Lucchesi). Only 10% of Africans are in formal employment, and the clear majority of labour in Africa is still informal, and particularly concentrated in the agricultural sector. Farming is the source of 60% to 80% of rural incomes, with the share of non-farm income gaining in importance. There are only 3 million formal jobs available for the 10 to 12 million African youth entering the workforce each year, and two thirds of the labour force increase over the next 20 years is projected to occur in rural areas.

The growing significance of cities and the fading rural-urban divide should not be a reason or a pretext to neglect our rural areas. They require just as much ongoing attention from policy-makers as our urban centres, for a multitude of reasons,” said Stefan Schmitz, Commissioner for the One World – No Hunger initiative at the Federal Ministry for Economic Cooperation and Development (BMZ)

This presents a challenge on three fronts: first, how to meet the demand for jobs and income generating opportunities, especially for youth in rural and peri-urban areas; second, how to speed up the transformation of agricultural production in Africa in response to this urban expansion and dietary changes among the growing middle class; and third, how to ensure that this demographic transition results in inclusive and sustainable development for both rural and urban areas, which reinforces productive linkages across key sectors – agriculture, services and manufacturing. These issues are especially relevant in the context of the global Agenda 2030, which calls on all development stakeholders, including the private sector, to contribute towards the Sustainable Development Goals that ensure food and nutrition security (SDG2), inclusive growth and decent productive work (SDG8) and sustainable cities and communities (SDG11).

Opportunities to scale up on-going efforts towards structural transformation in Africa (e.g. CAADP, Agenda 2063) through more efficient, productive and inclusive urban-rural linkages are abundant. This Briefing presents a good opportunity to draw on lessons learnt and to identify factors for success in approaches which have produced positive results. The widespread use of new technologies – particularly ICTs including mobile phones – is a good example. Rural areas have benefited from a growth in non-farm incomes, smart innovations and greater connectivity with markets through digital platforms. CTA has been actively working to promote ICT innovations for agriculture, especially by identifying and encouraging talented young ICT entrepreneurs to engage in agriculture.

 “The greatest opportunity for transforming African agriculture into a highly productive and profitable sector that creates value for smallholder producers and jobs for young people will come from establishing strong rural-urban linkages essential to meet the rapidly growing demand of urban consumers for fresh and processed foods,” said Michael Hailu, Director of CTA.

Infographic:  SPORE Magazine No. 176 Marketing and packaging: the retail revolution

Another key development has been the recognition by policymakers across Africa and internationally about the need to promote private sector participation to catalyse rural transformation and develop inclusive value chains. In this context, the African Development Bank, the European Commission and the European Investment Bank have launched financing mechanisms which seek to reduce the risk of private investment in the agricultural sector in Africa. These include programmes that leverage finance in a way that encourages private sector development in Africa, particularly for micro- and small and medium sized enterprises and youth entrepreneurs, and others which establish public-private partnerships that aim to tackle bigger structural issues, including poor infrastructure, access to energy and access to finance.

The transformation will be driven by the investment decisions taken by millions of private-sector stakeholders: small farmers, input providers, food processing firms, distributors, financial service companies, craft and trade enterprises, and many others. However, the pace and composition of this private investment will depend on the enabling environment created by governments,” said Stefan Schmitz, Commissioner for the One World – No Hunger initiative, Federal Ministry for Economic Cooperation and Development (BMZ)

This Briefing discuss latest trends in research, the dynamics driving demographic shifts, the key policy responses seeking to mitigate risks and promote sustainable rural growth, and the innovative approaches of the private sector, producers and youth entrepreneurs capturing the gains that rural-urban linkages present.

Registration is now open for the Briefing, which will take place at the ACP Secretariat (Avenue Georges Henri 451, 1200 Brussels, Room C): https://bb48.eventbrite.com

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Brussels Briefing 47: Regional Trade in Africa: Drivers, Trends and Opportunities

Experts at the 47th Brussels Development Briefing on the topic of “Regional Trade in Africa: Drivers, Trends and Opportunities” all agreed that Africa’s largest market opportunity lies within the continent. The event, which was held at the ACP Secretariat on Friday 3 February 2017 attracted an audience of close to 200 people, who joined the organisers to discuss the progress made in integrating Africa’s regional markets, and to explore suggestions for overcoming barriers to intra-African trade. Key findings from the African Agricultural Trade Status Report (AAFTR) 2017 by CTA and IFPRI were also presented at the Briefing. The event was co-organised by CTA, the International Food Policy Research Institute (IFPRI), the European Commission / DEVCO, the ACP Secretariat, and CONCORD.

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“When you come to look at intra-African trade, you can see the contrast between raw products exports to the rest of the world, and greater value added exports within Africa” said keynote speaker Dr. Mukhisa Kituyi, Secretary-General of UNCTAD, who weighed in on some of the most topical issues that are facing the continent’s trade landscape. Given the uncertain economic climate of Africa’s major international export destinations, Dr Kituyi was keen to emphasise the resilience that African economies can develop through enhanced intra and inter-regional trade.

The potential of intra-African trade to deliver greater value addition and productivity for the agricultural sector was repeated by a number of the distinguished panellists. However, in order for this to be realised, the scale, diversity and fluidity of cross-border transactions has to be significantly augmented.

In his presentation on trends in Africa’s regional trade, Dr Ousmane Badiane, Director for Africa at IFPRI noted that in terms of agricultural products, although African countries are the destination of only 20% of African exports, there has been a notable increase in the competitiveness of its regional markets, which augurs well for domestic agribusiness. This is on top of the opportunities arising from changes in demand and consumption due to the demographic transitions Africa faces. For example, the most rapid growth in intra-regional agricultural trade West Africa has been higher-value goods such as fish and animal products as well as vegetables and food oils.

Various recommendations on easing cross border trade were shared by the panellists, including Dr Badiane who argued that removal of “harassment costs” would have the biggest effect on intra-regional trade. This was echoed by Annette Mutaawe who demonstrated a number of initiatives supported by TradeMark East Africa to achieve just that. These include technology innovations, such as a mobile phone platform which allows women small scale producers to access available trucks to take their goods to market. This comes in addition to support for East African government agencies dealing with customs and transportation in order to streamline procedures, reduce costs and delays in moving goods across borders.

annette mutaawe“Agriculture produce is perishable – if you’re not able to take it through the borders quickly, that’s a huge problem. We found that there is a huge opportunity for women entrepreneurs to do business”.
Annette Mutaawe, TradeMark East Africa

Access to finance remains a predominant concern for Africa’s farmers, agribusinesses and small and medium enterprises, as well as for governments to fund large infrastructure-related projects that could ease the costs of trade between countries. It is in this context that Ishmael Sunga, CEO of the Southern African Confederation of Agricultural Unions (SACAU) and Nana Osei-Bonsu CEO of Ghana’s the Private Enterprise Federation (PEF) gave examples of successful PPPs – both public-private partnerships and private-private partnerships – as a way for producers to strengthen their presence in the marketplace and their negotiating power vis-à-vis other players in the value chain, notably banks and offtakers. The African Development Bank’s Josephine Mwangi spoke to the need to reduce the risk in agricultural investment, an area that the bank is already working on through its FEED Africa initiative and mobilisation of funding to finance Africa’s agricultural transformation.

Greater intra-African agricultural trade will depend not only on the actions of businesses and governments, but also on regional and partner institutions who can provide catalytic action on a wider scale. At the regional level, organisations such as Alliance for Commodity Trade in Eastern and Southern Africa (ACTESA), which is part of the COMESA regional block, have created an enabling environment through partnerships and investments that promotes intra-regional trade in fertilisers and other inputs.

gallina inlineThe European Commission used the Briefing as an opportunity to make a strong presentation of its support for regional trade in Africa. According to Sandra Gallina, Director for Sustainable Development at DG Trade, in terms of the Economic Partnership Agreements (EPA) “there are gains that can be made within EPA regions, as well as between EPA groupings through the opportunity to cumulate… this regional preference is what we see in the intra-regional EPA game as massively important.” This spoke directly to concerns about the implications of the EPAs for regional integration in the ACP, particularly for Africa. In his closing remarks, Roberto Ridolfi, Director for Sustainable Growth and Development at DG EuropeAid, presented ongoing and future engagements by the European Commission to support electrification and agribusiness financing for Africa (ElectriFI and AgriFI respectively). Both these instruments aim to reduce the risk of investing into these two priority areas for Africa’s regional development, and make it easier to leverage funds from both private and public sources. Ridolfi further stressed that aid instruments must be used to leverage private finance in order to scale up successful businesses, and agreed on the need to develop an online platform which consolidates all the information on the various EC programmes supporting trade.

CTA’s director, Michael Hailu, also expressed a wish to see regional trade in Africa leading to the creation of more jobs and opportunities in rural areas, and for increased private sector involvement. In terms of future activities, CTA will be engaging with DG Devco in a preparatory exercise in April or May, which will feed into the EU-Africa Business Forum that takes place during the European Development Days 2017 (June in Brussels). A declaration by business leaders and CEOs will be presented to the EU-African Union Summit, which is scheduled to take place in Abidjan in November 2017.

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Latest Brussels Briefing 47: “Regional Trade in Africa: Drivers, Trends and Opportunities”

The Brussels Development Briefing n.47 on the subject of “Regional Trade in Africa: Drivers, Trends and Opportunities” took place on 3rd February 2017 in Brussels at the ACP Secretariat (Avenue Georges Henri 451, 1200 Brussels) from 09:00 to 13:00.  This Briefing was organised by the ACP-EU Technical Centre for Agricultural and Rural Cooperation (CTA), in collaboration with IFPRI, the European Commission / DEVCO, the ACP Secretariat, and CONCORD .

Webstream: Click here to watch the event live
View the coverage on Twitter: @BruBriefings and using hashtag #BB47

Trade and regional integration have dominated the political agenda in recent years, with scores of countries pursuing trade agreements under various configurations. There is a renewed focus on the role of the private sector, and on reducing and eliminating trade barriers in order to boost economic growth by encouraging more trade and investment. The nexus between trade, integration and development is recognised to hold immense potential for sustainable growth and poverty reduction, and provides opportunities for enhancing the welfare of producers and consumers, provided that governments are able to develop and enforce policies to this effect. Under the framework of the 2030 Agenda for Sustainable Development, the role of trade in achieving the Sustainable Development Goals is recognised in a number of areas. Target 2.b of SDG2 calls for the correction and prevention of trade restrictions and distortions in world agricultural markets, whereas targets 17.10 to 17.12 of SDG 17 also highlights the importance of trade, particularly for the least developed countries.

In order to maximise the benefits of regional integration and look for new opportunities for competitiveness, policymakers, the private sector and development partners need access to accurate and comprehensive data on intra and inter-regional trade in Africa with respect to agricultural goods. It is in this context that CTA and the International Food Policy Research Institute (IFPRI) are launching the “African Agricultural Trade Status Report”, which examines the current status, trends and outlook in African trade performance, making an important contribution towards data and analysis of developments both at regional and at continental levels. The Report, which is released in conjunction with the Briefing, builds on the work by the Regional Strategic Analysis and Knowledge Support System (ReSAKSS) of CAADP and the African Growth and Development Policy Modeling Consortium (AGRODEP) trade and also reflects the CTA’s commitment to advancing knowledge and sharing of best practices relating to agricultural trade.

African Agricultural Trade Status Report 2017 
– Executive Summary
Chapter 1. Introduction
Chapter 2. Africa global trade patterns
Chapter 3. Regional trade patterns
Chapter 4. Competitiveness of African agricultural exports
Chapter 5. Determinants of African agricultural exports
Chapter 7. West Africa trade outlook: business as usual vs alternative options
Chapter 8. Summary and conclusions

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New! on the topic of Regional Trade in Africa: Drivers, Trends and Opportunities

Programme and Background Note 

Highlights (available soon)

Photos 

Biodata of the speakers 

CTA Resources
– Spore no. 178 “REGIONAL TRADE: The customers next door” [2015, download]
– ‘Opportunities for Value-chain Finance in Africa’s Intra-regional Food Trade’ [2016, download]
– ‘West Africa: Regional trade – what’s the story?’ [2017, download]

Resources

Programme

8h15-9h00        Registration

9h00-9h15         Introduction to the Briefing: Isolina Boto, Manager, CTA Brussels Office [video]

Introductory remarks: Viwanou Gnassounou, Assistant-Secretary-General, ACP Secretariat [video]; Axel Pougin de la Maisonneuve, Deputy Head of Unit, Private Framework Development, Trade and Regional Integration, DG DEVCO, European Commission [video]; Michael Hailu, Director of CTA [video]

Special address:          Future prospects for Africa in global trade
                                            Dr. Mukhisa Kituyi, Secretary-General of UNCTAD [video]

 9h15-11h00 Panel 1: Overview of Africa regional trade

This panel will provide an overview of the main trends in inter and intra-regional trade in Africa and the main drivers of success.
Chair: H.E. Mr Tadeous Tafirenyika Chifamba, Ambassador of Zimbabwe 

Panellists
:

– Trends in African regional trade
Ousmane Badiane, Director for Africa, International Food Policy Research Institute (IFPRI)  [presentation|video]

– Innovative finance for agriculture transformation
Josephine Mwangi, Manager, Agriculture & Agro-Industry Dept, African Development Bank [presentation|video]

– New opportunities for regional trade within the EPAs implementation
Sandra Gallina, Director for Sustainable Development, DG Trade at the European Commission  [presentation|video]

– Challenges and successes in implementing regional trade agreements
Dominique Njinkeu, Executive Director, African Trade and Sustainable Development (AFTSD)  [presentation|video]

Panel 1 Debate [video]

 11h00-11h15 Coffee Break

11h15-13h00 Panel 2: Implementing regional trade: successes and opportunities ahead

This panel will look at specific examples of successes in the implementation of regional trade agreements and will bring various perspectives, including the private sector.
ChairH.E. Mr Ousmane Sylla, Ambassador of Guinea to the EU

Panellists:

– Growth opportunities for the private sector in East Africa as a result of regional integration
Annette Mutaawe, Deputy Chief Executive Officer, TradeMark East Africa  [presentation|video]

– New opportunities in regional trade
Argent Chuula, Chief Executive Officer, Alliance for Commodity Trade in Eastern and Southern Africa (ACTESA)  [presentation|video]

– Promoting regional trade through PPPs and agribusiness development
Ishmael Sunga, CEO, Southern African Confederation of Agricultural Unions (SACAU)  [presentation|video]

– Investment opportunities and PPPs
Nana Osei-Bonsu, CEO, the Private Enterprise Federation (PEF), Ghana [presentation|video]

Panel 2 Debate [video]

Concluding remarksRoberto Ridolfi, Director for Sustainable Growth and Development, DG EuropeAid, European Commission [video]; Viwanou Gnassounou, Assistant-Secretary-General, ACP Secretariat [video]; Michael Hailu, Director of CTA [video]

Concluding Debate [video]

13h00               Networking Lunch