Farming is the solution for Africa
The economic outlook for Sub-Saharan Africa for 2016 gives room for cautious optimism. A 4.7% increase in GDP across the region in 2016 has been higher than expected. However, the World Bank warns that low commodity prices and high borrowing costs, combined with security issues in some areas, will continue to affect growth rates. To overcome a historic dependence on oil and mining revenues, African economies must continue to diversify into other sectors – particularly those that can provide jobs to a restless and growing young population.
Sustaining economic growth will require fiscal discipline, productivity improvements, infrastructure improvements, increased regional trade, and greater focus on stimulating and supporting innovation. All stakeholders – including government, donors and the private sector – must align and target their investments towards a shared goal of sustainable and inclusive growth.
While an absolute increase in investment is important in almost all sectors, in many of those sectors, there is an untapped margin of potential economic impact to be had from applying existing funds in a more targeted and coordinated way. A major opportunity for increasing growth through a “smart” and coordinated approach can be found in the agricultural sector. Agriculture today accounts for 32% of GDP in Africa and is the sector that offers greatest potential for poverty reduction and job creation, particularly among vulnerable rural populations and urban dwellers with limited job opportunities. Growth generated by agriculture in sub-Saharan Africa is estimated to be 11 times more effective in reducing poverty than GDP growth in other sectors – a vital multiplier given that 65% of the continent’s labour force is engaged in agriculture. Yet the sector has suffered sustained neglect and, as a result, Africa has gone from being an exporter of agricultural products in the 1960s to a net importer of agricultural and food products today.