via Non-State actors key to reviving agric | The Herald August 6, 2015

The issue of food insecurity and low productivity is not a Zimbabwean problem alone but a continental one. The African Union (AU) recognised the challenges of food insecurity and low agricultural productivity present to the long-term development of the continent.

In the AU’s Second Ordinary Assembly held in July of 2003 in Maputo, Mozambique, African Heads of State ratified an initiative called the Comprehensive Africa Agriculture Development Programme (CAADP).

The programme, which is part of the New Partnership for Africa Development (NEPAD), was endorsed as a framework meant to create ambitious institutional and policy transformation in the agriculture sector.

It was, and is, an agreed-upon process (the label “programme” is, in some respects, a misnomer) that embodies unique goals and principles.

For example, CAADP implementers sought to address fundamental obstacles to African agricultural development, including the sector’s reliance on external technical assistance, the lack of African political leadership and commitment, as well as poor planning and co-ordination between national and regional stakeholders.

The explicit goal of CAADP is to “eliminate hunger and reduce poverty through agriculture”. In pursuit of this aim, African governments commit to two “targets”.

The first is to achieve 6 percent annual growth in agricultural productivity by 2015.

The second was to increase the allocation of national budgets directed to the agricultural sector to at least 10 percent.

The programme also has four stated objectives, or “pillars”, that is, extending the area under sustainable land and water management, improving rural infrastructure and trade-related capacities for market access, increasing food supply and reducing hunger and agricultural research, technology dissemination and adoption.

Under the pillar of extending the area under sustainable land management and reliable water control systems, the AU noted that reliance on irregular and unreliable rainfall for agricultural production is a major constraint on crop productivity; rainfed agriculture is moreover often unable to permit high-yield crop varieties to achieve their full production potential.

The major concern for Africa the percentage of arable land that is irrigated is 7 percent (barely 3,7 percent in Sub-Saharan Africa) while the corresponding percentages for South America, East and South-East Asia and South Asia are 10 percent, 29 percent and 41 percent respectively.

Furthermore, in Africa 16 percent of all soils are classified as having low nutrient reserves while in Asia the equivalent figure is only 4 percent; moreover, fertiliser productivity (expressed in terms of maize yield response) in Africa is estimated at some 36 percent lower than in Asia and 92 percent lower than in developed countries.

Building up soil fertility and the moisture holding capacity of agricultural soils and rapidly increasing the area equipped with irrigation, especially small-scale water control, will not only provide farmers with opportunities to raise output on a sustainable basis but also will contribute to the reliability of food supplies.

Under the pillar of improving rural infrastructure and trade-related capacities for market access, AU notes that improvements in roads, storage, markets, packaging and handling systems, and input supply networks, are vital to raising the competitiveness of local production vis-à-vis imports and in export markets.

Investment in these areas will stimulate the volume of production and trade, thereby assisting to generate an appropriate rate of return on needed investments in ports and airport facilities.

In general, Africa urgently needs infrastructure improvements for development, given that it faces the longest distances to the nearest large markets and that a fifth of its population is landlocked.

Its rail freight is under 2 percent of the world total, the marine freight capacity is 11 percent (much being foreign owned but registered for convenience in Africa), and air freight is less than 1 percent; similarly, its power generation capacity per capita is less than half of that in either Asia or Latin America.

In parallel with improvements in infrastructure within Africa, adjustments are needed in the promotion and support (including subsidy) policies of developed countries.

Exporting countries within the region need to raise their capacity to participate in trade negotiations and to meet the increasingly stringent quality requirements of world trade.

The third pillar focuses on increasing food supply and reducing hunger. Africa currently lags behind all other regions in terms of farm productivity levels, with depressed crop and livestock yields and limited use of irrigation and other inputs.

By accessing improved technology — much of which is simple and relatively low in cost — small farmers can play a major role in increasing food availability close to where it is most needed, raising rural incomes and expanding employment opportunities, as well as in contributing to a growth in exports.

This requires improved farm support services, pilot projects targeted at poor communities and a supportive policy environment.

Further, to provide the scientific underpinning necessary for long-term productivity and competitiveness, there is a fourth pillar, that is, agricultural research, technology dissemination and adoption.

This long-term pillar, which aims at achieving accelerated gains in productivity, will require:

(a) An enhanced rate of adoption for the most promising available technologies, to support the immediate expansion of African production through the more efficient linking of research and extension systems to producers.

(b) Technology delivery systems that rapidly bring innovations to farmers and agri-businesses, thereby making increased adoption possible, notably through the appropriate use of new information and communication technologies.

(c) Renewing the ability of agricultural research systems to efficiently and effectively generate and adapt new knowledge and technologies, including biotechnology, to Africa, which are needed to increase output and productivity while conserving the environment; and

(d) Mechanisms that reduce the costs and risks of adopting new technologies.

These pillars support what could be thought of as the heart of CAADP, the country-level process, which has three core elements.

The first, “stock-taking”, is a process whereby relevant stakeholders analyse current and previous agricultural conditions, especially as they relate to the pillar issues.

The second is “round-table discussions”, in which broad arrays of actors are assembled to explore and agree upon ways to further the agricultural development agenda.

This part of the process culminates in the signing of a CAADP compact, essentially an agreement of consensually identified priorities and a roadmap to implement the country’s strategy for agricultural development.

Reflecting CAADP’s emphasis on creating consensus among a wide range of actors, the compact is signed by a number of key stakeholders.

The third and final part of the process is the preparation and implementation of country investment plans, which puts the CAADP compact into effect.

It defines the roles of stakeholders, estimates the costs of executing certain actions and identifies sources of funding.

From the beginning, when CAADP was mooted, Zimbabwe participated throughout the processes outlined above.

We have come up with country position on CAADP which was supported by the investment plan.

Ironically, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation (Zim-Asset) is in sync with the CAADP framework especially the Food and Nutrition cluster.

What is clear from the CAADP and Zim-Asset frameworks is that the process of mainstreaming these programmes requires significant participation of non state actors, that is, development partners, civil society, private sectors and academia.

With specific reference to CAADP, all the four pillars require active involvement of the non-State actors.

For example, provision of markets, packaging and handling systems, and input supply networks, agricultural research, technology dissemination and adoption.

If the statistics of the grain import bill is anything to go by, the fact that Government is only procuring 80 000 tonnes of the 700 000 of maize deficit with the rest being procured by private sector is a clear testimony of the role of private sector in resuscitating agriculture.

The million dollar question is how can we turn the energy of private sector to support agriculture now as we are moving into the rain season?

Alternatively, if we are to address fundamental problems affecting agriculture in Zimbabwe among other factors we have to address access to finance, markets and infrastructural issues like irrigation and access roads one would like to find measures required to address these twin factors?

We can get solutions if we continue to dialogue on these issues but in my view quick fixes should come from contract farming, commodity exchange, public private partnerships/joint ventures and harmonisation of donors.

As we move towards the 2016 Budget Statement, we need to aggressively engage private companies in the agricultural value chain and inclusively come up with incentives which stimulate their appetite to support agriculture through contract farming. Here, we must take lessons from the tobacco sector.

With respect to the commodity exchange, a commodity exchange is a market in which multiple buyers and sellers trade commodity-linked contracts on the basis of rules and procedures laid down by the exchange, such exchanges typically act as a platform for trade in futures contracts, or for standardised contracts for future delivery.

In other parts of the developing world, a commodity exchange may act in a broader range of ways, in order to stimulate trade in the commodity sector.

This may be through the use of instruments other than futures, such as the cash or “spot” trade for immediate delivery, forward contracts on the basis of warehouse receipts, or the trade of farmers’ repurchase agreements for financing known as “repos”.

This provides for an efficient price discovery mechanism since a commodity exchange is ideally bringing in large number of buyers and sellers.

The commodity exchange uses of warehouse receipts system which allows farmers as individuals or groups to deposit their produce in registered warehouses thereby reducing post harvest storage losses and solving lack of storage challenges.

Warehouse receipts can be negotiable or transferable and used as collateral by smallholder farmers thereby improved access to finance.

Public private partnership/joint ventures were pronounced in the 2015 Budget Statement thanks to the wisdom of the Treasury chief.

The Agricultural Rural Development Authority (ARDA) under the leadership of Mr Basil Nyabadza has taken up this initiative and is doing a fantastic job in reviving agriculture in Matabeleland under the PPP framework.

The Cold Storage Company (CSC) is currently looking for partners as well. We are moving in the right direction here.

With respect to harmonisation of donors, development partners such as the European Union, Care International, United Kingdom’s Department for International Development (DFID), Food and Agricultural Organisation and World Vision, to mention a few, are active in supporting agricultural or food security in one way or the other.

The challenge we have is lack of donor co-ordination which in itself result in inefficiency in use of those resources.

It is therefore important that Government design a framework aimed at harmonisation these resources and build critical mass for agricultural development.

In conclusion, the revival of agricultural sector requires collective participation of all players, that is, Government and non-State actors.

Going forward, our policy framework should aim to consolidate gains we noted in contract farming and PPPs and expand them, develop a framework for harmonisation of donors and establish the commodity exchange which was launched early 2011.

• Dr Mugano is an economic advisor, author and expert in trade and competitiveness. He is a Research Associate of Nelson Mandela Metropolitan University. Feedback: +263 772 541 209 or [email protected]