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Impact of Asian Drivers on SSA agriculture and food security
Issues and challenges
2007
Marios Obwona, Ephraim Chirwa

Acknowledgements: FANRPAN acknowledges the AERC website as the source of this report: www.aercafrica.org


Background

Africa is the only region in the world where poverty and hunger are on the increase. About 49 percent of the people in Africa lived below poverty in 2000, an increase from 47.7 percent in 1990 (Resnick, 2004). On current projections, Africa will be the only continent that is unlikely to meet the international community’s targets to reduce poverty, hunger and disease - the Millennium Development Goals (MDGs) by 2015. The World Bank (2004) estimated that, on current trends, Sub-Saharan Africa (SSA) will meet the MDGs in 2147, more than a century off target. Resnick (2004) notes that meeting the MDG targets requires growth rates of 7 percent per annum, but only 10 African countries have achieved a growth rate of at least 5 percent per annum. GDP growth averages about 3 percent per year and the population has continued to grow at 2.7 percent per year. It is estimated that about a third of the African population is undernourished, representing about double the number of undernourished in the late 1960s (FAO, 2005).

Agriculture is by far the single most important economic activity in SSA and it remains key to achieving the poverty targets of the MDGs in Africa. Several studies have emphasized the importance of the agriculture sector in SSA (NEPAD, 2003; Haggblade et al., 2004; FAO, 2005). It is estimated that nearly 80 percent of the population in SSA lives in rural areas and 70 percent of this rural population are dependent on food production through farming or livestock keeping for most of their livelihood. Small-scale farming provides most of the food produced in Africa, as well as employment for 60 percent of working people. According to NEPAD (2003) for most countries in SSA, agriculture contributes an average of 30-60 percent of GDP and about 30 percent of the value of exports.

Except for countries with sizable populations of European descent – such as South Africa, Zimbabwe and Kenya – agriculture has been largely confined to subsistence farming and has been considerably dependent on rain and an inefficient system of shifting cultivation, in which land is temporarily cultivated with simple implements (such as hand-hoes) until its fertility decreases and then abandoned for a time to allow the soil to regenerate. In addition, over most of African arable land generally has been allocated through a complex system of communal tenure and ownership rather than through individually acquired title, and peasant farmers have had rights to use relatively small and scattered holdings. This system of land ownership has tended to keep the intensity of agricultural production low and has inhibited the rate at which capital has been mobilized for modernizing production. The productivity in agriculture has been declining due to several factors including lack of access to capital, soil degradation, poor access to markets and new technologies, low investments in agricultural research, training and extension services.

Africa has also experienced more than its share of the impacts of climatic changes including extreme weather patterns in form of more frequent and prolonged droughts, floods and crop pests all of which have adversely affected agricultural production. There is also the problem of HIV/AIDS that is reducing life expectancy and productive capacity of farming households in SSA (Haggblade et al., 2004). Eicher (2003) also notes that in some countries donor support towards agricultural development in SSA has been declining.

Farmers in SSA are struggling to adapt to these crises but support is declining. Whilst total aid of SSA remained stable during the 1990s, the proportion allocated to agriculture declined year by year. But even more worrying are the global trade rules that have been forced onto African governments whose own structures are not strong enough to protest these unfair and detrimental policies. The Uruguay Round of trade agreements, which began in 1994, are generally held as the turning point in global agricultural policy, and are called the Agreements on Agriculture.

Trade liberalization and tariff barriers have been just some of the areas that have been detrimental to African farmers. Structural adjustment policies and trade conditions have resulted in the collapse of agricultural support institutions, the elimination of subsidies and reduction in tariffs for most African countries. At the same time, highly subsidized European and American farmers undermine the African farmers in both domestic and export markets – leaving African farmers unable to compete in the global market. Furthermore, these subsidized goods lead to overproduction, which then results in lowered prices.

The growing importance of China and India in the global economy has generated a lot of academic research interest on their likely impact on African economies and poverty reduction (among others Kaplinsky et al., 2006; Kaplinsky and Morris, 2006; Jenkins and Edwards, 2005; Chen et al., 2005). Both China and India (‘Asian Drivers’ or ADs) are recording higher growth rates in their economies and are increasingly engaging with African countries in various ways. These relationships are bound to have complementary and competitive effects on African growth and poverty reduction.

An important sector in Africa that could be affected by the growth of Asia Drivers is the agriculture sector. This paper, therefore, provides the framework for assessing the impact of the Asian Drivers on Sub-Saharan Africa agriculture. In particular, we review the performance of the agriculture sector in SSA and the challenges it faces to uplift the growth and poverty reduction potentials of African economies. We identify key issues of concern to SSA agriculture arising out of the emergence of Ads. We also identify key policy research questions, methods and approaches for investigating the impact of ADs as well as suggesting the selection criteria of countries to be included as case studies.

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