{"id":28935,"date":"2023-02-27T16:05:07","date_gmt":"2023-02-27T13:05:07","guid":{"rendered":"https:\/\/sbs.strathmore.edu\/?p=28935"},"modified":"2023-03-02T09:23:13","modified_gmt":"2023-03-02T06:23:13","slug":"africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why","status":"publish","type":"post","link":"https:\/\/sbs.strathmore.edu\/fr\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\/","title":{"rendered":"Africa\u2019s Agribusiness Sector Should Drive the Continent\u2019s Economic Development: Five Reasons Why"},"content":{"rendered":"
<\/span><\/div>

Africa\u2019s agriculture sector accounts for about 35 per cent of the continent\u2019s gross domestic product, and provides the livelihood of more than 50 per cent of the continent\u2019s population. These shares are more than double those of the world average and much higher than those of any other emerging region.<\/p>\n

Dependence on agriculture has declined in other emerging regions. For example in Southeast Asia, agriculture\u2019s share of GDP dropped from 30 to 35 per cent in 1970 to 10 to 15 per cent in 2019. In Africa it has remained unchanged for decades, according to World Bank data. At the same time, Africa\u2019s agriculture sector is the world\u2019s least developed, with the lowest levels of labour and land productivity. Value added per worker in agriculture is about a quarter of the world\u2019s average and less than a fifth of China\u2019s.<\/p>\n

The sector is dominated by smallholders, producing mainly for their own consumption. They operate well below minimum efficient scale and scope. Average farm size in Sub-Saharan Africa is 1.3 hectares, compared with 22 hectares in Central America, 51 hectares in South America and 186 hectares in North America, according to International Fund for Agricultural Development data.<\/p>\n

Average farm machinery use in Africa is the lowest in the world and has increased only very slightly since the 1960s.<\/p>\n

Against this backdrop, the development of the agribusiness sector holds enormous potential to foster Africa\u2019s economic development. For this to happen, the productivity of Africa\u2019s agribusiness must rise.<\/p>\n

My research on Africa\u2019s economic prospects has led me to believe that agribusiness offers African countries the most promising path for development and a shift towards higher value-added activities. This is the first step towards economic development.<\/p>\n

There are five reasons why agribusiness should drive Africa\u2019s economic development.<\/p>\n

Why Agriculture Should be the Focus<\/strong><\/h2>\n

Firstly, Africa has abundant land. Agribusiness might be its foremost source of comparative advantage. Africa\u2019s land size is larger than China, India, the US and most of Europe combined. More than half is arable land, suitable for crop growing. The weather in different parts of Africa provides perfect conditions for the growth of various crops.<\/p>\n

Secondly, agriculture has huge potential for adding value, and Africa has comparative advantages in this sector. Also, most African countries export commodities and raw materials and import finished goods. Ghana, for example, exports cocoa and imports high value-added chocolate; Kenya exports tea leaves and imports expensive branded tea. Nigeria and Angola have some of the world\u2019s largest oil resources, but lack refining capacity and depend on imports for their energy consumption.<\/p>\n

Africa\u2019s dependence on imports for its consumption is the highest\u00a0 in the world as a share of its GDP. The development of agribusiness is fundamental for Africa\u2019s ability to ensure food security.<\/p>\n

Upgrading to activities that add more value in agriculture often requires less advanced technology than in manufacturing industries. Compare the technology of producing spare parts for the automobile industry with that needed to produce tea bags.<\/p>\n

Thirdly, agribusiness is attractive because there are ready markets for its output. Africa has vast local markets for food. Agribusiness producers can sell much of their output in local markets. This enables local farming operations to grow and become more sophisticated in a less competitive environment before expanding internationally. Regional integration via the Africa Continental Free Trade Agreement greatly increases these opportunities.<\/p>\n

In export markets, Africa\u2019s agribusiness products are likely to benefit from the continent\u2019s reputation for high-quality natural resources. Ghana\u2019s cocoa is considered as some of the world\u2019s best, as are Kenya\u2019s tea and coffee.<\/p>\n

Fourth, African countries need to develop their agricultural sector also because they are unlikely to follow the traditional development paths. Many other emerging markets developed through industrialization and export-driven manufacturing. Growth led by manufacturing needs infrastructure; Africa\u2019s infrastructure is poor. This growth model is also threatened by automation and robotics that replace labour, and by growing protectionism in the world\u2019s major markets.<\/p>\n

With a few exceptions, such as Ethiopia and Morocco, most African countries have failed to establish a significant manufacturing sector, despite political efforts. A study showed that most African people who leave agriculture turn to low-skill, low-productivity services rather than to manufacturing. In 2022, manufacturing employment accounted for slightly over 10% of sub-Saharan Africa employment, the smallest share of any emerging region according to World Bank data. Nor did the flow of low-wage manufacturing jobs out of China trigger the development of Africa\u2019s manufacturing sector.<\/p>\n

Yet another reason to pay more attention to Africa\u2019s agribusiness is that it is at the forefront of environmental challenges and global warming. Drastic changes in rainfall and weather patterns change what can grow where, and increase the importance of efficiency of land use. It is important to understand the consequences of these changes so that they can be managed effectively.<\/p>\n

Africa\u2019s agribusiness must develop in order for the continent to develop economically. Its strengths and weaknesses make agribusiness the most significant sector to drive its overall economic development. Policy makers, educators and researchers should take note. Done right, the economic gains of developing Africa\u2019s agribusiness will be enormous.<\/p>\n

This article was first published in The Conversation Africa<\/a> on 17th<\/sup> February 2023<\/p>\n

Article by Prof. Lilac Nachum, Visiting Professor at Strathmore University Business School & Professor of International Business, City University New York. <\/strong><\/p>\n

Vous souhaitez partager un article ? \u00c9crivez-nous \u00e0 sbscommunication@strathmore.edu<\/em><\/strong><\/a><\/p>\n<\/div><\/div><\/div><\/div><\/div>","protected":false},"excerpt":{"rendered":"","protected":false},"author":2,"featured_media":29015,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[39],"tags":[],"class_list":["post-28935","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"acf":[],"yoast_head":"\nAfrica\u2019s Agribusiness Sector Should Drive the Continent\u2019s Economic Development: Five Reasons Why - Strathmore University Business School<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/sbs.strathmore.edu\/fr\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\/\" \/>\n<meta property=\"og:locale\" content=\"fr_FR\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Africa\u2019s Agribusiness Sector Should Drive the Continent\u2019s Economic Development: Five Reasons Why\" \/>\n<meta property=\"og:url\" content=\"https:\/\/sbs.strathmore.edu\/fr\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\/\" \/>\n<meta property=\"og:site_name\" content=\"Strathmore University Business School\" \/>\n<meta property=\"article:published_time\" content=\"2023-02-27T13:05:07+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-03-02T06:23:13+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/sbs.strathmore.edu\/wp-content\/uploads\/2023\/02\/Africas-Agribusiness-Sector-Should-Drive-the-Continents-Economic-Development-Five-Reasons-Why.png\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"675\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"sbs\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"\u00c9crit par\" \/>\n\t<meta name=\"twitter:data1\" content=\"sbs\" \/>\n\t<meta name=\"twitter:label2\" content=\"Dur\u00e9e de lecture estim\u00e9e\" \/>\n\t<meta name=\"twitter:data2\" content=\"6 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/sbs.strathmore.edu\\\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/sbs.strathmore.edu\\\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\\\/\"},\"author\":{\"name\":\"sbs\",\"@id\":\"https:\\\/\\\/sbs.strathmore.edu\\\/#\\\/schema\\\/person\\\/d3fa78c302c9226e141112880076ec94\"},\"headline\":\"Africa\u2019s Agribusiness Sector Should Drive the Continent\u2019s Economic Development: Five Reasons Why\",\"datePublished\":\"2023-02-27T13:05:07+00:00\",\"dateModified\":\"2023-03-02T06:23:13+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/sbs.strathmore.edu\\\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\\\/\"},\"wordCount\":1830,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/sbs.strathmore.edu\\\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/sbs.strathmore.edu\\\/wp-content\\\/uploads\\\/2023\\\/02\\\/Africas-Agribusiness-Sector-Should-Drive-the-Continents-Economic-Development-Five-Reasons-Why.png\",\"articleSection\":[\"News\"],\"inLanguage\":\"fr-FR\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/sbs.strathmore.edu\\\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/sbs.strathmore.edu\\\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\\\/\",\"url\":\"https:\\\/\\\/sbs.strathmore.edu\\\/africas-agribusiness-sector-should-drive-the-continents-economic-development-five-reasons-why\\\/\",\"name\":\"Africa\u2019s Agribusiness Sector Should Drive the Continent\u2019s Economic Development: Five Reasons Why - 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