The Brussels Development Briefing n. 58 on “Africa’s Agriculture Trade in a changing environment” organised by CTA, the European Commission/EuropeAid, the ACP Secretariat, IFPRI, Concord and BMZ/GIZ was held on Wednesday 23 October 2019 (9h00-13h00) at Hotel Sofitel Brussels Europe, Place Jourdan 1, 1040 Brussels. The briefing brought various perspectives and experiences around the new trends and opportunities in intra-Africa trade in the context of free trade agreements and regional integration. It also showed Africa trade within the broader global trade picture and with the EU as one of the main trade partners. Experts presented trends and prospects of regional trade in Africa in the light of new policy developments as well as Africa’s recent performance in different markets. It also featured successes and innovative models in regional trade across regions in Africa and lessons learned for upscaling and expanding regional trade.

1. Supporting Agribusiness
Development, Agro-
Industrialisation and Trade in
Africa
Mariam YINUSA, Principal Economist, Agribusiness Development, AFDB
September 2019
AFRICAN DEVELOPMENT BANK GROUP

2. TABLE OF CONTENTS
I. Introduction – Agriculture
in Africa
II. AfDB Feed Africa Strategy
III. Promoting Trade

3. I. Introduction– Agriculture in Africa

4. Africa’s Agriculture in Context
POPULATION GROWTH &
EXPANDING MIDDLE CLASS
2.5 billion
people living in Africa
MEGATRENDS
URBANIZATION &
TECHNOLOGICAL CHANGES
EVOLVING DIETARY
PREFERENCES
IMPACT BY 2050
65%
of the world’s
uncultivated arable land
is in Africa
51%
of Africans are engaged in
agriculture
but contribute only one quarter
of Africa's GDP
US$ 47 billion
was spent on
food imports
into Sub-Saharan Africa in 2017
over 60%
increase in Africa’s food
demand
AFDB. 2017. Betting on Africa to Feed the World; FAO. 2018. The Regional Outlook on Gender and Agrifood Systems; FAO. 2018. Food Outlook, Nov. 2018;
PNAS. 2016. Can Sub-Saharan Agriculture Feed Itself; ILRI. 2015. African Livestock Transformation, presented at AFDB Feeding Africa Conference Oct. 2015
4
STATE OF
AGRICULTURE IN
AFRICA
By 2030, African food
market will be worth
US$ 1 trillion

5. To sustainably feed a growing population, Africa must close the yield gap
and build a robust agribusiness sector
Asia
Latin Amer &
Caribeans
North America +
Europe
Sub-Sahara Africa
0
1
2
3
4
5
6
1961
1963
1965
1967
1969
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
Metrictonsperha
Average Cereal Yields
Challenges in the Agriculture Value Chain

6. Strong agriculture consumption growth in
Africa driven by three key growth drivers
31313233
34
50
0
10
20
30
40
50
Cereals
Sugar
Dairy
Meat
Fish
Oilseeds
Africa agricultural commodities consumption to significantly
outpace other regions
Key growth drivers
Other
developed
excl. SSA
SSA pop.
growth
• Growing population: growing
population resulting in increased food
demand (32% growth by ’25)
• Increased urbanisation: increasing
share of population demanding larger
variety of food and more processed
food
• Growing middle class: rise of Africa‘s
middle class to drive increased calorie
consumption and increased variety of
food demanded
Africa‘s food market valued at ~$300B in 2013
expected to triple in size to $1000B by 2030
Source: FAO; AfDB
% consumption growth expected between’15-‘25

7. • Transportation &
logistics companies
• Lenders/Insurance
companies
• Manufacturers
Actors
Overview of the Agricultural Value Chain
Inputs &
Production
Storage &
Handling
Value-Add
Processing
Distribution &
Packaging
Primary Secondary
Actors
Activities
Inputs
Outputs
• Seed
• Irrigation/Pumping
• Livestock feed
• Fertilizer
• Farming/Ranching
• On-farm mechanization
• Land, water, fertilizer, feed, medicine • “Upstream” outputs
• Fruits, vegetables, grains, livestock • Processed, refined goods (e.g., rice, meat,
bread)
• Cold storage
• Moisture control
• Mechanized
sorting/packaging
• Drying
• Milling / grinding /
refining
• Processing (e.g.
conversion into meal)
• Packaging
• Distribution
• Refrigeration
• Small holder farmers / Associations
• Commercial farms
• Co-ops
• Traders / Brokers
• Commercial operations
Tertiary Services
• Ancillary services
that serve to support
agriculture
throughout the
entire value chain
Description
• Farming / processing
equipment
• Financing
• Logistics / transport
• Warehousing
Activities

8. Trends in Intra-African Trade
Largest Importers
Other Major Exporters
Largest Exporter
Total value of exports
Intra-African exports
17.6% of Africa’s total exports
$65 billion
South Africa (35.4%)
Nigeria (7.7%) & Egypt (4.7%)
South Africa, Namibia &
Botswana
Other Major Exporters 13% of Africa’s total imports
Source: Intra-Africa Trade Profile, TRALAC (2017)

9. Intra-African Trade in Goods
Source: Intra-Africa Trade Profile, TRALAC (2017)

10. Trade in Agricultural Goods
• Agricultural goods represent of 20.7% of total intra-African exports and
22.7% of total intra-African imports (2016).
• Total intra-African agricultural trade amounts to $12,477 million (2016).
Source: TRALAC Guide, The African Continental Free Trade Area.

11. II. AfDB Feed Africa Strategy (2016-
2025)

12. 1. Power and Light Up Africa
2. Feed Africa
3. Industrialize Africa
4. Integrate Africa
5. Improve Quality of Life of Africans
The AfDB High 5 Development Priorities

13. Feed Africa Framework

14. Key Drivers
Increased
investment in
agricultural
research and
technology
dissemination
Support for
post-harvest
loss reduction
Enhanced
engagement of
youth
entrepreneurs
in agriculture
Support to
blue economy
and livestock
development
Deployment of
climate-smart
agriculture
practices
Promotion of
agricultural
value chain
development
and value
addition
Catalysing
private sector
entry and
growth in
African
agribusiness
Supporting the
development
of an
agribusiness
enabling
environment.

15. Raising agricultural
production &
productivity through
identification of
appropriate scalable
technologies
Creating an
enabling
environment for
technology
adoption
Facilitating effective
delivery of
technologies to
farmers at scale by
working with
existing R&D centers
TAAT’s agricultural technology transformation MUST be
regionally harmonized, food and nutrition conscious, &
environmentally sustainable
1 2 3
Technologies for African Agricultural Transformation (TAAT)

16. TAAT Country Programs
Development of
Seed Systems
Farmer extension
on Good
Agricultural
Practices
Market access
Enabling
environment
16
• Engagement of seed
companies or other
seed/animal producers
• Use of/establishment of
agro-dealer networks
• ICT-based delivery
systems to reach
farmers
Appropriate policies,
regulations, systems
by Gov’t
• Agriculture
• Trade
• Fiscal policies
• Etc
Linkage to:
• Processors
• Aggregators
• Warehouse receipt
operators
• Etc.
• Including Climate Smart
Agriculture

17. 8
01
Farm/
Production
03
Manufacturing
Processing
02
RTC/PH
04
Trade
 Inputs
 Mechanisation
 Irrigation
 Climate Smart Agriculture (CSA)
 Farm Access Roads
Agricultural Productivity
 Aggregation / Storage / Distribution
 Value Chain Support Services
 Market Services
 Farmer Institution Support
Aggregation and Post-harvest Support
 Power
 Water
 Roads
 Effluent mgt
 ICT
On-site Investment
 Highways
 Railways
 Airports
 Seaports
 Soft Infra
Distribution, Agro-logistics, Markets – Dom/Export
Production Agro-processing Trade / Marketing
Special Agro-industrial Processing Zones (SAPZ)
Private sector led agro-industry and value chain development

18. Special Agro-industrial Processing Zones (SAPZ)
7
Agro-based Spatial Development Initiatives
designed to concentrate agro-processing activities within areas of high agricultural
potential to improve productivity and integrate production, processing and marketing
of agricultural commodities.
Economic and Social Development of Rural Areas
This is achieved by bringing adequate infrastructure (energy, water, roads, ICT etc.) to
rural areas of high agricultural potential, and promote private investments (agro-
industrialists / entrepreneurs).
Business Development Services
The SAPZ are purposely built shared facilities (RTC, APH), to enable agricultural
producers, processors, aggregators and distributors to operate in the same vicinity to
reduce transaction costs and share business development services for increased
productivity and competitiveness.
Productivity enhancement and competitiveness of smallholder Farmers through skills
enhancement to close the industry skills gap for innovation and job creation for youth
Skills Enhancement

19. SAPZ Rural Transformation Centers (RTCs)
9

20. Schematic representation of an Agro-Processing Hub
which hosts facilities for agro-processing
SAPZ Agro-Processing Hub
10

21. Digital Solutions for African Agriculture
Input Supply
On Farm
Production
Post Harvest &
Agro-processing
Trade, Marketing
& Consumption
Enhance yields, scale
productivity
Improve efficiency
Improve traceability,
sustainability and
profitability
Facilitate access to
markets
• Land & soil fertility
mapping by remote
sensing/ mobile apps
• Weather monitoring
and insurance products
• Finance Agro dealers
• Mobile and ICT
based advisory
• Satellite or drone
based monitoring
• E-wallet
• Forecasting & shared
automated
harvesting
• Data capture &
analysis of field
performance
• Traceability and
mapping
• Price monitoring
• Digital payment &
mobile money
systems
• Digital marketplaces
Value
Chain
Goals
ICT Tools
Our goal is to increase investments in digital enablers across agriculture value chains in Africa.

22. Through public sector
investments, the Bank
will enable Governments
to:
• provide essential
public goods.
• partner with the
private sector.
Entry Point Intervention Areas
Approach to Promote Digital Agriculture
22
Pure Public Goods Interventions Potential PPP Interventions
Enabling Environment for Digitized
• Digital Strategies
• Digital infrastructure
• ICT and data regulations
• One-stop shops for coordination of
Access to Markets
• E-commerce/Digital marketplaces
outputs
•Tracking and Traceability (T&T)
• Blockchain for integrated food
Middleware Infrastructure
• E-registries
• E-extension
• Soil Information Management
• Agricultural Projects Information
System (e-AgriGovernance)
Inclusive Fintech4Ag
• E-wallets and e-insurance
• Other digital finance solutions
• Co-invest in agtech startup funds
Digital Literacy and Capacity
• ICT4Ag incubation and accelerator
• Smallholder Farmer Digital Literacy
•Technology transfer and capacity
Smart Agriculture and Intelligent
• Geospatial and remote sensing
• Farm management systems
• Drone development

23. Trade
and exports
Commodity Products
Improve the Agricultural Value Chain
Farmers Agro
Dealers
Seed
companies
Fertilizer
companies
Agro
processors
Industrial
manufacturers
Public Goods support:
Roads, Irrigation, R&D, Storage, Price Stabilization, etc.
Seasonal
Financing
Term
Financing
• De-risk the financial value chain
• Unlock commercial financing for agriculture
• AFDB to support
RMCs to setup RSF
• RSF to leverage up
to 10x
• Systemic change in
bank financing for
agriculture
• Finance for growth
of Agribusiness
• Financing
agriculture as a
business/ENABLE
Youth
Commodity and Agricultural Financing Value ChainsRisk sharing mechanism for increased agriculture
finance
Appropriate Risk Sharing Instruments along the Agricultural Value Chain
Guarantees
Interest
rebates
Insurance
Technical
Assistance

24. III. AfDB Trade Support Initiatives

25. AfCFTA Potential Outcomes
On industrial products, intra-African trade
would incease between 25%-30%.
Sectors that are expected to benefit the
most:
• Textile
• Apparel
• Leather
• Wood and paper
• Vehicle and transport equipment
• Electronics
• Metals
On agriculture and food products, intra-
African trade would incease between 20%-
30%.
Sectors that are expected to benefit the most:
• Sugar
• Vegetables
• Fruit
• Nuts
• Beverages
• Tobaco
• Meat
• Dairy products
• The removal of tariffs on goods would increase the share of intra-African trade to
50% (depending on the ambition of the liberalization) between the implementation of
the AfCFTA and 2040.
• The value of intra-African trade would increase between 15%-25% (depending on
the ambition of the liberalization) in 2040.
Source: UN Economic Commission for Africa

26. Africa Trade Fund (AfTra)
26
Vision MissionAfTRA
To mobilize resources to improve
supply-side capacity and trade
facilitation in RMCs for enhanced
market access
A competitive African
economy that is
regionally and globally
integrated
To achieve this, AfTra supports the delivery of Aid for Trade to RMCs,
especially low-income countries, aimed at improving supply-side capacity
for producers and traders

27. Africa Trade Fund Pillars
Facilitating Trade
Building Products
and Markets
Building Capacity
for Institutions
Making customs,
ports and one-
stop border posts
more open and
accessible and
easing
movement along
trade corridors
Getting goods up
to SPS standards,
stamping quality
on products and
crossing over to
new markets
Building capacity for
institutions,
collecting market
data, analyzing trade
gaps, adding value
along the chain and
supporting
negotiations

28. Africa Trade Fund Success Stories
Agriculture and Food Products:
Raising standards, boosting
livelihoods
• Project: Harmonization of African
Standards for agriculture and food
products
• Location: Africa-wide
• Beneficiaries: Farmers, producers,
businesses and traders
Enabling women beekeepers to access
markets in Rwanda
• Project: Rwanda honey value chain
development project
• Location: Rwanda
• Beneficiaries: Beekeepers
particularly women and honey
processors
• Project: Support for African
Cashew Industries in West and
East Africa
• Location: Benin, Burkina Faso,
Cote d’Ivoire, Guinea Bissau,
Kenya, Mozambique, Tanzania
• Beneficiaries: Cashew
Businesses, Cashew processors
(particularly women)
• Project: Trade and Institutional
capacity building in the apiculture
sector
• Location: Zambia
• Beneficiaries: Honey processors,
particularly women and youth

29. Trade RemediesKnowledge Products
Improving SPS
Measures
Reducing Technical
Barriers to Trade
Trade Facilitation
Customs Cooperation and
Mutual Administrative
Assistance
Rules of OriginInfrastructure
Other Enablers

30. CONTACT:
M.YINUSA@AFDB.ORG