Seizing opportunities in African agriculture

There is tremendous potential in African agriculture. Geographic areas within the African continent have suitable combinations of water, soil, and land endowments to be highly productive food baskets with supportive policies and investments. Half of the region’s population depends on primary agriculture for their livelihood, and, together with food marketing, transport, processing, and retail services, the agri-food system accounts for two-thirds of the region’s jobs. While Africa’s agri-food sector still suffers from persistent constraints, there are opportunities for the sector to grow and create new jobs for the region’s population that I share in this blog commemorating 15 years of the Africa Development Forum (ADF) book series co-published by the World Bank and the Agence Francaise de Developpement.

Since the ADF Series was launched in 2009, agriculture development in Africa has had a mixed record. While there was some resurgence in agricultural growth in Africa to 3.1% in gross output over 2010-2023, about three-quarters of this increase came from land expansion rather than input intensification or productivity growth. This is not a sustainable development path and comes at a high environmental cost.  And the region stands in sharp contrast to other developing countries where productivity growth has been the primary source of agricultural growth. Moreover, the agricultural growth performance among African countries varied widely, from a high of 7.7% per year in Senegal to under 2% annual growth in the majority of countries over 2010-2023. 

Figure 1: Sources of Agricultural Growth, 2010-2023

On the demand side, rising incomes and urbanization in the region are driving growth of diverse foods and food services.  The midstream and downstream components of the agri-food sector–including marketing, transportation, storage, processing, retailing, and food preparation services–are some of the fastest growing sources of employment in Africa. Between 2001 and 2022, employment in these activities grew by 4.1% per year, faster than overall employment growth of 2.6% per year, and by 2022 accounted for 19% of all jobs in the region.

In 2000, 60% of the region’s workforce was engaged in primary agriculture, 13% in mid/downstream agrifood segments. By 2022, the share of the labor force in primary agriculture had fallen to 49%, while the share in mid/downstream agri-food sector had increased to 19%. At the country level, the off-farm agri-food sector’s contribution to overall employment is related to the extent its (primary) agriculture sector and agricultural trade are commercialized. Nigeria has nearly as many jobs in the off-farm agri-food sector (33%) as in primary agriculture (35%). In contrast, the Democratic Republic of Congo has a small off-farm agri-food sector providing only 5% of all jobs, while 56% of total employment is in primary agriculture.

Figure 2: Employment Shares in Agri-Food Systems in Sub-Saharan Africa

a: Trends, 2000-22

b: Sub-Saharan African Countries, 2022

Source: Data on total and agricultural employment are from ILOSTAT modeled estimates; data on employment in the off-farm agri-food sector are from FAOSTAT.

Yet, without adequate productivity growth in primary agriculture, an increasing share of Africa’s rising demand for food will be met through imports, missing an opportunity for inclusive, poverty-reducing growth. A consequence of slowing agricultural growth is an increasing agricultural trade deficit. Africa is already a large net importer of food products, even among many of its basic staples: 75% of Sub-Saharan Africa’s wheat and 50% of its domestic rice supply were imported in 2022.

Closing these productivity gaps is underway in some countries such as Ethiopia, Rwanda, Ghana, and Senegal, aided by effective government investments in rural public goods and policies that encourage private sector investment in agribusinesses. The evidence presented in our 2017 ADF book,  Agriculture Public Spending in Sub Saharan Africa, showed that improving the quality of agricultural public spending can be one important instrument in laying the foundations for productivity growth in the region. We show that the dividends from investments in rural public goods to strengthen markets, expand water access, develop and adopt improved technologies can be enormous. And improving the policy environment through trade and regulatory reforms complement the efficient use of public funds by enhancing the incentives for producers and innovators to crowd in private investment. Getting the greatest impact from public spending has become all the more important recently as fiscal resources available to African countries have become more constrained.

With policy prioritization, agribusinesses can work effectively with farmers to help finance and upgrade their production practices and provide accessible markets for their produce. Côte d’Ivoire has emerged as a leading producer and exporter of cashews (second only to cocoa in export earnings) and has invested in domestic processing for shelling, peeling, grading, and inspection to meet the standards demanded in world markets. After tourism and tea, Kenya’s cut flower sector is the country’s third most important source of export earnings. Between 2002 and 2014, the harvest of farmed fish in Nigeria grew more than tenfold. Cassava production has been booming in Zambia where the private sector has invested heavily in the cassava value chain, building processing plants for flour, ethanol, animal feed, and beverages. Extending these successes more broadly across the African continent will greatly enhance the role of agriculture and agrifood in the economic and employment growth needed for the region’s future.

This blog is part of a commemorative series marking 15 years of the Africa Development Forum book series co-published by the World Bank and the Agence Francaise de Developpement