New !May 15 Posted by: Dave | Today, 03:50 |

Addis Ababa, Ethiopia — THE key to increasing agricultural productivity in Africa lies in transforming the small-scale farming sector, whose potential has remained dormant for a long time, the World Economic Forum on Africa concluded here on Friday. Although Africa has 60 percent of the world's potentially available arable land, it has failed to contribute significantly to global food demand, largely because of a constrained smallholder farmer.

With about 70 percent of the continent's population living in rural areas, it was critical that more resources be channelled towards improving their farming activities.

Speaking during an interactive session on transforming agriculture in Africa, Ethiopian Prime Minister Meles Zenawi said his country had already shown the efficacy of supporting the small farmers, with agricultural production rising to unprecedented levels this year.

Ethiopia now devoted 16 percent of its national budget to agriculture, a figure above the 10 percent that African countries committed to the sector.

There was scope for the private sector to partner government in assisting the small-scale farmers.

In Ethiopia, such companies as Pepsi and Diageo had partnered smallholder farmers in growing chick peas and in the production of malt for their processes.

Tanzanian President Mr Jakaya Kikwete agreed that immense potential to boost agriculture lay in the small-scale farming sector, stressing that governments could assist with irrigation, inputs availability and access to markets.

Malawi National Smallholder Farmers' Association chief executive Dyborn Charlie Chibonga said the answer to food security on the continent lay with small farmers.

"The sleeping giant, that is the African smallholder farmer, needs to be woken up," he said.

The notion that investing in agriculture was risky for banks needed to be revisited, said one banker, Berry Martin, board member of Rabobank Group of the Netherlands. He said his bank, operating in more than 20 countries in Africa, had "never once lost money in a small farming venture. By contrast, it has lost on investments in large-scale projects run by big companies".

It would thus be more beneficial for investors to address issues in the entire agriculture supply chain.

In Zimbabwe, some banks were offering loans to farmers but the majority considered the sector a high risk.

In some instances, loans were structured in a way that constricted access by farmers, particularly the short repayment periods, with banks attributing this to the liquidity challenges obtaining in the economy.

In the 2012 National Budget, Government allocated US$226,7 million to agriculture but these funds have proved inadequate.

Zimbabwe's agricultural sector achieved 19 percent growth in 2011, with experts saying more recovery would be achieved with adequate support to farmers in terms of research, training, inputs availability and more friendly lending terms.

The Grow Africa initiative launched here ahead of the World Economic Forum would be a critical factor in achieving higher agricultural productivity on the continent.

The initiative, formed by the African Union in conjunction with the World Economic Forum, involves seven countries and 60 private companies, farmer organisations and civil society to foster growth in agriculture.

"Its single goal is to create an enabling environment for more productive farming on the continent.

"It will be Africa-led, Africa-owned, and will be based on market principles," said WEF.

The 22nd WEF on Africa has brought together 700 leaders from all corners of the continent and around the world to share insights on the opportunities and risks underpinning Africa's growth story.

The collaboration on actionable ideas is expected to impact the continent positively.