Africa Can Help Feed Africa: Removing Regional Barriers to Trade in Food StaplesMarch 14, 2013 By Derek Langford
We need to understand why barriers to trade exist in order to alleviate the food insecurity that confronts Africa, said Makhtar Diop, World Bank vice president for Africa, at the Wilson Center in January.
The World Bank released a new report in October 2012 that is part of a series that concentrates on intraregional trade. Africa Can Help Feed Africa: Removing Regional Barriers to Trade in Food Staples, however, is unique, Diop said, because it “moves the focus from general barriers to trade in Africa to focus on food,” so that policymakers can move away from crisis response and address food insecurity at a base level. [Video Below]
“Africa in the last hundred years was developed to take resources out of Africa,” said the World Bank in an accompanying film (see above). “Trade [outside] Africa flows much more easily than the trade within Africa.”
The suggestions outlined in Africa Can Help Feed Africa promote agricultural self-sufficiency, as well as poverty reduction on the continent, Diop said.
According to World Bank estimates, only 10 percent of the 400 million hectares of arable land available in sub-Saharan Africa is utilized. This is caused by myriad factors, Diop said, including, “poor irrigation, very low productivity, and very low access to a certain number of factors of production.” Fluctuation in the prices of food staples impacts Africa’s poorest, and this phenomenon is exacerbated by increasing demand for food, especially in urban centers.
Fragmentation of markets and lack of predictable policy obstructs private investment that might improve the situation. The unwillingness of investors to commit capital is compounded by the structure of many African economies – small and dominated by agricultural production. Diminished trucking and shipping capacity and high import fees and tariffs are also major inhibitors to economic growth. As a result, Africa’s ability to achieve agricultural sustainability has been thwarted.
Diop suggested several remedies: Privatizing the transportation sector could rapidly increase freight capacity and improve infrastructure and improving access to quality seeds and fertilizers, through a regional institutionalization of agricultural production policy, would help further reduce the domestic prices of food staples in these regional blocks.
Marcelo Giugale, director of economic policy and poverty reduction programs for Africa at the World Bank, coordinates the work of some 200 economists “that are dedicated exclusively to Africa and feel very passionately about this issue.”
From working with these scholars and practitioners, Giugale said he’s come to realize two things. For one, Africa’s global integration via the commodities trade has been disappointing. Second, the continent has failed at self-integration.
As a result, while global trade has expanded, it has done little to bring the jobs needed to allay daunting poverty and hunger. Integration, in Giugale’s mind, means not only the vertical integration of markets, but the services, finance, and factors of production therein.
“We know where the problem is, and we so far have only acted on tariff barriers,” Giugale said, but to enact any sort of real, systemic reform, the more difficult challenge lies in the non-tariff barriers to trade.
“The Potential Is There”
Formerly, “Africa was…known as that continent, not because of its people, but because of the ugliness highlighted [in the film]: the ugly faces of war animated by refugees, hunger, and instability,” said H.E. Amélia Matos Sumbana, Republic of Mozambique ambassador to the United States. Although African nations are grateful for the help that they have received from Western donors and international organizations, she argued that the regional barriers to the trade of food staples can only be solved by Africans themselves, not external actors.
Sound natural resource management, trade, and economic liberalization are “inherently linked to peace, security, democracy and good governance,” Sumbana said. “The paradigm in Africa is changing…and the main problems have been identified for the continent.” It is now the responsibility of leaders to make the necessary choices to combat poverty, she said.
Daniel Karanja, vice president of the Partnership to Cut Hunger and Poverty in Africa, agreed. All of the issues addressed during the discussion can be remedied if avenues of communication are opened between the government, the private sector, and the international community to ensure that grievances at various levels are acknowledged and rectified, he said. “The potential is definitely there.”
The rising middle class is a pressure in and of itself, Karanja said, driving demand for a larger variety of food higher and higher. Harnessing this by connecting African farmers to surging urban markets and then exposing them to regional agricultural integration could be a fruitful avenue of economic development.
A Question of Will
Todd Amani, senior deputy assistant administrator for Africa at the U.S. Agency for International Development (USAID), said that scaling up the capability of small-holder agricultural producers is the central challenge.
“President Obama’s policy towards sub-Saharan Africa has been focused on spurring economic development and trade,” he said, and promoting a stable environment for internal and external investment. However, African governments, Amani stressed, are responsible for assuring that economic growth is fostered within their borders, as well as forging a relationship with the private sector, because that is where job creation is founded.
Amani concluded by underlining how USAID’s cooperation with the African Union and regional economic communities is essential, as African-led changes are the most sustainable. This will also assure that protectionism and corruption do not characterize trade in the agricultural sector.
All of the panelists maintained that the responsibility of national and international policymakers is to assure that the trade of food staples is free, open, and fair for the countries involved. Standardizing commerce and removing transnational barriers will not only provide a necessary uniformity to the distribution of these food staples, but it could, in turn, provide yet another mechanism for cooperation and collaboration for African governments.
Video Credit: “An Africa That Can Feed Africa,” courtesy of Mark N. Hopkins.