Dig Digit ital al So Solu lutions ions for or Africa Af ican A n Agr gricu icultu lture re Ms. Atsuko TODA, Director, Agriculture Finance & Rural Development Ms. Olukemi AFUN-OGIDAN, Principal Agribusiness Officer
I. I. In Introduct oduction ion Un Unde derstandi anding g di differen rent t country y and ag d agricult culture ure sector or context xt and c d comm mmon n agenda da MENTI NTIMETER METER Question tion 1
A R A Ris ising ing Co Conti ntinent nent – Sus ustained ained Gr Grow owth th Sustained economic growth in some countries (17 countries with growth rates above 5% in 2017) and sometimes outperforming the rest of the world (7 countries among the 20 world’s fastest growing economies) Real GDP 10 Rank Country Growth Rate 1 Macao SAR 13.4 2 Ethiopia 8.5 8 3 Côte d'Ivoire 7.6 6 4 Nepal 7.5 5 Myanmar 7.2 4 6 Bangladesh 7.1 7 Djibouti 7 2 8 Cambodia 6.9 9 Lao P .D.R. 6.9 10 China, People's Rep. of 6.8 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 11 Senegal 6.8 -2 12 Guinea 6.7 13 India 6.7 -4 14 Philippines 6.6 16 Tanzania 6.5 -6 17 Turkmenistan 6.5 Asia and Pacific Africa Latin America and the Caribbean World European Union 19 Burkina Faso 6.4 Source: IMF , WEO,2017 20 Vietnam 6.3
De Demo mogr graphic aphic Di Divi vidend end of of a a You oung ng Co Continent ntinent 40% of Africans are between the age of 15- 35 and classified as “Youth” 40% Over 65% of Africa’s 1 Billion population is under the age of 35 65% 50% 50% are under 25 years By y 2050 there e will ll be close se to close se to 2 bill llion ion you youth In the meantim time, e, labor r force ce in other r parts s of the world ld will ll decli line ne
The he Ri Rise se of th the Mid iddle le Cl Clas ass Average income increased by about 30% over the past 10 years (as compared to 20% of decrease between 1980 and 2000) By 2060, 43% of Africans will belong to the middle or upper classes, implying considerably higher demand for goods and services Source: Brookings 2016 Source: Pwc, 2017 8
Agri ricu cultu lture re in in Af Afri rica a – An An Un Untapp apped ed Mar arket 65% 51% US$ 47 billion STATE OF AGRICULTURE IN of Africans are engaged in of the world’s was spent on AFRICA agriculture uncultivated arable land food imports but contribute only one quarter is in Africa into Sub-Saharan Africa in 2017 of Africa's GDP EVOLVING DIETARY POPULATION GROWTH & URBANIZATION & PREFERENCES EXPANDING MIDDLE CLASS TECHNOLOGICAL CHANGES MEGATRENDS over 60% 2.5 billion By 2030, African food IMPACT BY 2050 market will be worth increase in Africa’s food people living in Africa US$ 1 trillion 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; 6 PNAS. 2016. Can Sub-Saharan Agriculture Feed Itself; ILRI. 2015. African Livestock Transformation, presented at AFDB Feeding Africa Conference Oct. 2015
Ch Chal allenges lenges in in the he Agri ricu cultur lture e Val alue ue Ch Chai ain To sustainably feed a growing population, Africa must close the yield gap and build a robust agribusiness sector 6 North America + Average Cereal Yields Europe 5 Asia Metric tons per ha 4 3 Latin Amer & Caribeans 2 Sub-Sahara Africa 1 0 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
Ch Chal allenges lenges in in t he Agriculture Value Chain (Cont’d) Agriculture Post Harvest & Marketing & Input Supply On Farm Production Agro-processing Consumption Value Chain • Insufficient reach of extension • Lack of technical • High post harvest • Fragmented services • Lack of knowhow to losses demand for inputs • Insufficient access markets • Lack of credit for information on • Lack of climate data, input storage facilities Challenges farmers and agro- • Inconsistency in information on needs, etc. dealers • Lack of access to product origin & • Government quality of produce • Poor processing & farmer practices finance and • Almost non- crowding out markets handling private sector • Land existent tracking techniques systems fragmentation, degraded soils 8
II II. African ican De Deve velopm opment ent Ba Bank nk - FEED AF AFRI RICA
AFDB’s “High 5” Pr Prio iorities rities 1 . Power and Light Up Africa 2. Feed Africa 3. Industrialize Africa 4. Integrate Africa 5. Improve Quality of Life of Africans
The he “Feed Africa” St Strat ategy egy Feed Africa Vision: To transform African agriculture into a competitive and inclusive agribusiness sector that creates wealth, improves lives and secures the environment.
A Focused Approach on Integrated Commodity Value Chains The Bank and its partners will pursue an agenda to transform a selection of key agricultural commodities and agro-ecological zones In particular, Feed Wheat in North Africa Maize, soybean, Africa will take a livestock, and poultry commodity- across the Guinea focused integrated Sorghum, millet, Savannah cowpea, and livestock approach – across the Sahel simultaneously addressing multiple Rice in West Africa bottlenecks across entire prioritized agricultural Tree crops (inc. Cassava in humid and sub-humid zones cocoa, coffee, commodity value cashew, and oil chains and within palm ), horticulture related agro- and fish farming ecological zones across all of Africa Agricultural commodity value chains and agro-ecological zones targeted by the Feed Africa
II III. I. Introducing Digitalization’s Rise e in Afric rica
THE RISE OF DIGITIZATION IN AFRICA The entry point for digitization in Africa has been through the telecommunications sector and the rise in increasing internet connectivity and mobile phone uptake over the last decade Between 2010 – 2015, Africa had the fastest growth of mobile phone subscribers 14 Forbes https://www.forbes.com/sites/tobyshapshak/2015/09/02/african-internet-capacity-growth-continues-to-outstrip-the-world-2/#7aafaf2f568e GSMA. The Mobile Economy Africa 2016
THE RISE OF DIGITIZATION IN AFRICA (CONT’D) 30 300 m 0 million lion additional people to come online by 2025 2025 Internet connection in Africa outpaced the rest of world from 2011 - 2015 FACTORS BEHIND THE TREND Scarce diffusion on fixed line networks Entry of key international mobile service providers Increasing affordability of new devices and a growing market for second-hand devices GSM Association: The Mobile Economy Sub-Saharan Africa 2018
Though Africa remains weak on ICT performance compared to rest of world… ICT Development Index by world regions and African countries (from highest score 8.9 to lowest score 1.0) 8.0 7.5 5.9 5.0 5.0 4.8 4.8 4.8 4.6 4.6 African countries 3.1 2.9 2.9 2.8 2.7 2.6 1.9 1.8 1.7 1.6 1.0 Avrg. Avrg. Avrg. Avrg. Avrg. Mauritius South Tunisia Morocco Egypt Botswana Côte Zimbabwe Kenya Senegal Nigeria Angola Tanzania Ethiopia Congo, Eritrea US & Europe Americas Asia Africa Africa d’Ivoire DR Canada Pacific Global Ranking (on 176 72 92 99 100 103 105 131 136 138 142 143 160 165 170 171 176 countries) • ICT access (e.g. fixed telephone & cellular subscriptions) ICT Development Index combines 11 • ICT use (e.g. % of individuals using internet) indicators in three categories • ICT skills (e.g. tertiary gross development ratio) Source: International Telecommunication Union (ITU) - ICT Development Index 2017 ; BCG analysis
…ICT adoption is booming in Africa…. Mobile-cellular telephone subscriptions (M) Active mobile-broadband subscriptions (M) +20% p.a. +51% p.a. 759 253 708 181 366 87 14 2005 2010 2015 2017 2010 2015 2017 Households with a computer (%) Individuals using the Internet (M) +9% p.a. +25% p.a. 10 9 213 164 5 4 54 15 2005 2010 2015 2017 2005 2010 2015 2017 Source: ITU
….and is already moving fast in some service sectors, such as mobile money – MENTI QUESTION 2 Mobile money services are developing quickly on the continent... ... and are already well adopted Number of live mobile money services Percent of respondents who have a mobile money account Africa Consumer Sentiment Survey 2015 98% Urban consumers 64% 56% 47% 2015 Africa 28% 17% 17% 3+ mobile money services 2 mobile money services Angola DRC Ghana Ivory Coast Kenya South Africa 1 mobile money services Source: Sagaci Research 2015, BCG Africa Consumer Sentiment survey February to April 2015 GSMA Note: Survey reached 11,127 total consumers., of which 8,977 were lived in urban areas.
AFRICA’S DIGITAL AGRICULTURE LANDSCAPE ICT outreach and technological innovation is on the rise As at 2018, there are at least 390 ICT and digital solutions actively operating in the African agriculture space Reaching an estimated 33.1 million smallholder farmers 33.1M 13% Number of ICT4Ag Solutions currently operating in Africa 390 14% 27% 314 Estimated number (in millions) of smallholder 220 farmers using ICT4Ag solutions 163 35% 112 66 42 Financial Supply Total Advisory Market 2012 2013 2014 2015 2016 2017 2018 Inclusion Chain Mgt services linkage 19 Dalberg Analysis, CTA Digitalization for Agriculture Report – Africa, 2019
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