A poor African farmer produces a little more corn this year than last. He sells the surplus in a nearby urban market and uses the money to purchase a shirt stitched by a local seamstress. With the good harvest, more and more farmers are interested in the seamstress’ wares. The extra income allows her to buy better materials and a new sewing machine. Her business grows, and she begins to sell her work in bigger markets, further from her small village.
This is the vision that Dr. Ousman Badiane, Africa Director for the International Food Policy Research Institute, presented to an audience of students and faculty at Stanford University last month. In a two-hour symposium, Badiane called on African governments to make investment in agriculture a core part of their development strategy. Improving agricultural productivity, he explained, will promote healthy, stable economic growth and help African nations attain larger social and economic goals.
Badiane said that economic growth over the past 15 years has created new problems for relatively unsophisticated African economies. Rural Africans, frustrated by years of meager returns from primitive farming, are increasingly migrating to cities. But in new urban areas, high-productivity jobs in processing and manufacturing remain scarce.
Instead, migrants join a low-productivity service sector, peddling trinkets on the streets or struggling to compete with international tourist businesses. Africa’s service sector, Badiane said, now ranks second in size only to Latin America’s – a region with an overall economy seven times larger. In Kenya, nearly 60 percent of the population works in services.
“Agriculture has just plummeted too fast and too quickly in these countries,” Badiane explained. If low-productivity service workers remained in farming and improved their crop yields, they could earn a better living and provide a stable market for new industrial products.
In order to keep farmers in the fields, African governments need to provide equipment and financial support. They need to invest in research to develop crops that grow well in African soils, and they need to teach farmers techniques to reduce water use, minimize fertilizer applications, and prevent erosion. But increasing agricultural budgets will put fiscal pressure on public welfare programs such as health and education.
Dr. Joel Samoff, a Stanford professor of African Studies, said African nations cannot afford to de-fund those services. “Most countries in Africa spend around $10 per person per year on health,” Samoff said. “How do you reduce that?”
But Badiane thinks African nations can do both. “They will have to see how they can use social service budgets to sustain growth in agriculture,” he said. “Look at health and education not as an entitlement, but as a tool to raise labor productivity.”
Similarly, investment in agriculture need not compromise industrial growth. In fact, according to Badiane, every $100 increase in agricultural output could result in up to a $130 increase in output from industry. In an era of volatile global food prices, locally produced food is often cheaper and more readily available, and well-stocked local markets allow industrial entrepreneurs to commit more money to growing their businesses. And farmers who produce and sell enough food to make a profit can afford to buy industrial products, furthering the cycle of growth.
“What agriculture needs is what industry needs,” Badiane said. “There are a lot of things you can do right by all the sectors at the same time.”
Badiane described one step that African governments have already taken to set the positive agriculture-industry feedback in motion. In 2002, the African Union announced a coordinated effort to increase investment in agricultural research and farmer support programs. According to an International Food Policy Research Institute brochure, the Comprehensive Africa Agriculture Development Program aims to “accelerate growth and progress toward poverty reduction and food and nutrition security by revitalizing agriculture and rural development.” The program’s objectives, including a six percent overall economic growth rate in the African Union, are ambitious long-term goals for most countries. But Badiane said that the joint initiative has already generated international acclaim and strong political momentum.
Stanford Professor Peter Timmer described Badiane’s strategy as “a very ambitious undertaking.”
“You’re talking about getting industry moving at the same time as you’re getting agriculture moving,” Timmer noted, addressing the audience during a question-and-answer session following Badiane’s talk. However, Timmer also indicated that he saw the seeds of success in Badiane’s ideas.
“I think we’ve just heard a quite profound analysis of Africa’s agricultural problems, and its structural history,” he said. “And a possible way forward.”