Stakeholders in the wider agricultural sector from Europe and the United States of America (USA), but mainly from Africa, gathered at the recent African Agri Investment Indaba in Cape Town, South Africa.
The event space rang with the sound of an impressively diverse array of languages, a striking reminder of the apparent ease with which Africans seem able to acquire fluency in foreign tongues.
If this ability is indeed a continental talent, then it is a resource that could prove to be worth more than a few points on trade negotiation platforms, where every point counts.
President of the World Farmers’ Organisation (WFO), Dr. Theo de Jager, spoke with some passion when he urged farmers to benchmark themselves against the best in the highly competitive world of agriculture.
“The world has become too small for captive, isolated markets and it’s no big deal for the most competitive farmers to get their product into areas where there is sensitivity to price, quality or volumes,” said de Jager.
A sub-tropical fruit farmer, who farms in South Africa’s Limpopo Province, De Jager said the strategies to win the competition game in agriculture were simple: “You get the preferred product onto the market and you lure the market to your products.”
Housewives, who cook for their families, and chefs, who cook commercially and set trends in the food industry, are the most important people in the life of a farmer and both buy with their eyes.
Also read: Attracting investment – the challenge for Africa’s smallholder farmers
THE GAME CHANGER
Technology has become the gateway through which farmers may gain a competitive edge on the market. “But the reality is that technology is expensive and the money [to pay for it] has to be found somewhere,” said de Jager.
The model of using land as security has not been replaced in Africa. Farmers, who are their own biggest investors, access money through bank loans, using their land as collateral.
Although there were pilot projects running in East Africa and South Africa, in which farmers had borrowed money through value-chain financing, this is not the norm.
Foreign direct investment could fuel the agricultural engines of small-scale farmers throughout the developing world, empowering farmers to grow their businesses and helping them to gain a place on global markets.
Also read: EU to move beyond aid to investment in Africa
THE RIGHT ENVIRONMENT
“There is no exception to the rule that investors are lured by certainty and a stable policy environment, and there is nothing that kills investment more efficiently than armed conflict.”
Investment in Mozambique’s newly thriving agricultural sector had drained away within weeks from the day Frelimo (the ruling party) and Renamo (the popular opposition party) returned to arms.
Although capital could take flight at impressive speeds, agriculture and the agricultural economy took years to recover, he said.
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COMMON GROUND AND UNITY
The African Agri Investment Indaba was an opportunity for networking on common ground. “At events like this we should seize the moment for discussion and debate so that we can make sure the ‘push’ from the the private sector and civil society is strong enough to get policy makers to bring certainty into the policy environment.”
De Jager said the only way to have a real impact on policy making was through common effort and a united voice. Without the strength of unity from civil society and business, politicians would continue to play cat and mouse with the sector. “They are masters at that game,” he said, “they are politicians; it is what they are paid to do.
“Influence on policy is a team sport, no individual can win this game,” said the WFO president.
