Welcome to the May edition of the Addleshaw Goddard Africa Group Newsletter. We hope you enjoy reading a selection of business news and articles from around the continent.
Visit our dedicated Africa site for more information about doing business in Africa and how Addleshaw Goddard can support you.
With increased worldwide awareness of food security and sustainable food production, agriculture is rapidly growing as one of the key industries on both a global and local level. In Africa the sector employs over two thirds of the continent’s labour force, and accounts for between 30-40 percent of gross domestic product. The World Bank estimates that agriculture and agribusiness together will make up a US$ 1 trillion presence in Africa’s regional economy by 2030.
There are a myriad of factors that are driving the projected growth in the agriculture sector in Africa, such as a rising middle class and domestic market requiring major agribusiness investment in processing, logistics, market infrastructure and retail networks, the fact that Africa has 45 % of the global total of land suitable for sustainable agriculture and African farmers being far from the technological frontier meaning there is significant potential for investment and growth. These are all factors which continue to attract ever-increasing levels of foreign investment in agribusiness and food production.
Undoubtedly however, challenges remain. Much of the continent’s transport, technology and financial services infrastructure is in need of development and, despite vast natural resources, power production is inefficient and unreliable, restricting the growth of reliable agriculture value-chains.
In this special edition of the Addleshaw Goddard Africa Newsletter we are focusing on the opportunities and challenges that we see across the agriculture value chain in Africa. We are joined by a number of fantastic guest authors, including a Q&A with Ravi Dhanani Asset Manager at the infrastructure investment fund, InfraCo Africa, a guest article from Yariv Cohen and Angela Homsi, Co-founders of Ignite Power touching on the power of solar irrigation in Africa, and last but not least a video interview with Atsuko Toda, Acting Vice President for Agriculture, Human and Social Developmental the African Development Bank.
Ravi Dhanani, Asset Manager at InfraCo Africa
InfraCo Africa is an infrastructure investment fund and part of the Private Infrastructure Development Group. InfraCo Africa seeks to alleviate poverty by mobilising investment into sub- Saharan infrastructure projects, through investing directly into early-stage projects which need the financial commitment and support, and investing into innovative solutions that need support to scale-up or to pilot new products or enter new markets. InfraCo Africa invest in a number of innovative agricultural projects, and we have asked Ravi Dhanani from InfraCo Africa to provide a quick Q&A in relation to their agri-assets.
To read this guest editorial, please click here
Yariv Cohen and Angela Homsi, Co-founders of Ignite Power
Imagine a professional basketball player wearing sneakers only 6% of the time. Or an international banking chain, with only 6% of the branches having a safe. Strange, right? Although these are absurd, hard-to-imagine scenarios, this is precisely the situation in a much more substantial and fundamental field: the agriculture sector in Africa, with only 6% of farmlands across the continent receiving proper irrigation.
To read this guest editorial, please click here
Alexander Sarac, Partner Addleshaw Goddard, Eleanor Morris, Associate Addleshaw Goddard
Most of us are aware that we are facing a global food security crisis. Global population is expected to rise from 7 billion today to 9.6 billion by 2050, and more than half of that is projected to take place in Africa. Calamity aside, history dictates that where the world faces a significant problem, solutions are found through the application of technology. In this article we discuss the burgeoning opportunity in the agribusiness sector in Africa and provide a brief introduction to growing interest in agriculture technology globally, and its potential application in Africa.
To read this guest editorial, please click here
Ms. Atsuko Toda , is an experienced manager and expert in the field of rural and agricultural finance, with extensive experience in rural development. She joined the AFDB from the International Fund for Agricultural Development (IFAD), where she worked for close to twenty years on rural development and financing in Asia and Africa. She was the Country Director for Nigeria for IFAD, where she managed a large portfolio of investments in rural development, accelerating the access of farmers to new technologies, finance and markets.
Atsuko was kind enough to lend us her time for a short interview, and in this interview she discusses what she sees as the biggest opportunities for investments in the agriculture sector, the challenges for doing business in the agriculture sector in Africa, and also a little about the role, vision and mission of the AFDB.
To watch the interview, please click here
CDC Group, a UK-based development finance institution and impact investor, has announced a $100 million loan to ETG, an integrated agricultural conglomerate present in more than 48 countries. The financing is provided as capital to ETG and is known to be one of the largest corporate debt investments so far made by the CDC group.
To read this article, please click here
The agriculture ministry recently launched a special project on urban agriculture, aimed at strengthening Namibia food systems and ensuring recovery from emergencies and disease-related shocks.
Agriculture minister Calle Schlettwein, who launched the project on the day, said the country’s food systems could recover from emergencies through the Build Back Better (BBB) programme.
To read this article, please click here
The Milken Institute and the Motsepe Foundation have partnered to launch a US$2 million agri-tech aimed at supporting innovative solutions in the farming space.
The agri-tech prize is part of the wider Milken-Motsepe Innovation Prize programme, a multi-year initiative to focus global innovators and entrepreneurs on developing technological solutions that accelerate progress towards implementing the United Nations’ Sustainable Development Goals (SDGs), with a spotlight on the African continent.
To read this article, please click here
The Government of Zimbabwe, and Food and Agriculture Organisation of the United Nations (FAO) last week launched a project titled: Capacity Building Related to Multilateral Environmental Agreements in African, Caribbean and Pacific Countries — Phase III (ACP-MEAs 3) project in Zimbabwe.
The project is funded by the European Union (EU) through a global project budget of about US$10 million. Zimbabwe was allocated more than US$500 000 over three years (2021-2023).
To read this article, please click here
A coalition of multilateral development banks and development partners has pledged over $17 billion in financing on Friday during a high-level forum, in a bold bid to address rising hunger on the African continent and to improve food security.
Funds were pledged on the final day of a two-day high-level dialogue – Feeding Africa: leadership to scale up successful innovations. The event was hosted by the Africa Development Bank and the UN International Fund for Agricultural Development (IFAD), in partnership with the Forum for Agricultural Research in Africa (FARA) and the CGIAR System Organization, on 29 and 30 April.
To read this article, please click here
$957 billion. That has just been confirmed by the UN as the average amount that low- and lower-middle-income countries invest annually in agriculture. So, if agriculture accounts for more than 25% of GDP in some developing countries, employs 63% of the world’s poor people and has the potential to improve food security for 80% of them, then why hasn’t this investment translated into stronger economies and better livelihoods?
One of the answers is data. Or the lack of it. Many low-income countries are limited by gaping holes in agricultural and rural data that could inform planning, budgeting and policy making in this vital sector. The scarcity of high-quality, timely agricultural data is directly complicating countries’ plans for economic growth and efforts to reduce poverty.
To read this article, please click here
Urgent action needs to be taken to rehabilitate Africa's youth jobs market. Developing the continent’s agriculture value chain will be a key part of the solution.
Over the last year, coronavirus has disrupted life as we know it. Recent graduates in developed economies are facing uncertain job prospects. In the US, the unemployment rate for young people (16-24) is currently 11.5%, nearly double the overall unemployment rate of 6.7%, according to the Department of Labor.
To read this article, please click here
Cassava Smartech Zimbabwe is employing digital technology to enable farmers to boost agricultural production and scale their operations across the country.
This year the southern African nation is expecting a bumper harvest of up to 2.8 million tonnes of maize, thanks to a good rainfall season. The anticipated harvest will see the country saving close to US$200 million in maize imports.
To read this article, please click here
The Alliance for a Green Revolution in Africa (AGRA) has launched a centre to provide hands-on support for African leaders in the agriculture sector. This could help achieve food security and inclusive economic growth.
Launched on April 27 in Nairobi, the Centre for African Leaders in Agriculture (CALA) is a key part of a scale-up of investment to AGRA by the German Development Cooperation through KfW Development Bank, AGRA said through a press release.
To read this article, please click here
How can African farmers optimise production? We examine how South African company Aerobotics is helping farmers advance with the use of drone technology and AI.
In 2014, Cape Town-born Benji Meltzer identified a huge gap in one of Africa’s key markets – the continent’s 33m smallholder farmers had no crop data to help them improve their farming. Meltzer and his old university friend James Paterson, who grew up on a citrus farm in the Western Cape, had just finished master’s degrees in aerobotics and neurotechnology overseas. They returned to the Cape that year, drawing on their expertise to start a company that they hoped would transform farming.
To read this article, please click here
