With the global spread of the COVID-19, and gradual lockdowns in cities and countries across Africa, I have new fears – that starvation and hunger are mounting threats for people across continent. These fears are hinged on the realization that it is planting season in most parts of the Continent, and yet farmers are being asked to sit at home, the movement of seasonal workers is restricted, research institutes that provide seeds, fertilizer blending companies and agrodealers, processors and markets are all being shut down. Our regional and national borders are closed, and trading is being restricted. These realities, if pro-longed and not urgently addressed, will lead to short term consequences of food shortages, price hikes, and medium to long term consequences of under-nutrition, mass starvation and eventually death, especially among our most vulnerable populations.
We have to act with urgency to stem the virus through social distancing and lock downs. At the same time, we must recognize that farmers and workers in the food industry are essential to the fight against the pandemicand desperately need to be protected and supported. Indeed, without nutritious food, the sick cannot recover, and the healthy will eventually become unwell.
My fears are shared by a few stakeholders on the Continent and around the world. The EU Farmer’s organization – COPA-COGECAearlier this week actively advocated for support to ensure minimal disruptions to the food supply chain, worker protection and contingency plans. The United Kingdom and the United States have already outlined comprehensive plans to provide intervention grants, loans, and tax holidays, for stakeholders in the food industry, including restaurant owners and retailers affected by the economic fallout of the pandemic. In Mexico, farmers who continue to plough their fields are being celebrated as heroes.
Sadly, there has been no coordinated action from industry groups, the private sector, civil society, or the public sector to raise awareness about the looming food crises on the African Continent, linked to COVID-19.
Thankfully, it is not too late to act! We must take decisive and proactive steps to ensure that our people have access to affordable nutritious food in both our urban and rural communities. This will require that;
- Our governments at the federal, state, and local levels recognize key stakeholders in the food and agricultural landscape as essential workers and provide them with the protection and support that they need to continue to work, following pre-stipulated safety and health protocols. We must keep food markets and factories open, with clear guidelines around limiting crowds, and widely publicized schedules for who can enter during what periods of time. We can also learn from China’s example over the last few months, where government officials, especially the Ministry of Agriculture and Rural Affairs (MARA) and Ministry of Human Resources and Social Security and National Health Commission repeatedly issued comprehensive notes to farmers on the control and prevention of the virus in rural areas, as well recommendations and protocols for preparing for their planting season and sustaining the livestock and poultry sectors.
Beyond guidance and protocols, our governments must urgently partner with the financial services sector to develop comprehensive loan packages for farmers, and entrepreneurs who are committed to working during the crises and can demonstrate their capacity to fill critical gaps in the food ecosystem. These interventions must actively engage women, who play a critical role in the sector. In addition, our governments must assess thenational strategic and emergency grain reserves to gauge what is available and how to effectively manage and deploy these reserves in a transparent and accountable manner to minimize price hikes and widespread shortages.
- Our industry associations, fast moving consumer goods companies, international trading companies, aggregators, wholesalers, and retailers must work together seamlessly to ensure the efficient and effective provision of affordable food to the masses of people. Leveraging technology, raw material suppliers and processors can actively partner with logisticsproviders and retailers to ensure that food is moved to where it is needed most, and no community is left behind.
This is not a period for hoarding and price gouging, with a focus on profits and growth at all costs. Companies must rise to the higher ideal of shared corporate values, where they put the needs of their customers and the African people ahead of their own requirements for profits and shareholder value. To ensure that this occurs, consumer protection and anti-competition agencies must closely monitor the activities of the largest actors in the food industry to ensure a level playing field.
In addition, the private sector can facilitate the introduction ofdrones, sensors and other precision agriculture andinnovative technology solutions, which will allow for active monitoring of commercial farm activity from a distance. Companies such as Atlas AI have demonstrated the power of technology to manage farms and assess impact, without direct human contact.
Our nonprofit organizations and media organizations must provide thought-leadership, monitoring and guidance to the entire ecosystem. Organizations such as GAIN are already providing critical guidance during this period.
- Finally, average citizens must invest in their own backyard and community gardens, while ensuring social distancing, manage their food budgets judiciously and share with their neighbors. Faith based organizations must open soup kitchens, offering free meals and partner with logistics providers to coordinate drop-offs. We must rebuild trust in our communities by caring for the most vulnerable at this exceedingly challenging time in our history as humanity!
As an eternal optimist, I am hopeful that as a people we will survive the COVID-19 pandemic, emerging with some critical lessons and a more resilient, united,and efficient food ecosystem. Now is the time for governments, stakeholders in the food ecosystem and citizens to act! Every minute counts!
Article By: Ndidi Okonkwo Nwuneli is the managing partner of Sahel Consulting Agriculture & Nutrition and the Co-Founder of AACE Foods. She is a 2018 Aspen New Voices Fellow and is currently writing a book titled “African Entrepreneurs Nourishing the World,” as a research fellow at the MR-CBG at the Harvard Kennedy School.
Visit: Sahel Consult
Madagascar receives US$797,049 million drought recovery insurance payout
African Risk Capacity Group and the African Development Bank presented a symbolic US$797,049 cheque to the Government of Madagascar following delayed rains during the 2021-2022 agricultural season, which resulted in drought conditions across the country, particularly in the Grand South. The ARC payout is the result of drought insurance taken by the country under the African Development Bank’s flagship programme ADRiFi, which financed 50% of the 2021/2022 insurance premium for sovereign drought risk transfer for the Republic of Madagascar.
This payout will be specifically used to strengthen the resilience of part of the approximately 1,024,523 people affected by drought, according to the estimate of the Africa RiskView software, a tool used by ARC to estimate the number of people affected by disaster events and the associated response costs.
“I would like to thank the African Risk Capacity Group, the African Development Bank, the German government, as well as multi-donor partners such as Switzerland and the United Kingdom, who provided premium support to the Government of Madagascar to enable insurance uptake. Your support to ARC and to countries across the continent is crucial to enable us to sustain membership in this vital insurance mechanism,” said Mr Tahina Razafindramalo, Minister of Digital Development, Digital Transformation, Posts, and Telecommunications.
In his remarks, United Nations Assistant Secretary-General and Director General of the ARC Group, Ibrahima Cheikh Diong said: “The payout made today not only supports vulnerable communities affected by drought, but also reaffirms the Government of Madagascar’s commitment to protecting its people against climate-induced shocks by actively participating in the ARC’s insurance mechanism.”
“Madagascar is, unfortunately, one of the African countries hardest hit by the impact of climate change. However, the government’s foresight to take out drought insurance meant that we were able to work together to develop a pre-emptive contingency plan, detailing how the payout would be used. The swift release of funds means the most-affected communities can now be assisted as a matter of urgency,” said Lesley Ndlovu, CEO of ARC Limited, the insurance affiliate of the ARC Agency.
In establishing a framework for collaboration, ARC and the African Development Bank signed a Memorandum of Understanding in March 2017 to support African states to manage disaster risks and to be better prepared to effectively respond to climate-related perils that seriously affect the continent. It is within this framework that the Bank provided financial support to the Government of Madagascar for the payment of its insurance premium over a period of 5 years (2019-2023) through the ADRiFi programme.
“This is the third insurance payout via the African Disaster Risk Financing Programme and ARC to the Government of Madagascar. The combined total of more than $13.5 million to boost the government’s ability to provide services that are keeping thousands of vulnerable people from food insecurity or migrating in search of food and work, demonstrates the Bank’s sustained commitment to building African nations’ resilience to climate change,” said Dr Beth Dunford, African Development Bank’s Vice President for Agriculture, Human and Social Development.
CAP-F Partners Pledge Support for Private Sector Agribusiness Investments in Nigeria
CAP-F Partners and NABG Officials (Image: Supplied)
The food situation in Africa is quite dire but full of potential. According to the United Nations Conferences on Trade and Development (UNCTD), between 2016 and 2018, the continent imported about 85% of its food from outside the continent. This cost the continent about $35 billion. What’s worse? This cost is expected to rise to $110 billion by 2025. The impact of this is two-fold; African economies are unable to guarantee food security for the continent and are unable to take advantage of the global food market, which is expected to reach $11 trillion by 2030.
To achieve Africa’s agricultural potential, The Grow Africa Partnership was jointly founded in 2011 by the African Union, African Union Development Agency-New Partnership for Africa’s Development (AUDA-NEPAD) and the World Economic Forum. Grow Africa’s mission is to increase private sector investment in Agriculture. Grow Africa’s flagship programme is the Country Agribusiness Partnership Framework (CAP-F), a mechanism for establishing effective public private engagement to create agribusiness partnerships in a country. CAP-F facilitates the alignment of private sector investments commitments with public sector policy/infrastructure obligations and provides a mechanism for all parties to hold each other accountable for their obligations. CAP-F’s footprint currently spans 16 African countries.
During a recent CAP-F private sector stakeholder sensitization engagement, CAP-F’s partners, including AUDA-NEPAD, Alliance for a Green Revolution in Africa (AGRA) and Nigeria Agribusiness Group (NABG), pledged to work with multi-stakeholder agriculture value chain platforms to promote private sector investments that can improve agriculture productivity in Nigeria.
In his welcome address, Emmanuel Ijewere, Vice President, Nigeria Agribusiness Group (NABG) expounded on the context of a private-sector led agribusiness investment ecosystem in Nigeria. “Agriculture has the credentials to be Nigeria’s most attractive investment option. It is very important that stakeholders across the public and private sectors work together to align their interests and expectations. This is the value that CAP-F brings to the table,” Ijewere noted.
Also speaking at the engagement, Ibrahim Gourouza, Chief Operating Officer of Grow Africa noted that the optimised participation of private sector investors will help build more sophisticated agriculture value chains across Africa. This tasked Grow Africa with the responsibility of creating a private-sector inclusive agriculture investment ecosystem through CAP-F. On the design principles around CAP-F, he noted, “One of CAP-F’s key success factors is that it is owned by countries and anchored on existing structures. With this in mind, in collaboration with stakeholders, we selected NABG as the anchor of CAP-F coordination in Nigeria.”
He noted that Grow Africa is committed to CAP-F in Nigeria in a number of ways. “Grow Africa has provided the CAP-F Secretariat in Nigeria with a business model that has generated close to $500m in private sector investments in Africa across 6 countries and in 5 value chains. This will be an invaluable tool for business deal generation in Nigeria. We will continue to provide technical assistance for the team in Nigeria. While we have attracted funding from AGRA for the CAP-F Secretariat in Nigeria, we will work to expand the partnership support to ensure a more sustainable CAP-F implementation in Nigeria. Finally, we will provide a database of financiers who we will connect to provide sector deals in agriculture in Nigeria,” Gourouza noted.
The CAP-F business model focuses on collaborating with multi-stakeholder platforms across agriculture value chains in the country (existing and new platforms) and the development of business cases to identify investment opportunities in these value chains as well as inhibitors to these investment opportunities. The business model then creates matchmaking opportunities between various stakeholders, which culminates in a term sheet that aligns the commitments and expectations of all stakeholders from those investment opportunities. These term sheets are then taken from commitments on paper to actual investments that are concluded. The final stage of the business model is a mutual accountability and knowledge sharing activity, where updates on private sector investments are presented to the African Union.
CAP-F’s activities in Nigeria are funded by AGRA. In its address, the funders, represented by David Adama, Senior Programme Officer, noted that the engagement with private sector stakeholders is extremely important in driving agricultural transformation in the country. He stated, “CAP-F provides an opportunity for government and the private sector to engage on some of the opportunities that have been identified through the National Agriculture Investment Programme (NAIP) in order to know where private sector investments are necessary. This is particularly important, given the current challenges around public sector investments. AGRA is happy to work closely with Grow Africa and NABG in Nigeria to facilitate this.”
CAP-F Partners is also critical if Nigeria is able to move its millions of smallholder farmers into agripreneurs, who can actually create wealth through agriculture.
Climate change report shines spotlight on Africa’s agriculture potential
It seems almost incongruous to talk about the opportunity that exists in ensuring the world’s food security by bolstering Africa’s agricultural output when the very pressing and public crisis of climate change could be its undoing.
Particularly in the run up to COP26 and the “reality check” that came with this week’s release of the Intergovernmental Panel on Climate Change (IPCC) Six Assessment Report, it is clear the entire African continent is “highly exposed” to climate extremes, at a relatively “high level of vulnerability”.
With over two thirds of Africans deriving their livelihood off agriculture, climate change-led crises like droughts, floods and cyclones continue to threaten the continent’s economic growth, employment, and food security. And yet, ensuring Africa’s agricultural resilience would not just help Africa. It’s essential for ensuring global food security.
What’s more, these climate-led natural disasters have the greatest and most disproportionate impact on small- to medium-scale farmers, comprising as much as 80% of Africa’s agricultural output, from maize and wheat to rice, cassava, and sorghum.
“The UN Report confirmed that climate change is intensifying the water cycle and affecting rainfall patterns, bringing more intense rainfall and associated flooding, as well as more intense drought in many regions,” says Malvern Chirume, African Risk Capacity Limited Chief Underwriting Officer.
“These African farmers are the heart of the continent’s agriculture and are at the mercy of climate change events completely out of their control,” Chirume adds.
Established in 2014, ARC Limited provides natural disaster insurance relief to African countries which have joined the sovereign risk pool.
Along with its partners, which provide premium support, the insurer has already paid over US$65m to seven African countries to provide drought relief and address the economic concerns these countries’ most vulnerable citizens face.
Responding to the climate crisis
Traditionally, countries have responded to climate change-led disasters such as droughts or floods by raising funds for emergency relief. This approach is time-consuming and inefficient.
“It takes far too long for African countries to mobilise the immediate resources they need for relief efforts, to save lives and livelihoods. Our role at ARC Limited is to work with countries to prepare them for the risk exposure they have and how to respond swiftly to climate-related food security emergencies. This includes helping them to establish a rainy-day fund which pays out swiftly, before the problem has become worse, and more funding is needed.”
The ARC Limited model, built on parametric insurance (pre-specified pay-outs based upon a trigger event), has been highly successful, says Chirume.
“We have to date paid out close to $65 million dollars in claims. When one considers that every dollar in insurance pay-outs saves US$4 dollars, this makes the cumulative economic impact around US$240 million. With those funds, we’ve helped more than 5.9 million people whose livelihoods have been affected by climate change impacts,” Chirume explains.
While parametric insurance against natural disasters has enormous potential for the agricultural sector, it has a further economic impact. Because agriculture makes up such a significant portion of the continent’s economy, a downturn caused by a climate shock will echo through the broader economy of any nation affected.
This can bring an economic downturn, a lack of funding for key infrastructure and services at government level, and a loss of jobs as farmers struggle to recover. There is also evidence of migration away from areas experiencing drought, which can have a long-term impact on the regional economy.
Organisations such as ARC Limited have an essential role to play in this way in protecting agricultural value chains and the economies of and employment in Africa. “Our role is to help mitigate and manage the risk, building resilience and ensuring the African country is able to bounce back sooner after a natural disaster,” says Chirume.
With the negative impacts of climate change increasing and their potential to devastate the agricultural sectors and food security of African countries, it has become more important than ever to put sustainability at the heart of interventions.
“Creating an environment that limits the impact of climate shocks on the agricultural sector is about more than just securing economic transformation. At the heart of this investment is the need to ensure basic food security for the continent and the world,” says Chirume.
In its Sustainable Development Series, the World Bank says the African continent could play a leading role in ensuring food security for the earth’s estimated 9 billion people by 2050.
According to McKinsey, Africa’s full agricultural potential remains untapped. It determines that Africa could produce two to three times more cereals and grains, which would add 20% more cereals and grains to the world’s current output of 2.6 billion tons.
Given Africa’s productive potential, the continent could be a key contributor to feeding the world in the future. But to fully realise that potential will require overcoming many obstacles, including how it deals with the impact of climate change on agriculture and food security.
“We need broader collaboration between private and public sector to solve the climate change disaster response problem our continent faces. The problem is so big, that all of us have a role to play,” says Lesley Ndlovu, ARC Limited CEO.
With the support of the United Kingdom and German Government, ARC Limited has been equipped to help the member states of the African Union reduce the risk of loss and damage caused by extreme weather events affecting African populations.
“But there’s so much more work that still needs to go into reaching as many people as possible to help build the resilience of local communities and ensure they have the means to bounce back whenever they are impacted by a natural disaster,” concludes Ndlovu.