The tide of social unrest that swept a number of African countries during 2007-2008 to protest against rising food prices has now ebbed. In its wake, the absurdity of agricultural policies that called for the urban populations in Africa to rely for their food on cheap imports from other continents’ agricultural surpluses is now plain for all to see. Clearly, the low price of imports – kept artificially so by hundreds of billions of subsidies to farmers of exporting countries- has been a major obstacle to the growth of a diversified and commercially viable agriculture in Africa.

The streets of Africa may now be quiet but food prices have continued to rise. Population growth, accelerated urbanization and changes in eating habits will keep fuelling African demand for food products. However, the gradual reduction of subsidies, the pressure of bio fuels, chronic underinvestment in agriculture, the growing scarcity of arable land and climatic vagaries worldwide will ensure that the supply side remains volatile.

For private investors though, this bullish trend in food prices is a leading indicator of the potential for a profitable agriculture in Africa. For governments, it creates a window of opportunity to tackle the fundamental issue of food security on our continent.

Africa’s comparative advantages are numerous in agriculture: the five millions hectares of arable land sold or leased on long term basis to Asian and Middle Eastern investors by African governments between 2006 and 2009 is a clear if controversial evidence of this (1).

Business opportunities in agriculture and agribusiness are diversified and plentiful in Africa. This stems from the bewildering array of agricultural industries suffering from chronic underinvestment in the face of unmet local or export demand. While some companies and private equity funds have identified this potential, their numbers are still too thin to kick-start and fully exploit the growth potential of this sector.

Business opportunities in agriculture and agribusiness are diversified and plentiful in Africa. This stems from the bewildering array of agricultural industries suffering from chronic underinvestment in the face of unmet local or export demand. While some companies and private equity funds have identified this potential, their numbers are still too thin to kick-start and fully exploit the growth potential of this sector.

Governments, for their part, will have to design a whole new set of policies. These should aim at (i) protecting private investment in agriculture by maintaining attractive food prices in the cities, (ii) investing in agronomic research and training as well as in key infrastructures, and (iii) promoting regional markets for food products.

All industrialized countries are first agricultural powers. If she is to provide food security to her people, Africa too will have to board the agribusiness train.

(1) Source : International Food Policy Research Institute.

Louis ADANDÉ