NMISTAKABLE SIGNS OF AGRI FOOD SYSTEMS …...7 UNMISTAKABLE SIGNS OF AGRI-FOOD SYSTEM TRANSFORMATION IN SSA 1. Major growth in per capita incomes 2. Impressive agricultural growth

T.S.JayneandHolgerKray

SeminaratMinistryofAgriculture,GovernmentofTanzania

10April2018Dodoma,Tanzania

UNMISTAKABLE SIGNS OF AGRI-FOODSYSTEMS TRANSFORMATION IN AFRICA

7UNMISTAKABLESIGNSOFAGRI-FOODSYSTEMTRANSFORMATIONINSSA

1. Majorgrowthinpercapitaincomes

2. Impressiveagriculturalgrowthrates

3. RiseofcommercializedAfricaninvestorfarmers

4. RapidinvestmentinagriculturalvaluechainsbyAfricanentrepreneurs

5. Diversificationofthelaborforceintooff-farmactivities

6. Greatervibrancyofagriculturalfactorsmarkets

7. ImprovedmarketaccessconditionsforAfricanfarmers

• 35%growthininflation-adjustedrealp.c.incomesinSSA,2000-2014

– Doubling inmanycountries

• Povertyratesfallingfortheregion

– %ofpeoplelivingonlessthan$1.90adaydeclinedfrom54%in

1990to41%in2013(Barrettetal.,2017)

RISINGREALINCOMES

Annualinflation-adjustedagriculturalgrowthrates,2000-2016:

• Sub-SaharanAfrica: +4.62%

– Tanzania: +3.50%

• EastAsia: +3.07%

• SouthAsia: +2.96%

• LatinAmerica: +2.49%

• World: +2.75%

IMPRESSIVEAGRICULTURALGROWTH

AGRICULTURALVALUEADDEDANNUALGROWTHRATES2000-2016(constantlocalcurrencyunits)

Ethiopia Nigeria Rwanda Moz'bique Mali Tanzania Kenya Malawi Zambia%growth 6.2 5.91 5.47 4.72 4.55 3.5 3.07 1.89 -0.92

7Source: World Development Indicators, 2017

%growthra

8Source:IFADRuralDevelopmentReport,2016;WorldDevelopmentIndicatorsdatabase,2016.

RELATIONSHIPBETWEENAGRICULTURALGROWTHANDPOVERTYREDUCTION

Farmsize Numberoffarms(%oftotal)%growthin

numberoffarmsbetweeninitialand

latestyear

%oftotaloperatedlandonfarmsbetween0-100

2008 2012 2008 2012

0– 5ha 5,454,961(92.8) 6,151,035(91.4) 12.8 62.4 56.3

5– 10ha 300,511(5.1) 406,947(6.0) 35.4 15.9 18.0

10– 20ha 77,668(1.3) 109,960(1.6) 41.6 7.9 9.7

20– 100ha 45,700(0.7) 64,588(0.9) 41.3 13.8 16.0

Total 5,878,840(100%) 6,732,530(100%) 14.5 100.0 100.0

- 6.1%

CHANGESINFARMSTRUCTUREINTANZANIA(2008-2012)LSMS/NATIONALPANELSURVEYS

Source:GhanaGLSSSurveys,1992,2013

GhanaNumberoffarms %growthinnumber

offarms %oftotalcultivatedarea

1992 2013 1992 2013

0-2ha 1,458,540 1,582,034 8.5 25.1 14.2

2-5ha 578,890 998,651 72.5 35.6 31.3

5-10ha 116,800 320,411 174.3 17.2 22.8

10-20ha 38,690 117,722 204.3 11.0 16.1

20-100ha 18,980 37,421 97.2 11.1 12.2

>100ha -- 1,740 - -- 3.5

Total 2,211,900 3,057,978 38.3 100 100

51%oftotalfarm-land

CHANGESINFARMSTRUCTUREINGHANA(1992-2013)

12Source:NPS2009,2011,2013,2015

MEDIUMSCALEFARMS’SHAREOFTOTALCROPVALUEINTANZANIA–14%TO30%IN6YEARS

• 8-fold increase in the volumes and value of food marketed

through rural-to-urban value chains since 2000 (Tschirley et al,

• Underlying drivers:

– rapidly rising urban demand

– high global food prices

– agricultural sectoral reforms of 1990s

RAPIDINVESTMENTINAGRICULTURALVALUECHAINSBYAFRICANENTREPRENEURS

RAPIDDECLINEINSHAREOFLABORFORCEINFARMING(INFULL-TIMEEQUVALENTS)

Source:Yeboah andJayne(2018)

FARMINGISTHESINGLELARGESTEMPLOYERINMOSTCOUNTRIESDESPITEDECLININGJOBSHARE

5 5.5 6 6.5 7 7.5 8 8.5 9 9.5

Log of GDP per Capita (2010 US dollar)

Botswana Ethiopia Ghana Kenya Malawi MauritiusNigeria Senegal South Africa Tanzania Zambia

Agriculture

5 5.5 6 6.5 7 7.5 8 8.5 9 9.5

Log GDP per Capita (2010 US dollar)

Services

5 5.5 6 6.5 7 7.5 8 8.5 9 9.5

Log GDP per Capita (2010 US dollar)

Manufacturing

Source:YeboahandJayne(2018)

MAJORITYOFOFF-FARMAGRI-FOODSYSTEMJOBSINCOMMERCE,MUCHLESSINAGRO-PROCESSING

Inherited 33.17%

Gifted 10.33%

Purchased 29.63%

Borrowed 11.09%

Rented 9.63%

Other(squatting/clearedland/allocated) 6.16%

Observations 4,291

Inherited/gifted38.34%

Purchased36.46%

Borrowed6.90%

Rented7.00%

Othermodeofacquisition11.30%

PERCENTOFTOTALFARMLANDAREA

Source:LSMS/NationalPanelSurvey2014/15

PERCENTOFPLOTS

MODEOFACQUISITIONOFALLFARMPLOTSINTANZANIA

Source:VanderWesthuisenetal,2018,basedonTradeMapdatabase

NOMINALVALUEOFTRACTORIMPORTSTOSUB-SAHARANAFRICA(EXCL.SOUTHAFRICA),2001-2015

25Source:VanderWesthuisen,2018,basedonLSMS/NPSsurveys

%OFFARMHOUSEHOLDSRENTINGTRACTORSERVICESINTANZANIA,2009VS2015

26Source:LSMS2009,2011,2013,2015

MEANLANDPRICESINTANZANIA:+53.9%INREALTERMSIN6YEARS

Sources:LSMS-ISAandIHSforlandandwages;FEWSNETforureaandmaize

OUTPUTANDFACTORPRICEINDICES,RURALMALAWI,2004-2013

7. ImprovedmarketaccessconditionsforAfricanfarmers

Source:SitkoandJayne,2014

FARMERREPORTEDNUMBERSOFTRADERSBUYINGMAIZEINTHEIRVILLAGE,2014

30Source:ChamberlinandJayne,2012

CHANGEINFARMHOUSEHOLDS’DISTANCETOSERVICESINRURALKENYA,1997-2010

1. Futureaggrowthneededfromhighervalueperhectareandperlaborer,notjustareaexpansion

MAJORCHALLENGESTOBETACKLED

AFRICA’SAGRICULTURALGROWTHSTILLRELIESMAINLYONCROPLANDEXPANSION,NOTENOUGHONPRODUCTIVITYGROWTH

Source:EconomicResearchService,https://www.ers.usda.gov/data-products/international-agricultural-productivity/

1. Africa’slaborforcediversifyingawayfromsubsistencefarming

2. Shareoflaborforceinnon-farmemploymentupsharplysince2000

3. Governancehasimproved,albeitunevenly.Daysofhyperinflation,blackmarketexchangerates

andmacroturmoillargelyover.

4. GreaterproportionofyoungAfricansacquiringsecondaryanduniversityeducations

5. PercapitaGDPincreasedbetween2000and2014by35%inrealterms.SSAhasbeenworld’s

second-fastestgrowingeconomy,exceededonlybyAsia

6. +4.6%inflation-adjustedp.a.aggrowthbetween2000-2016(WB,2017)vs.worldavg.of2.75%

7. Womenhavebecomeconsiderablymoreactiveinlabormarketsandbetterabletoholdstocksof

wealthontheirown

8. Povertyratesdeclinedsignificantlysince2000

9. Nutritionalindicatorsalsoshowgradualbutclearimprovement

SUMMARY:UNMISTAKABLEPROGRESSINSSA

YOUTHLIVELIHOODSOPTIONS

62%<25years

40%Non-farm

60%Farming

Pulledoutofagriculture• Injobswithhighbarrierstoentry• Post-secondaryeducation• Investedinskills

YOUTHLIVELIHOODSOPTIONS

62%<25years

40%Non-farm

60%Farming

10%Successfulnon-farm

30%Strugglingnon-farm

10%Successfulfarming

50%Strugglingfarm

70%Successfulnon-farm

30%Successfulfarming

Policies• Inclusiveeconomic

growth• Infrastructure• R&D• Education

– Post-secondary

Policies• R&D/ext.• Landaccess• Finance• Infrastructureand

investmentsalongvaluechain

– Irrigation– Roads– Electricity

STRUCTURALTRANSFORMATIONPATHWAY

T.S.JayneandHolgerKray

SeminaratMinistryofAgriculture,GovernmentofTanzania

10April2018Dodoma,Tanzania

UNMISTAKABLE SIGNS OF AGRI-FOODSYSTEMS TRANSFORMATION IN AFRICA

Source:UN2013

SUBSAHARANAFRICA:ONLYREGIONOFTHEWORLDWHERERURALPOPULATIONCONTINUESTORISEPAST2050

SSATotalFoodImports from7to40billionUSD(2001-2015)(intraSSAtradefrom1to10billionUSD)

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

TotalFoodImportsl_SSA

TotalFoodImports_nonSSA

Totalvaluefoodimportsas%valueofdomesticagricultureproduction

Billions of nominal U

Source:VanderWesthuisenetal.,2018,basedonNPS/LSMSsurveys

%OFFARMHOUSEHOLDSRENTINGTRACTORSERVICESINTANZANIA,2009VS2015

Distancefromfarmto:

Percentileoffarmhouseholddistribution

Mean 10th 25th 50th 75th 95th

-------------- kmdistance--------------

Nearestdistricttown(km)

37.1 6.0 13.0 30.0 58.0 94.0

Pointofmaizesaletotrader(km)

Source:ChapotoandJayne,2014,basedon2014CropForecastSurvey,n=13,859farmhouseholds

MARKETACCESSCONDITIONS,ZAMBIA,2014

Distancefromfarmto:

Percentileoffarmhouseholddistribution

Mean 10th 25th 50th 75th 95th

-------------- kmdistance--------------

Nearestdistricttown(km)

37.1 6.0 13.0 30.0 58.0 94.0

Pointofmaizesaletotrader(km)

6.8 0.0 0.0 0.0 2.0 58.0

Source:ChapotoandJayne,2014,basedon2014CropForecastSurvey,n=13,859farmhouseholds

MARKETACCESSCONDITIONS,ZAMBIA,2014

1. Futureaggrowthneededfromhighervalueperhectareandperlaborer,notjustareaexpansion

2. Land/soildegradation– willmakecontinuedagriculturaltransformationmoredifficultunless

addressed

• Proximatecauses:lowadoptionof“climatesmart”and“sustainable”landmanagement

practices

• Underlyingculprits– ineffectivenationalagR&Dandextensionsystems

3. The“employmentchallenge”:eachyear,roughly17millionyoungAfricansenterworkingage

MAJORCHALLENGESTOBETACKLED

62%<25yearsold

LOOMINGEMPLOYMENTCHALLENGEINSSA

NMISTAKABLE SIGNS OF AGRI FOOD SYSTEMS …...7 UNMISTAKABLE SIGNS OF AGRI-FOOD SYSTEM TRANSFORMATION IN SSA 1. Major growth in per capita incomes 2. Impressive agricultural growth

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