Breakout session 1:  AFRICA

Paper "Sub-Saharan Africa: The state of smallholders in agriculture" by Geoffrey Livingston, Steven Schonberger and Sara Delaney, IFAD

Chair’s remarks and key points: Mark Sadler, World Bank

• There are clear opportunities for commercialization of smallholder farming in Africa but the challenge lies in bringing markets to farmers – ‘pulling’ demand for goods that will motivate farmers to make investments, find innovative ways of overcoming spatial and technological constraints.

• Producer organizations are fundamental to giving smallholder farmers voice in governance and policy fore, facilitating engagement with the private sector in value chains, and sharing knowledge and technology to improve the quality of output.

• Raising the interest of youth in the ‘business’ of agriculture is a priority. The proposition of value in smallholder farming will be attractive to the entrepreneurial-spirited with knowledge of commercialization.

• Expand knowledge with vocational and skills training with the dual goals of business-decision making and movement toward knowledge-intensive production systems.

• Private sector investment is essential for intensification of agriculture (extensification proving to be complicated and less feasible) but projects often lack the visibility for attracting private investors. Public-private partnerships are a promising solution to bridging the divide.

• Get to the village level in development planning; move away from abstract decentralization to a concrete range such as the “10 km radius of a mother and child reunion,” and get more implementation done.  

• Timeliness of intervention needs to improve. Research should evaluate existing processes and the optimal frameworks for delivering payments or programs. Whose role is it (IFIs, governments, private sector) and whose role should it be?

• Africa suffers from chronic geographic isolation. Spatial constraints need to be addressed, and although the discussion is mature, how much of an issue is this?

• The issue of viability needs to address a balance between investment in infrastructure and institutions, and public goods and subsidies.

Synthesis of discussion

The paper presented Sub-Saharan Africa (SSA) as a region of “superlatives and contrasts”. Certain facts coloured the working group discussion: it is the most land-locked region, yet has the least intra-regional trade; it has the highest proportion of the population in agriculture, with the greatest dependence on imports; the highest percentage growth rate in the agricultural sector despite low public expenditure. The major challenges to smallholder farming in this context are characterized by the authors (non-exhaustively) as twofold. First, the spatial context, described as “extreme geographic isolation,” highlights smallholders’ inability to participate in markets due to physical and economic distance. A study of transportation costs served to illustrate this constraint. Secondly, a lack of timeliness in project intervention has caused ineffectiveness and calls for candid introspection by donor agencies and development professionals. The viability of smallholder farming in SSA was discussed more broadly in the discussion that followed.

There exist opportunities for farmers to commercialize, namely in import substitution, linking to growing urban markets, and by intensifying production with improved technology and practices. The latter is in contrast to extensification onto land suitable for agriculture, since ownership and other uses of the land complicate its availability. Connection to markets remains a great challenge, with distance being a disincentive for farmers to seek marketing opportunities and invest in productivity-enhancing technology. It was proposed that demand from structured markets with fair prices would ‘pull’ smallholders toward more commercialized production, qualified, however, by the need for appropriate infrastructure. In this respect, donor organizations need to find the balance between hardware (e.g. roads, infrastructure) and software investment (e.g. capacity, financial services) that will best enable smallholders to commercialize.

Farmers’ organizations were found to be core to the viability of smallholder farming.

They hold tremendous potential for,

• acquiring inputs and marketing outputs
• pooling output for engaging with ‘big business’
• creating bargaining power and giving “voice” to smallholders in local democracy
• communally-purchasing equipment and technology
• transmitting and sharing market information

Could there also be a role for farmer organizations in infrastructure development? More generally, organizing empowers farmers to develop, engage, and flourish. In SSA, this means overcoming economic and physical distance. Organizations are an especially powerful tool for women farmers, with broad implications for rural development as agriculture becomes increasingly feminized. There is a positive role for the development community to increase investment, refine interaction, and improve utilization of farmer’s organizations.

Increasing production and commercially-orientating do not come before having the capacity to do so. As distinct from broad capacity building, “entrepreneurial” training is often underestimated, yet not all farmers are endowed with entrepreneurial knowledge or flair. It was suggested that a short course that covers the basics of business management would be an effective, empowering tool. It is also a need that could be addressed by the pooled resources of farmer’s organizations.

Geography remains a constraint for marketing goods, and the additional issue of ports was raised in the context of transportation costs. Congestion at ports, water levels and deep-sea port infrastructure are relevant concerns for many land-locked countries in SSA who wish to connect to export markets. Conversely, in terms of import substitution as a growth opportunity for smallholders, improving port infrastructure will help the flow of goods out and in. This raised the question; can smallholder farmers really be competitive against producers from countries with lower transportation costs, subsidized agriculture, or higher productivity? The suggestion that import activity could be limited to coastal areas in turn raised the importance of intra-continental trade for land-locked countries. The enormous potential of intra-regional trade, however, requires vast improvement of the enabling environment. A case in point is ECOWAS, where sound trade policies are found but transport costs are a major impediment. Unwinding the linkages of politically-connected private transport operators and policy-makers will require a transfer of power that is unlikely to be easy. This raised the question of who should be taking the lead to create these changes.

A discussion about labour productivity emerged with the idea that burgeoning democracy in SSA is addressing labour regulation issues, including child labour practices, but in effect raising the cost of labour. The constraint is especially felt at peak harvest times and ultimately affects profitability and the ability to acquire labour-saving technology. Furthermore, as the hand-ho is traded for more sophisticated equipment, labour is released from agriculture creating a need for employment opportunities in the non-farm sector. Yet it is technological innovation that will change perceptions, allowing youth to see themselves as entrepreneurial smallholders rather than subsistence farmers.

Discussion over the late delivery of programmes and project intervention raised an unanswered question; are poor planning and weak management to blame or should projects be delivered by different means all together? Decentralization to the village level was recommended, so that development intervention can effectively reach the “10km radius of a woman and child” in rural SSA. Despite the shortcomings of development programmes, there is still the major benefit of supply network development which effectively creates demand, in other words a guaranteed market for input supplies.

Finally, comprehensive strategies for smallholder farming were cited, in particular CAADP, the Maputo Declaration, and AGRA. Although more discussion is welcome as to which on-the-ground approaches work best in SSA, the next step is to move on to implementation.