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Statement by IFAD President Kanayo F. Nwanze at Ministry of Foreign Affairs Rome, Italy

Location: Rome, Italy

17 May 2016

Economic sustainability – Italy and Africa, challenges for a common growth

 

Excellencies,

Esteemed colleagues,

Ladies and gentlemen,

It is my great honour to be here today.

IFAD enjoys a special relationship with Italy, our host country.

Of course, Rome is our home – as well as home to our sister agencies: The Food and Agriculture Organization of the United Nations, and the World Food Programme.

More than that, Italy has played – and continues to play – a pivotal role in funding and sustaining IFAD’s activities.

Our cooperation spans many areas. Together we have worked closely in supporting the development of the Sustainable Development Goals/Agenda 2030, as well as last year’s Milan Expo 2015, at which we called world attention to the importance of agriculture for sustainable development.

We share a conviction that a vibrant agricultural sector depends on small-scale farming –– and that smallholder farmers have a crucial role to play in food security, nutrition, and poverty reduction.

We also share a commitment to Africa. Italy has a long history of investing in sub-Saharan Africa’s development, and this is also where about half of IFAD’s financing is directed.

As you know, IFAD is both a specialized agency of the United Nations and an International Financial Institution. As such, we are concerned with human development, but we also focus on the bottom line.

IFAD acts as an investor – at times granting and at times lending money to governments to help poor rural people to invest in and grow their businesses, and contribute to food security and economic growth

IFAD has been operating for almost 40 years, with ongoing programmes and projects in 98 countries around the world, including many in partnership with Italy, in Africa.

The reform of Italy’s development cooperation, with the creation of the Italian Agency for Development Cooperation and the new role for Cassa Depositi e Prestiti represents an opportunity to strengthen this partnership even further, as we work to achieve the SDGs.

Ladies and Gentlemen,

As we examine the conditions for economic sustainability, let me be clear: for Africa, economic sustainability goes hand-in-hand with agricultural development.

More than 330 million Africans live in extreme poverty, and the number is rising.

This is unacceptable.

Today, Africa imports more than US$35 billion in food every year. Much of this is for stable foods – such as rice and maize – that can be produced on the continent.

This is unsustainable.

Africa is a richly endowed continent. It is blessed with arable land – a large part with plenty of sunshine, rivers and abundant rainfall. But governments have made extractive industries a priority, at the expense of agriculture.

The riches from extractive industries have not translated into wide-ranging job creation. They have not led to stronger or more stable societies. They have not fed hungry people. They have not reduced poverty.

This, too, is unsustainable.

Fortunately, or unfortunately, global trends are forcing African nations to refocus their priorities – commodity prices continue to fall, oil prices are at their lowest in decades, and China’s economy continues to slow down.

And this is where agriculture has become absolutely crucial. Africa needs diversification INTO agriculture, not out of agriculture.

Evidence shows that for sub-Saharan Africa, GDP growth generated by agriculture is up to 11 times more effective in reducing poverty than growth in other sectors.

Of course, farming feeds people. But it also creates jobs and generates wealth! It offers the basic foundations for a cohesive society.

There can be no development without peace and security. And the reverse is also true.

At IFAD, we see time and time again that inclusive agricultural development results in greater productivity, in higher incomes, in better food security and in social cohesion.

With an ever-increasing population, and more wealth on the continent, there will be no shortage of demand for food in the years ahead.

By investing in rural economies, we can also create a range of opportunities for young people in Africa’s rural areas.

In sub-Saharan Africa, around 224 million young people will be seeking employment in the next decade. Of these, more than 130 million will live in rural areas.

It is not realistic to expect urban areas and the non-farm sector to absorb an extra 130 million people in the next ten years.

I can understand when children, women and men risk their lives to flee man-made conflict, insecurity and hunger from countries like Libya, Syria, and South Sudan. But it is a disgrace that our sisters and brothers in sub-Saharan Africa are also forced to flee inequality, indignity and lack of opportunity.

Too many die on the road to a better life, their bodies found across the Saharan desert or washed up on Mediterranean beaches.

This adds to the urgency of our work.

So how do we unlock the huge potential of agriculture for Africa? And how do we ensure these changes are economically viable and environmentally sustainable?

We start by acknowledging that farming at any scale is a business – and that it must also provide opportunities for the development of SMEs.

Rural business people need the same things that all business people need. They need access to finance and markets. Decent infrastructure, particularly reliable energy connectivity. They need policies and legislation that promote growth and protect their rights to water and land.  

And they need policies that support equitable and transparent business relationships, so that the less powerful partners – particularly women and young people – are not exploited or marginalized.

This is a process that must start in Africa and be led by Africa.

Honourable Ministers, Excellencies, Ladies and Gentlemen,

Last week, I was in Kigali, Rwanda, attending the annual meetings of the Grow Africa Investment Forum and the World Economic Forum on Africa. In only five years, Grow Africa has galvanised domestic and foreign private sector players to invest in Africa’s agriculture. It has also linked millions of the continent's small producers and SMEs to markets.

It is a start. A good start. But it must be followed up by concerted action.

There is a real danger that by 2030 Africa will be home to 80 per cent of the world’s poor!

Let me leave you with a question I first asked African leaders in 2014 – is this the legacy we want to leave for future generations?

 At IFAD, we stand ready to work with all partners gathered here over the coming months and years to unlock the potential of millions of African women and men by creating opportunities in rural areas.

On behalf of IFAD, I would like to thank the Italian government for its Africa-Italia initiative.

Thank you