Atsuko Toda - Afrikan Heroes

SME’s and MSME’S are Lynchpin of African Agriculture – AfDB

September 9, 2020

A panel of some of Africa’s most promising small and medium-enterprise (SME) agripreneurs gathered online to call for more selective investment, accelerated business acquisitions and increased cooperation to help Africa feed itself and the world. The African Development Bank organized the virtual session, Integrating African Food Systems through the Lens of SME Champions, as a side-event ahead of Africa’s largest agriculture conference – the African Green Revolution Forum (AGRF) – which is being held online for the first time, from 8-11 September. Webinar moderator Atsuko Toda, Bank Director for agricultural finance and rural development, said the panel members, were selected because they are using innovative solutions, tailored their business models, have a proven track record, and shown to have an impact on food systems.

Atsuko Toda, Director for agricultural finance and rural development,AfDB

“We see the importance of the roles that you play, the risks you take and the Bank wants to give you more visibility so that policy makers can understand the challenges of what you are facing and help SME Champions to grow,” Toda said. The group of African “SME Champions” – heads of SMEs across the continent’s food system production, processing, logistics, agricultural digitization and cold storage chain solutions sub-sectors, set the scene for webinar attendees, by describing the challenges and opportunities they face in trying to meet Africa’s food systems demands. Some said policy, programs and financing in Africa are geared toward larger organizations and businesses – and that there is still too heavy a focus on agricultural imports to Africa.

“Especially if you are an SME it is really challenging to penetrate the market and do something significant,” said Nicholas Alexandre, Global Head of Commercial at LORI, a Kenya-based tech-driven logistics company.

Others shared their experiences in overcoming challenges. For example, Nnaemeka Ikegwuonu, head of Nigeria-based ColdHubs, says his solar power, cold storage facility company helps farmers’ produce stay fresher, longer, reducing the need to rush product to market at less competitive prices. ColdHubs says it invested in the storage infrastructure, so that farmers could benefit from the service at a reasonable price.

“We are taking the risk out of ownership of huge cold rooms from smallholder farmers because we design, operate and maintain these cold rooms. We offer a pay-as-you-use service model,” said Ikegwounu.

Kenya’s SunCulture company, which provides farmers with solar-powered irrigation services, also uses a similar “pay-as-you-grow” service fee program. SunCulture CEO and SME Champion Samir Ibrahim told webinar attendees that there has been sufficient development and investment support to African entrepreneurs to know what works – and that it is time to step up scaling up efforts. “We know that there are proven solutions, the focus now should be to target finance and partnerships to scale those…We need donors and multilaterals to start cutting much bigger checks for much fewer interventions…so we can see the needle moving,” Ibrahim said.

Other champions said building up Africa’s agriculture sector lies in building up its agriculture value chains. SME Champion Patricia Zoundi, who started up Canaan Land, a Cote d’Ivoire-based company that trains women in rural areas in order to develop sustainable and inclusive agriculture said, “We have north-north cooperation. We have south-south cooperation. Now it is time to have SME-to-SME cooperation…On this panel, I see three SMEs with which I can collaborate in marketing…[they offer] something I need in my value chain.”

Toda closed the session by reassuring SME Champions that their insights shared would be transformed into key messages intended to reimagine policy, resulting in the accelerated transformation of Africa’s food systems. “There is so much for us to share, proven solutions for us to amplify, to bring forward to scale and consolidate through partnerships and finance.”

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Mitigating COVID-19’s impact on Africa’s food systems

April 18, 2020

Atsuko Toda, Director of Agricultural Finance and Rural Development at African Development Bank

By Atsuko Toda and Martin Fregene

We are facing great uncertainty on the African continent. The global spread of COVID-19 and the rising number of coronavirus cases in Africa are fueling anxiety about negative economic growth, failing healthcare and collapsing food systems. We are already grappling with a locust outbreak in the Horn of Africa, drought and flood extremes due to climate change and increasing food importation costs of more than $47 billion in 2019. The convergence of all these sets the stage for an imminent food crisis – unless measures are taken to mitigate the impact of the pandemic. Consider also that the U.S. dollar has surged against emerging market currencies, reducing the purchasing power of countries reliant on commodity imports and sparking higher consumer prices. Inflationary pressure on food staples can breed social tension and even unrest.

Dr. Martin Fregene, Director of Agriculture and Agro-industry Africa Development Bank

Anti-pandemic measures like nationwide lockdowns and border closures compound food shortages – especially of nutritious but perishable foods like fruit and vegetables. Restrictions on movement and quarantine measures impede farmers’ access to markets. In Nigeria, rice prices are 30% higher than in January, thanks to panic buying, transport restrictions and rising global prices.

Also, foreign direct investment and aid into Africa is expected to fall, or be delayed as international investors and development partners redirect capital to their local economies and into stimulus packages to combat COVID-19. But Africa is coming up with its own solutions for these challenges, with the African Development Bank being prominently involved.

To address the threat of food security, several short-term measures are being taken: Creation of a “green channel” for the free flow of food and agricultural inputs. Creation of strong demand for agricultural inputs of fertilizer, seeds and agro-chemicals through smart input famer subsidies. Measures to prevent food price hikes by releasing food from government grain reserves and implementing anti-hoarding policy. Rapid scale up of food production technologies, including high-yielding, early-maturing, drought-tolerant, disease- and pest-resistant staple crops, livestock and fish through programs like the Bank’s Technologies for African Agricultural Transformation initiative. Feeding programs for the worst affected and most vulnerable zones.

Medium to longer-term food security interventions include: Provision of recovery strategy support to key supply chain players like logistics companies and anchor farmers. Strengthening food supply chain resilience via efficient production, processing and value addition. Enforcing food safety, improved food quality and traceability policies in the post-coronavirus period. Promoting digitalization and e-commerce in markets hit by COVID-19.

Guided by lessons learned from previous health crises, including the Ebola epidemic, the Bank has responded to the pandemic by putting together a package of support for the public and private sector. The COVID-19 Response Facility will mobilize up to $10 billion to provide financial assistance to African countries fight the pandemic. The Bank has also raised a $3 billon COVID-19 bond, proceeds of which will go to address fiscal challenges, as well as emergency procurement of drugs, vaccinations, ventilators and other health-related expenditures, as well as feeding programs, agro-input subsidies and other socio-economic interventions.

To rebound from the pandemic, Africa must maintain adequate food reserves, avoid protectionist policies and promote value chains that link domestic and international markets. As the Bank takes a key role in supporting African countries to design and implement coordinated policy responses, it will work with regional partners including the African Union and the United Nations Economic Commission for Africa, as well as international ones such as the World Trade Organization, the Global Alliance for Improved Nutrition, the Food and Agriculture Organization, the World Bank, and other international partners.

Dr. Martin Fregene is the Bank’s Director of Agriculture and Agro-industry. Atsuko Toda is Director of Agricultural Finance and Rural Development at African Development Bank.

Kelechi Deca