Agriculture at the heart of Africa's future
By Hervé Gaymard
Member of Parliament & Head of the Savoie General Council, ex-Agricultural Minister
Following the successive industrial revolutions which have accelerated growth and economic development in rich countries, agriculture is considered the poor relation. The view that economic, social and cultural progress is linked to industrialization and urbanization has gained ground by being largely relayed by the media as well as major international institutions, such as the World Bank and IMF.
However, as pointed out by former the Agricultural Minister Hervé Gaymard in an article published in the journal Politique étrangère in spring 2009 , the sacrifice of agriculture to industrial development and the service industry must end. Agriculture is central to the development of poor countries, particularly Africa, mainly because farmers are by far the majority, but also because it would be wrong to forget that that the development of agriculture is a prerequisite sine qua non of the economic growth of a nation. With the exception of the oil countries, no country in the world has developed without the support of competitive agriculture.
We recommend that you read this article (below is an extract), because, in addition to demonstrating how the success of the theory of free trade is almost exclusively based on a political model (British), Hervé Gaymard presents a convincing case about the need to protect African agriculture in order to prompt the continent's economic development. The means to do this remain to be defined....
Extract from the article by Hervé Gaymard
(...) "Economic theories do not grow hydroponically. As with the general movement of ideas, they are the product of history, geography and environment and are founded on mutual interest. As it happens, this theory, formulated by Ricardo in 1817 and implemented 30 years later by Great Britain, has been given the supreme status: to challenge it could only be the product of a dangerous mind, favourable of protectionism and therefore war because, as repeated ad nauseam, "protectionism leads to war." However, things are not that simple.
Refusing the hierarchization of economic activity which sacrifices agriculture
We live indeed within an implicit model of economic evolution. Industry, inherently superior to agriculture, will itself be ultimately overthrown by the services industry; this demonstrates that a society’s modernity and efficiency is reflected by its diminishing number of farmers. Nothing could be more untrue and more dangerous. Of course, it is normal to see a drop in the number of farmers due to growth in agricultural yields which frees-up labour for other sectors, but this does not mean that agriculture should be regarded as an obsolete or second-rate industry once development is attained. This is true for every country in the world but more so for Africa. Firstly, because the agricultural labour force is still the majority in almost every country on the continent. Secondly, because in most cases, as history has demonstrated in Europe, America or Asia, the expansion of cities is not the result of industrial development, but the result of rural-urban migration caused by hardship, not venture, giving rise to the shanty towns of the growing mass of unemployed. Lastly, because reducing poverty should, primarily, relate to the rural community, which already does not have enough to eat, and given the demographic outlook, risks getting into a worse situation tomorrow.
Refusing economic Malthusianism: the world does not produce too much food
Certainly, since spring 2008, with the food crisis – which only surprised those who had a superficial approach to global food issues – this belief has since faded. However, it must be repeated, that to meet the planet’s current and future needs, we must increase production, protect all types of farming and pay particular attention to the environment, the development and the production of agriculture in the southern regions. According to some estimates, Africa will have to increase its food production 5 fold by 2050 to meet its food shortage and cope with population growth.
Northern agricultural policies vs. agriculture in Africa
Another belief expertly spread by the major, vast-estate, agricultural exporting countries of the Cairn Group is that: the European Common Agricultural Policy (CAP) is itself responsible for the difficulties of African agriculture - curiously, U.S. policy is spared by this reasoning –. There is no doubt that export subsidies have had a negative effect because products maintained at artificially low prices discourage local production. However, it is now ten years since the European Union (EU) drastically decreased these subsidies, and even suggested eliminating them during the Doha Round. But what did the United States do? They increased their marketing loans and continued with their food aid policy (whose devastating effect on agriculture in the southern regions, particularly in Africa, has been generally acknowledged).
For Africa to develop its agriculture and feed its population, it will have to permanently protect its markets from more competitive markets, especially from major emerging economies. On African markets, the Brazilian chicken is found more frequently than the Brittany or Dutch chicken, and on the market of Mopti in Mali, Mali rice is sold 350 CFA francs (CFA-F) per kg, compared to 250 CFA-F for Thai rice. We also know the extent of the struggle to resolve the problem of cotton (see box). Even if still under debate, the EU’s sugar policy of 1968, which guaranteed minimum quantity sugar purchases at European prices higher than world market prices, has enabled many countries to consolidate their development - the best example being Mauritius. For the full story, let’s not forget that this system was recently dismantled following a complaint made to the WTO by Brazil and Thailand to the detriment of many African, Caribbean and Pacific (ACP) countries. Finally, we should also note that: 1) issues concerning the price of tropical commodities are in no way linked to European politics, 2) if Europe is the outlet to half of Africa's agricultural exports (while only 30% of African imports come from Europe) it is because of the unequal trade policy extensively pursued by the EU (Lomé Convention in 1975, initiatives such as “Everything But Arms” in 2001).
Using the experience of recent decades
(...) Since the early 1970s, there has been a relative decline in African agriculture (highlighted by the fact that in the same laps of time, Asia underwent a spectacular green revolution), illustrated by a decrease in average yield, the fall of the continent's share in global agricultural and food trade (from 10% to 4% between 1960 and 2005) and a greater dependence on food imports. There are several explanations: the decline in aid policies for agricultural development (these fell by 10% to 4% between 1990 and 2005), notably because of the World Bank; the negative side-effects of the Structural Adjustment Programs mandated by the IMF, with a massive drop in customs duties and the withdrawal, though slight, of support policies for agricultural sectors; export crop dependency on global prices, which show a long-term downward trend and which are lower than cereal prices; and not forgetting of course the effects of the lack of a transport infrastructure, as well the conflicts that have proliferated on the continent after decades of relative peace. Despite this decline, we must remember that the continent’s food and agricultural trade balance remains positive, with $ 14 billion in exports compared to $ 10 billion in imports.
This brief account of evolution is certainly lacking and should be completed, detailed and corrected depending on the times and the regions involved. It is of course, simplistic to refer to African agriculture as a whole: what characterizes it is obviously its great diversity due to the climate and the population pressure of each individual country. But by and large agriculture, with 65% of the active population and over 30% of gross domestic product, is irrefutably the present and future of Africa. (...)
As stressed, African agriculture has experienced a "moment" characterized by inadequate protection of customs duties, often lower than the rates authorized by the WTO, and the decline in public investment as part of an implicit model directed towards global export, intra-continental trade only represents 22% of agricultural trade. The new international context marked by increased prices in raw materials, even higher global price volatility and the development of numerous bilateral trade negotiations due to the Doha Round deadlock, must lead African countries into defining an aggressive agricultural policy, supported by the international community, mainly the EU which has always been the Africa’s principal partner. This new African agricultural policy, whose early stages were first observed with initiatives for the Maputo Summit of the African Union (AU) in 2003, the drive of the Economic and Monetary Union of West Africa (UEMOA) in 2001 and the Agricultural Policy of the Economic Community of West African States (ECOWAS) in 2005, could be organized as following:
Priority must be given to subsistence food farming (taking into account both the traditions and habits of the population but also agronomical realities) or for export to other African countries through the consolidation of regional markets. It is estimated that demand will have doubled between 2000 and 2015, and that from 2030 the urban shift will increase market opportunities. Demographic data also indicates that there will be an increase in activity scheduled until 2040; this will increase the numbers in the active population ready to work and consume. African institutions, at a sub-regional and national level (some countries such as Senegal, Mali, or Burkina Faso have already taken initiatives) and strongly supported by financial backing, should therefore categorize this priority into all the compartments of its agricultural policy, be it for infrastructure (transport, irrigation, electrification, cold chain), training, fertilizer and seed availability or the organization of production channels, processing and marketing. But the most important aspect and the most difficult to implement, as with any agricultural policy, is the means to limit agricultural price volatility which destroys any long-term perspective. Early warning systems for production and prices as well as insurance against disaster and emergency stocks are essential to building a sustainable agricultural policy.
Agricultural development in Africa cannot be achieved without adjusting WTO rules, both for subsistence food farming and for export. So far, governments, NGOs and public opinion have given too much importance to the WTO: it has wrongfully been given the power to do that which it was initially intended to prevent. This organization should acknowledge the decisions made elsewhere and give each regional group the opportunity to organize themselves according to their needs and capacity, without being constrained by free-trade and the laws of the favourite nation. As I put forward a long time ago, a Global Food Security Board could lay down sanctions to regulate the WTO. Trade is very important, but it is not everything. It is only one element in the future of a population. The agricultural issue is not primarily a commercial matter. Compared to global agricultural production, the portion that is internationally traded remains modest - from 2% to 10% depending on the product - even if its impact on prices and therefore farmers and agricultural structures is massive. The agricultural issue is primarily a political matter because it implicates the organization of society, lies at the crossroads of most public policies (agricultural, industrial, health, social ...) and is at the heart of international aid policies for development and reducing poverty."