The causes for Africa's poor performance on agricultural and food markets are numerous and complex. Among the most important factors are its lack of competitiveness on both internal and global markets and its inability to influence them because its contribution as a supplier is insignificant. It is likely that misdirected investments over long periods in the past and undeveloped marketing infrastructure and services have contributed to these conditions.
Individual countries have applied a retail approach to development that has led to the marginalization of producers from markets. This approach should be replaced by the adoption of a more appropriate scale of analysis, decision and action, which is provided by the constituent Regional Economic Organizations and the NEPAD framework. Indeed, NEPAD, through its CAADP, can contribute to the sustainable and profitable development of agriculture with regard to both competitiveness and growing supplier significance. Competitiveness can be enhanced by promoting investments for products that have comparative advantage. NEPAD can also increase supplier significance by making a few selected products priorities and promoting the convergence of these priorities within sub-regions and selected countries. Such an approach would prevent the dispersal of investments that in the past was ineffective in capturing the myriads of market possibilities.
This desk study aimed at initiating a process to identify dynamic products for both significant market niches and mass markets within Africa and internationally. In addition, key factors of Africa's poor performance in agriculture were reviewed, which helped identify targets for action and investment that would increase supplier significance and competitiveness.
Despite the achievements of this study, further work is needed, especially to augment the production - cost analysis and cost profiles of selected products along the chain from farm to market. This work would provide an even stronger basis for selection and investment choice with an aim at exploiting value-adding opportunities in the food sector (i.e. processing, packaging and marketing). Additional study should be devoted to the export dynamics and performance of main African products. Moreover, a rigorous examination should be made to compare the competitiveness of imports (e.g. rice, sorghums, maize) relative to corresponding African production. Meanwhile, it should be kept in mind that too frequently large amounts of subsidized supplies are provided through aid programmes or liberalized trading regimes.
In summary, Africa has limited resources, and it is necessary to promote products that have a good chance of commercial success on internal and international markets alike.
Santiago Funes
Director, Policy Assistance Division
