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Economic Transformation Africa:
Some Gaps in Research and Policy
Kimsey Savadogo
PTCI & Universite de Ouagadougou
African policy orientation from the
1960s to today
• The early twenty years: 1960-80
– Emphasis on industrial sector
– State involvement in commercialization: marketing
boards
– Occasional subsidies for agriculture
• The 1980s and early 1990s
– Denouncing the inefficiency of past public policies
– SAPs: Trade liberalization, privatization, abolition of
marketing boards, state retrenchment (reduction of
public expenditure in agriculture), and currency
devaluation
African policy orientation from the
1960s to today
• The late 1990s to the first decade of the years
2000
– Poverty reduction strategy policies (PRSPs)
– Lack of a global view of growth and development
– Advent of CAADP as a unifying framework for
policy making in Africa
• The second decade of the year 2000
– Inclusion of growth concerns in donor assisted
programs
African policy orientation from the
1960s to today
• Summing up
– Policy shifts observed every decade
– Frequent changes on what stands as priority areas
– Fortunately a sharp turn starting ten years ago with
the advent of a unifying policy framework at
continental level
• Lessons
– In the future Africa has to keep in memory this period
of trials and errors of the past and resolutely engage
in the design of policies to achieve a stable growth
Economic transformation and the role
of agriculture
• Any economic transformation in Africa will
have to build on the agricultural sector
– The significance of agriculture in the national
economies is well known. Agriculture contributes
to food security, employment, income for close to
80 percent of population
– Agricultural growth and GDP growth go hand in
hand in Africa
GDP growth and agriculture
-4
-2
0
2
4
6
8
10
1980 1985 1990 1995 2000 2005 2010
Annualgrowth,%
Figure 1— GDP and agricultural growth in Sub-Saharan
Africa, 1980–2011
Agriculture, value added (annual % growth) GDP growth (annual %) Linear (GDP growth (annual %))
What may prevent the role of agriculture in
economic transformation
• For agriculture to however be the engine of economic
transformation, agricultural production has to become more
predictable: looking at the graph above, one can note the
ample year to year fluctuations of the inter-annual changes of
agricultural value added (role of technology, soil conservation)
• The gains in the sector these pat years following the
macroeconomic policies of the 1980-1990s need to be
sustained.
• Africa still relies on rainfed cropping, the contribution of
irrigated agriculture is dismal
• Governments have withdrawn from financing the agricultural
sector, ODA has been reduce, but there is a tendency to
reverse the decline in ODA and private funding has started to
supplement government investment in agriculture, e.g. AGRA
Policy orientation? New Threats?
• In Africa, agricultural production is still dominated by
the small farm, yet there is no clear vision of the role of
the small farmer in the future of agriculture. For
example, do we need different types of actors for
agriculture to grow? (Case of successful China and the
role of smallholder there)
• An ongoing phenomenon that threatens the sustained
development of agriculture is climate change; among
other things, climate instability creates swings in year
to year production
• Another new, developing phenomenon is the one of
foreign acquisition of African land for agricultural
production
Possible Research Areas
• Recent event of land acquisition by foreigners
– Is this a positive or negative thing for Africa (consider possible
benefits and the losses incurred? Are there contractual
arrangements that may ensure gains for Africa?
– Does the answer depend on whether it is a long term or
temporary phenomenon?
– Can there be any learning from foreign ventures on African soil?
– What are environmental effects? Are foreign firms going to
mine the soils for some time and leave when the land becomes
degraded? Will there be any land protection?
– What are the impacts on Africa’s food security? Are we going to
witness a situation of export-reimport of products produced on
African land?
Possible Research Areas
• The issue of the small holder. Given that smallholders
make up the crushing majority of farms in Africa, what
would be the right stand?
– Is the smallholder the problem rather than part of a solution?
Should we consider smallholders to be social problems with
solutions belonging to the area of social protection? Or is the
smallholder an economic agent to be reckoned with?
– Can the Chinese situation apply to Africa?
– What is the likely success of the approach praised by some
countries who consider agri-business to be the solution to
agricultural development and food security? And what would be
the right agri-business be? Consider the fact that in many
African countries the political and urban elite become the
landlords very often, and progressively large pieces of land pass
hands from peasant farmers to these new land lords.
– Can Africa afford to do away with the small holders by treating
them as a social problem?
Possible Research Areas
• Technology, innovations and agricultural growth The role of
technology in agricultural growth has been addressed by many, at
the farm level, usually for a region of a country. However, the effect
of technology Africa wide is not known.
• Examine rates of return, and distribution of benefit, for major
innovations/groups of innovations in staple food crops in several
African countries
• What would be the impact of wide scale irrigation in Africa? Is such
wide scale irrigation feasible ? (inter-country water right issues?
Environmental issues?)
• What is the role of agro-processing in stabilizing agricultural
growth? What are factors of hindrance to the development of agro-
processing? What are the impacts of international trade
arrangements on the success of aro-processing?

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Economic transformation africa

  • 1. Economic Transformation Africa: Some Gaps in Research and Policy Kimsey Savadogo PTCI & Universite de Ouagadougou
  • 2. African policy orientation from the 1960s to today • The early twenty years: 1960-80 – Emphasis on industrial sector – State involvement in commercialization: marketing boards – Occasional subsidies for agriculture • The 1980s and early 1990s – Denouncing the inefficiency of past public policies – SAPs: Trade liberalization, privatization, abolition of marketing boards, state retrenchment (reduction of public expenditure in agriculture), and currency devaluation
  • 3. African policy orientation from the 1960s to today • The late 1990s to the first decade of the years 2000 – Poverty reduction strategy policies (PRSPs) – Lack of a global view of growth and development – Advent of CAADP as a unifying framework for policy making in Africa • The second decade of the year 2000 – Inclusion of growth concerns in donor assisted programs
  • 4. African policy orientation from the 1960s to today • Summing up – Policy shifts observed every decade – Frequent changes on what stands as priority areas – Fortunately a sharp turn starting ten years ago with the advent of a unifying policy framework at continental level • Lessons – In the future Africa has to keep in memory this period of trials and errors of the past and resolutely engage in the design of policies to achieve a stable growth
  • 5. Economic transformation and the role of agriculture • Any economic transformation in Africa will have to build on the agricultural sector – The significance of agriculture in the national economies is well known. Agriculture contributes to food security, employment, income for close to 80 percent of population – Agricultural growth and GDP growth go hand in hand in Africa
  • 6. GDP growth and agriculture -4 -2 0 2 4 6 8 10 1980 1985 1990 1995 2000 2005 2010 Annualgrowth,% Figure 1— GDP and agricultural growth in Sub-Saharan Africa, 1980–2011 Agriculture, value added (annual % growth) GDP growth (annual %) Linear (GDP growth (annual %))
  • 7. What may prevent the role of agriculture in economic transformation • For agriculture to however be the engine of economic transformation, agricultural production has to become more predictable: looking at the graph above, one can note the ample year to year fluctuations of the inter-annual changes of agricultural value added (role of technology, soil conservation) • The gains in the sector these pat years following the macroeconomic policies of the 1980-1990s need to be sustained. • Africa still relies on rainfed cropping, the contribution of irrigated agriculture is dismal • Governments have withdrawn from financing the agricultural sector, ODA has been reduce, but there is a tendency to reverse the decline in ODA and private funding has started to supplement government investment in agriculture, e.g. AGRA
  • 8. Policy orientation? New Threats? • In Africa, agricultural production is still dominated by the small farm, yet there is no clear vision of the role of the small farmer in the future of agriculture. For example, do we need different types of actors for agriculture to grow? (Case of successful China and the role of smallholder there) • An ongoing phenomenon that threatens the sustained development of agriculture is climate change; among other things, climate instability creates swings in year to year production • Another new, developing phenomenon is the one of foreign acquisition of African land for agricultural production
  • 9. Possible Research Areas • Recent event of land acquisition by foreigners – Is this a positive or negative thing for Africa (consider possible benefits and the losses incurred? Are there contractual arrangements that may ensure gains for Africa? – Does the answer depend on whether it is a long term or temporary phenomenon? – Can there be any learning from foreign ventures on African soil? – What are environmental effects? Are foreign firms going to mine the soils for some time and leave when the land becomes degraded? Will there be any land protection? – What are the impacts on Africa’s food security? Are we going to witness a situation of export-reimport of products produced on African land?
  • 10. Possible Research Areas • The issue of the small holder. Given that smallholders make up the crushing majority of farms in Africa, what would be the right stand? – Is the smallholder the problem rather than part of a solution? Should we consider smallholders to be social problems with solutions belonging to the area of social protection? Or is the smallholder an economic agent to be reckoned with? – Can the Chinese situation apply to Africa? – What is the likely success of the approach praised by some countries who consider agri-business to be the solution to agricultural development and food security? And what would be the right agri-business be? Consider the fact that in many African countries the political and urban elite become the landlords very often, and progressively large pieces of land pass hands from peasant farmers to these new land lords. – Can Africa afford to do away with the small holders by treating them as a social problem?
  • 11. Possible Research Areas • Technology, innovations and agricultural growth The role of technology in agricultural growth has been addressed by many, at the farm level, usually for a region of a country. However, the effect of technology Africa wide is not known. • Examine rates of return, and distribution of benefit, for major innovations/groups of innovations in staple food crops in several African countries • What would be the impact of wide scale irrigation in Africa? Is such wide scale irrigation feasible ? (inter-country water right issues? Environmental issues?) • What is the role of agro-processing in stabilizing agricultural growth? What are factors of hindrance to the development of agro- processing? What are the impacts of international trade arrangements on the success of aro-processing?