Business

AfDB invests US$40 billion in Africa’s agro-sector

TRYNESS TEMBO, Lusaka
THE African Development Bank (AfDB) will invest about US$40 billion annually in transforming the agriculture sector and commodity value chains to make the African industry more competitive, bank director for agriculture and agro-industry Chiji Ojukwu has said.
Mr Ojukwu said transforming the commodity value chains and agro-ecological zones will open up markets worth US$85 billion making substantial impact towards sustainable development goals on poverty reduction and ending hunger.
He said this when he presented a paper on the Road to agricultural transformation at the on-going African Development Bank annual conference.
“Fulfilling Africa’s potential for transformation in the priority commodities value chains and agro-ecological zones entail different emphasis in the type of support needed to catalyse investment. The total cost of transformation for these areas in the strategy is between US$315 billion and US$400 billion over 10 years, equivalent to US$31.5 billion to US$40 billion per year,” he said.
Mr Ojukwu said the investment needed exceeds resources currently available from the public sector, but through coordination and partnership, as well as the development of innovative financial instruments, it can be achieved.
He said the bank and its partners will pursue the agenda to transform a selection of key agricultural commodities and agro-ecological zones which will involve strengthening a broad range of value chains.
He, however, said in the short and medium term, resources will be focused on selected agricultural value chains and related agro-ecological zones.
He said the prioritisation of the selected agricultural value chains and related agro-ecological zones are based on future demand, competitive advantage, scope for transformation uplift, potential to nourish Africa and existing focus.
Meanwhile, Mr Ojukwu said currently, 232 million people are under-nourished in Africa and low productivity makes African agriculture uncompetitive.
“If nothing is done, the population under extreme poverty will rise from 420 million in 2015 to 550 million 2025,” he said.
He also said increased food demand and changing consumption habits driven by demographic factors such as population growth and urbanization, are leading to rapidly rising net food imports which are expected to grow from US$35 billion in 2015, to over US$110 billion by 2025.

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