Harmonizing Market and Trade Policies and sourcing in Africa

This session curated a macro perspective on African value chains and their integration into global markets. As well as highlighting the need to make the African Continental Free Trade Area (AfCFTA) a reality, the overall message was that Africa must feed itself and that a collaborative effort is required from all actors in the value chain, with support from governments in creating a conducive environment for businesses to thrive and for investors to inject capital into African markets.

Mr. Paul Polman, former CEO of Unilever and now Co-founder and Chair of IMAGINE, urged that the COVID-19 pandemic has offered a unique opportunity to re-imagine and transform a system that is not working for either people or the planet, remarking that it is “hurtful to him” that Africa rarely captures the true value in its own value chain, when it has the potential to be both self-sufficient and a major exporter. There is an urgent need to create sustainable, greener, more equitable food systems, the AfCFTA trade agreement being an important framework, and that the private sector has a huge role to play: “Corporations are starting to wake up” he said, citing major initiatives in cocoa in Ghana and the Ivory Coast, as well as his work at IMAGINE in bringing together a coalition of 27 major food companies spending billions of dollars on making value chains more robust. Some key recommendations for immediate actions included: fostering enabling environments through capacity-building, transparency and compliance; building capital markets and better financial flow, including opportunities in blended financing; and investing in digitization market information collection.

One of the players in the IMAGINE partnership, Mr. Erik Fyrwald CEO, Syngenta, was brought in to speak about the IMAGINE model as a fully integrated partnership approach, one that pulls together a collaboration of key value chain players from end to end. He spoke of how past initiatives to bring about a self-sustaining Africa have been frustrated due to a lack of connection with the downstream market, but that they are seeing more success through this method of linking all the way through from farmer to demand at market level. Another important recommendation was the setting of standards across the continent so that both seed and technology can be approved and moved around.

Another private sector player, Alec Martin from AgDevCo, who represents Private investors looking to build sustainable business in Africa, spoke of some key areas to unlock, including: increased formalisation of markets, more stability in the operating environment, greater commonality of food standards, improved logistics and infrastructure, and more blended finance opportunities.

Professor Carlos Lopes, at the University of Cape Town's Nelson Mandela School of Public Governance stressed other avenues of progress, in addition to trade, reminding the audience that trade is not an end on its own but a means of development: “The free trade agreement is a response to a lack of progress,” he said, “a recognition that we need to do it for ourselves.” He spoke about shifting Africa’s commodity based export economy – which has been an impediment to structural transformation – to a modern form of economy, through adaptation to greener, simpler way of industrialisation (particularly as the continent with the best renewable energy potential), better self-generated income through appropriate taxation, and measures to tackle corruption.

The discussion moved on to an ‘on the ground’ perspective as Sadiq Usman, Deputy Chief Operating Officer at Flour Mills Nigeria, spoke about the real life challenges of connecting rural agriculture to urban consumers, and the need to improve the productivity and profitability of smallholder farmers within value chains, with a key recommendation of closing the gap – the many unnecessary layers and middle men – between the farmer and the processor. He encouraged the audience to think about growing markets by asking ‘what kinds of food are we producing for the consumer class of tomorrow’?, highlighting trends in “sachet-tising” to meet with affordability constraints of consumers. He also argued that more attention be paid to policies on backward integration and trade facilitation.