The demographic dividend that will play out in Africa over the next few years will be spectacular. In Kenya, where the median age is 19, the promise of a generational transformation of the economy – equipped with new tastes and preferences is whetting the appetite of global brands that want a slice of this emerging market.
Policymakers are equally aware that the full aspirations of this new generation will only be realised if there are deep investments in critical areas, not least the evolving themes around food security. According to the Africa Agriculture Status Report of 2023, half the continent’s population grapples with food insecurity. While the appropriate response to such heart-wrenching figures should have been a unified call for effective solutions, the reality, unfortunately, has been an alleged philosophical dispute pitting large-scale commercial farming against smallholder farmers.
Indeed, most economists will agree that there is an urgent need for productivity gains across food systems. This means leveraging our best insights on optimal land use, achieving the best seed quality and deploying the best technology in aiding production. The resources required for this scale of investment are not insignificant and this has been the space in which institutions such as Alliance for a Green Revolution in Africa (AGRA) have been found to be most strategic. The African Development Bank Group has approved an equity investment of 18 million euros in the Africa Guarantee Fund (AGF) and another 1.2 million euros to support youth and women entrepreneurs engaged in agricultural value chains in Kenya.
By its very nature, commercial agriculture has the benefit of enjoying economies of scale and the incentive to plough back profits into research and development to unlock ever-increasing productivity. The United States provides a fascinating case study on a country whose 90 per cent of the population lived on farms 200 years ago but is now home to a multitude of remarkable cities whose food supply is supported by commercial agriculture, delivering incredible levels of abundance and affordability.
Americans spend less on groceries than any other country in the world. According to data from the US Agriculture Department, Americans shelled out 6.6 per cent of their household income on food in 2012. The next lowest country is Singapore at 7.3 per cent. These are realities that can be replicated across Africa if serious investments are made.
Advancements in large-scale commercial agriculture need not be at the expense of smallholder farmers for they too are critical to Africa’s food systems. In many ways, they contribute to rich biodiversity as well as building resilience and harnessing tradition, heritage and culture. The emotional attachments to preserving subsistence lifestyles that have been handed from generation to generation are deeply etched in the mind and soul of the smallholder farmer. And therefore, any form of disruption to this familiar lifestyle in the name of progress can attract hostility in all its forms. In England, the dawn of the industrial revolution caused deep anxieties among its people.
Mr Gichinga is chief economist at Mentoria Economics