Food Crisis Response - Africa Region

1. FOOD CRISIS RESPONSE-AFRICA REGION Lensa Omune (Research Officer), Juneweenex Mbuthia (Research officer) University of Nairobi Public Lecture 19 May 2023

2. www.cgiar.org Outline of the Presentation Global Food Policy Report-Africa Region Findings Impacts of Russia-Ukraine Conflict in Kenya Impacts of implementing the Bottom-Up Economic Plan on food systems and social outcomes

3. Africa: 20% of population are facing food insecurity and undernourished  Significant variation across regions and countries o Central and southern Africa most affected, followed by eastern and western Africa o Countries with largest number of people affected: DRC, Ethiopia, Nigeria o Countries with largest share of population affected: South Sudan, Angola Overall, the share affected in Africa is more than double the share in any other world region Share of population in crisis or worse, 2021 Number of people in crisis or worse, 2021 Source: 2022 Global Report on Food Security (adopted from Benin 2023)

4.  Main drivers: conflict, weather shocks (esp. droughts & floods), and poverty, all of which affect the demand, supply, and availability of food  Extreme weather-related pests have worsened the situation o Fall armyworm plague that started in 2016 in western Africa o Locust infestation across eastern Africa in 2020  Agricultural policies have also contributed o Policy support favor ag. exports (whose prices have been declining) over food commodities consumed (whose prices have been rising) o Declining export prices  lower foreign exchange receipts/income o Rising food prices  higher food import bills o Lower foreign exchange + higher food imports  declining investment in food systems and other key public goods/services  Other shocks: Ebola, Covid-19 pandemic, Russia-Ukraine war  Incidence and severity of these drivers and shocks vary across the continent Fall army worm Drivers of food crises in Africa El Niño & La Niña (adopted from Benin 2023)

5. Gendered effects of food crises in Africa  Food crises affect women and men and boys and girls differently due to norms and cultural practices that lead to different roles, responsibilities, and access to resources and coping strategies  Price shocks in several countries during Covid-19 pandemic: 33% of women vs. 30% of men affected  Job loss in South Africa during Covid-19 pandemic: two-thirds were women  Loss of trader incomes in Sierra Leone & Liberia during Ebola: 85% were women  These exacerbate other negative impacts for women and girls, such as violence and sexually transmitted infections  Ebola outbreak in DRC: increase sexual and domestic violence  Ebola outbreak in Guinea: 4.5% increase in violence against women  Higher rates of chronic malnutrition among pregnant women and children in armed conflict areas (e.g., Burundi, Côte d’Ivoire, Ethiopia, Eritrea, Nigeria, Rwanda, and Somalia) (adopted from Benin 2023)

6. Impacts of Russia-Ukraine Conflict in Kenya

7. Kenya | Russia-Ukraine Conflict Impacts Foresight and Metrics to Accelerate Food, Land and Water Systems Transformation National Policies and Strategies for Food, Land and Water Systems Transformation Country partners • Kenya Institute for public Policy Research and Analysis (KIPPRA) • Ministry of Agriculture ,Livestock, Fisheries and Co-operatives (MoALF) • Kenya National Bureau of Statistics (KNBS) • Kenya Agricultural and Livestock Research Organization (KALRO) • Tegemeo Institute Stakeholder engagements • CoPP workshop to discuss assumptions and scenarios • Policy consultations with MALFC especially on fertilizer policies • Public dissemination seminar jointly with KIPPRA ↑ 450,000 Poor population Food price shock also has a large impact on food security ↑ 680,000 Poor population ↑ 550,000 Undernourished population Fertilizer price shock has the largest impact on poverty and food security, and disrupts agri-food systems ↓ $230 million Agri-food system GDP IFPRI-Kenya https://www.ifpri.org/program/kenya-strategy-support-program

8. Results | GDP and Employment • National GDP and employment declines • Negative terms-of-trade shock (i.e., negative effect of higher import prices outweighs positive effect of higher export prices) • Rising import costs reduces spending on domestically produced goods • Falling production leads to job losses • Impacts occur throughout the economy • Agri-food system GDP and employment also fall • GDP declines in both primary agriculture and off- farm agri-food sectors (e.g., processing, trading) • Larger GDP declines in agriculture (equal to 30% of overall GDP losses in the country) • Faster job losses in off-farm sectors, especially in food-related services, incl. trade and transport Source: IFPRI Kenya RIAPA Model Contribution to total change GDP Jobs -0.8% -1.0% -1.1% -0.7% -0.8% -2.6% -2.1% -1.8% -4.7% -3.2% Whole economy Whole AFS Agriculture Off-farm OutsideAFS Agri-food system Change in GDP and employment due to food, fuel and fertilizer shocks (%) GDP Employment 30% 9% 60% Agriculture Off-farm Outside AFS 37% 13% 51% Foresight and Metrics to Accelerate Food, Land and Water Systems Transformation National Policies and Strategies for Food, Land and Water Systems Transformation

9. Results | Household Consumption Source: IFPRI Kenya RIAPA Model • Household consumption falls significantly • Larger than GDP losses as production shifts to exports to cover import costs & in response to real exchange rate • Rising food prices is a more important driver of consumption losses than for GDP losses • Importance of shocks differs across population groups: • Fertilizer shocks important for rural and poor households • Rely more on farm incomes • Consume more domestically-produced foods • Fuel shocks important for urban and nonpoor households • Earn more income outside the agri-food system • More import-intensive consumer basket • Consume products with larger transaction cost margins • Food prices affect all households • Higher food consumption share for poor households, means slightly larger impacts Contribution to change -0.8% -0.7% -0.8% -1.0% -0.7% -1.1% -0.8% -1.2% -0.7% -1.1% -0.7% -1.7% -2.0% -0.5% -2.5% -3.2% -2.1% -3.7% -2.4% National Rural Urban Poor Nonpoor Percentage change in real consumption Food prices Fuel prices Fertilizer prices & response 30% 42% 28%

10. Impacts of implementing the Bottom-Up Economic Plan on food systems and social outcomes

11. Headlines | Macroeconomy • Economy grows much faster under Bottom-Up Plan • Total GDP growth rises from 4.8% to 7.2% per year • Private and public consumption demand grows slower than GDP • Leads to falling consumer prices (CPI) • Investment growth accelerates • Doubling base-run growth rate • Capital supply grows much faster than land or labor • Trade position improves significantly • Stronger export growth (relative to imports) • Economy reorients towards exports and investment • Goal of Bottom-Up Plan Growth Under Base-Run and Accelerated Growth Scenarios (average annual growth rate, 2022-2027) 4.8% 4.8% 4.5% 3.9% 5.6% 4.0% -0.8% 7.2% 5.9% 6.0% 8.1% 11.3% 5.5% -1.2% Total GDP Consumption Government Investment Exports Imports CPI Base-run Accelerated growth Foresight and Metrics to Accelerate Food, Land and Water Systems Transformation National Policies and Strategies for Food, Land and Water Systems Transformation

12. Headlines | Sector GDP growth • Growth accelerates in all broad economic sectors • About additional 2-3%-points growth rates • Relatively larger accelerations in agriculture (“bottom-up”) • Economy continues to undergo structural change • Slower growth (in absolute terms) in agriculture that has lower productivity • Faster growth in manufacturing that has higher productivity GDP Growth Under Base-Run and Accelerated Growth Scenarios (average annual growth rate, 2022-2027) 4.9% 3.4% 3.2% 4.4% 4.9% 5.6% 5.4% 7.4% 5.6% 5.3% 7.1% 8.3% 8.9% 7.9% Total GDP Agriculture Crops Livestock Industry Manufacturing Services Base-run Accelerated growth Foresight and Metrics to Accelerate Food, Land and Water Systems Transformation National Policies and Strategies for Food, Land and Water Systems Transformation

13. Headlines | Household Impacts • Incomes and employment rises with accelerated growth • GDP per capita increases $280 (30,700 KSh) by 2027 ($540 vs. $260) • Additional 700,000 jobs created (4.3 mil. vs. 5.0 mil.) • Rising incomes reduce poverty • 2.8 million fewer poor people by 2027 (see poverty headcount) • Growth benefits poorest of the poor (see poverty gap) • Food security also improves • 1.5 million fewer undernourished people (see hunger headcount) • Diet deprivation declines (i.e., gap between household-level consumption and healthy reference diet, based on six major food groups) • Bottom-Up Plan is consistent with its goals • Faster growth and job creation • Reduced poverty, hunger, and cost-of-living Poverty and Food Security Outcomes Under Base-Run and Accelerated Growth Scenarios (change in outcomes, 2022-2027) 0.26 4.3 -1.46 -0.55 -0.82 -0.90 0.54 5.0 -2.35 -0.85 -1.30 -1.68 GDP per capita ($1000) Jobs created (millions) Headcount (%-point) Gap (%-point) Hunger headcount (%-point) Diet deprivation (ReDD) Poverty Food security Base-run Accelerated growth

14. www.cgiar.org

Food Crisis Response - Africa Region

Food Crisis Response - Africa Region

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