Economic transformation africa


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Economic Transformation Africa: Some Gaps in Research and Policy
Kimsey Savadogo
PTCI & Universite de Ouagadougou

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Economic transformation africa

  1. 1. Economic Transformation Africa:Some Gaps in Research and PolicyKimsey SavadogoPTCI & Universite de Ouagadougou
  2. 2. African policy orientation from the1960s to today• The early twenty years: 1960-80– Emphasis on industrial sector– State involvement in commercialization: marketingboards– Occasional subsidies for agriculture• The 1980s and early 1990s– Denouncing the inefficiency of past public policies– SAPs: Trade liberalization, privatization, abolition ofmarketing boards, state retrenchment (reduction ofpublic expenditure in agriculture), and currencydevaluation
  3. 3. African policy orientation from the1960s to today• The late 1990s to the first decade of the years2000– Poverty reduction strategy policies (PRSPs)– Lack of a global view of growth and development– Advent of CAADP as a unifying framework forpolicy making in Africa• The second decade of the year 2000– Inclusion of growth concerns in donor assistedprograms
  4. 4. African policy orientation from the1960s 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 withthe advent of a unifying policy framework atcontinental level• Lessons– In the future Africa has to keep in memory this periodof trials and errors of the past and resolutely engagein the design of policies to achieve a stable growth
  5. 5. Economic transformation and the roleof agriculture• Any economic transformation in Africa willhave to build on the agricultural sector– The significance of agriculture in the nationaleconomies is well known. Agriculture contributesto food security, employment, income for close to80 percent of population– Agricultural growth and GDP growth go hand inhand in Africa
  6. 6. GDP growth and agriculture-4-202468101980 1985 1990 1995 2000 2005 2010Annualgrowth,%Figure 1— GDP and agricultural growth in Sub-SaharanAfrica, 1980–2011Agriculture, value added (annual % growth) GDP growth (annual %) Linear (GDP growth (annual %))
  7. 7. What may prevent the role of agriculture ineconomic transformation• For agriculture to however be the engine of economictransformation, agricultural production has to become morepredictable: looking at the graph above, one can note theample year to year fluctuations of the inter-annual changes ofagricultural value added (role of technology, soil conservation)• The gains in the sector these pat years following themacroeconomic policies of the 1980-1990s need to besustained.• Africa still relies on rainfed cropping, the contribution ofirrigated agriculture is dismal• Governments have withdrawn from financing the agriculturalsector, ODA has been reduce, but there is a tendency toreverse the decline in ODA and private funding has started tosupplement government investment in agriculture, e.g. AGRA
  8. 8. Policy orientation? New Threats?• In Africa, agricultural production is still dominated bythe small farm, yet there is no clear vision of the role ofthe small farmer in the future of agriculture. Forexample, do we need different types of actors foragriculture to grow? (Case of successful China and therole of smallholder there)• An ongoing phenomenon that threatens the sustaineddevelopment of agriculture is climate change; amongother things, climate instability creates swings in yearto year production• Another new, developing phenomenon is the one offoreign acquisition of African land for agriculturalproduction
  9. 9. Possible Research Areas• Recent event of land acquisition by foreigners– Is this a positive or negative thing for Africa (consider possiblebenefits and the losses incurred? Are there contractualarrangements that may ensure gains for Africa?– Does the answer depend on whether it is a long term ortemporary phenomenon?– Can there be any learning from foreign ventures on African soil?– What are environmental effects? Are foreign firms going tomine the soils for some time and leave when the land becomesdegraded? Will there be any land protection?– What are the impacts on Africa’s food security? Are we going towitness a situation of export-reimport of products produced onAfrican land?
  10. 10. Possible Research Areas• The issue of the small holder. Given that smallholdersmake up the crushing majority of farms in Africa, whatwould be the right stand?– Is the smallholder the problem rather than part of a solution?Should we consider smallholders to be social problems withsolutions belonging to the area of social protection? Or is thesmallholder an economic agent to be reckoned with?– Can the Chinese situation apply to Africa?– What is the likely success of the approach praised by somecountries who consider agri-business to be the solution toagricultural development and food security? And what would bethe right agri-business be? Consider the fact that in manyAfrican countries the political and urban elite become thelandlords very often, and progressively large pieces of land passhands from peasant farmers to these new land lords.– Can Africa afford to do away with the small holders by treatingthem as a social problem?
  11. 11. Possible Research Areas• Technology, innovations and agricultural growth The role oftechnology in agricultural growth has been addressed by many, atthe farm level, usually for a region of a country. However, the effectof technology Africa wide is not known.• Examine rates of return, and distribution of benefit, for majorinnovations/groups of innovations in staple food crops in severalAfrican countries• What would be the impact of wide scale irrigation in Africa? Is suchwide scale irrigation feasible ? (inter-country water right issues?Environmental issues?)• What is the role of agro-processing in stabilizing agriculturalgrowth? What are factors of hindrance to the development of agro-processing? What are the impacts of international tradearrangements on the success of aro-processing?