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Africa urged to look to European investment as food crisis deepens

AFRICAN countries would have to increase public and private investments in agriculture, try to attract expertise, as well as make use of technology to improve land efficiency in the wake of high commodity prices caused by the war in Ukraine.

Experts say that the global food crisis could undermine African economies and increase poverty.

According to the US-based International Food Policy Research Institute (IFPRI), many countries are witnessing high prices across a wide range of commodities such as fertilisers, edible oil and maize.

A recent IFPRI modelling study focusing on Kenya suggested that the country would record reduced GDP growth and increased poverty rates, thus pushing an extra 1.4 million Kenyans below the poverty line.

Experts now say that this model can be applied to most African countries with varying degrees of economic impact.

But in the main, the experts add, Africa will now have to expand agriculture and productivity in order to become more self-sufficient.

‘Although many African countries might find it difficult to raise the sort of money we are talking about when it comes to investing in agriculture, there is a way out,’ said a food security expert in East Africa.

‘These countries could turn to European investment in Africa’s agriculture sector.

‘Indeed, this is vital for global food security because European and other countries around the world have been forced to look for alternative sources of food supply as a result of the war in Ukraine.’

Writing for the EU Reporter last week, Candice Musungayi said: ‘It makes sense for Africa to take up a more significant role [in global food production].

‘Home to 60 per cent of the world’s arable land, agriculture and its related businesses are a key driver of development and a leading employer on the continent.

‘With over 70 per cent of Africa’s population in jobs linked to the production, processing or sale of food, these sectors make up 25 per cent of its GDP,’ Musungayi added.

But the continent is currently a net importer of food and struggles to feed itself, with 281 million classified as undernourished in 2020.

However, in Angola things are looking up for the food sector and the country is taking steps to reduce its reliance on foreign parties.

In 2017, as part of its Empowering Africa initiative, Paramount Energy and Commodities, in conjunction with an Angolan food production company, Carrinho Group, transformed the country’s food sector.

When Carrinho started in 1996 it was a catering company but by 2014 it had become a food production company and has now developed into one of the biggest such plants in Angola.

Paramount, a Geneva-based private energy and commodity trading company, invested $500 million in Carrinho’s industrial complex that consists of 17 factories.

This investment has allowed Angola to produce its own processed food products – such as pasta and tinned goods – and even export them, as well as support the creation of jobs and opportunities in local communities.

The investor is also looking to expanding its footprint in Africa and to establish businesses through sustainable, long-term investment.

This type of investment from abroad is seen as crucial if Africa is to untangle itself from the web that has been cast by the war in Ukraine.

Earlier this week, Ukrainian President Volodymyr Zelenskyy told the African Union through video link that, by blockading his country’s food exports, Russia was holding Africa ‘hostage’.

When the African Union Chairperson, the President of Senegal, Macky Sall, met the Russian President Vladimir Putin in Sochi earlier this month, the Senegalese leader raised concerns about the food crisis, pointing out that it would be difficult for Africa to continue to take a neutral stand on the war.

‘Clearly, the need for food self-sufficiency in Africa is now crucial to the continent’s long-term development,’ the food security expert said.

‘So it would make sense to galvanise foreign investment in the continent’s agriculture sector, such as we are now seeing with Paramount and Carrinho in Angola.’

 

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