African agriculture has taken a hit from the worldwide economic crisis. Agriculture is one of the most important economic activities in Africa. Millions of people are direct beneficiaries of employment from farming or other agricultural activities. Over 200 million people are engaged in agricultural labor, according to UN estimates – over 50 percent of the total population. Aside from employment, agriculture supports the survival and well-being many African societies.
It has been one of the most affected sectors in the current global crisis. World Bank figures show that global trade is expected to decrease by almost 10 percent in both the developed and developing world.
Africa exports millions of dollars worth of agricultural produce, so a decrease in demand on the world market has far-reaching effects on communities that depend on export incomes.
The slowdown is already showing a major reduction in government and household incomes across the continent -- mainly sub-Saharan Africa. The FAO reports a drop in demand for commodities like coffee, rubber and tea, fueling unemployment and a causing a major drop in household incomes.
The high cost of staple foods is straining the ability of the poor to afford three square meals a day.
The decreased purchasing power of western nations coupled with falling prices of commodities like coffee and tea is threatening to turn back the clock on some important progress in the agricultural sector. “When the export sector is affected, all other sectors are affected too, because they rely on the export sector for demand,” says World Bank economist Shantayanan Devarajan.
The economic crisis has led to a decline in private and public Investment in agricultural development, according to Dr. Montey Jones, a director with the Ghana-based Forum for Agricultural Research. Much of the foreign aid that was geared towards research in agricultural research has either been redirected or completely cut off, he says.
The crisis has undermined the Comprehensive Africa Agriculture Development Program (CAADP), which was created by the FAO and the New Partnership for Africa’s Development (NEPAD). One of its goals was to increase investment in agriculture, but countries hard hit by the crisis can’t afford to do so.
Poor roads hamper transportation
Malawi earns up to 70 percent of its foreign exchange from tobacco. Most of it is grown in the rural areas where farmers have to transport it for long miles to the capital city, Blantyre. Statistics indicate that only 34% of sub-Saharan Africa’s rural population lives within two kilometers of a tarmac road.
Alinafeje Agaraga, a farmer in southern Malawi, says one of his main problems is high transportation costs.
“It is a big challenge to us farmers,” he says. Poor rural infrastructure, like roads, makes it expensive to transport goods to the markets. This makes it harder for African farmers to compete in the global markets.
Fuel prices affect farmers
Increased fuel prices, also a direct result of the financial crisis, have affected Agaraga‘s profits. Many transport companies have shifted the high cost of fuel to the farmers, who now have to pay more than twice as much as they used to in order to get their produce to the city
In the end, the higher cost is passed on to the consumers, pushing up food prices tremendously in the past couple of years. Eradicating extreme poverty and hunger is the first Millennium Development Goal (MDG) but cannot be achieved without food security.
