As the population across sub-Saharan Africa continues to grow, the demand for food and agricultural resources increases as well. African diets are shifting from mostly grain-based to becoming more dependent on livestock and horticulture. With these changes in diet, agriculture is becoming affected and food systems are changing. Agra’s Africa Agriculture Status Report for 2017 states that food systems should be transformed to accommodate large agribusinesses to create more jobs for the increasing population. Small and medium enterprises (SMEs) coupled with large commercial agribusinesses could help decrease poverty, hunger, and unemployment (Hazell).
The graph below depicts the drastic increase in agriculture as a percent of GDP compared to services and industry as a percent of GDP. South Africa is among the more developed countries in Africa and agriculture represents the majority of its GDP. The economic and agricultural growth in these sub-Saharan African countries has led to changes in the composition of economies and government policies
Due to Africa’s increasing urbanization, more opportunities for agricultural growth have risen.
According to Agra’s Agricultural Status Report, “Africa still has the resource base that if more intensively farmed could easily produce another 100 million tons of grain equivalents each year, equivalent to adding another US corn belt to the global supply and turning Africa into a net agricultural exporter” (Hazell 5). Africa’s demand for food is set to more than double by 2050, so capitalizing on agriculture could be vital to maintaining low poverty and hunger levels. However, African countries are different from countries like China because African governments tend to not invest in agriculture whereas China’s government has invested, ultimately leading to China being more self-sufficient in terms of food production.
The majority of food costs to urban Africans are brought upon by supply chain production. Due to the increase in supply chain production, more small and medium enterprises have been investing in wholesale, trucking, and warehouses (Reardon et al. 2014).
With increasing rural populations, Africa is put under the pressure of land values subsequently increasing, which means that farms are becoming too small to support a single-family. Young people in rural areas are finding it difficult to find employment and have started migrating to areas where they can find work. This raises yet another issue for Africa’s agricultural development: the ability to create enough jobs when the farming business is gradually transforming to using supply chain management. This also raises the argument about what kind of transformation Africa should have. Some argue that Africa should move towards highly commercial production for higher output, while others argue that Africa should stick to small and medium enterprises to sustain employment. There could be a compromise to include both transformations to reduce poverty, increase employment, and create a system that could be better protected from climate change and economic shocks.
For the most part, small farms are categorized into three groups: commercial smallholder farmers, small farms in transition, and subsistence-oriented small farms. Commercial smallholder farmers are more business-oriented and carry high importance in farm sales out of the three groups. There are also pre-commercial farms that are transitioning into becoming commercialized. Small farms in transition get most of their income from non-farm sources and carry a low to medium importance in overall farm sales. Lastly, subsistence-oriented small farms do not have nearly the potential for agricultural growth, are usually marginalized, and carry low importance in farm sales. These factors contribute to these farmers and their families completely relying on their crops for both food security and cash income.
Some of these farms can receive assistance and access to new technologies, financial services, and management help. For subsistence farmers, this assistance may be vital to expand their business and gain knowledge and entrepreneurial skills to manage a successful farm. Assistance can take the form of cash transfers, better technologies, social protection, and empowerment.
As for the future, sub-Saharan Africa’s GDP is expected to average a 3.6% growth rate between 2019 and 2020, according to the World Bank. With economic growth and investment, sub-Saharan Africa’s GDP is set to continue on an upswing.