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Monday, January 26, 2015

Act now to stop collapse of smallholder agriculture

Three myths. Agriculture contributes between 20 and 75 per cent of Africa’s GDP. Over 70 per cent of Africans depend on agriculture for their livelihood. Agriculture is a critical driver of economic growth and wellbeing in sub-Saharan Africa.

These myths often preface development discourse and are the Holy Grail of keynotes at conferences on Africa’s development. Moreover, Africa has exploited these myths in global climate change negotiations. The first two myths have been accepted as self-evidently true, some kind of axiom. And the third myth is accepted without challenge or question, especially among development economists.

The claims about the contribution of agriculture to economic growth, livelihoods and wellbeing for a majority of Africans are conjectural at best. The proponents of these myths believe that they speak for the voiceless, and make a compelling case for the smallholder farmer, pleading for technology, infrastructure and financial services for the African farmer.

African farmers are trapped in poverty. Thanks to subsistence agriculture. They want out because they are rational, value driven entrepreneurs. They get it; subsistence agriculture is comatose. A majority of young men aged between 25 and 35 years often leave the village for the city. The flow of remittances to rural Africa from the cities is instructive. Increasingly, rural women depend less on income from farm labor. Buttressed by the unprecedented success off village savings and loans, rural women now own small businesses. The motorcycle taxi epidemic, which pays at least $10 a day, has made subsistence agriculture a terrible idea for young people aged below 25 years.   

Statistics have little value in Africa. For example we cannot give a number on the acreage under maize cultivation in Kenya in 2013. Neither do we know the total maize yield in 2012. And we don’t know how many chickens were reared or sold by rural farmers in 2014? Do we know how many goats and sheep and cattle smallholder farmers own? Numbers is not our thing. So it is highly unlikely that value of agricultural goods ands services generated by smallholders are included in our national accounts.

If agriculture contributes 20-75 per cent of Africa’s GDP, it is certainly not coming from subsistence farmers. It comes from the big commercial agri-business operations; tea, sugarcane, coffee, cut flower, dairy, wheat, large-scale maize and the large value addition operations like Bidco Oil Refineries, Unilever, Del Monte Foods, Karuturi etc., as well as the packaging and freight companies.

Smallholder subsistence agriculture is at a critical point, with three possible outcomes. First, climate change, aging farming population, uneconomic fragmentation of land, low productivity, and the flight of the youth from the land has put smallholder farming firmly on a path of imminent collapse. Such collapse is exacerbated by poor infrastructure, lack of essential services such as health, education, and clean water. Moreover, a dysfunctional rural economy makes life on the small farm short, brutish and fans out migration.

The second outcome is transformation through production intensification on the small farm, made possible by use of modern inputs, including appropriate mechanization, transition from subsistence to high value market-oriented products, taking advantage of the rise of local supermarket and global markets. Such transformation would be reinforced by access to high quality education and health services, clean water, good roads, agricultural advisory, and financial services, including credit and insurance. In this scenario, the youth are the new small farm entrepreneurs, driving high tech innovation, value addition logistics and marketing.

The third outcome, the emergence of large-scale commercial agriculture, would be made possible by the collapse of subsistence agriculture; pushed over the cliff by climate change, land fragmentation, aging farming population, low profitability, exodus of the youth, collapse of rural economy owing to lack of investment in social services and infrastructure. Local and multinational operations take over through buy out or long-term lease.

Displaced subsistence farmers would stay on the land providing unskilled labor. But access to better education and health services, thanks to private investment, could make it possible for their children to gain higher education, and re-inventing smallholder production. It is probable that large commercial operations will co-exist with smallholder systems, leveraging their competitive advantage in high value organic produce market segment.

We must decide what a post-subsistence agriculture dispensation will be. We must favor not collapse but the emergence of climate smart, high-tech market-oriented smallholder agriculture, thriving alongside large-scale commercial agriculture.

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