[Dar es Salaam, Tanzania, 5th-7th, OCTOBER 2017]. The 7th African Grain Trade Summit (AGTS) was held in Dar es Salaam, Tanzania. The forum attracted over 300 key players in the international grain industry who met to deliberate on reshaping the agenda for the sector. The meeting was themed “Setting New Horizons to rethink Grain Trade for Food Security and Prosperity in Africa”.
The Minister for Agriculture, Fisheries & Livestock of the United Republic of Tanzania, Hon Dr. Charles Tizeba opened the summit. In his speech, Hon. Charles Tizeba noted that Tanzanians were privileged to host the historical summit. While noting the importance of the grain sector in Tanzania, he recognized the President’s appreciation for the country’s agricultural sector which contributes approximately 65% of inputs to the industrial sector, constitutes 23% of the country’s GDP, and employs approximately two-thirds of Tanzania’s workforce.
“We have great investment opportunities in Tanzania in value addition, particularly in processing and milling industries for grains,” said Hon Chizeba. “In line with the 2025 Vision, the Ministry of Agriculture is keen to promote food security within the country and the region at large. We plan to export value added grains, for instance rice and not paddy,” he added while inviting both local and international investors to consider investing their resources to the agro-processing sector in Tanzania.
African economies heavily rely on agriculture as a major source of income, but untapped potential has resulted in persistent poverty and limited wealth creation. The continent’s food security has declined over the past five decades despite interventions from governments, the private sector and development partners. “Africa has a rapid population growth of which 60% are under the age of 25 with higher preference for rice consumption than maize,” commented Mr. Alehandro Terminel, the Chairman of the board of the Terra Wealth Trader Company, Mexico. “This calls for crop diversification to meet consumer needs within and outside the continent.”
The infrastructure remains a top issue in the region with some agricultural areas with high potential of agricultural production still inaccessible. “In the Great Horn of Africa, some states are still volatile and this has hampered development and social well-being of the grain sector in the region “expressed Yohannes Assefa, the Director of Agriculture and Agribusiness at the USAID East Africa Trade and Investment Hub.
The unpredictable policy environment that results in extreme price shifts for staple foods was also discussed. Rural communities and consumers continue to be significantly affected by price instability. A comparison was drawn to Mexico, which abandoned protectionist policies to open its markets to international trade, developing its local industry and eventually contributing to their current position as a net exporter of food.
Mexico is currently the 3rd largest producer of agricultural products in Latin America and the 12th largest in the world. Mr. Gerald Masila, Executive Director of the Eastern Africa Grain Council (EAGC) reiterated that African smallholder farmers need to be supported through judiciously applied price supports. Grain stakeholders at the summit called upon governments to enact policies with the necessary incentives required to attract investments in grain value chains.
“While Agricultural productivity in the region is on the rise, challenges including insufficient infrastructure, lack of finance and unpredictable weather patterns which affect productivity and trade continue. As a result, smallholder farmers and consumers face persistent food shortages and unreliable markets,” explained Steve Orr, Team Leader – FoodTrade East & Southern Africa (ESA). “Working with organisations such as the Eastern Africa Grain Council to promote public-private solutions will ensure smallholder farmers benefit from increased trade,” he said.
The meeting provided an opportunity for the private sector to raise pertinent concerns that continue to hinder investment in agriculture. “Fewer than 10% of agricultural producers in Africa have access to credit. The same situation is true on insurance – agricultural risks are high and a primary barrier to investment,” Mr. Otim Otile, Managing Director of Totco Uganda Ltd. explained when discussing the need to reshape financial services for grain trade.
In his closing remarks, Mr. Gerald Masila underscored that the 7th AGTS was the outcome of joint efforts by the private sector, along with central, regional and local governments. The event organized by the Eastern African Grain Council in partnership with the United Republic of Tanzania and the USAID-East Africa Trade and Investment Hub. Other sponsors include e UK government funded Food trade East and Southern Africa programme, SIDA,CTA, Terra Wealth Trader, VUNA , JICA, Litenga Holdings, Belayne Kindie Import Export & Associates, Scales and Software (K) Ltd, USAID ASPIRES, Save grain bags, Liaison Group , Sorela Supplies and BRITEN.
The EAGC Chairman Emeritus, Dr. Bernard Otim closed the meeting by urging sector players to learn from the case of Mexico – the macro economic effects of establishing an enabling policy environment will create jobs for the rising population of youth, men and women. Grain traders in the value chain renewed their commitment to playing the role of responsible actors in influencing the global food system.