While the talks between Ukrainians and Russians, conducted under Senegal-Turkish auspices, have enabled a first shipment of cereals from Odessa, Africa holds its breath and counts the days. The disruption of international supply chains, already weakened by the pandemic, has been compounded by the war in Ukraine creating a snowball effect on food and fertilizer markets, which are interdependent. In June 2022, the number of acutely food insecure people – that is, people whose short-term access to food has reduced to the point of putting their lives and means at risk livelihoods – reached 345 million in 82 countries, according to the World Food Program (WFP). In this context, France with its European partners has launched a multilateral initiative called “Food & Agriculture Resilience Mission (FARM)”. It must respond to the food emergency exacerbated by the Russian-Ukrainian conflict. Senegalese President Macky Sall, who chairs the African Union, has also repeatedly called on Western leaders to find an immediate solution to unblock Ukrainian and Russian grain exports. In the process, a high-level meeting chaired by the French Minister of Foreign Affairs took place at the Quai d’Orsay two weeks ago for the mobilization of French private sector actors associated with the Elysee initiative. To talk about it, Financial Afrik exclusively received Karim Ait Talb, Deputy Managing Director of Advens-Geocoton and initiator of the ALFA coalition, an active member of FARM.
Mr. Ait Talb, first of all, briefly remind us of the genesis of FARM as well as its objectives?
FARM is an initiative of the President of the French Republic, Emmanuel Macron, who wants to respond to the global food emergency caused by the war in Ukraine. This crisis had already been latent since the pandemic shock. Indeed, we observed that the supply chains were severely disrupted due to successive confinements, not to mention the shortages and a surge in the price of oil which had a direct impact on the prices of basic foodstuffs. The seeds of the crisis were already there and the war in Ukraine revealed the structural weaknesses of the continent’s food security. To deal with this unprecedented crisis, the Head of State announced on March 24 the launch of the European initiative “Food and Agriculture Resilience Mission” (FARM). This initiative has three pillars: (i) preserving the movement of agricultural commodities globally, including by supporting the Ukrainian agricultural sector; ii) guarantee, with the help of the World Food Program (WFP), the food supply of the most vulnerable; iii) invest locally to develop sustainable and resilient food systems, particularly on the African continent. And on June 23, 2022, a first group of companies and private actors, of which ALFA is a part, agreed to launch a coalition for food security – Global Business for Food Security coalition (GBFS), with the support of the France, the European Commission, the European Investment Bank, the WFP and the International Fund for Agricultural Development (IFAD).
Through this coalition, the companies undertake, each according to their capacity and their field of activity, to support the implementation of one or more of the objectives among the following:
- Supporting the Ukrainian agricultural sector in its production and export capacities, in coherence with European efforts and in particular the Solidarity Lanes initiative which sets up logistics routes to restore the circulation of agricultural goods to and from Ukraine;
- Support the access of the most vulnerable countries to agricultural and food commodities and inputs alongside the World Food Program (WFP);
- Support the development of sustainable production capacities and robust value chains in fragile countries particularly in Africa (in synergy with IFAD action and on the basis of needs identified jointly with the local private sector) ;
- Based on this common roadmap, the coalition calls on all companies that share these objectives to join it.
You yourself have been advocating for 3 years to reconsider agriculture as a lever for fundamental development in Africa, particularly in the Sahelian zones. Today’s news proves you right. Will this strengthen the ALFA agricultural coalition that you chair?
Absolutely. Agriculture has always been the poor relation of public policies and development aid dedicated to the continent. Yet we are talking here about the first employer of the working population. In terms of contribution to GDP, the primary sector weighs no less than 23% on average. The African challenges, I will summarize them with what I call 3G, for the 3 giants: the environmental challenge, the social challenge and the economic challenge. I will focus on the latter, because agriculture is central there and Europe is directly concerned. Africa must, of course, feed its people. But it will also, sooner or later, be responsible for feeding other regions of the world and, first of all, the old continent. For this too, we call for an agricultural New Deal for Africa.
Are Africans ready for it? It’s not sure. On the one hand, the International Monetary Fund (IMF) estimates that they will need 285 billion dollars in additional financing by 2025. But, on the other hand, there is no recovery plan. massif clearly identified and making it possible to meet this deadline. In other words, while other regions of the world see a rapid recovery of their economies, Africa is lagging behind; it does not fight on equal terms; and there is a risk that an economic and social crisis will not allow it to offer the opportunities, in particular to its youth, that they are entitled to expect. Agriculture and livestock should, in fact, be much more at the heart of public policies in African countries. They must have a central place in development aid strategies. Food sovereignty is the sine qua non of the sanctuary of a middle class without which there is never, anywhere, economic emergence. And it could not be achieved without the strong involvement of the private sector.
This is also the raison d’être of ALFA for AGRICUTURE LIVESTOCK & FISHERIES AFRICA. When we launched it as part of the last Africa France summit in 2021, I had the firm conviction that French agricultural companies had a lot to offer their African partners for the structuring of integrated sectors and to put Africa at sheltered from regional or global geopolitical hazards. Thus, we are building, in a way, a tool as close as possible to French and African economic realities, for the benefit of French economic diplomacy. Today, the news, unfortunately not very happy, confirms our vision. Concretely, this consists, on the one hand, in further encouraging the French private sector to promote the advantages of the French agricultural model, which is in demand internationally and, on the other hand, in offering our African peers a framework partnership to support the modernization of agriculture on the continent. Aware that Africa represents an exceptional lever for growth and an opportunity for new partnerships, more than 100 companies and institutions in the agriculture, livestock and fishing sectors have decided to join forces within ‘ALFA. Today we are working closely with the other actors of FARM to respond to the emergencies posed by the war and also to reflect, I know that I have often repeated it, in the future to place African agriculture definitively on the path of progress. and economic performance.
You accompanied Emmanuel Macron on his first trip to Cameroon on July 25. Tell us about the sequence which precisely concerned the agricultural aspect within the framework of the agreements or discussions between the two Heads of State…
I had the honor of being part of the official delegation of the President of the Republic, which visited Yaoundé, as the initiator of the ALFA coalition. It was an important move, especially since the context of activism by other powers in Africa raised fears of a French economic decline in Central Africa. Agriculture was therefore one of the major subjects for strengthening economic ties. Knowing Cameroon’s agricultural potential, it was therefore natural to bring together our partners from the private sector, I am thinking in particular of the Groupement Inter-Patronal du Cameroun (GICAM) represented by its president, Célestin Tawamba. The message to pass on was clear, aid and international solidarity simply alleviate the symptoms. To go beyond short-term actions, it was necessary to envisage a solid partnership between the two private sectors to develop key crops as well as livestock. The French President and his advisers were very sensitive to the involvement of the private sector in the global reflection. It is not for nothing that FARM includes private action in a specific pillar to ultimately guarantee the food sovereignty of the continent.
We were therefore able to exchange for more than 4 hours with the various actors: on the Cameroonian side, the Minister of Economy, the Minister of Agriculture and Rural Development, the Minister of Livestock and GICAM. On the French side, in addition to the ALFA coalition, the International Business Movement of France (MEDEF) represented by Francois BURGAUD, the French Business Circle in Cameroon (CAFCAM) as well as the Minister of Attractiveness and Foreign Trade Olivier Becht. After this dense work sequence, we presented to the President of the Republic, Emmanuel Macron, the conclusions of our work: to detect joint investment opportunities, particularly in the seed, fruit and vegetable, corn, cotton, livestock, potatoes and propose global solutions to be implemented, including the structuring of financing schemes adapted to the reality of agricultural and pastoral activities in Africa.
Beyond the response to the current emergency, African agriculture needs a massive and structural development plan. We often hear it at conferences organized on economic issues related to the continent, but concrete actions are slow to emerge! Why you think ?
As I said above, this is above all due to the weakness of public policies in general and, from my point of view, their lack of ambition. We need more proactive strategies to produce much more, while respecting natural resources and the climate. It is imperative to improve productivity to increase the income of producers and ensure that they live more decently than today on their income. This certainly requires a professionalization of African farmers. Of course, important subjects such as research, land security, the connection of production areas to those of consumption by suitable infrastructures must also be treated with a long-term commitment. Finally, there is not only a lack of coordination between the public authorities and the private sector, but it is also regrettable that the administrations, like the donors, do not rely sufficiently on companies to define and implement policies. efforts to modernize the sector.
In addition, public actors and their financial partners do not provide sufficient financial support to private projects that contribute to the aforementioned objectives. And this particularly concerns financing tools. They are either inaccessible or simply unsuitable.In most African countries, there are currently no banks specializing in the agriculture and livestock sectors, nor development banks. Commercial banks, beyond short-term campaign loans, do not have the necessary long-term resources and this sector of activity seems far too risky to them. If these companies turn to development financing institutions, such as Proparco, the International Finance Corporation or the European Investment Bank, their efforts are unsuccessful, because the amounts requested are deemed to be too low to make the costs of financing profitable. examination of files. Two to three years’ prior experience is also required to prove the effectiveness of the business model.
At the same time, private capital is massively available today in the world and could be mobilized in the service of a great African agricultural ambition. But, in terms of agriculture and livestock, it is perhaps necessary, more than elsewhere, to support them with public resources. The international financial institutions have all set themselves the task of preserving natural resources and contributing to limiting the effects of climate change. African agriculture represents a unique opportunity to experiment with partnerships between public authorities, donors and private companies to offer innovative green financing, combining public and private resources. We never stop saying it at ALFA, we call on the French public authorities to support the creation of a tool dedicated to African agriculture and livestock. This instrument will have a leverage effect on private investment by mitigating an unfortunately still significant risk taking in this sector and on this continent.
In a recent column that you published in Le Monde Afrique, you stated that one of the solutions to the backwardness of the African agricultural sector is to “de-risk investments”. Yet investments, aid and loans continue to be granted to Africa. How do you explain this paradox?
First of all, I would like to point out that this column was co-written with Jean Marc Gravellini, senior fellow for the Foundation for Studies and Research on International Development (Ferdi), as well as Pierre Arnaud, promoter of a production project fodder in Mauritania. Then, in view of the considerable delays to be caught up in terms of agricultural development and the numerous risks (climate, security, food in particular) inherent in the geography of the continent, I insist on our conviction that financial support for private companies and farms in the sector is the way to go. The mix of subsidies, concessional loans and private resources should make it possible to partially “de-risk” the investments of these companies and cover the necessary support and monitoring expenses for promoters. To answer your question specifically, financial assistance, which is currently intended for African agriculture and livestock farming, is mainly mobilized to support public structures and projects and not yet enough to really support the private economic fabric of the individual farmer or breeder to the processing industry. To conclude, the paradigm shift is at this level: it must be admitted that the company is a central player in African agriculture and livestock and that it must be massively financed with tools adapted to the specificities of the sector.
