Bank’s Agricultural Strategy in Africa: An Update

2

The Context in 2011

In Africa (and the world)

Global food (and fertilizer) prices spikes in 2008 and 2010 threaten the poor, and social stability, while offering potential

incentives to farmers Refocused SSA Governments

are investing in agriculture, but not always in ways that will yield high payoffs. Increased recognition of need for evidence-based decision making.

CAADP platform has energized definition of country-owned programs, but inflated expectations on external

financing, has been of variable quality and transactions-intensive Donor finance flows

Donors willing (Aquila G20 USD 20 billion engagement), but able (GAFSP commitments < USD 1 b)?

Private sector interest and finance positive FDI trends (but data are poor); but policy frameworks still constrain (sector taxation-

>regulation, investment climate) Emphasis on results and measuring them

absolutely essential for mobilizing resources in highly constrained environment

3

Scale-Up Strategy

Goal: Higher SSA agricultural growth and improved food security

Current Strategy Focus Commit USD 1 billion in new money annually Four pillars: land and water management, agricultural markets and

infrastructure, food security and vulnerability, agricultural technology Horizontal beams – sector-wide policies, gender, climate change Strengthen the CAADP process

How New instruments Donor coordination/partnership Commercial/subsistence balance Measuring impact Regional programs

Bank organization Decentralize AFTAR staff, with senior staff pillar/thematic coordination from

headquarters: 76 staff in total + 10 extended-term consultants (down slightly prior to 2009); 2/3 in country offices

4

Progress: Sector Performance

1000

1050

1100

1150

1200

1250Cereal Yields (kg/ha)5 yr moving average

2000-04 2001-05 2002-06 2003-07 2004-20080.01.02.03.04.05.0

Real Agricultural GDP (28 countries value

weighted)

48 5

34

# of countries > 5%/yr

Seych

elle

s

Guine

a Biss

au**

Congo

, Dem

. Rep

.**

Kenya

*

Liber

ia*

Tanza

nia

Sierr

a Leo

ne**

*

Ugand

a

Botsw

ana*

*

Mau

ritius

Swaz

iland

**

Zambi

a**

Burun

di**

Niger

ia

Chad*

*

Mau

ritan

ia**

*

Zimba

bwe*

*

Sudan

**Tog

o

Ethiopi

a*M

ali

Burki

na F

aso

Guine

a

0

2

4

6

8

10

12

14

16

Agriculture expenditures/Total expenditures CAADP 10% Target

Ag

ricu

ltu

re e

xp

en

dit

ure

sh

are

in

to

tal

(%)

* = 2009** = 2007*** = 2006**** = 2005

Public Spending

Sources: ReSAKSS Comprehensive Monitoring and Evaluation Report, April 2010

5

Trends in agricultural GDP and per capita agricultural GDP in Sub-

Saharan Africa

Value of agricultural exports and imports Sub-Saharan Africa (1970-

2008)

Progress: sector performance

1970

1973

1976

1979

1982

1985

1988

1991

1994

1997

2000

2003

2006

20

30

40

50

60

70

80

40

50

60

70

80

90

100

110

AgGDP

US$2000

Bil

lions

US$2000 p

er

pers

on

1970

1974

1978

1982

1986

1990

1994

1998

2002

2006

0

5

10

15

20

25

ImportsExports

$U

S2000 b

illi

onis

6

Progress: Financing Composition of WB Funding

FY08 FY09-10 FY11-120%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Land & Water Mgt Markets & InfrastructureFood Security & Vulnerability Agricultural Technology

Annual Average

$437m $1290m

$1123m

Food security response shifting to fundamentals: soil and water management, markets, technology

LOOKING FORWARD: ALIGNMENT WITH AFRICA NEW STRATEGY Y

Pillars and Foundation Competitiveness and Employment, Vulnerability and Resilience, and Governance and Public Sector Capacity provide a good framework for addressing the sector challenges

Partnerships With governments, private sector, development actors Scale and scope of the problem demands and use our catalytic power and expertise to

leverage other partners Learn from and build on existing partnerships (CAADP, AfDB, AUC, Bilateral, civil society, etc) Mobilize partners to deepen and accelerate support to Africa Agriculture (crowding in private

and other public resources)

Knowledge Connector of knowledge in Agriculture and Agribusiness development

Strengthened impact of ESW (economic and sector work: Sleeping Giant Study, Rural Struc,…) South-South partnerships (e.g. Brazil)

Political economy analysis of incentives facing actors in reform process

Finance Leverage WB , specially IDA resources

Private sector and PPP Trust funds (Fragile states, GEF,…) Domestic resource mobilization (through agric public expenditure work in CAADP framework)

7

8

Looking Forward:Strengthening the Pillars

Continued Strategic Focus Four main pillars: land and water management,

agricultural markets and infrastructure, food security and vulnerability, agriculture technology

Horizontal beams – policies, gender, climate changeMain Adjustments

Land and water operations implementation – updating the irrigation business plan + land administration

Agribusiness platform – for better leveraging of private investment and increased participation + promotion of commercial agriculture

Public expenditure policy engagement – cross-pillar program strengthening through CAADP-MDTF and BMGF trust fund for analytical work (9 countries underway in 2011)

9

Pillars (1) – Land and Water

Land Sustainable land management – rainfed land and pasture management; TerrAfrica Investing in land administration

Titling, registration and cadastral capacity for small and large farm enterprises Innovating in community mapping and land taxation Staff constraint, particularly for French-speaking countries, being addressed with secondees

Engaging on policies for responsible FDI in land for agriculture, linked to land administration capacity

Water Irrigation business plan – mid-term review just completed Scope exists for further scale-up Main constraints are preparatory work with countries, and staffing (only partially being solved

with secondees) Climate change impact on priorities

Water management Soil carbon

Good practice projects Ghana Land Administration Zambia Irrigation Development and Support Ethiopia Irrigation and Drainage

10

Pillars (2) – Agri-marketing and Commercial Agriculture

Diversification, value chain deepening extensive analytical foundations and piloting, now moving into operational work both domestic (rapid urbanization) and export markets opportunities

Private investment flows – mobilizing and harnessing; PPP Program integration

Agribusiness Platform (AR, FP, IFC, with infrastructure) Piloting integrated project designs – four pipeline projects (Ghana, Burkina Faso,

Senegal, Malawi) Increasing attention to safeguards: palm oil, GMOs, monoculture pressure on

biodiversity

Africa Union Agribusiness Initiative (3ADI) Focusing on scale-up Technical tools being developed

Good practice projects Ethiopia Agricultural Growth Program Nigeria Commercial Agriculture Mali Agricultural Competitiveness and Diversification

11

Pillars (3) – Food Security and Vulnerability

GFRP – resources mostly allocated; shifting to longer-term impacts on food production productivity and marketing efficiency

Community-Demanded Development Projects Food security for the very vulnerable Communities with declining resource bases Mauritania, Chad, Niger, Madagascar, Nigeria (FADAMA) Evolution: away from too-open menu for broad livelihoods, sharper focus on

agriculture and more access to better techniques Disaster Dimension

Early warning systems for drought (Kenya, Ethiopia, Malawi, Madagascar) Climate-related vulnerabilities and adaptive responses

Productive Safety Nets Opportunities for complementarities with HD, but better role focus (who does what)

possible on food security Good practice projects

Mauritania – Community Based Rural Development Nigeria - FADAMA Development Project III Madagascar - Rural Development Support

12

Pillars (4) - Technology

Research projectso Regional projects designed to achieve critical mass and facilitate spillover take-up of resultso National system support – rebuilding, while forcing the link to dissemination and extension;

no free-standing agricultural research projectso Spill-in through South-South partnerships (EMBRAPA and innovation grants)

Extension o Designs are tailored to constraints e.g. demand (Uganda, Rwanda), supply (Ethiopia),

effective diffusion from research (WAAPP), and input/irrigation related (Nigeria Commercial Agric and FADAMA; and WUA elsewhere)

Leveraging resources - large MDTF

Bio-safety capacity o Regulatory underpinnings for new seed technologies; national and regional capacity being

built

Climate change - impacting research/extension priorities

Good practice projectso West/East Africa Agriculture Productivity Projectso West Africa Regional Bio-safety Project

13

Looking Forward : Partnership in working with CAADP

Less process, more impact. Managing expectations.

Strengthen the technical review of national investment plans; lend into them.

Link policy dialogue to investment.Expand on public expenditure analysis for

fact-based consensus-buildingCrowd in the private sectorUse impact evaluations as part of peer review

process

14

Looking Forward: Emerging Issues

Private investment flows Tracking - household, domestic commercial, FDI Link to employment generation

Capturing climate change finance for agriculture Main opportunity is soil carbon

M/E and statistics agenda Tracking impact, acting on it

Mechanization, ICT, Innovation High political profile but still seeking workable strategies. Need intermediate

technology.

15

Summary of Main Action Areas

Sustain the scaled-up financial level in the range of US$ 1-1.2 billion/year + lesser number of projects, meaning larger operations

Engage in supporting the four main CAADP pillars, paying particular attention to expanding agribusiness & water management/irrigation

Expand engagement through partnerships: in-country ag. sector coordination groups; at regional level through RECs and the CAADP-PP; support for South-South partnerships

Leverage Bank resources: mobilizing private resource flows + supporting public investments that crowds in private investment + PPPs and improved business environment; public expenditure sector work to make better use of countries own resources

Learn and apply results: strengthened results frameworks, monitoring of core indicators, impact assessments