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#AgriIndaba: Investing in Africa is not for sissies
“But let’s face it, investing in Africa is not for sissies because of all the barriers,” said Thabi Nkosi, sector specialist: agriculture and agri-processing, Public Investment Corporation.
She was moderating a panel discussion on the policy and legal framework on the continent at the African Agri Investment Indaba in Cape Town.
Making agri-processing viable
Professor Ferdi Meyer, director: Bureau for Food and Agricultural Policy, South Africa started off the discussion by outlining the attractiveness of the continent for FDI, particularly in the agricultural sector.
“We know Africa is experiencing the fastest growth in FDI. The key factors underlying this are the recently experienced commodities super-cycle and the rapid population growth and urbanisation on the continent.
“Although we have almost 100m hectares under grain and oil seeds, we don’t have the infrastructure to get the products to market. So the real challenge is to make agri-processing economically viable,” he said.
Getting production right
Commercial agriculture is the area of growth that must be looked to for investment, if this sector doesn’t grow, Africa will stay third world. “If we don’t get primary production right, we will remain poor,” said Omri van Zyl, CEO of Agri-SA.
In terms of finance, he says, for farmers, big and small, property rights are still an issue, especially when it comes to lease agreements that cannot be collateralised.
“We desperately need new solutions, especially in infrastructure and in the post-harvest value chain,” he said.
Farming is a business
However, Motsepe Matlala, president of the National African Farmers Union said small-scale farmers can’t be discounted.
“Farming is the same all over the world, it is a business, and small-scale farmers are part of that success. In my view, the challenge we are talking about is economic viability and it is the same no matter the size of the business.”
Zimbabwean model
Zimbabwe veered very close to the edge when it came the land reform, said Dr Nigel Chanakira, chairman: Zimbabwe Investment Authority.
“Within the ambit of agriculture, land reform was a political football and not the best way to attract investors.” However, things have settled and the country has developed a different model, in which agricultural land is owned by the state and leased to farmers for 99 years, this has led to “an emerging crop of young farmers”, while the country’s Agricultural Development Authority is hiring experienced farmers to manage state-owned operations.
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About Nicci Botha
Nicci Botha has been wordsmithing for more than 20 years, covering just about every subject under the sun and then some. She's strung together words on sustainable development, maritime matters, mining, marketing, medical, lifestyle... and that elixir of life - chocolate. Nicci has worked for local and international media houses including Primedia, Caxton, Lloyd's and Reuters. Her new passion is digital media.![](/res/img/s.gif)