Former Nigerian president Olusegun Obasanjo says the G20 Leaders’ Summit served as an urgent opportunity to address trade imbalances that hindered Africa’s agriculture sector from becoming a solution to hunger and a job creator.
He was speaking at the African Agri Investment Indaba in Cape Town on Tuesday. His remarks come after South Africa became the first African country to chair the G20 and host the G20 Leaders’ Summit in Johannesburg at the weekend.
“Africa is projected to have the world’s largest workforce by 2030, estimated at 1-billion people. That is good. But if you take it for what you have now, how many will be employed and how many unemployed?
“Africa has to account for one-third of the global labour force by 2050. [It is] a unique and historic opportunity for productivity, innovation, industrialisation, economic growth and wealth generation. However, this can only happen if the people are educated, skilled and empowered.”
The African Continental Free Trade Area (AfCFTA) is a continental agreement that aims to turn the continent into the world’s largest free-trade area with 1.3-billion people and $3.4-trillion in production, leveraging sectors such as mining, tourism and agriculture.
According to Bloomberg Economics, the continent will need to create 1-billion new jobs by the end of the century, and 600-million African people will enter the labour market by 2050.
The International Federation of Red Cross and Red Crescent Societies said 282-million people in Africa were exposed to severe hunger due to challenges including conflict, climate shocks and economic instability.
Obasanjo said regarding land and population, Africa had to move towards building capital so the continent does not condemn itself to remaining a net importer of food goods from the rest of the world, despite being a breadbasket for other economies.
“We possess more than 60% of arable land, and yet we are going hungry. What does that do for us? With land and population, we should only need investment to avoid import dependence. Land, population and then capital. There is a small fourth one, which is research and innovation.”
He decried the imbalance in the cost of capital, which is steepest for the poorest countries that need capital the most. He said production and markets on the continent are highly fragmented and dominated by smallholder farmers.
“The cost of capital is prohibitive, above 20% in most African countries compared to 3% to 7% in Asia. In my home country, you cannot get loans from commercial banks for agriculture for anything less than 28% to 30%. As I said to them, unless you are producing cocaine, there is no way you can invest that in agriculture and expect to make it.”
Also at the indaba, National Assembly Speaker and former agriculture minister Thoko Didiza said the trade multilateralism reaffirmed in the G20 Leaders’ Summit Declaration was key to resolving Africa’s employment needs and its food security and hunger challenges.
We must reimagine and work hard to change our agricultural export basket, which is comprised of raw and unprocessed products. If we continue exporting our raw products without beneficiating them closer to source, we are not only exporting direct job opportunities but also slowing our economies from industrialising and prospering.
— National Assembly Speaker and former agriculture minister Thoko Didiza
“There is a need … to look at marketing infrastructure, information and trade. How do we maximise our participation as different countries in the AfCFTA and remove barriers without increasing protectionism among each other?”
Didiza said the G20 summit rekindled a sense of solidarity among Africans and reinvigorated the need to tackle contemporary issues of poverty, rising debt, climate change and beneficiation of the continent’s minerals and natural endowments.
“We must reimagine and work hard to change our agricultural export basket, which is comprised of raw and unprocessed products. If we continue exporting our raw products without beneficiating them closer to the source, we are not only exporting direct job opportunities but also slowing our economies from industrialising and prospering.”
The G20 Leaders’ Summit declaration said the gathering recognised the “fundamental right of everyone to be free from hunger”. It also affirmed that political will to expand access to and affordability of safe, healthy and nutritious food was urgently needed.
“We support the implementation of the AU’s Comprehensive Africa Agriculture Development Programme Strategy and Action Plan and the AfCFTA, including through investing in local food production, storage and distribution capacities to reduce dependency on volatile global supply chains and supporting African-led efforts to build integrated seed banks, enhance local fertiliser production and promote intra-African agricultural trade.”
According to the declaration, food security remained a major challenge, especially in the Global South, as up to 720-million people continued to experience hunger in 2024, and 2.6-billion people were unable to afford healthy diets.
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