As climate change sweeps the globe, unleashing extreme weather events, Africa, being a continent where economies are dominated by agriculture, finds itself at a crossroads. It faces a future where the investment required for adapting to climate change and building resilience is still a crucial challenge.
Africa is particularly vulnerable to droughts, floods and other climate-related extreme events, with climate change already disrupting traditional agricultural practices and threatening food security.
Farmers and food producers across the continent must contend with the adaptation, transition and physical risks that climate change poses to realise the full benefits of sustainable agricultural practices. Transitioning is hampered by a lack of access to important resources such as finance, infrastructure, improved climate-resilient inputs, and technologies that support efficiencies throughout the value chain.
Thousands of African farmers face a dilemma when it comes to climate change. They must remain financially viable, yet in some cases find that, owing to the cost of transitioning, they cannot achieve this if they try to move away from conventional farming methods.
There are many modern technologies that allow farmers to adapt to climate change. These include precision agricultural techniques using drought-resistant seeds, remote sensors, production-enhancing data, and smart equipment and machinery, all of which are commonplace in many developed countries, but still remain out of the financial reach of thousands of African farmers.
Given the present situation and the possibility of added transition risk, farmers might face an export market crisis, such as the one being triggered by the EU. This developed market is demanding more climate-related trade regulations, such as traceability and additional green certification, that many African farmers cannot provide, but which will result in a new holistic approach to African agriculture.
Action must extend across all levels of society and involve stakeholders ranging from governments to organised agriculture bodies, development institutions, financial institutions, farmers, and agriculture value-chain players.
Poor infrastructure — such as roads, storage facilities and unsuitable transport and logistics systems — needs to be addressed. These hinder the distribution of agricultural produce, affect quality, increase waste, and make it difficult for producers to access markets, improve efficiencies and obtain fair prices for their crops.
As awareness of the importance of regenerative agriculture grows, improved access to education, research and training on climate-smart agricultural methods will be required, as these will assist farmers in moving from conventional agricultural practices to more sustainable and restorative models.
The increasing number of farmers attending Standard Bank-supported regenerative agriculture events shows these requirements are necessary and becoming an important component of the agriculture sector.
Coupled with this is growing awareness by consumers of the dangers of climate change, as a result of which they are demanding that food be produced more organically, with fewer chemicals and pesticides, and according to more sustainable farming styles.
A commitment to doing the right business in the right way means financial institutions must use their resources to promote sustainable and resilient agricultural methods
— Louis van Ravesteyn is head of Agri Business: Business and Commercial at Standard Bank Group
As production costs rise, farmers are seeking practical alternatives to building resilient farms that can remain sustainable through climatic events and commodity cycles, while also complying with more complex market access and border tax regulations.
A commitment to doing the right business in the right way means financial institutions must use their resources to promote sustainable agricultural methods. Participation must include partnerships between banks, industry bodies, producer organisations, governments and development finance institutions, with the objective being financial institutions supporting their clients by promoting sustainability, resilience and food security for present and future generations.
The focus of financial institutions must be on the following imperatives:
- Promoting food security by encouraging the use of climate-smart agricultural practices that include crop diversification, intercropping and agroforestry, where appropriate, as well as precision agriculture. This approach also incorporates adopting appropriate technologies and effective energy and water-management methods. These measures allow for natural resources (soil, water, flora and fauna) to be protected and enhanced, and their future sustainability ensured.
- Developing finance packages for appropriate technologies that operate through the agriculture value chain and reduce food wastage while improving productivity.
- Introducing green financing packages to assist with a switch to green practices attractive to commercial and small-scale farming operations.
- Playing a more active role in formalising and promoting carbon-credit financing and trading of credits.
A shared duty is the joint goal of governments, business leaders and societies across the continent to offer actions and solutions that aim to reach net zero by 2050, in accordance with the Paris Agreement signed at the UN climate change conference in 2015.
In Southern Africa, notable success has already been achieved through the financing of farm-based solar installations and other traditional water and energy sources.
Though large parts of SA are water-scarce regions, farmers relying on irrigation already invest in solar power as a form of renewable energy. This has helped build capacity and increase crop production, and will significantly benefit the country by allowing it to meet export standards that will more and more focus on the use of clean, renewable energy for growing crops.
Educating and supporting farmers through sponsored events, farmers’ days and participation in important national and provincial agricultural events and seminars will also help broaden the climate-change agenda.
Finally, optimising the use of digital platforms and launching initiatives such as the Standard Bank OneFarm Share food relief programme encourage active participation and emphasise the promotion of food security and food-waste reduction.
There is no doubt the climate-change challenges facing Africa can be met. However, this can be done only through a combined approach of investment in infrastructure, education, access to affordable technology and financial solutions. Supported by governments driving policy reforms and improving infrastructure, change can then be facilitated by all the stakeholders in the agriculture value chain.
Together, industry players can build a future in which producers work together to promote resilient farming methods that can reduce climate change in Africa.
• About the author: Louis van Ravesteyn is head of Agri Business: Business and Commercial at Standard Bank Group.
This article was sponsored by Standard Bank.
