Resources | 19 Oct, 2021

Unlocking Regional Trade: Whitepaper

Do you know which policies prevent private agribusiness from contributing to regional food trade? IDH and AGRA surveyed private agribusiness to get insights that can strengthen the African policy making processes.

The food and agriculture sectors in African economies can benefit greatly from improved regional food trade integration, and achieving this requires action at both the public and private sector levels.

Currently, many African countries’ food trade – the trade in food-related products – is more closely integrated with the rest of the world than it is with other African countries. While the demand for food products is growing – due to factors like population growth, urbanization and increasing prosperity – domestic production has not grown as fast, increasing many countries’ import dependency.

This contributes to foreign exchange outflows, depressed domestic currencies, heightened food inflation, and ultimately greater food insecurity. Increasing the volume and value of regional trade can yield many improvements, including access to better, more affordable, and more nutritious food; more and higher paying jobs; improved opportunities for small and medium enterprises; and a more vibrant localized economy.

The efforts needed from the public sector are quite well-understood and include strengthening of the policy and regulatory environment at the national and regional levels, build the capacity and resilience of value chain actors, and strengthening national and regional production. Efforts such as the African Continental Free Trade Area (AfCFTA) are promising step. Insights from the private sector confirm that while there is an eagerness to participate in and benefit from greater regional food trade, companies are hampered by inefficient, unpredictable and in some cases insufficient policies and implementation.