Africa’s Agricultural Potential: A Paradox of Opportunity

By Samaila Zubairu

Abundant Resources, Yet Food Insecurity:
Africa’s agricultural potential is immense. With over 60 percent of the world’s uncultivated arable land,the continent has all the natural advantages it needs to become a global agricultural leader. Fertile soils,diverse climates, and abundant rainfall across many regions create optimal conditions for growing a wide variety of crops, from staple grains to cash crops like cocoa, coffee, and cotton. In theory, this should make Africa a food-secure continent, a leader in global food production, and an exporter of agricultural goods. However, this is not the case.In reality, more than 282 million Africans are undernourished, and millions more suffer from moderate to severe food insecurity. This is a staggering figure, especially when considering the resources available to the continent.

The Import Dependency Paradox:

Despite possessing vast agricultural resources, Africa remains heavily dependent on food imports. Every year, the continent spends around US$50 billion on food imports, much of which is directed toward basic staples like cereals, oils, and grains. This growing dependence is problematic not only because it drains vital foreign exchange reserves but also because it keeps Africa vulnerable to external shocks—fluctuating global food prices, supply chain disruptions, and the impacts of climate change.

• This reliance on imports is projected to increase given its current trajectory.
• The sharp increase in food import expenditure highlights the urgent need for systemic change in how Africa approaches agricultural production, food systems, and self-sufficiency.

Strategic Investment for Transformation:

• The reason for this paradox isn’t scarcity of resources, but rather the lack of concerted and strategic investments in three key areas: infrastructure, industrialization, and financing.
• These levers are essential to harness Africa’s agricultural potential and shift the continent from food dependency to self-sufficiency.
• By addressing critical infrastructure gaps—such as rural roads, storage facilities, irrigation systems, and energy access—and focusing on industrialising agriculture through mechanisation and agro-processing,Africa can break the cycle of dependency.
• Investments in financing and modern farming techniques will ensure smallholder farmers have the tools and resources they need to increase productivity and move beyond subsistence farming.This will unlock Africa’s agricultural potential, reduce dependence on imports, and set the stage for a sustainable, food-secure future.

Modernizing Agriculture for Self-Sufficiency and Value Creation
Agriculture: The Heart of Africa’s Economy but a Source of Low Productivity:

Agriculture is the backbone of most African economies. It contributes significantly to GDP, with up to 22 percent of GDP in some countries, and employs over 60 percent of the population. However, the sector remains plagued by low productivity, which is the lowest in the world. Smallholder farmers, who produce the bulk of Africa’s food, face numerous challenges: outdated farming practices, limited access to capital, and inadequate support in terms of credit and insurance. These factors contribute to a vicious cycle of low yields and persistent poverty.

This productivity gap is compounded by climate change, which brings more unpredictable weather patterns, droughts, and floods, disrupting traditional farming methods. As a result, smallholder farmers struggle to meet the increasing food demands of Africa’s rapidly growing population.

The Case for Modernisation:

To address the productivity challenges, Africa must embrace modernization in agriculture. This means adopting advanced farming techniques, which can dramatically increase yields and reduce dependence on traditional, low-output methods.
The use of mechanization is crucial—tractors, harvesters, and other machinery can increase efficiency,reduce labor costs, and boost output, allowing farmers to scale production. Climate-resilient crops, such as drought-tolerant maize or heat-resistant wheat, should become the norm rather than the exception.

These crops can withstand extreme weather, improving food security for the continent. Additionally, the adoption of advanced irrigation techniques can help mitigate the impact of water scarcity, ensuring reliable water supplies for crops in dry periods.By embracing these modern methods, African agriculture can achieve the productivity gains necessary to meet growing demand, reduce food insecurity, and strengthen economic resilience.

Post-Harvest Losses: A Massive Drain on Resources:

One of the most significant barriers to food security in Africa is post-harvest losses, which account for up to 40 percent of perishable crops. These losses occur due to inadequate storage, poor transportation infrastructure, and inefficient supply chains.

. To address this, Africa must invest in cold storage and value-added infrastructure. In Nigeria, for example, AFC’s partnership with the Nigeria Sovereign Investment Authority (NSIA) is developing modular warehouses and cold storage solutions to preserve crops after harvest. Scaling up this type of infrastructure across the continent can ensure that the food produced is not wasted and can be stored for later consumption or processing. These investments will not only improve food security but will also stabilize prices by reducing supply fluctuations.

The Ethiopia Model—Proof of Possibility:

The success of Ethiopia’s wheat revolution serves as a shining example of what can be achieved. Supported by the African Development Bank, Ethiopia has dramatically expanded its irrigated wheat fields from less than 5,000 hectares in 2018 to over 650,000 hectares by 2021. This initiative has led to a significant increase in per-hectare yields, enabling Ethiopia to achieve self-sufficiency in wheat production by 2022. This transformation allowed Ethiopia to save millions of dollars previously spent on wheat imports, marking a shift towards food sovereignty and a more stable agricultural economy.
Replicating such successful models across Africa can drive the continent toward self-sufficiency,reducing the need for costly imports and making African agriculture more competitive globally.Building Agro-Industrial Hubs and Securing Fertilizer Supply for Resilience

The Need for Value Addition in Africa’s Agricultural Sector:

At present, many African countries export agricultural commodities in raw form—cocoa, cotton,maize—without adding significant value through processing. This practice prevents African economies from realizing the full potential of their agricultural resources and limits job creation. The challenge lies in fragmented food systems, limited access to finance for local processors, and underdeveloped regional trade networks.

To fully capitalize on agricultural opportunities, Africa must build agro-industrial hubs that integrate production, processing, and logistics. These hubs will ensure local value addition, creating jobs,stimulating trade, and reducing the reliance on imports. Agro-processing hubs can generate substantial economic benefits by processing raw materials locally, increasing the export of finished products, and ensuring that more of the wealth generated by agriculture remains within the continent.

Agro-Industrial Hubs: The ARISE IIP Model:

AFC’s ARISE Integrated Industrial Platforms (ARISE IIP) are at the forefront of this shift. These hubs provide the necessary infrastructure, financing, and expertise to enable local value addition. For example, in Benin, the ARISE IIP cotton-to-textile hub processes locally grown cotton into finished textiles, which are then exported to regional and global markets. This initiative has created thousands of jobs, reduced the country’s reliance on imported textiles, and helped integrate the local economy into the global market.

Similarly, in Chad, AFC is working on developing a meat-processing hub that will allow the country to substitute imports of meat from places like Argentina and Brazil. Such initiatives foster regional integration, increase exports, and provide new markets for African agricultural products.

Building Strategic Infrastructure for Agriculture:

Infrastructure is a crucial enabler of the agricultural transformation. For instance, the Lobito Corridor—a trans-continental rail line connecting Angola, the Democratic Republic of Congo, and Zambia—is an example of how infrastructure can support agricultural development. The Lobito Corridor will provide a seamless link between agricultural production regions and rapidly growing urban markets, enabling African farmers to scale their operations and compete in global markets. It will also drastically reduce transport costs and allow for more efficient trade within the continent.

The Path Forward: A Moment of Opportunity:

. It is clear that the opportunity for transformation is now. The paradox of a continent with vast agricultural potential yet high levels of food insecurity and import dependency can no longer be ignored. . The resources, land, and talent are all in place; what is required is a focused, coordinated effort to harness them. Africa’s agricultural future is not a distant dream—it is within our grasp, but only if we act decisively and strategically.

. For Africa to fully unlock its agricultural potential, it will take more than isolated efforts. Governments,the private sector, development partners, and regional institutions must work together to create an ecosystem that supports sustainable agricultural growth. Policy alignment, resource mobilisation, and the active participation of all stakeholders are crucial to overcoming the structural challenges we face.

.The need for infrastructure development, increased investment in modern farming techniques, creation of agro-industrial hubs, and the establishment of regional fertilizer supply chains must be prioritized.These investments are not just about building agricultural capacity—they are about creating a more resilient, self-sufficient, and prosperous Africa.

. The path ahead requires bold action, commitment, and collaboration. Let us embrace the full potential of Africa’s agricultural sector—investing in modernization, expanding infrastructure, and developing local value chains. By doing so, we will not only ensure food security for Africa’s growing population but also build a foundation for sustainable economic growth and regional integration.

.The time to act is now. Let us commit to the transformation of Africa’s agriculture, unlock its full potential, and create a prosperous future for generations to come.Together, we can turn Africa’s agricultural potential into lasting prosperity.

The author is President and CEO, Africa Finance Corporation