The recent endorsement of the African Continental Free Trade Area (AfCFTA) by African countries will impart positively on the agricultural sector and trade on the African continent, according to Asue Ighodalo, chairman of Sterling Bank Plc.
Ighodalo said this in Lagos while addressing participants at the opening of the 4th edition of the Agriculture Summit Africa (ASA) hosted by the bank in collaboration with Saro Africa, AFEX Commodities Exchange Limited, Leadway Assurance, Agriculture and Finance Consultants (AFC), Young Africa Works (MasterCard), Stears, Thrive Agric and Nestle. The annual agro summit was rounded up on Wednesday.
He explained that the AfCFTA will undoubtedly achieve the objective of fostering agricultural transformation and advancement in the African region as part of the effort to promote food security and competitiveness through the improvement of regional agricultural value chains
He noted that “it is unacceptable and an ironic paradox for Africa to lack homegrown agricultural produce and have food insecurity in the midst of so much fertile and arable land across the continent.”
According to him, when Sterling Bank started the ASA four years ago, it was conceived as a powerful advocacy platform to provide solutions towards rebuilding and transforming the agriculture sector into a resilience growth driver.
“In the last three years, our bank has paid specific attention to and concentrate resources on the health, education, agriculture, renewable energy, and transportation. These sectors, when put together, represent the HEART of Sterling, and either by design or fortuitously, agriculture has been and remain the heart of the strategy,” Ighodalo said.
The chairman noted that ASA has become much more than a summit for the bank. “It is now one of the major sources of providing powerful suggestions to drive the wheel of inclusive growth in Africa, create employment, reduce poverty and provide a strong base for the manufacturing sector of the Nigerian economy,” he said.
Ighodalo said despite its numerous challenges, agriculture remains the largest sector in Nigeria contributing an average of 24 percent to the nation’s GDP between 2013 and 2019, and a more recent contribution to GDP at Q1 2020 which stood at approximately 22 percent.
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He said, in a bid to stimulate the economy towards positive growth, the Nigerian government has continued to prioritise agricultural development in its policy and budgetary plan. This approach will help in building a strong agribusiness economy capable of meeting domestic food demand goals and generating export revenues leading to an increase in foreign exchange earnings and creating jobs, he said.
He expressed the hope that the easy access to regional importation of food products can help countries within Africa to achieve food security given that the pact connects 1.3 billion people across 55 countries with a combined GDP valued at $3.4 trillion. It is, therefore, expected that the establishment of the AfCFTA would create new regional markets for farmers, strengthen the agro-value chains and significantly reduce agricultural imports from outside the continent, he said.
According to him, with the design and implementation of the right trade policies mixed with scalable innovation and adequate leveraging of data and technology to maximise productivity, the nation’s, and by extension, the continent’s agribusiness sector could yet be transformed into a powerhouse that will not only feed the continent’s growing population but also create decent employment for millions of young people and perhaps absorb the shocks from the ongoing pandemic.
He said key issues to be discussed at the two-day summit include increasing the involvement of key stakeholders across public and private sectors in developing policies to aid the growth of the agribusiness value chain and funding agribusiness under the new framework to frame friendly policies that will enhance seamless regional trade and developing local economy through improved production.
Others are export product standardisation to avoid rejection of made in Africa goods, deploying digital solutions for improved productivity among smallholder farmers, and understanding the changing regional climate cycles, their impact on productivity, and adjusting practices to deliver growth despite changing climate systems.
He said the expected outcomes of the summit are for the bank to collaborate with key stakeholders to identify and deliver actionable steps to maximise the potential of the AfCFTA agreement to Africa’s agribusiness industries for sustained long-term growth and facilitate sizeable investments to drive increased output across the agribusiness value chain.
In his keynote address Rasheed Sarumi, group managing director of Saro Africa noted that the summit comes at a time the country is faced with numerous challenges, noting the agriculture sector if given needed attention can salvage the economy.
He was of the view that the agriculture sector needs to be highly innovative to meet the demands and expectations of stakeholders given the current global realities in the wake of the COVID-19 pandemic.
Sarumi said, “Innovation can solve problems, will attract good capital, it would address consumers pain. It can propel the growth of agric in Africa more than we’ve had over the last 30 years, especially the last 20 years,”
Also speaking, Benedict Oramah, President of Afreximbank who presented a keynote address entitled: The Green Mile – AfCFTA, Trade and Africa’s Agribusiness Economy on the opening day of the summit encouraged African countries to rise above the loss of revenue that would have accrued to them and see the bigger picture in the enhanced regional trade that the new trade regime would bring on the continent.
The Afreximbank’s President who was represented by Ibrahim Sagna, director of advisory and capital markets, Afreximbank remarked that at the forefront of Africa’s economic integration with various forms of products keyed towards financing and promoting intra-African trade.
While commending the organisers of the Summit, Orama said agriculture has the potential to fast-track Africa’s economic growth, industrialisation, employment, and economic sustainability, among other benefits.
He harped on the need to strengthen agriculture development and its value chains to be the driving force for the African economy that would emerge from the AfCFTA.
According to him, technological innovations would help bring the needed industrialisation to be driven by agriculture with greater employment benefits, financial empowerment, and growth potential.
Orama said it was based on the commitment of the bank to promote intra-Africa trade as well as enhancing and protecting its economy that Afreximbank launched the pan-African payment and settlement systems designed to facilitate trade within Africa and settlement of trades’ deals in local currencies.
He added that Afriexim has been at the forefront of facilitating the movement of goods and services across the African continent as well as trade financing across Africa.
The Afreximbank President said the implementation of the AfCFTA Agreement portends growth of Africa’s economy, diversification of sources of growth and exports, and development of regional and global value chains.
Orama said if the AfCFTA is rightly implemented, it will drive the integration of African countries into the global economy and enhance their bargaining power in international trade negotiations.
The emerging largest global market based on capitalisation, Orama said, transcends institutional and non-tariff trade barriers and will enable economies of scale to increase Africa’s efficiency and competitiveness.
With the AfCFTA, Afreximbank will double the over $20 billion spent so far in facilitating intra-Africa trade in the coming years, Orama said.
“The AfCTFA will lift millions of people out of poverty and if successfully implemented, Africa will emerge as the largest single market in the world,” he said.
In his remarks, Sarumi … group managing director of Saro Africa noted that the summit comes at a time the country is faced with numerous challenges, noting the agriculture sector if given needed attention can salvage the economy. However, he said the sector needs to be highly innovative to meet the demands and expectations of stakeholders.
“Innovation can solve problems, will attract good capital, it would address consumers pain. It can propel the growth of agric on Africa more than we have had over the last 30 years, especially the last 20 years.”
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