PROF SIDI OSHO...PROF SIDI OSHO Chairperson, FANRPAN ‘‘HOW CLIMATE CHANGE WILL AFFECT INTER-REGIONAL AGRICULTURAL TRADE IN AFRICA’ 10 JULY 2019 PREMIER HOTEL O.R. TAMBO Food,

PROF SIDI OSHOChairperson, FANRPAN

‘ ‘HOW CLIMATE CHANGE WILL AFFECT INTER-REGIONAL AGRICULTURAL TRADE IN AFRICA’

10 JULY 2019PREMIER HOTEL O.R. TAMBO

JOHANNESBURG, SOUTH AFRICA© PROF SIDI OSHO

www.fanrpan.orgFood, Agriculture and Natural Resources Policy Analysis Network www.fanrpan.org

www.fanrpan.orgFood, Agriculture and Natural Resources Policy Analysis Network

FRANKLYN LISK – A DEVELOPMENT E ECONOMIST AND POLICY ADVERT F OVER 40 YEARS OF PROFESSIONAL EXPERIENCE

“As the poorest continent, Africa is considered most susceptible to climate change due to its vulnerability and inability to cope with the physical, human and socioeconomic consequences of climate extremes.” 2018

Quote

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The Challenge We All Face


Top 10 Risks in terms of likelihood1. Extreme weather events2. Large‐scale involuntary migration3. Natural disasters4. Terrorist attacks5. Data fraud or theft6. Cyberattacks7. Illicit trade8. Man‐made environmental disasters9. Interstate conflict10. Failure of national governance



Impact of climate change on agricultural production in Africa

Climate change is emerging as a major challenge to agriculture developmentin Africa

Temperatures are likely to increase by between 1.5‐4 in this century Projections on yield reduction show a drop of up to 50% and crop revenue is

forecast to fall by as much as 90% by 2100

Fisheries will be particularly affected due to changes in seatemperatures that could decrease trends in productivityby 50‐60%

Productivity in Africa will be further undermined by a reduction in fertileagricultural land available and an expansion in the coverage of low potentialland


Countries' response to the threat posed by climate change on national food security

Tanzania ‐ has put in place relevant legislation to address the challenges key policydocuments reviewed include: National Adaptation Programme of Action (NAPA2007), Tanzania National Development Plan (2016/17‐ 2020/21) and NationalClimate Change Strategy 2012

South Africa ‐ has recently published the national Climate Change Bill that is aimedat communicating and implementing an effective nationally determined climatechange response

Malawi ‐ in 2016, released the National Resilience Plan ‐ a five year agenda aimedat addressing the causes of climate change and minimizing the effects of climatechange to food insecurity

Zambia ‐ has developed the National Policy on Climate Change to establish acoordinated national response to climate change


The Value Chain Concept

• A value chain in Agriculture describes the rangeof activities and set of actors that bringagricultural product from production in the fieldto final consumption. At each stage value isadded to the product and a value chain iscreated. From Farm to Fork.


THE VALUE CHAIN ACTIVITIES AND ACTORS


CLIMATE CHANGE AND INTER‐ REGIONAL AGRICULTURAL TRADE IN AFRICA

How can Africa impact of Climate change as it affects inter‐ regional agricultural trade in Africa?

Link between climate change and socio‐economic conditions that intensify under development and poverty in Africa.

Examine the different pathways through which climate change affects Africa’s development and Trade.

Highlight the opportunity that we can create for Africa to adapt to new more efficient patterns of development that reduce its vulnerability and improve its resilience.


Action 1 – Strengthen Climate Resilient Agriculture (CRA) needs integrate the risks of climate change within the farm work of CAADP- Comprehensive Africa Agriculture Development Programme.

Action 2- Enhance Regional Trade in Agricultural Commodities Action 3- Enhance capacity for development and implementation of effective water

harvesting, irrigation and water efficiency management for agriculture and other uses. Action 4- Enhance capacity for implementation of soil conservation and better soil

management.

African Union – 2014 - Climate variability and change add to this complex picture their impact on key sectors of the economy, or important drivers of growth.


African Union – 2014 -Climate change & impact on key sectors of the economy, or important drivers of growth.

Action 5- Enhance cooperation with Climate Technology Centers and Network ( CTCN) of CRA

Action 6- Integrate risk management and national developmentinitiatives, food security infrastructure, and contingency plans.

Action 7- Promote employment flexibility, green Jobs and social protection for employed workers to make them more resilient andable to adapt their skills to climate change.

Action 8-Promote involvement of women in decision makingprocesses on Climate Smart Agriculture.


The Challenge We All FaceThe Africa Continental Free Trade • African market of 1.3 billion people and a cumulative GDP over $3.4 trillion• 2015 Africa’s food imports from outside the continent ‐ about US$63 billion. • Projected intra‐African trade in agricultural products ‐ between 20% and 30% higher in

2040 (Economic Commission for Africa (ECA) modelling)

• Africa’s annual food and agricultural import bill averages US$ 35 billion and rising faster than intra‐African trade


Trade and Climate Change- the world experiences an unprecedented expansion in international trade.Why? -----This rapid growth has been fuelled by dramatic technological innovations in the spares of transportation and communications where significant reduction in costs has facilitated more trade and investments around the world.‐‐‐‐‐‐The projection was that Africa will witness substantial levels of investment and growth of interstate trade.------- Africa stands to gain from a comprehensive understanding of linkages between trade and climate change.


The global Trading system has shown that Climate change adaptation measures include the following:------ Policies- standards and regulations or economic, either regulation schemes or economic incentives e.g taxes tradable permits, and subsidies.------ Intersect with international trade in many ways.Invoke and Promote Climate – Friendly International Trade-------Trade can help African countries with adapation, through generating export earnings and accesing technologies.


PROMOTE CLIMATE – FRIENDLY INTERNATIONAL TRADE• Action 1 – Development appropriate

financial mechanisms to promote trade in climate friendly goods and technologies.

• Action 2 – Establish and operationalize regulatory and fiscal polices, emissions trading systems, and voluntary agreements to combat GHG emissions.

• Action 3 – Increase investment in renewable energy such as solar and wind power generation.

• Action 4- Facilitate uniform approach to the pricing of greenhouse gas emission.

• Action 5 – Streamline the intellectual property rights, investment rules and other policies including environment standards and regulatory policies and pollution charges.


MINIMIZE ADVERSE IMPACTS OF CLIMATE CHANGE THROUGH INTERNATIONAL TRADE:

Action 1- Develop cost- effective policies and mitigation technologies that contribute to long-term low carbon growth paths. Action 2 – Liberalize trade in specific goods and technologies that are relevant for climate change mitigate.Action 3 – Remove tariff and non tariff barriers to facilitate the diffusion of climate friendly and clean energy technologies in African countries.Action 4 – Promote and support trade between African countries


Impact of climate change on inter‐regional trade

Positive Impacts (dependent on actions)

• With CSA and less trade barriers, Africa has potential to produce an additional $20 billion worth of staple food e.g. West Africa could halve transport costs in less than a decade by reforming agricultural trade policies

• Adopt a new paradigm ‐ use natural resources as productive assets

• Adopt ecosystem‐based approach (EbA) for higher crop yields – e.g. protecting bees’ habitats by minimizing tillage tillage (promoting natural pollinators)


Impact of climate change on inter‐regional trade


IN THE DEVELOPMENT PROCESS OF AFRICA, TRADE IS REGARDED AS VERY IMPORTANT

Trade generates foreign exchange needed for economic advancement and ensures optimum level of societal welfare; therefore, trade balance is a major economic goal.

Trade as a common practice of exchanging excess produce for scare ones, measured by level of foreign exchange earnings is not equally obtained by every nation.


Reduction of food imports Increase Exports Increase domestic Supply of Food Improve the Agricultural Value Chain with improved technologies Improve Agriculture Financing Improve Infrastructure – roads, railroads, and irrigation dams Promote Agricultural Investment through Private Sector Engagement See Agriculture as a business – Commercializing agriculture Agriculture as key to long term economic growth and security –

technologies, financial services, inputs market linkages Market Orientation Climate Change and Environmental sustainability Nutrition Sensitive Agriculture

ECOWAS Agriculture Regional Agricultural Investment Program (RAIP)

Promotion of strategic projects for food security and food sovereigntyPromotion of a global environment conducive to regional agricultural development


AfDB “ECONOMIC EMPOWERMENT OF AFRICAN WOMEN THROUGH EQUITABLE PARTICIPATION IN AGRICULTURAL VALUE

CHAINS” Promoting agribusiness entrepreneurs along the value chain, creating

products to target niche markets and expanding cooperative programmes.

The four important crops:

• cocoa, coffee, cotton and cassava. These crops have been chosen because of their importance for food security or in being a primary generator of export revenues for African countries.

• Collectively, these four sub‐sectors account for USD 43 billion in production value* and USD 12 billion in export value** across the focus countries.


Woman Coffee FarmerEthiopia is Africa’s largest coffee producer & exported USD 771 million in coffee in 2013.

Côte d’Ivoire is the largestcocoa producer, generating one-third of the world’s cocoa.USD 8 billion worth of cocoa beans was produced globally in 2012 But it only processed 34 % of its production in 2013.

Woman Cocoa Farmer

Africa competes with Brazil, Vietnam andIndonesia


Women Cotton Farmers

Burkina Faso is Africa’s largest cotton producer. In 2013,the global market for cotton was worth USD 39 billion in production value andUSD 65 billion in export value.Africa contributed only about 6 percent of the global cotton production

Nigeria is the largest African (and global) cassava producer. Africa produced USD 51 billion worth of cassava in 2013. Nigeria produced 20 percent of global cassava but less than 1 % of exports.

Women Cassava farmers


African Continental Free Trade Agreement (AfCFTA)


AfCFTA Nigeria has now made up its mind to

join the league of other nations that have subscribed to a focused regional continental trade development initiative known as the African Continental Free Trade Agreement (AfCFTA) which has a market penetration of over two (2) billion population.

• This did not come on a platter of gold and silver. For instance, in 2018, 44 African countries, at a summit of the African Union (AU) in Kigali, Rwanda, signed an agreement to create the AfCFTA but Nigeria, Africa’s largest economy did not key into it even though she had earlier indicated interest to do so.


AfCFTAThis is a step forward for the

AU’s 2063 project for closer African integration. The project 2063 is fashioned to boost intra-African trade and poised to be the biggest trade agreement since the formation of the World Trade Organization in 1995.

•

Reducing barriers to trade, such as removing import duties and non-tariff barriers,

African countries hope to boost intra-continental business.

The AfCFTA could improve trade between African countries, which in 2016, was estimated to account for only 10%.


The general objectives of the AfCFTA are

To create a single market for goods/services and movement of persons;

Deepen economic integration of the African Continent;

Create a liberalized market for goods and services,

Cooperation on investment; Intellectual property rights and

competition policy through successive rounds of negotiations.

To add impetus by contributing greatly to the movement of capital and natural persons and facilitate investments by laying the foundation for the establishment of a continental customs union at a later stage.

To serve as a mechanism to promote and attain sustainable and inclusive socio-economic development, gender equality, structural transformation of the state parties, in addition

To enhancing the competitiveness of the economies of state parties in the continent and global market.


AfCFTA aims to promote industrial development through diversification and regional value chain development.

--------The AfCFTA is estimated to be the biggest free trade agreement in the world and is projected to increase intra-African trade by 52 per cent by the year 2022, using trade levels in 2010 projection as baseline.

--------The cooperation on customs matters and the implementation of trade facilitation measures, establishment of a mechanism for the settlement of disputes concerning State Parties’ rights and obligations are critical elements that have been infused into the institutional framework for the implementation of the AfCFTA on the continent.


The African Continental Free Trade Agreement (AfCFTA) is a trade agreement:

Which is in force between 27 African Union member states, with the goal of creating a single market followed by free movementand an African single-currency union.

The AfCFTA was signed in Kigali, Rwanda, on 21 March 2018. As of July 2019, 54 states have signed the agreement.

Ratification by 22 countries was required for the agreement to enter into force and the African Continental Free Trade Area to become effective.

The agreement will function as an umbrella to which protocols and annexes will be added.


Tackling Climate Change requires concerted and coordinated actionof state and all non‐state actors

FANRPAN Vision:

– Resilient African agriculture and food systems, securing prosperity and health for all

FANRPAN Mission:

• To build resilient food systems across Africa through:• the creation, implementation and assessment of policies for food, agriculture and natural resources

• that are both evidence‐based and developed in partnership with non‐state actors

What FANRPAN is Doing


Strategic Goal 3: Climate change resilient and resource sustainable food systems in Africa

Strategic Objectives

Improved access to knowledge and resources to accelerate the adoption of

climate smart agriculture

1

Empowered and informed individuals making climate smart choices within

supportive social systems

2

Increased investment into the sustainable and inclusive use of natural resources, through climate funds and

other appropriate mechanisms

3

Address the following issues:• Adaptation• Mitigation• Resilience• Women and youth

empowerment• Climate financing• Communities of practices


Climate Smart Agriculture (CSA) ‐based practices thathave the potential to:

1. Sustainably achieve food security (increase food productionwithout further depleting water and soil resources)

2. Increase resilience of farmers and farming systems to climaticchange

3. Improve capacity of systems to sequester carbon and mitigateclimate change (increasing carbon stocks in terrestrialsystems‐ farmland, grassland or forests)

Why Climate Smart Agriculture


• Expanding the evidence base and assessment tools to identifyagricultural growth strategies for food security that integratenecessary adaptation and potential mitigation

• Building policy frameworks and consensus to supportimplementation at scale

• Strengthening national and local institutions to enable farmermanagement of climate risks and adoption of context‐suitableagricultural practices, technologies and systems

• Enhancing financing options to support implementation, linkingclimate and agricultural finance

Actions needed to implement climate‐smart agriculture?


FANRPAN Programmatic CSA Focus

Ensuring efficient water use

Protecting our harvests

Strengthening capacity of key actors


Implementing the TISA Project(Transforming Smallholder Irrigation into Profitable and Self‐Sustaining Systems in Southern Africa)

• Goal• To improve farmer livelihoods, equity andcommunity management in smallholder irrigationschemes in southern Africa

• Focus CountriesMozambique, Tanzania and Zimbabwe

Ensuring efficient water use


• ObjectiveTo address major constraining factors oftechnology dissemination and adoption,knowledge and information sharing, ruraladvisory services (RAS) and policies related toPHM.• Focus CountriesBenin and Mozambique

Protecting our harvests

Implementing the PHM‐SA Project(Postharvest Management in Sub‐Saharan Africa)


Strengthening capacity of key actors

Implementing the GCRF‐AFRICAP Project(Agricultural and Food‐system Resilience: Increasing Capacity and Advising Policy)

• ObjectiveTo enable the design, and uptake, of evidence‐basedpractices and policies that deliver productive,sustainable, resilient agri‐food systems: “ClimateSmart Agri‐food Systems” to allow sustainabledevelopment towards the SDGs and beyond.

• Focus CountriesMalawi, Mozambique, South Africa, Tanzania


Message

• Generation of evidence. • When new policies are implemented there are winners and losers. • There is need for evidence on what ACFTA means to agricultural value chains. • What are the gains and loses

Messengers:

• Building the capacity of policy champions (especially the non‐state actors) • How to use the generated evidence to translate into bankable actions • Hold government accountable• Capacity of practitioners to monitor and evaluate the implementation process

Platforms

• Policies – building voices of private sector champions • Inclusive platforms ‐ provision of an inclusive and safe space for dialogue

FANRPAN – Way Forward


Influencing using Policy Platforms

National Platforms• Multi‐stakeholder policy dialogues• Community Theatre for Policy Advocacy• Parliamentary Committee Portfolio Meetings• Farmer Field Days

Global Advocacy Initiatives• United Nations Framework Convention on Climate Change ‐ UNFCC• Commission on Food Security (CFS)• World Economic Forum• Global Landscapes Forum• Global Forum for Innovations in Agriculture (GFIA)

Regional Advocacy Initiatives• FANRPAN Flagship Multi‐stakeholder Regional Policy Dialogue • COMESA Ministers of Agriculture and Environment Meetings• African Union Heads of State Summits and Ministerial Meetings


Influencing through Partnerships


• Substantial evidence that the frequency and intensity of extreme climate events may change in the coming decades

• Research ‐ An improved understanding of how projected climate changes will impact the international markets for Africa’s food security.

Conclusions


With the changing climate there will be opportunities and losses (others will be able to produce and others will not be able to do so). What is Private Sector Gain?

Do the regional and continental trade policies provide for this?

Important to identify and use suitable models that capture all the necessary variables of climate change, agricultural production and trade. Where is your niche as private sector?


The Comprehensive Africa Agriculture Development Programme ( CAADP) was endorsed at the African Unions Heads of State Summit as a New Partnership for Africa’s Development (NEPAD) program in July 2003 with the goal of “ helping Africa countries reach a higher path of economic growth through agriculture – led development which eliminates hunger, reduces poverty and food insecurity, and enables expansion of exports.

This is a growth oriented agricultural development agenda aimed at increasing agriculture growth rates to a minimum of six percent per year to create wealth needed for rural communities and households in Africa to prosper.

Question – Is Africa truly prosperous in Agricultural Trade ?

Conclusions


“Agriculture not only gives riches to a nation but the

only riches she can call her own” By

Samuel Johnson

“Manage Climate change; reduce poverty & maintaining economic growth to ensure peace and stability.”

Ban Ki-moonFormer Secretary-General of

the United Nations


Thank you for listening

Prof Sidi OshoScreens Speakers

Documents

PROF SIDI OSHO...PROF SIDI OSHO Chairperson, FANRPAN ‘‘HOW CLIMATE CHANGE WILL AFFECT INTER-REGIONAL AGRICULTURAL TRADE IN AFRICA’ 10 JULY 2019 PREMIER HOTEL O.R. TAMBO Food,