- Regional trade enables countries to take advantage of specialization and create win-win opportunities. In the agricultural trade space, Africa currently imports $75 million worth of food and this is projected to reach $110 million by 2025. By producing and trading these basic commodities on the continent, African countries can better create jobs and wealth.
- Intra-African trade currently lags, in part due to the continent’s colonial legacy (established trade patterns continue to center around former colonial powers in Europe, and transportation and trade infrastructure remains geared towards extraction and exportation rather than intra-continental trade) and inefficiencies and expenses at the border (duties on agricultural trade more than double other commodity markets and red tape makes trade non-competitive).
“My aspiration is to see this work scaled, and for markets to think more purposefully about how smallholder farmers and often-excluded stakeholder groups can more equitably participate and benefit from regional trade,” Ariana Constant
- Digital technology can offer solutions, especially in terms of modernizing transactions and cutting down time (and graft) at the border. And, through digital, the barriers to entry can be further lowered, allowing smaller players like small and medium-sized enterprises and smallholder farmers to benefit more fully.
- The Clinton Development Initiative has been working in Malawi, Rwanda, and Tanzania to connect farming communities to business opportunities in the agriculture sector, through training smallholder farmers and mobilizing cooperatives, playing a brokerage role, and de-risking interaction with banks, markets, and farmer groups.
- COVID-19 has affected regional trade, but the creation of ‘green channels’ and supporting special procedures by the World Bank—through which agriculture products could more easily flow—has helped mitigate disruption. A key learning is that shorter value chains are more resilient to shocks than longer value chains.
“For a continent that has revolutionized a mobile phone payment system, there should be no excuse for using carbon copies and fax machines at our borders to process import and export transactions. African trade must go digital,” Edward Mabaya