The H.E.A.R.T of the Matter : Sterling Bank’s “Trillion-Dollar Agriculture Economy”

Over the past few years, there’s been a renewed focus on agriculture and the incredible potential embedded within its value chain across the African continent and even beyond. 

The World Bank spurred an interesting debate when its “Growing Africa” report concluded that Africa’s farmers and agribusinesses could create a trillion-dollar food market by 2030 if they expand their access to more capital, electricity, better technology, and irrigated land.   

Sterling Bank appears to be taking this discourse further, when it announced plans to host Africa’s Agriculture Summit between September 5th and 6th 2019 in Abuja. Any keen observer would wonder whether the theme of the summit “Agriculture: Your Piece of the Trillion Dollar Economy”, is a subtle invitation to share the spoils of a banks investment in agriculture, or just another talk shop dedicated to expressing- yet again, just how important agriculture is to an entire continent.  

As the emphasis on oil continues to dwindle, governments across the African continent are compelled to seek viable alternatives to boost and sustain their economies effectively. Agriculture is unarguably one of the most viable options. 

The untapped treasure that agribusiness represents is vividly apparent: According to a field report by the International Fund for Agricultural Development (IFAD), more than half of the Earth’s arable land—roughly 600 million hectares—is located on the African continent. Nigeria alone has 84 million hectares of land that can be put into agricultural use. 

The Agriculture Outlook 2018-27 report from the OECD and Food and Agriculture Organisation projects that the sector will undergo robust growth, with crop production in sub-Saharan Africa predicted to rise 30% between 2018 and 2028. 

While many countries in Africa continue to grapple with poor infrastructure, unfriendly government policies, epileptic power supply, water shortage, unemployment, and inadequate financing, there have been efforts to effect a transformation in their fortune through one thing they have always had—agriculture. 

The Good Ole’ Days… 

Nigeria was once a predominantly an agrarian economyTales abound of how the great Asian tigers visited the country for its oil palm seeds decades ago, and now lead the world in the production of a different kind of oil. Subsistence farming reigned supreme in the ’60s with the production of staple food crops such as yam, rice, cowpea, banana, and millet and cash crops like cocoa, palm kernel and rubber.  

However, the discovery and subsequent exploitation of crude oil changed this dynamic. With the huge foreign exchange earnings from oil came the unfortunate neglect of the agriculture sector. Farmers who were already poorly paid began to troop to the cities, and over time, farming became unattractive to the average Nigerian. 

Decades later, stakeholders in the agricultural value chain have realized that only a return to the country’s previous mainstay is likely to cause the needed turnaround in its economic fortunes. Little wonder the sector was made the highest priority of the government’s economic policy in 1999 and continued to receive better attention with successive administrations. 

The Potential Agriculture Boom 

At the Public Lecture of the Food and Agriculture Organization (FAO) of the United Nations in August 2018, President, Africa Development Bank, Akinwumi Adesina stated that the AFDB will be investing $24 Billion US dollars to implement its Feed Africa Strategy over a period of 10 years. This is because the future of food in the world depends on Africa which holds 65% of the uncultivated arable land left to feed 9 Billion people by 2050.  

This in my humble opinion was a call to arms for serious agribusiness players- finally, global financial powerhouses are planning a return to funding the long-neglected sector.  

This effectively makes agriculture the next frontier for the discerning investor and indeed, individuals, agro-processing entrepreneurs, policymakers, value chain players, development agencies, financial institutions, and captains of industry. But did many financial institutions dial in on these opportunities to localize the experience for their customers and offer them tangible products, services, and benefits? Not many did.  

Sterling Bank’s Leadership: The Time to Plug into Agriculture is Now 

We must therefore, commend Sterling Banks efforts at creating a convergence of public and private sector discourse around this seminal subject. What would be even more gratifying, is if actions can match the words that would be spoken at this week’s conference. Let’s not just talk- the time to plug into agriculture is NOW.  

In the last 3 years, Agric-tech digital platforms offering Nigerians the opportunity to be a part of the farming value chain have sprung up rapidly in different parts of the country.  

Agro entrepreneurs who are the brains behind these platforms are cognizant of Africa’s drive towards agro industrialization in order to ensure food security and economic emancipation for the continent. 

And there’s no reason to believe that the commitment to inject huge financial resources to make Africa the food basket of the world will fail; for one, people the world over have a consistent need to feed for throughout their lifespan. 

Secondly, strategic public-private partnerships involving policymakers, farmers, input suppliers, financial institutions and captains of industry have provided a solid base to launch Nigeria, and ultimately Africa into the stratosphere of economic prosperity, and perhaps, a world superpower. 

As potential beneficiaries of the boom to come, we must each play our parts in making this dream come to fruition. Kudos to Sterling Bank for taking the initiative to create this platform for Nigeria’s benefit and Africa’s future