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2023 Named the “Year of the African Continental Free Trade Area”

Year of the African Continental Free Trade Area

In 2023, the Assembly of Heads of State and Government of the African Union (the AU Assembly) adopted the “Acceleration of AfCFTA Implementation” as the theme of the year. By making 2023 the Year of the African Continental Free Trade Area (AfCFTA), the AU hopes to make major breakthroughs in its implementation by increasing the political commitment of member states and the different stakeholders and improving their collaboration.

The AfCFTA Alleviating Poverty

The Year of the African Continental Free Trade Area, one of the major projects outlined in Agenda 2063 of the AU, is set to greatly contribute to the alleviation of poverty in Africa. By eradicating barriers to trade and expanding commerce within the continent, the program has the creation of a unique African market as its goal. It aims to achieve development in a sustainable and inclusive manner and to ensure food security and the development of the agricultural and industrial sectors.

With 55 member states of the AU and an expected 2050 population of 2.5 billion, the AfCFTA is also set to be the world’s largest free trade zone since the World Trade Organisation was formed, and per the World Bank estimates, it will increase the continent’s income by $450 billion by 2035.

All of this will have a major impact on poverty in Africa. The program should enable around 30 million people to leave extreme poverty. Another 68 million will be able to escape moderate poverty. By creating employment and enhancing sustainable development, the AfCFTA will significantly improve the African population’s average quality of life. 

The AfCFTA Roadmap

  1. May 2019 marked the AfCFTA Agreement entering into effect, and its implementation has progressed ever since. As of March 2023, 46 countries have ratified the agreement. Before the start of the 2023 Year of the AfCFTA, eight countries had met the minimum requirements for trade and participated in the program’s Guided Trade Initiative, an important start in the implementation of the AfCFTA. However, the project has still been limited by a need for foreign direct investment and by infrastructure issues. Furthermore, negotiations were complicated by competing interests between individual governments and the continent-wide project. 

However, 2023 being the Year of the AfCFTA has had non-negligible advantages. In July 2023, the AU’s Mid-Year Coordination Meeting remarked that the negotiations on the “strengthening of infrastructure through the corridor approach”, which had been stalling before, were now completed. The AfCFTA implementation has thus been accelerated and is on the right path to one day generate significant income and jobs for the continent, thus benefiting millions of people in poverty and the world economy. 

A Focus on Women and Youth 

The AfCFTA project also aims to guarantee socio-economic inclusiveness across the continent by facilitating women’s and youth’s access to cross-border trade. With Africa’s population being the youngest in the world (people under the age of 30 make up 70% of the overall population), and women being major participants of cross-border activities in Africa, their involvement in the development of the AfCFTA is essential. However, social inequalities in Africa impede women’s participation in the economy, thus pushing them into the informal sector.  Like young people, women are disproportionately impacted by financial and systematic obstacles and lack of employment. 

Among its objectives, the AfCFTA wishes to address this situation by including a Protocol on Women and Youth in Trade in the Agreement on the AfCFTA. 

Discussions on the Protocol, which had already been held in 26 countries before the start of the Year of the AfCFTA, have been a forum for African women in trade to shape their participation in the project and address the challenges they face today. The Protocol aims to find solutions to abolish the structural obstacles that women and youth face in trade, such as significant trade tariffs, or gender-based violence.

The inclusion of women and youth in the implementation of this program is paramount to the sound development of the trade area and the African economy. It is also essential to ensure that this important part of the African population is lifted out of poverty and can access better welfare. 

The Road Ahead

Despite the progress made in the 2023 Year of the AfCFTA, there is still work ahead to ensure its full implementation. Notably, the project is still in need of investment and hampered by infrastructure issues. However, the AU has made impressive strides toward the trade area’s full development in the past years and in 2023 alone, which shows its eagerness to succeed in this endeavor. If the AU achieves the full implementation of the program, it could mean unprecedented benefits for both the African and world economies. The potential for poverty alleviation it holds would be revolutionary for the African population.

– Kenza Oulammou
Photo: Unsplash

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4 Ways Blockchain Technology Aids Poverty Alleviation in Nigeria

Poverty Alleviation in NigeriaWith approximately 4 in 10 Nigerians living below the national poverty line, the “Giant of Africa” needs effective strategies to tackle these alarming rates and promote inclusive growth. In an era defined by rapid technological advancement, innovative solutions empower impoverished communities. Blockchain technology offers the potential to be one technological game-changer in the process of achieving poverty alleviation in Nigeria.

What is Blockchain technology?

Blockchain technology is a decentralized digital ledger that securely records transactions across multiple computers. It operates on a peer-to-peer network, where each transaction, or “block,” is linked to the previous one, forming an immutable chain. This technology ensures transparency, security and trust as all participants in the network have access to the same information, eliminating the need for intermediaries and enhancing efficiency.

4 Ways Blockchain Technology Helps Poverty Alleviation in Nigeria

  1. Advancements in Financial Inclusion: Initiatives such as “Project GIANT” by the Central Bank of Nigeria (CBN) aim to leverage blockchain technology to enhance financial inclusion in the country. Under Project GIANT, the CBN has partnered with financial institutions and technology companies to develop a blockchain-based solution for Know Your Customer (KYC) verification. KYC is a crucial process for accessing financial services, but it can be challenging for individuals in underserved areas who lack formal identification documents. By utilizing blockchain technology, Project GIANT enables individuals to create and manage their digital identities securely fostering sustainable change for poverty alleviation in Nigeria.
  2. Transparent Governance and Anti-Corruption Efforts: By implementing blockchain-based systems for public service delivery, procurement processes and records management, Nigeria can increase transparency and reduce corruption. This ultimately allows for an efficient utilization of public resources and poverty alleviation in Nigeria. One successful example is the “Abuja Electronic Government Records and Document Management System” (E-Records System) implemented by the Federal Capital Territory Administration (FCTA. Through the E-Records System, government agencies in Abuja can securely store and manage various types of documents, including land titles, property records, permits, licenses and official correspondences. The decentralized nature of blockchain ensures that no single entity can manipulate or falsify records, reducing the potential for corrupt practices.
  3. Secure and Transparent Social Programs: Using Blockchain’s transparency and tamper-resistant features, Nigeria can guarantee that aid reaches its intended beneficiaries, minimizing leakages and improving the effectiveness of poverty alleviation in Nigeria. The “Building Blocks” initiative by the World Food Programme (WFP) was piloted in collaboration with the government of Nigeria and focused on providing food assistance to vulnerable populations, particularly internally displaced persons (IDPs) affected by conflict. WFP currently distributes food and money (including mobile-phone-based transfers) to 1.2 million people each month in Yobe, Adamawa and Borno. They profited off blockchain technology to improve the delivery of food assistance by enhancing transparency, reducing fraud and ensuring aid reached the intended beneficiaries.
  4. Access to Funding and Investments: Blockchain-based crowdfunding and tokenization platforms can democratize access to funding and investments. Entrepreneurs, including those in underserved areas, can showcase their ideas and projects to a global pool of investors, potentially attracting financial support for business ventures that can generate employment and economic growth. One notable example is the Nigerian “Farmcrowdy” platform that connects small-scale farmers with investors through a blockchain-based crowdfunding model. The platform enables individuals to invest in various agricultural projects, such as poultry, crop farming and fish farming, by providing funds for inputs, equipment and other farming needs. The impact on poverty alleviation in Nigeria has been significant, with farmers’ incomes increasing by an average of 50% per hectare in two years after registration and 500,000 new jobs in the areas of processing, transport and warehousing and cooling.

A Positive Impact

Overall, Blockchain technology presents a transformative opportunity for Nigeria to alleviate poverty and achieve sustainable development. It’s a promise of progress that can boost the Nigerian economy by $29 billion by 2030. While it continues to evolve and demonstrate its potential, its impact on Nigeria’s development and poverty alleviation efforts can inspire other nations to explore and adopt similar solutions tailored to their specific contexts and challenges.

– Miriam Schuller
Photo: Pixabay

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Improving Electricity Access in Africa

Electricity Access in AfricaIn an effort to better understand anti-poverty initiatives and their effectiveness, a pioneering Stanford University study published in November 2022 has provided some of the strongest evidence yet of the extent to which electrification fuels economic growth in the developing world. Though the research is still developing, rapid advances in computer technology indicate that the ability to collect and analyze such data will only expand in the coming years and decades.

A New Study

Led by PhD candidate Nathan Ratledge, the research relied on innovative techniques, developed at Stanford, that combine satellite imagery and AI to measure and study poverty in countries where data collection has traditionally posed a challenge. The researchers’ findings demonstrate that Machine Learning (ML) techniques can provide more reliable estimates of the causative impact of electricity access in Africa.

Specifically, the study analyzed the impact of Uganda’s expanding electricity grid on livelihoods in the country. Drawing upon vast data, it juxtaposed digitized maps from 2005 to 2016 with satellite-image-based wealth estimates for more than 640,000 houses across 27,000 villages in sub-Saharan Africa. This deep learning model, which trained an algorithm to detect patterns from images, allowed the researchers to visualize the social and economic impacts of electricity in ways not previously possible.

The Findings

Based on the findings, the electrical grid encompassed 41% of Uganda in 2019, marking a significant increase from just 12% in 2010. Furthermore, increased access to electricity correlated with substantial improvements in financial conditions and quality of life, as measured by increases in home construction, appliance use and other tangible markers of growing wealth. Overall, the data showed that the rate of wealth accumulation roughly doubled in Ugandan communities that gained electricity access, as compared with communities that lacked it. 

These findings were published during the November 2022 COP27 in Egypt, which marked the 27th annual meeting of the Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change. The seminal focus of COP27 was overcoming challenges to addressing the pressing global climate crisis. More than 35,000 participants and 100 Heads of State representing governments around the globe attended the conference. One of the key outcomes was an agreement to establish a “loss and damage fund” to mitigate the inordinate effects that high-income countries have had on climate change and, thereby, on the vulnerable nations that suffer the most impact. Many of these nations are in Africa, which has seen continent-wide destruction by droughts, flooding and other climate-related disasters in recent years.

Encountered Problems

Until now, one of the primary problems encountered in measuring electricity access and its relation to poverty in Africa has been a lack of data. As Ratledge stated, “It’s hard in many low-income countries to get any reliable data. It just doesn’t exist.” A model for overcoming this obstacle, the recent Stanford study presents a new way to measure progress in the fight against global poverty.

A Promise of Future Growth

Due to the Stanford research, “we now have this technique to give local-level measurements of key economic outcomes at a broad, spatial scale and over time,” said Marshall Burke, the study’s co-author. Perhaps the most inspiring aspect of the researchers’ work is that all evidence points to an exponential proliferation of understanding. Ongoing technological advancements are expected to make such techniques widely affordable and accessible, allowing researchers to carry out similar work to better understand and combat poverty around the world.

– Gabriel Gathercole
Photo: Flickr
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Circular Economies Are Alleviating Poverty in Africa

Circular EconomiesCircular economies use industrial systems and economic activities that are regenerative to keep materials and services recycled as long as possible. By recycling products and services, circular economies eliminate excess waste and use fewer raw resources. Circular economies are alleviating poverty in Africa by creating a new workforce in resource recovery and reducing the use of scarce natural resources like water.

Many communities are taking the concept of circular economies into their own hands, forming cooperatives, or organizations ran jointly by their members. A cooperative in Kenya utilized solar resources that they had an abundance of to generate energy for the area, alleviating poverty by allowing people access to electricity. By making policies more environmentally friendly, circular economies are alleviating poverty in Africa in more ways than one.

Limitations on Single-use Items

There are currently 37 African countries that have a ban focused on eliminating single-use plastic, most focused on plastic bags. In 2017, the East African Community (EAC) endorsed the Polythene Materials Control Bill which provides the regulation and control of the use, sale and manufacturing of polythene materials like plastic. Circular economies are alleviating poverty in Africa by eliminating single-use plastics. By doing this, there will be less pollution in communities in Africa where poverty is present, resulting in less money allocated towards the cleaning of this pollution and more funds dedicated to the people of the area.

Extended Producer Responsibility (EPR) Policies

EPR is an environmental policy in which a producer is still responsible for their product even after it is consumed. This way producers fully take into account the environmental implications of producing their product. In South Africa, EPR policies regulate producers to be responsible for funding a salary scheme for workers to determine how employees are paid in the informal sector, where businesses are generally cash-based and workers have informal agreements with their employers. South Africa’s EPR plan also outlines expanding the Packa-ching project, which advises people in informal settlements to sort their waste, clearing the settlements of pollution. Circular economies are alleviating poverty in Africa by giving policies the chance to steadily pay their workers and rid their communities of waste.

Enabling Digital Transformation

South Africa, Kenya and Rwanda have all implemented digital accessibility policies and this could contribute to circular economies alleviating poverty in Africa because they can support youth employment and skill development by creating jobs that focus on the management, use and repair of equipment. The policies include free or subsidized internet access to those who can not afford it by recycling old technology and fixing it to make it functional.

Specifically, Rwanda collaborated with the World Economic Forum to host a Centre for the Fourth Industrial Revolution in 2022, promoting emerging technologies including artificial intelligence and blockchain, which is an advanced business database. Within the same year, Rwanda’s capital held the ITU World Telecommunication Development Conference, which included a new Generation Connect Global Youth Summit to discuss engaging the next generation of leaders in a digital age. Rwandan entrepreneurs use Irembo, a government-to-citizen service portal located on a kiosk, as micro-businesses that generate income. Rwanda is a great example of a country using technology in a circular way to alleviate poverty– by giving its citizens resources, people have more opportunities to make money while giving back to their community.

Pushing Circular Economy Agenda through Policy

Circular economies are alleviating poverty in Africa, but there still is a way to go before Africa and other continents can fully adopt an economy focused on reusing and recycling. This can be done by introducing policies that incorporate a circular economy and post-pandemic recovery, including low-carbon emissions carrying over from the pandemic to the post-pandemic era.

In addition, by giving the public more of a say in policymaking, such as people working in waste management and secondary material production, circular economy policies are developed where benefits are distributed fairly.

– Olivia Maillet
Photo: Flickr

 

The Digital Moonshot: Bringing Universal Internet Access in Africa 

universal INTERNET ACCESS IN AFRICANow more than ever, the whole world relies on the internet for everything. From shopping to education, access to the internet has become a crucial aspect of modern life. While it is often taken for granted, access to the internet is not yet universal. Two decades ago, the entire continent of Africa had less internet bandwidth than Luxembourg – a nation smaller than Lake Victoria. Although progress has been made in the last 20 years, universal internet access in Africa has yet to be achieved.

In April 2019, international organizations gathered to discuss the African Union’s Digital Transformation agenda and the Digital Moonshot initiative, which aims to “digitally enable” all of Africa by the year 2030, in line with the United Nations’ target date to meet the Sustainable Development Goals.

The Importance of the Internet

The disparity in internet access in Africa has hindered economic growth in both the private and public sectors across the continent. In emerging economies like Brazil and India, the internet has accounted for over 10% of GDP growth over the last five years. Although African countries have made considerable progress in economic development in the last few years, it continues to lag in this regard.

It is not just African businesses and governments who would benefit from greater internet connectivity but individuals, too. In a poll by the Pew Research Center, a majority of people in sub-Saharan Africa believe that increased access to the internet has had a positive influence on the economy, education and interpersonal relationships.

Internet access in Africa has certainly increased in the 21st century. Between 2014 and 2017, the percentage of people in sub-Saharan Africa who use the internet increased from 29% to 41%. However, there is still important work to be done to ensure universal internet access in Africa and importantly, stable connectivity.

The African Union’s Digital Transformation Agenda

The African Union released its Digital Transformation Agenda to digitally empower all businesses and individuals to freely access the internet by 2030. This plan will also spur intra-African trade and investment, therefore requiring a high level of cooperation between all nations in the African Union.

Currently, the African Union considers weak coordination and collaboration as a key threat to this agenda. Another central issue is a lack of cooperation between “continental institutions” in the digital sector; the African Union report states that “this deficiency must be addressed immediately otherwise the project is already destined to fail even before being implemented.”

However, the African Union also sees this plan as an opportunity for increased harmonization between regional and continental actors. It also hopes that it can improve relationships between governments within the continent. This is why collaboration with a variety of international organizations who are supporting this initiative.

The Digital Moonshot Initiative

The Digital Moonshot initiative is the World Bank’s project to support the African Union’s Digital Transformation Agenda. This initiative recognizes the need for a holistic approach that will go beyond simply increasing internet access in Africa.

World Bank Vice-President for Infrastructure Makhtar Diop stressed that the Digital Moonshot will include many fields, such as “e-government transformation, fintech, investment in human capital and digital literacy,” and support for entrepreneurship in digital advancement.

Going further, both the African Union and the World Bank emphasized the importance of inclusivity in this initiative. The African Union recognizes that the cost of internet access will inherently inhibit Africa’s poorest from being a part of the digitization initiative. Thus, the Digital Moonshot initiative will make a point to emphasize job creation and poverty reduction in the digitization process.

It also notes that a gender gap exists in access and usage of mobile phones and the internet that must be addressed as part of this plan. The World Bank’s Digital Moonshot will place a special focus on women, ensuring that the policies implemented do not exacerbate the existing gender gap in digital access.

The support of many international organizations, including the World Bank, will be crucial to the achievement of the African Union’s Digital Transformation Agenda and ultimately the pursuit of universal internet access in Africa. If these plans move forward as expected, they will have a significant impact on Africa’s economic growth and its path towards poverty reduction, in addition to connecting more African individuals and sharing their voices to the world.

– Leina Gabra
Photo: Flickr

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Rise of Solar Energy in Africa Fuels the Future

Rise of Solar Energy in AfricaThe future is bright for Africa. The continent is beginning to tap into an energy source that is plentiful, clean, renewable and self-sustaining. Unlike other energy sources such as coal or oil, solar energy is a path to energy independence for African nations developing their economies. This desire for energy independence has led to the rise of solar energy in Africa.

Growth Potential

Since sunlight is the most intense closest to the equator, Africa has a great opportunity when it comes to solar energy. The equator runs through the center of the continent, earning Africa the nickname, “The Sunshine Continent.” Companies such as Kenyan-based M-KOPA are tapping into the abundant resource. M-KOPA has, so far, created 2,500 jobs in East Africa. Although the rise of solar power is relatively new, Africa’s access to sunlight could fuel the future.

Independence

Other energy sources are often imported and therefore create a reliance on other nations, whereas solar energy is often independently operated. Nations with vast oil reserves are able to consolidate control over the resource, but not all citizens benefit from the nation’s wealth. The average citizen is not able to drill for oil and process it. Although oil and coal provide money for the nation, only a few wealthy people can control the resource. Individuals cannot build dams or nuclear reactors, but they can install their own solar panels and power their homes. M-KOPA helps foster self-reliance by supplying 750,000 homes and businesses with solar panels to produce electricity.

Additionally, 46% of households that are powered by M-KOPA solar panels generate income from their solar panels. They can essentially sell their excess energy back to the grid. Solar power empowers individuals because they have control over their energy. The ability to sell excess energy allows the people of Africa to collect passive income and invest in their future. Most importantly, electricity is a requisite for many activities and is necessary to live a more autonomous life. Access to electricity allows people to be more productive with their time, as they can see and work at night. Unfortunately, only 43% of Africa has access to electricity.

Companies such as SolarNow provide solar power systems for people that live off the grid. Considering 60-80% of people in Uganda and Kenya live off the grid, companies like SolarNow have an enormous market to serve. SolarNow has sold more than 50,000 units in East Africa. The rise of solar power in Africa will continue to grow the economy of African nations and allow people to take control of their lives and energy.

Clean and Renewable

Unlike other resources, solar power is clean and does not pollute the atmosphere. Solar power is renewable, utilizing energy from the sun, which is relatively infinite. Since much of Africa lacks electricity, it is important that the continent develops sustainably. This way, people do not suffer from the harmful effects of pollution. The rise of solar energy in Africa has been successful so far, considering M-KOPA has conserved 1.7 million tonnes of CO2 since 2011. Although solar panels are expensive, they are a cleaner and more sustainable option than the coal that is currently burned to produce electricity.

A Bright Future

Despite having room for further improvement, the future is bright for the people of Africa. Investing in solar power is a key component to reducing poverty because it empowers individuals to harvest their own energy and potentially profit from it. Far too many African people lack access to the electrical grid, and solar energy is a viable path to powering the continent. The rise of solar energy in Africa will continue to create jobs and produce clean, renewable energy that can help grow the economies of African nations.

– Noah Kleinert
Photo: Flickr

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TikTok in Africa Empowers Youth

TikTok in Africa
TikTok, the popular video-sharing social media platform, has taken a unique approach to enter the African market by empowering young Africans to take a stance as influencers. Many users on the site share short entertaining videos of themselves or friends singing and dancing along to popular songs. They can connect to others based on shared viewing interests. Some users of TikTok in Africa have decided to take things a step further and use the platform to share their support for certain ideas or causes.

TikTok for Good

One way the company encourages activism on its platform is through the TikTok for Good program, where users receive encouragement to share hashtags across the site that promote causes they are passionate about. “TikTok wants to inspire and encourage a new generation to have a positive impact on the planet and those around them,” the company wrote in a statement on its website. By uploading videos with a hashtag that represents a specific cause or campaign, users can become influencers and advocates and continue to share videos within the trend.

Some of the most successful TikTok for Good trends in the past have been #PetBff and #CreateForACause. #PetBff celebrated International Homeless Animals’ Day in 2019 in partnership with the American Society for the Prevention of Cruelty to Animals (ASPCA). TikTok encouraged users to share videos of their pets, and for every video that it posted from Aug. 19 to Aug. 22, 2019, the company donated $1 to the ASPCA. According to the TikTok website, the trend had over 490,000 videos created and raised $75,000, the company’s maximum pledge amount. Similarly, #CreateForACause encouraged users to use special holiday filters in their videos in support of DoSomething.org, a completely youth-led nonprofit organization that advocates for social change; Best Friends Animal Society, a nonprofit organization in support of animal welfare and Oceana, an international ocean conservation advocacy group. TikTok pledged a $2 million donation to the charities during the campaign.

#DanceforChange Inspires Advocacy

A popular advocacy trend on TikTok in Africa has been the #DanceforChange challenge in partnership with the United Nations’ International Fund for Agricultural Development (IFAD). IFAD is a Rome-based U.N. agency that works to encourage individuals, companies and countries around the world to invest in more sustainable agriculture in order to improve food security across the globe. According to its website, IFAD has given $20.9 billion in loans and grants towards 1,069 sustainable agriculture projects that it has supported in partnership with 125 governments. In total, it has reached approximately 483 million people around the world with its programs.

The #DanceforChange challenge encourages users to post dancing content to the site with the hashtag. The videos act as a virtual petition that IFAD uses in support of greater investment in sustainable agriculture across rural African communities. “IFAD invests in rural people, empowering them to reduce poverty, increase food security, improve nutrition and strengthen resilience,” the organization said in a statement on its website.

Sherrie Silver, IFAD’s advocate for rural youth and an MTV award-winning choreographer, partnered with the popular African recording artist Mr Eazi to highlight the TikTok campaign in the hopes of inspiring more African youth to take action using the site. “We are dancing to capture the world’s attention and to share a message with young people everywhere: our generation can end global hunger, but only if our leaders invest more in agriculture and the next generation of young farmers,” Silver said in an interview with IFAD.

The #DanceforChange challenge goes further than other TikTok for Good trends by both offering African youth a space to showcase its talents and giving them the opportunity to advocate for themselves and their communities to a global audience. The platform allows users of TikTok in Africa to catch the rest of the world’s attention and ask for help addressing issues like hunger and inefficient agricultural practices that they still face in poverty.

TikTok in Africa

The Chinese-based company quickly gained popularity in the United States and across Europe, though TikTok is now focusing on the African market. Along with the #DanceforChange challenge, TikTok has begun moving some company operations into Africa. For example, in 2018 TikTok partnered with Nairobi Garage, a co-working space in Nairobi that offers meeting rooms, club space and private offices, to offer educational sessions on creating content and safe practices while using the platform. The company also began hiring local staff for TikTok in Africa throughout Kenya, Nigeria and South Africa in order to both provide jobs within each country’s business sector and connect to the local African market from within.

By moving TikTok into Africa, the company has been able to offer formal employment opportunities at its new office spaces, which in turn helps to reduce poverty levels in those countries as incomes and quality of life increases. Additionally, TikTok is able to create a more inclusive audience as African creators and influencers join the platform to share their culture.

TikTok in Africa continues to make a positive impact both within the country and across the globe by connecting people from impoverished backgrounds to the same creative spaces the rest of the world is able to access. Not only does the app inspire users around the world to advocate for development in Africa, but it also empowers youth within Africa to take their own action to fight hunger because they have a chance for others to hear and see them.

– Myranda Campanella
Photo: Flickr

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5 African Agritech Startups Tackling Poverty

African Agritech Startups
The World Bank predicts that agribusiness in Africa will grow to become a $1 trillion industry by 2030. This growth impacts poverty reduction efforts. For every 1 percent increase in agricultural GDP, poverty in the region decreases by 1 percent. Food security and stable growth in the region can be obtained by investments in agriculture. Specifically, a large branch of agriculture business on the rise is agricultural-tech in Sub-Saharan Africa. With African agritech startups launching in 2010, exponential growth has been seen since. 

Agritech companies, or disruptive agricultural technologies (DATs), aim to develop solutions to ongoing issues in the form of solar devices, mobile apps and even bio-fortified foods. These companies help farmers in two ways: increasing produce yield by 3-5x the baseline and/or connecting farmers directly to buyers and affordable equipment, effectively cutting out the middleman. These technological advances help farmers increase their output, efficiency and access to markets. With the help of agritech, farmers can combat a lack of regional resources and reduce poverty.

5 African Agritech Startups Tackling Poverty

  1. Kitovu is a Nigerian based mobile app that was launched in 2016. The startup’s goal is to help farmers increase their crop yield while guaranteeing sales directly to buyers. Kitovu’s primary motivation evolved from post-harvest loss and waste occurring in roughly 40 percent of crops. This waste is partly due to small farmers being required to sell their goods through intermediaries who take a large portion of the profit. To reduce loss and decrease corruption, Kitovu connects farmers directly to processing companies and relevant consumers. With this information, farmers use Kitovu’s FarmPack to provide insight into the purchase of crop-specific fertilizers, appropriate seeds and agrochemicals. Kitovu also has a user exchange feature, called FarmSwap, that allows farmers to trade produce, thus gaining additional funding through inputs financing. Lastly, Kitovu offers a third feature, called eProcure, to help farmers with various supply chain needs, including exportation and necessary operational machinery.
  2. Agrocenta is a four-tiered software platform founded in Ghana in 2015. Similar to Kitovu, Agrocenta seeks to solve a common barrier to farmers: a lack of access to buyers and financing options. Four distinct platforms are offered. AgroTrade simulates an active marketplace that connects farmers of staples directly to buyers. AgroPay creates a reliable log for various products. AgroInfo delivers industry news such as crop prices and weather updates. Finally, Truckr partners directly with Ghana Private Road Transport Union to ensure drivers deliver goods efficiently. With these services, Agrocenta services more than 46,000 individual farmers.
  3. AgriPredict is a Zambian-based agritech company created by CEO Mwila Kangwa that utilizes AI to help around 22,000 farmers manage risks of environmental disasters, including drought, pests and crop diseases. This mobile app and web-based platform predicts weather patterns and identifies crop diseases through machine learning. A farmer will take a photo of the diseased crop and upload it to the app where the output will be a real-time diagnosis, treatment options and a location of the nearest agricultural supply store. Additionally, AgriPredict has a tool that helps farmers estimate their yield of a specific plot of land.
  4. Yellow Beast Tech is aiming to solve severe water shortages, like the shortages that plagued South Africa from 2015 to 2018. During this time, city dam water levels fell below the typical level by 13.5 percent. Founded by civil engineers, Pontisho Molestane and Matebele Moshoni, the company invents, manufactures, sells and installs irrigation systems aimed to limit water waste. Additionally, the device uses AI to analyze the most optimal conditions for the soil-crop system to aid farmers in maximizing crop yield while limiting water usage.
  5. Hello Tractor, a mobile app, was founded in 2015 to provide affordable equipment to farmers in Nigeria and Kenya. The app connects tractor owners, small-scale farmers, banks and dealers to locate the best solutions. A monitoring device is first attached to the tractor and connected to the cloud. Relevant data is transmitted to stakeholders to optimize agricultural business networking and production. According to the company, 22,500 farmers have been served to date. Further, these farmers see about a 200 percent increase in crop yield.

African agritech startups show promise for the continent by addressing the needs of the ever-increasing population. Not only do these five startups provide an innovative approach to addressing systemic issues in the sector, but concrete solutions to food security and poverty as well.

– Danielle Barnes
Photo: Flickr

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Rising Life Expectancy in Africa

Rising Life Expectancy in AfricaBetween the years of 1770 and 1925, Africa’s life expectancy stayed the same while life expectancies were rising in the rest of the world. Since 1925, however, Africa has also has seen a steady rise in its life expectancy. While the average life expectancy stayed at 26.4 years of age for over a century, it has since risen by over 30 years, with an average life expectancy of 60 years of age in 2015. In the 21st century alone, life expectancy at birth has risen by 42 percent, according to the World Bank.

Declining Infant Mortality Rate and Antiretrovirals

Several factors can explain the rising life expectancy in Africa. One main element driving this is the fall in the infant mortality rate and rise in child survival. Fewer infants have died shortly after their births and more children to live past their fifth birthdays due to increased health care and more efficient and healthy, delivery processes. Additionally, a wide variety of generic drugs have become more accessible and more affordable for low-income families in Africa.

Another factor, also regarding health and wellness, that has contributed to the rising life expectancy in Africa is the increased accessibility to antiretrovirals for treating HIV. During the 1990s, life expectancy in Africa significantly declined as a result of the HIV/AIDS epidemic. Since then, continuous research and funding have been funneled into providing efficient treatments and drugs for HIV/AIDS, ideally at an inexpensive rate. As of 2017, 66 percent of adults and 59 percent of children in Africa who are living with HIV are on antiretroviral treatment and the increase of this treatment directly correlates to the increase in life expectancy.

Rising Incomes

The rising income per capita could also be a factor to explain the rising life expectancy in Africa. According to the World Bank, the GDP per capita in sub-Saharan Africa in 2000 was less than $600; as of 2017, that number has more than doubled and stands at more than $1,500. Of course, food supply in a given country plays a huge role in the projected life expectancy and with more income, there comes greater food security. As mentioned, higher income can lead to greater health services and increased access to housing and clean water also factors into increased life expectancy.

While the continent of Africa has increased its life expectancy rate since 1925, there are some impending factors that could pose a threat to its successes. Africans between the ages of 50 and 69 are at risk of health problems such as high blood pressure, high blood sugar and obesity. These risk factors could lead to increased deaths related to diabetes, heart attacks and strokes.

Since the start of the 21st century, Africa has seen a significant rise in income, allowing the government to spend more on health care and providing vaccines to people who need them. Overall governance in Africa has appeared to have improved over the past couple of decades, according to William Jackson, a senior emerging markets economist at Capital Economics. He argues that the rising life expectancy in Africa over the past century, but more specifically the past 20 years, is a huge achievement for the continent, despite potential setbacks in years to come.

– Charlotte Kriftcher
Photo: Flickr

What’s Happening with Free Trade in Africa?

Free Trade in Africa
Free trade is currently a hot topic in Africa. Several countries have already signed a trade agreement that opens the continent to free internal trade and now the European Union is looking to connect with Africa and form an alliance between Europe and Africa. While these talks certainly seem like a good idea, the question of whether they ultimately help Africa’s poor remains unanswered.

A Move Toward Intra-African Trade Improvement

Early in 2018, many African leaders came together in Kigali, Rwanda, to establish the African Continental Free Trade Area (AfCFTA) with the goal of executing the agreement before January 2019. The deal would allow free movement of capital and business travelers. Ideally, it would give a chance for manufacturing sectors growth in many countries and lead to economic diversification.

AfCFTA will potentially cover the market of more than a billion people in African and will be one of the largest free trade areas ever established in the world. Its goal is to create one continental market for goods and services. AfCFTA should also “enhance competitiveness at the industry and enterprise level through the exploitation of opportunities for scale production, continental market access and better reallocation of resources.” The Economic Commission for Africa has calculated that this deal would increase intra-Africa trade by more than 50 percent through the elimination of trade barriers.

What Does External Free Trade in Africa Look Like Right Now?

Currently, Africa and Europe are committed to the Cotonou Agreement that, unless amended, expires in 2020. Signed at the turn of the millennium, this agreement covers the partnership between the E.U. and many developing countries in Africa, the Caribbean and the Pacific.

The Next Chapter for EU and Free Trade in Africa

European Commission Chief Jean-Claude Juncker stated that Africa does not need charity. He said that this continent needs true and fair partnerships. And Europe needs this partnership just as much. His recent State of the Union address called his colleagues to see Africa as Europe’s “twin.” He argued that the perspective of this continent as the one needing Europe’s help or charity was not only insulting but rather false.

Europe is beginning the process of replacing the Cotonou Agreement, focusing on Africa with the goal of a free trade agreement between E.U. and all Africa countries. A report from the European Commission argues for an Alliance for Sustainable Investment and Jobs. The report summarizes that this alliance is more than a financial plan and it represents a radical shift in the way these two continents work as partners toward a logic focused on Africa’s economic potential and the mobilization of the private sector.  This Alliance has 10 main actions in focus:

  1. Boosting strategic investments via blending and guarantees
  2. Supporting the opportunities for manufacturing and processing at the national and regional level
  3. Establishing sectoral groups of African and European public, private and financial operators and academia, under the Commissioner lead, to provide expertise, advice and recommendations
  4. Supporting education and skills development at the continental level
  5. Supporting skills development at the national level to match skills to strategic development choices for each country
  6. Strengthening the dialogue, cooperation and support on the investment and business climate
  7. Supporting the Africa Continental Free Trade Area
  8. Strengthening intra-African and E.U.-African trade in the long-term perspective of a continent-to-continent free trade agreement
  9. Supporting connectivity both intra-African and between the E.U. and Africa
  10. Mobilizing a substantial package of financial resources

This Alliance is estimated to create 10 million jobs over the next five years and hopes to strengthen the private sector as well. AfCFTA is crucial in achieving these goals. African Union’s High Representative Carlos Lopes said that AfCFTA should be the main instrument for a free trade agreement with the E.U. Currently, more than a third of Africa’s trade occurs with the European Union. Lowering costs and improving efficiencies would benefit everyone involved.

Poverty and Free Trade in Africa

Free trade agreements have many advantages and can lead to better lives of Africa’s poor population. However, they can also go in the opposite direction and take away jobs leaving unskilled workers with few options to support themselves and their families.

Free trade tends to increase a country’s economic growth, attracts foreign investors and leads to a transfer of expertise and technologies. It also leads to greater outsourcing, destruction of native cultures and can hurt local industries and firms.

Nigerian President Muhammadu Buhari is especially cautious when it comes to opening borders for trade. He has delayed (and may ultimately avoid) agreeing to AfCFTA because he fears that competition from other African nations will destroy local industries. The World Trade Organization meanwhile argues that free trade helps reduce poverty. In fact, their research found that trade liberalization is generally a strongly positive contributor to poverty alleviation since it allows people to exploit their productive potential, assists economic growth, curtails arbitrary policy interventions and helps to insulate against shocks.

The open trade comes with certain consequences, but many countries and many people have benefitted greatly from opening their borders to the free flow of goods and services. If Africa can ratify its internal trade agreement and then form a new alliance with the European Union, it could mean better jobs for the citizens of the continent and poverty reduction.

– Sarah Stanley

Photo: Flickr