#AGRF2020: AGRA’s Nwafor on how stronger markets could shape agriculture in Africa

In a recent interview on CNBC Africa, Dr. Apollos Nwafor, the vice president for policy and state capability at AGRA, delved into the importance of stronger markets in shaping agriculture in Africa. The discussion centered around the critical role markets play in strengthening food systems as the continent strives to feed its burgeoning urban populations. Dr. Nwafor emphasized the need for markets that are not only effective but also efficient. He outlined key elements that contribute to the strength of markets, such as policy predictability, a functional supply chain, an enabling environment, and access for all stakeholders. The predictability of policies ensures that governments create an environment conducive to market-driven approaches to food production and distribution. One of the significant challenges facing African agriculture is the informal nature of many markets. Dr. Nwafor highlighted that while informal markets have thrived in the past, there is a need to formalize trade structures to ensure inclusivity. He underscored the importance of policies that support smallholder farmers and small-scale producers, enabling them to participate in formalized trade without burdensome regulations or tax impositions. The conversation then turned to the formalization of trade within the agricultural sector, particularly in the context of the African Continental Free Trade Area (AfCFTA). Dr. Nwafor expressed optimism about the potential of the AfCFTA to formalize market systems and promote inclusive trade practices. He stressed the need for policies that do not exclude informal market participants but rather facilitate their integration into formal trade structures. Addressing the current challenges faced by farmers in moving agricultural produce across borders, Dr. Nwafor proposed leveraging existing regional economic communities to expedite trade processes. He cited examples such as ECOWAS in West Africa, COMESA in East and Southern Africa, and SADC in Southern Africa as models for creating common markets and facilitating trade within the region. Dr. Nwafor highlighted the importance of addressing non-tariff barriers to trade, emphasizing the need for harmonized standards and regulations. He noted that while tariff barriers are less prevalent, non-tariff barriers present significant challenges to intracontinental trade. AGRA is actively supporting regional initiatives to harmonize standards and regulations, particularly in the grain trade sector, to facilitate cross-border movement of essential food commodities. In light of the disruptions caused by the COVID-19 pandemic, Dr. Nwafor underscored the importance of policy predictability in maintaining functional market systems. He warned against succumbing to protectionist policies driven by political considerations, as these could lead to market dysfunctionality and price hikes, ultimately impacting food access for vulnerable populations. As Africa grapples with the twin challenges of urbanization and food security, the role of stronger markets and improved trade mechanisms becomes increasingly crucial. Dr. Nwafor's insights shed light on the pathways to enhancing market efficiency, formalizing trade structures, and overcoming trade barriers to foster a more resilient and inclusive agricultural sector in Africa.