In its initial condition, Africa’s agriculture bears a striking resemblance to its telecom sector in the late 1990s. A decade on, a combination of right policies and strengthened regulatory framework has seen the sector open up to free enterprise, attracting about $60 billion in private investments and leading to today’s ICT boom: 450 million mobile phones in Africa, which is more mobile phones than Canada, Mexico and the United States combined.

As with telecom, the “early movers” into Africa’s agriculture are likely to reap the most rewards. And we are seeing significant interests from Middle Eastern, North African, South African and Asian firms seeking to establish commercial farms and agri-businesses along the value chain.

With only one-fourth of Africa’s arable land (50 per cent of global arable land) currently in use accounting for a mere 10 per cent of global food production, an agriculture and agri-business sector in full bloom is likely to result in even more transformational change in the lives of the world’s bottom billion than ICTs.

This is not some distant, future dream. Even die-hard afro-pessimists now concede that the global tide is turning in Africa’s favour, revealing a virgin market of one billion people, and a potential trillion dollar economy with enormous staying power and no less than 29 per cent of the world’s youth by 2025.

But timing matters, and huge windows of financial and economic opportunity are open to the pacesetters. Agriculture, I must reiterate, is not only Africa’s “next big thing.” It is already its life wire: it is Africa’s leading private sector. Some 70 per cent of Africans depend on it for their livelihoods, and it accounts for about 40 per cent of the region’s GDP.

During my dialogue last week with hundreds of young civil society leaders from 18 African countries, I was not surprised by their optimism about agriculture. Their eagerness to be involved in the sector was as infectious as it was enlightening for me and my colleagues. However, they were very clear as to what must be done by their governments and partners, to make agriculture work for jobs. I would summarize their views in four major areas.

First, governments (traditional, local and national) need to guarantee land rights for farmers, ensuring that large commercial farms – which are bound to employ fewer people — co-exist with the millions of smallholder farms – which preserve and maximize the job opportunities the sector offers, as well as provide the nucleus for establishing small and medium-size agri-businesses along the value chain. Attention must also be paid to ensure that male farmers – often the first to hop on a tractor and the ones most likely in rural areas to manage the money flowing from agriculture — do not marginalise women farmers, who hold the key to food security.

Valorising land and ensuring that Africa’s banking and financial sectors recognise it as one of the most tangible economic assets of Africa is just as important as building and maintaining adequate infrastructure like farm-to-market roads.

Second, young Africans do not want to be the farmers their grandparents were: hoe in hand, tilling the soil in scorching sun all year round, harvesting barely enough to feed, shelter and house their families. Making the sector more attractive to the African youth – seven-to-ten million of whom join the labour force each year – must entail modernising agriculture, raising productivity, boosting incomes, and expanding links to export markets.

Smallholder farmers would need access not only to more productive seeds and other farm inputs, but also to irrigation, research, technology and finance. Seed funding, notably in the form of grants, patient capital or loans from commercial banks guaranteed by some facility or the valorised farmland could make the difference between a farm start-up failing or prospering. Obstructionist policies, such as price controls, food export bans, and restrictions to cross-and within-border trade, need to be eliminated.

As one participant from Sierra Leone put it: “The market is the problem,” he said, complaining about the ban on his country’s food exports to such neighbouring countries as Gambia, Liberia and Senegal.

A third priority must be that of linking farmers to markets, including the sale opportunities that school feeding or food voucher programmes can generate by buying from local farmers. Pilot initiatives like the World Food Programme’s “Purchasing for Progress,” which has sourced about $1 billion worth of humanitarian food directly from African farmers over the last three years, would need to be expanded. Electronic vouchers, provided through “scratch cards” similar to prepaid phone cards and mobile phone-enabled platforms, have offered funding for food purchases for the poor in Liberia.

Connecting African farmers to Internet-based platforms such as the Ethiopian Commodities Exchange, which made deals worth $1 billion in its first three years of existence would be as essential as linking these farmers to giant global retailers like the U.S.-based Walmart, whose foundation plans to plow about $1 billion in Africa in order to have direct influence over its supply chain. So, too, would be an integrated approach to infrastructure development that combines highway or railroad construction with the setting up of vast agricultural plantations under the so-called “development corridor” model.

Devising these and other smarter ways of reaching markets and consumers would help trim the estimated 35 per cent of food supplies lost on the continent during the post-harvest, transport to market, storage, processing and conservation phases.

Fourth, reforms across Africa will work only if global food markets work for Africa and unfair trade practices are ended. The issue of subsidies by developed countries — currently estimated at $360 billion – will need to be resolved. Young African farmers entering the sector will prosper not only if they can trade, but if trade is fair and if mechanisms to promote transparency on existing stocks help prevent speculators from using food as a commodity to make money on the backs of farmers.

Success would require an integrated approach such as that offered within the Comprehensive Africa Agriculture Development Programme (CAADP) framework – with the strategic pillars of land and water management, markets and infrastructure, food security and vulnerability and agricultural technology. It would also require significant investments. The Food and Agriculture Organization (FAO) says the $22 billion pledged by the G20 at the Pittsburgh Summit barely gets things started. However, while foreign investors and donors can help, African countries which committed in Maputo in 2002 to devote at least 10 per cent of their national budgets to agriculture are those who must step up to the plate.

Mali, which currently devotes 13 per cent of its national budget to the sector, is one of very few countries that have either met or surpassed this target. Too many other countries invest far too little. Cameroon, for example, devotes an estimated one per cent of the national budget to the agriculture sector, although the sector employs 70 per cent of the population and accounts for 40 per cent of the country’s GDP. Without significantly higher investments, the sector will not deliver on the millions of jobs it promises. Much worse: the 2002 World Food Summit warned that business as usual in agriculture could mean that the aim of halving world hunger by 2015 will only be met in 2150.

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Can you tell us how you went into furniture business?

I started by working with another furniture company called Interior Woodwork Limited. It is one of the major furniture production companies in Abuja. I worked with them for seven years before I started my own. I’m very fortunate because I disengaged about a year ago and here I am today with a factory of mine. I was fortunate to win a contract with a major construction company here in Abuja. They gave me a job for the paneling of the wall and partition in the National Judicial Council and from where I was able to get the fund to set up my factory here.

Did you study anything related to what you are doing?

I’m a graduate of University of Ilorin. I graduated in 1992 and my discipline has nothing to do with furnishing because I’m a graduate of Social Administration. I also did Post Graduate Diploma in Public Administration in Ahmadu Bello University Zaria.

I fell in love with the job when I moved from Kano to my former company, and I have been so many things to that company. I have been the head of production, head of Installation before I disengaged so I got to know the workings of furniture making through that company and I decided to make a vocation out of it.

What are the prospects of furniture industry in Nigeria?

The prospect is very great because if you look at Nigeria and particularly Abuja, many buildings are springing up. Though government pay lip service to the issue of building but private individuals and estate developers are all over the places and they require the services of carpenters like us to do the wardrobe,the kitchen, the doors and all that, so the prospect is really very high.

As a matter of fact, I want to believe now that we don’t have enough furniture makers in Nigeria to meet the demands, especially those who do the real thing not just the road side, we have quite a number of them but those who do the real thing that people want are very few.

How do you source your raw materials?

What we use here are what we called melamine face cheep boards or MFC. We import them mostly from China and these are boards that are fully finished in terms of the surface, all we do here is to cut them to sizes and then assemble and it become whatever we want it to be.

Can’t we manufacture some of these things in the country?

Of course we can. They are simple things. If you look at the Ajaokuta steel industry, we have everything but I don’t know what is keeping it down up till now. It’s just negligence on the part of government otherwise these are very simple things.

If you go to most Saw Mills, there are so many dust in the plain wood they cut that you can convert as raw materials to produce some of these boards but if you go to saw mills, you see heap of sawdust which are just set on fire as waste but these are the things that are used to make these article boards we are talking about.

If government is serious, it can encourage people or release funds to us to bring the machines and produce them and employ people and pay back their money.

What will you say about the recent unbanning of imported furniture’s in the country?

It’s definitely bad. As a matter of fact, some of us are thriving because of that ban. It is helping us to grow and develop but the good news is that I was speaking with my former MD few days ago, he said that unbanning did not hold water because it was not gazetted and that a lot of people that were importing furniture encountered problem at the point of arrival as Customs were seizing them because the Customs said though they heard over the news that there was an unbanning but there was no gazette to that effect so they are not working based on newspaper information or a circular from government.

As it is now, the unbanning has seized so we have gone back to the status quo whereby importation is still prohibited for furniture items and which is good for the company and Nigeria at large.

As small as this company is, we have employed not less than 20 people even though we have not started full operations because of the delay of the machines we are expecting but 20 people is not bad. If there is an unbanning, that means we will close shop and cause such people to go into the labour market which will further deplete the economy.

Does the quality of your products meet international standards?

Yes. The machines that are being used abroad are the machines that we imported into the country. So rather than go there and bring the finished goods, we have endeavored to bring those machines down to our country, the raw materials like I said earlier, are also imported.

The only thing that we are trying to do here is skill training. The difference between what we have here and there is the human being doing the job. Abroad they are more exposed and have good workers but here you have to train them to imbibe international standard and practices in what they do so if you see any difference, is the factor of the human doing the production element but for the machines, the raw materials, they are the same things.

Have you ever received assistance either from the government or financial institutions?

Absolutely no. When I was about to start my company, I had a challenge of how to raise money. Unfortunately I had no money, I just left my former place of employment. I approached my bank, unfortunately, the bankers too are not helping. All they were asking for was that I should bring collateral which I didn’t have.

They said if I have landed property here in Abuja, they could tie it to whatever money I want to collect but I said this is a contract paper from a reputable company. This is the value of the paper, you can do everything within your policy to release fund for this project but they said no, the best way out is for me to look for property anywhere.

I ran to an insurance company to see if I can get something like an insurance or performance bond which the company was requiring before they can give advance payment but they too were asking for collateral.

I was lucky to run into one of our old customer who also imports. He was the one that gave me the initial materials which I used to secure that particular job. So there is no support at all from government and most unfortunately even from banks that are supposed to be helping out.

Have you made any effort or know somebody who has been able to secure the N200 billion SMEs bailout fund?

I have not heard about anybody who has secured the fund for now.

How is the patronage like in the furniture business?

The patronage is very good and high especially in Abuja. Abuja residents go for quality. As long as you can give them what they want at an affordable price, the sky cannot even limit you. So many sites all over the place, the patronage is very impressive.

Can you tell us how much you make in a month even though you have not fully started?

My turnover in a month is about N5 million  just because I have not mounted my machines and I’m also careful not to take jobs that will stress and cause me to disappoint customers because I don’t have all the facilities right here now.

What are some of your challenges?

Number one constraint that is very well known to everybody is power as you can see I bought a 75KVA generator which is on standby. The second constraints is that of manpower. Like I said earlier on our people are used to the old method of doing things and this is a new horizon.

The products we are trying to produce can compete favorably with anyone elsewhere in the world and you cannot produce without the human factor. So the challenge of getting quality workers is also there but we are trying to overcome that by training and retraining the ones that we have.

The other challenge is fund. I said earlier on that in my initial take off, I had that challenge. If not that I was lucky to meet a friend who was willing to give me materials on credit, I might have lost out on the job completely and what that means is that I might have lost out on my dreams of having a factory like this.

Another   one may be government inconsistency in policy. We just talk about the issue of banning and unbanning; another government will come and do another thing. Most times, government play politics with the decisions they take not bearing in mind the far reaching consequences on the economy.

What is your message to unemployed graduates?

My message is simple. It is good to be educated because it will prepare you for the challenges ahead but we should not rely on the certificates because it is no longer a thing that is in vogue all over the world now. What is in vogue is for you to think deep within you.

I was trained as a social administrator and what that means is that I was supposed to be administrating to people in the prison, giving counsel to those who are distressed but I have gone way beyond that to think of what I can do that can generate employment for people. That should be the focal point of the new people coming into the labour force.

Government also should create a programme that will no longer be focused on certificates but on skill acquisition.

As I m  talking to you now there is skill gap in this furniture industry and if government identify it they can do something to begin to train people so that they can become marketable especially in the furniture industry.

I’m married with three children, two of them are in the secondary school and one is in the primary school, one boy two girls.

What is your message to managers of our economy?

They should remember that everyone has his or her role to play in the development of our nation. China today is said to be the second largest economy in the world apart from America. They got to that stage as a result of dedicated minds.

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Region Kwara Nigeria

Sector Agriculture & Agri-processing, Energy

Foreign and local investors have the opportunity to invest in the production of ethanol in Kwara State, situated in central Nigeria.

Investment Opportunity

Cassava, an edible starchy tuberous root, is grown in large quantities across Kwara State and well suited for the production of ethanol. Ethanol is generally produced by the fermentation of sugar, cellulose, or converted starch. Apart from food and pharmaceutical uses, ethanol is finding itself alternative use for biofuel in most of the developed world.

Investors looking to process cassava into ethanol can either cultivate their own crops or buy from local farmers. Many of the ‘new Nigerian farmers’ from Zimbabwe are currently involved in the commercial cultivation of cassava. Alternatively the oil from the seeds of the Jatropha plant can also be used for ethanol production. Kwara State’s climate and soil is conducive for the growing of Jatropha.

The federal government has introduced Nigeria’s Biofuel Production Programme to establish a thriving a fuel ethanol industry by utilising agricultural products. A number of incentives have been introduced to stimulate Nigeria’s biofuel industry. These include:
# Pioneer Status All registered businesses engaged in activities related to biofuels production and/or the production of feedstock for the purpose of biofuel production and co-generation within the country shall be accorded Pioneer Status within the provisions of the Industrial Development (Income Tax Relief) Act.
# Withholding tax on interest, dividends, etc.
# Waiver on import and customs duties
# Waiver on Value Added Tax Biofuel companies that are involved in the production of biofuels feedstock; or the production of biofuels and/or the generation of electricity from biomass shall be exempted from payment of Value Added Taxes on all products and services consumed by them.
# Long term preferential loans

Reasons to Invest in Kwara State

Incentives: The Kwara State Government is willing to extend a number of incentives to serious investors. These include the provision of land and infrastructure, tax holidays and assistance with obtaining financing.

Labour: Kwara State is home to the well-respected University of Ilorin and construction of the new Kwara State University will soon be completed. Kwara State therefore has a large number of graduates who can be employed by companies investing in the state.

Cargo terminal: A new cargo terminal at the Ilorin International Airport will soon be completed and will allow for goods to be transported via air, both locally and internationally.

Power supply: Due to the recent completion of the Ganmo sub-station, the state capital, Ilorin, currently enjoys very close to 24 hours a day of uninterrupted power supply. Many business owners are delighted by the fact that they have to make very little use of generators.

Political will: The government of Kwara State is devoted to creating an enabling environment for business and investment. The state is also committed to continuity of policies which will ensure that an investor friendly environment remains even after the end of the current administration’s tenure.

Investment insurance: Nigeria is a member of MIGA (Multilateral Investment Guarantee Agency) and the ICSD (International Centre for Settlement of Investment Disputes). Potential investors are therefore insured against a wide range of non-commercial risks.

Contact Details Investors interested in this project should contact Fela Ibidapo, Special Assistant to the Executive Governor, Kwara State (Investments) at felaibidapo@gmai

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