ACP regional and local markets news – Post date: July 8th, 2020

The role of MSMEs in food systems: now more critical than ever

A recent survey of 363 agri-food SMEs in 17 countries by the Global Alliance for Improved Nutrition (GAIN), the SUN Business Network and the World Food Programme showed that 94% reported being impacted by the pandemic (GAIN, 27 June). Nearly all responding firms had taken action to mitigate the impact of the pandemic on their business or to protect their employees, and about one third reported downsizing their workforce. This article looks at businesses spurred by the pandemic to explore new market opportunities, such as Farmfresh Food Company, which normally sells precooked beans across Rwanda and East Africa. Due to COVID-19 restrictions imposed at borders, Farmfresh is sending more products to supermarkets and to distributors who sell through online portals. GAIN says that although some food system SMEs around the world have adapted admirably, the need to support them is greater than the challenges most of them are facing, particularly with financial and technical assistance through programmes such as GAIN’s Nutritious Foods Financing Facility (N3F).

Ghana: COVID-19 disrupting seed industry

Seed companies in some parts of Africa are struggling to produce and import enough quantities of quality certified seeds for distribution to farmers as a result of the COVID-19 pandemic (Joy Online, 23 June). Shortage of labour to work in seed companies, border closures and restrictions on movements are making it more difficult to get quality seeds to farmers. “COVID-19 came at a time when a lot of the seed companies were preparing to clean their seeds. Or preparing to import. The lockdown came in March. And we were supposed to start planting in March. Most of the seeds we were expecting from outside have not come in,” Augusta Nyamadi Clottey, executive secretary of the National Seed Trade Association of Ghana (NASTAG) explained.

Ghana imports a lot of its improved vegetable and other seeds, as well as other agricultural inputs from Europe, Asia and America, which are now more expensive to bring in because of the closure of borders to commercial flights. And local seed companies that produce certified seeds for sale to farmers are struggling to get labour to operate smoothly.

The African Seed Trade Association has called for concerted efforts to ensure quality and improved seeds reach farmers in a timely manner despite the COVID-19 pandemic. The Secretary General of the Association, Justin Rakotoarisaona, said “Closing borders or even slowing down the cross-border seed movement creates a significant problem in the seed supply chain domestically, regionally and globally. In a number of regions, it is now the planting season and timely delivery of seed and other agricultural inputs is crucial to ensure farmers plant on time in order to ensure food security especially after the health crisis.” Dr Solomon Gyan Ansah, Deputy Director of Agriculture at the Ministry of Food and Agriculture in Ghana, said “In fact, this pandemic has really prompted government that at any point in time, we should have some seeds that are secured to be used in times of disaster. And I believe government will put measures in place to make sure that we have seeds at all times to be used.”

Nigeria: coronavirus threatens food security

PricewaterhouseCoopers (PwC) has indicated that the COVID-19 pandemic is putting pressure on food prices, posing a major threat to Nigeria’s food security (Vanguard, 30 June). Meanwhile, other experts in agriculture and food security have also advocated a review of the national food security structure to address an imminent food security crisis that may hit Nigeria as a result of the effect of COVID-19 in the agricultural sector. The PwC publication, “Responding to the impact of COVID-19 on food security and agriculture in Nigeria”, states that “With COVID-19, the challenges hampering the attainment of food security in Nigeria could deepen. The impact is already being felt in the form of rising food prices. As at April 2020, food inflation rose to 15% compared to 14.7% in December 2019.” Panelists at the BusinessDay National Conversation on Mapping Nigeria’s response to Covid-19 also drew attention to what should be done to prevent a major crises in the food sector. For example, Sani Dangote, Vice Chairman of Dangote Foods, stated that “For instance, there are no statistics to show the quantity of rice or maize produced yearly in Nigeria even at the state level. The country also needs to focus on the irrigation scheme to assist farmers in their crop production while a strong local sourcing policy is put in place in a coordinated approach among stakeholders in agriculture and the private companies that rely on agriculture.” Managing Director of the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL Plc), Aliyu Abdulhameed, said the agency is working with the Central Bank of Nigeria (CBN) to provide guarantees for farmers and other technical support that they may require for a good harvest. The CBN, through NIRSAL, has put in place funds to boost smallholder farmers by focusing on risk analysis, finance for agriculture, and development.

South Africa: effects of COVID-19 on agricultural employment

A recent analysis suggests there may be some resilience in South Africa’s agricultural sector compared to other sectors of the economy (BizCommunity South Africa, 23 June). The sector was largely operational even during the strict level 5 lockdown, except for a few subsectors such as the wine, tobacco, wool and floriculture industries. South Africa expects its second-largest grain harvest in the 2019/20 season, and there is an expectation of a record citrus harvest, general improvement in output in other fruit following drought years, and also a recovery in wine grapes output. This means that there will generally be increased activity in the farming sector compared to the previous year. However, the social distancing regulations introduced at the end of March 2020 to prevent the spread of the coronavirus could mean that farmers and agribusiness might not increase employment, especially of seasonal labour, in the same way they would have done in the absence of a pandemic. The impact of these dynamics, however, will only be reflected in the second quarter labour data, as well as the following quarters of the year.

The South African Citrus Growers’ Association is offering free Covid-19 compliance courses to citrus companies, packhouses and cooling facilities (Fresh Plaza, 29 June). Although the response from farms has been swift, there are cold stores and inspection points yet to register a Covid-19 compliance officer with the CGA.

Rwanda: promoting better value chain organisation

Rwanda’s newly launched Horticulture Exports Association has called for a better organised value chain to boost productivity and increase Rwanda’s horticulture export revenue (The New Times, 30 June). Robert Rukundo, Chairman of the association, said: “As exporters we want to organise ourselves. Bringing our efforts together in order to boost the sector performance while we also address the existing challenges in this industry.” However, the chairman also pointed out that due to the current coronavirus pandemic there are other challenges affecting the horticulture business, including financial capability, high freight charges, limits on products exported, and the issue of discrepancies in data, among others. Rwanda’s National Agricultural Export Development Board (NAEB) has been working with RwandAir to reduce the cost of airfreight, and engaging them to open up more destinations that have demand for fresh produce, such as Dubai, China and South Africa.

Cameroon: pandemic is an opportunity to review trade strategy

In the context of the Covid-19 pandemic, the overall volume of Cameroon’s trade declined by 16% in the first half of 2020 (Investir au Cameroun, 26 June). For the Minister of Trade, Mr Mbarga Atangana, the pandemic offers Cameroon the opportunity to review its trade strategy, which includes the development of regional and sub-regional trade, while reducing the volume of imports of food and manufactured products in order to limit its dependence on the outside world. The Minister advocates a series of structural measures includng accelerated implementation of the Industrialisation Master Plan to increase the level of local processing of raw materials, the revival of major export channels, and the development of fish farming and aquaculture. He also wishes to promote Cameroonian companies on export markets, with marketing abroad of “Made in Cameroon”, and the development of mentoring and networking of national export companies.

Caribbean COVID-19 Food Security and Livelihoods Survey

CARICOM has launched the second round of the Caribbean COVID-19 Food Security and Livelihoods Survey. Following an April 2020 survey that highlighted loss of livelihoods and impacts on food security in the initial stages of the COVID-19 response, this round aims to capture the current status of affairs and illustrate how livelihoods, food security and markets have shifted over the past two months. The survey is open to all CARICOM Member States and Associate Members, as well as Aruba, Curaçao and Sint Maarten, until 6 July.

Nevis: new cold storage facility

The Nevis Island Administration is constructing a cold storage facility at a government-owned farm on the outskirts of Charlestown (SKN Vibes, 23 June). “Food security is extremely important in these times, and it was an urgent need for the department and ministry to be in a position to store produce once cultivated here on the island. We are in the middle of a programme to improve and increase the production and one of the weaknesses in our system was the inability to store fresh produce” said Hon. Spencer Brand, Minister of Communication and Works. The refrigeration facility for fruits and vegetables produced on Nevis, temporarily delayed by COVID-19 but now back on track, comes at a time when the ministry is actively involved in implementing measures aimed at strengthening the island’s food security.

Quarter of businesses in Pacific fear they will not survive Covid-19

The Guardian (29 June) reports that a quarter of businesses in the Pacific are not confident they will survive the coronavirus pandemic, despite the region largely avoiding the health crises seen elsewhere, according to a survey of businesses across the region. Ninety per cent of businesses have reported a decline in revenue, and 91% say their local economy has been harmed. Closed international borders, poor cashflow, and a lack of certainty about how long lockdowns and travel restrictions would last were doing the most harm. The majority of businesses across the Pacific remain either partly operational (46%) or temporarily closed (22%). While only 1% of businesses reported having shut their doors permanently because of Covid, more than a quarter (26%) are not confident of surviving the pandemic shutdowns.

A separate survey run by PTI Australia found nearly two-thirds (65%) of Pacific businesses had also been negatively impacted by extreme weather over the past 12 months. Agriculture was especially hard hit, most acutely by increased frequency and severity of storms, extreme rainfall, or increased temperatures.

Caleb Jarvis, trade and investment commissioner with PTI Australia, said the economic impacts of Covid-19 shutdowns and border closures had been profound, and would be long-lasting. “The leaders of Pacific islands showed strong leadership, they made some big decisions early on, which prevented the health crisis, but they don’t have the funding and the resources available to be able to support businesses and people as other countries have been able to.”

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