Seven years after the African Continental Free Trade Area (AfCFTA) was signed, African countries continue to face the challenge of creating jobs for a growing youth population. To address these challenges, the Economic Commission for Africa (ECA) sought perspectives from thought leaders on the future of jobs and value chains. Pamela Coke-Hamilton, Executive Director of the International Trade Centre, emphasizes the critical role of technology in strengthening Africa’s agricultural value chains.
The AfCFTA, which began trading four years ago, holds significant promise for transforming Africa’s economic future. However, the global crises of the past few years, including climate change, COVID-19, and ongoing conflicts, have impacted Africa’s growth. Climate-related disruptions have resulted in GDP losses of up to 5% and worsened food security, making it urgent to prioritize value addition and reduce reliance on food imports.
As the global economy remains unstable, Africa must focus on building resilient regional value chains. Public and private sector investments are key to turning this vision into reality. The AfCFTA provides a strong framework for such efforts, with clear goals and agreements covering critical areas like youth, women, and digital trade.
Since the AfCFTA’s launch, over 90 value chains have been identified with the potential to increase intra-African trade by up to $22 billion annually. Much of this untapped potential lies in agricultural products like cotton, textiles, oilseeds, and essential oils. However, most of Africa’s raw cotton is processed abroad, leading to missed economic opportunities and a reliance on imported finished goods.
To fully capitalize on these opportunities, Africa must invest in strategic sectors like agriculture, particularly in value addition. This includes the digital ecosystem, which can help address obstacles faced by smallholder farmers, such as limited access to finance and information, poor logistics, and a lack of modern equipment. Digital solutions can help improve agricultural processes, create smarter farming practices, and simplify financial transactions for farmers.
Africa’s young population, with nearly 1 billion people under 30, is ready to embrace digital technologies to modernize the agricultural sector. The AfCFTA’s Digital Trade Protocol further enhances the potential for regulatory convergence and common standards across the continent. As the digital ecosystem grows, so do opportunities for local agribusinesses to adopt technological solutions that improve efficiency and sustainability.
Many agritech startups are already helping farmers by providing services like digital advisory, smart farming tools, and mobile payment solutions. These startups, operating in countries like Benin, Ethiopia, Ghana, and Senegal, are driving innovation and fostering collaboration to meet the needs of agribusinesses.
Investing in agritech startups is essential, but it is equally important to assess the digital readiness of existing agribusinesses. Understanding their current capabilities and needs will help ensure that the right technologies are introduced to improve their operations. Field visits by tech startups to farming communities have proven effective in identifying specific needs and tailoring solutions.
This process requires collaboration between local and international partners from both the public and private sectors. Investing in local solutions for local challenges is the key to achieving long-term success and sustainable growth in Africa’s agricultural sector.
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