Sustainable Agribusiness in Africa: a getting started guide

Transcription

1 Sustainable Agribusiness in Africa: a getting started guide MAY 2013

2 Disclaimer Cover image: World Bank/Stephan Bachenheimer IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help countries achieve sustainable growth by financing investment, providing advisory services to businesses and governments, and mobilizing capital in the international financial markets. This guide was commissioned by the Sustainable Business Advisory Unit of the IFC to promote the sharing of information and practices and is distributed with the understanding that neither the authors, nor the organizations, countries they represent, nor the publisher are engaged in rendering legal or financial advice. The material in this publication is set out in good faith for general guidance, and no liability can be accepted for any possible loss or expense incurred as a result of relying on the information contained herein. This publication is not intended to be exhaustive. The conclusions and judgments contained in this report should not be attributed to, and do not necessarily represent the views of the IFC. IFC does not guarantee the accuracy of the data in this publication and accept no responsibility for any consequences of their use. This publication is distributed subject to the condition that it shall not, by way of trade or otherwise, be lent, re-sold, hired out, or otherwise circulated on a commercial basis without IFC s prior consent. Business Briefing: Sustainable Agribusiness in Africa

3 CONTENTS Introduction... 4 Sustainable Agribusiness: what are we talking about?... 6 Key Sustainability Issues... 8 Economic... 8 Productivity, Capacity and Purchasing Practices... 8 Good Governance, Corruption and Transparency... 9 Social Food Security Food Safety Labour and Working Conditions Poverty, Health and Education Land Access Environment Climate Change Water Biodiversity Managing these issues for More Sustainable Business Standards Resource Efficiency Supply Chain and Community Investment: Engaging Smallholders...21 Measuring the Impact Conclusion Appendix 1: A Company Self-Assessment Tool Appendix 2: Standards and Multi-Stakeholder Initiatives Relevant for the Industry...32 Appendix 3: Commodity Snapshots Appendix 4: Country Snapshots End Notes Business Briefing: Sustainable Agribusiness in Africa

4 Introduction Africa is now the world s fastest-growing continent 1. On a regional level, economic growth in Africa has raised its GDP to a level similar to that of to Brazil or Russia. The World Bank estimates that by 2025, most African countries will have reached middle income status 2. While there are differences within and amongst countries in the region, social development indicators have improved, poverty has reduced, governance has improved and generally there is more stability. The rising prices of agricultural commodities have helped to fuel this. Agriculture is critical for both economic growth and poverty alleviation. Within the agriculture industry agribusiness refers to the business activities that are performed from farm to fork covering inputs, the production and transformation of agricultural products and their distribution to final consumers 3. Across the continent, agriculture and agribusiness account for nearly half of GDP 4, 15 per cent of exports and employs roughly 60 per cent of the labour force 5. While rural to urban migration is increasing, 70 per cent of the population still lives in the country side and depends on agriculture for their livelihoods 6. Women make up most of the agricultural labour force. Growth in the sector will be a key driver of long-term sustainable development as well as meeting global food demand. The World Bank estimates that by 2030 agriculture and agribusiness together could develop into a US$ 1 trillion industry in Sub-Saharan Africa 7. Global pressures on agriculture will continue to increase with demand for food expected to double by In the next 25 years, in order to meet global caloric demand it is estimated that the world will need to produce two to three times as many agricultural products on the same amount of cultivated land 9. Africa is well positioned to help meet this demand with more than half of the world s agriculturally suitable yet unused land and abundant water resources. However, despite positive prospects, there are challenges to overcome. Sub-Saharan Africa is one of the most vulnerable regions in the world to climate change. Competition for energy, water and land use will continue to increase, putting pressure on producers to grow more with fewer resources. Poverty and food insecurity remain as challenges and roughly one out of every five people in Africa lives in hunger. While water resources may be abundant, these are not evenly distributed. An estimated one in three people endures water scarcity which will be exacerbated by climate change. smallholders are not integrated into international supply chains 11. Smallholders are often faced with an absence of farmers groupings and business units, lack of extension services, inadequate market information, lack of basic infrastructure and high operating costs. There are limited incentives for the young people of today to pursue farming as a livelihood choice and rural to urban migration is on the increase. Rural areas have highly constrained agroprocessing activity and capacity and there is limited value added to farm production in the region. Agribusiness in Africa is on the rise with more and more interest from international companies and investors. Businesses in the region are faced with a multitude of different pressures and are increasingly recognising that long-term success will mean addressing and engaging on issues such as poverty, climate change, and food security. Companies that can do business in a way that provides opportunities for smallholders, generates decent work and jobs, respects human rights and protects the environment can better manage risks and seize opportunities. They can also help to build more resilient communities and create and foster sustainable livelihoods. The International Finance Corporation (IFC) is the private sector arm of the World Bank and is the largest global development institution focused exclusively on the private sector in developing countries. The Sustainable Business Advisory (SBA) unit of the IFC works with companies to adopt environmental, social, and governance practices and technologies that create a competitive edge, which can help to transform markets and improve people s lives. The SBA team in Africa is working with businesses and their stakeholders to create long term value for companies, communities and the environment. It is engaging with companies across industry sectors and helping to share and disseminate good practices for more sustainable business. Most of the food production (80 per cent) in sub-saharan Africa is by smallholder farms feeding themselves, their communities and the world 10. With the exception of cocoa and coffee, most other commodities produced by 4 Business Briefing: Sustainable Agribusiness in Africa

5 PURPOSE OF THIS BRIEFING This guide has been prepared to assist agribusinesses operating in and sourcing from Africa to understand some of the important issues and to share examples of good practice of how these issues are being managed. This guide has been prepared based on a review of literature and a scan of practices both by country and by key commodity. This was supplemented with interviews with companies, IFC staff, non-governmental organisations and consultants in the industry. A roundtable event was hosted by the IFC in London in March 2013 to engage a group of UK retailers and other stakeholders. The sections that follow outline sustainability in the context of agribusiness along with key risk areas for business. It should be noted that any viewpoints expressed in the text are those of the consultant tasked with preparing this and may not necessarily reflect those of IFC. The guide is not exhaustive but is intended to be introductory and will be more relevant to managers who are new to working in sustainability and need a basic understanding of the issues in a Sub-Saharan African context. It includes SBA s framework for working with business and examples of practices which address sustainability standards, resource efficiency and engaging smallholders. Appendix 1 provides a basic tool that companies can use to get started on building systems to manage key issues. Appendix 2 briefly summarises some of the important sustainability standards and multi-stakeholder initiatives. Appendix 3 provides an overview of key issues and multi-stakeholder initiatives and standards by commodity including: cocoa; palm; cashews; coffee; tea; horticulture; and cotton. Appendix 4 is a brief summary of country contexts for Burkina Faso, Ghana, Kenya, Mozambique, Nigeria, Senegal, Tanzania and Zambia which were the countries prioritised for the research. World Bank/Arne Hoel Business Briefing: Sustainable Agribusiness in Africa 5

6 Sustainable Agribusiness: what are we talking about? Sustainable development is about meeting the needs of the present without compromising the ability of future generations to meet their own needs 12. Sustainable agribusiness is about balancing financial, social and environmental issues, to ensure stable supply chains, the long-term success of the company and the sustainable livelihoods of the communities they source from and sell to. It involves community engagement, respecting human rights, protecting the environment, being transparent, and acting with integrity. Different stakeholders will have different perspectives on what sustainability means in the context of agribusiness. The companies we interviewed for this report talked about maintaining and managing the business in a way which ensures a return now and in the future. Many companies highlight their approach to being a socially responsible business and respecting and protecting the environment, whilst operating with ethics and integrity. While recognising the benefits that business can bring to local communities, some NGOs point to the fact that what companies express in terms of sustainability commitments does not always translate into benefits for communities. They also emphasise, that there are expectations from businesses even when there is not always an immediate business case 13. Africa is one of the most vulnerable regions in the world to climate change. Climate change can affect the types of seeds that will flourish and that are being used, growing seasons, water availability, and the frequency of storms and droughts. Businesses are concerned about the long-term viability of farming as a choice of livelihood, and recognise they need to understand the working conditions in their supply chains, and ensure that their business operations as well as ways of doing business enable employees to have fair wages and decent and safe working conditions. For any company working within this sector, land use and acquisition is a critical issue. Sustainable business practices can help: Secure supply chains Build reputation Strengthen client and customer relationships Support employee recruitment and retention Build relationships with investors and the financial community Build relationships with government and the local community Everything we make and sell starts on the farm. Sustainable agribusiness for us is about long term secure supply chains. (Quote from company interview) Ultimately it is about enlightened self-interest and not something separate from the core business model. (Quote from company interview) What is a Value Chain? Whereas supply chains refer only to backward linkages (i.e. with producers), value chains refer to both backward and forward linkages (i.e. with producers through to consumers). Value chain is a widely cited concept to describe the full range of activities which are required to bring a product or service from conception, through the intermediary of production, delivery to consumers, and disposal after use (Kaplinsky 2000). Value should be added at each step along the chain from the farmer who grows the product, to the layers where any processing or packaging take place to distribution to the final basket it sits in where the consumer purchases it. Creating Shared Value Companies cannot succeed in communities that do not. Shared value is about ensuring business success while also ensuring that communities prosper as well. Creating Shared Value (CSV) is a term which is attributed to an article by Michael E Porter in the Harvard Business Review. 6 Business Briefing: Sustainable Agribusiness in Africa

7 Agribusinesses have the potential to help improve people s lives and give them opportunities to escape poverty. There are also opportunities for companies to develop business models, which protect the environment and natural resources to ensure production for the present and for future generations, while ensuring benefits for farmers and their communities. Agricultural value chains are complex and involve growers, input providers, government agencies, processors, packagers, and various agents who need to work together. Sustainable business models need to take an integrated approach. Integrating the management of environmental, social and governance related issues are important for managing these complex risks and opportunities. The IFC Performance Standards i can help companies to manage these issues. Companies can also look to guiding standards such as the ISO Guidelines for Social Responsibility, and numerous other standards to help them identify the steps that they can take (see Appendix 2). For companies getting started on a journey to a more sustainable business, there are some key steps that can be taken to support continuous improvement. Understand the material issues: Companies needs to understand the important (i.e. material) issues, which can impact their business. While there will be crossover within industry and between sectors, not all issues have the same relevance for every business. Briefings such as this one can provide business with a first step and general overview. Engage with stakeholders: To understand their material issues, companies need to engage with their stakeholders. There are various tools and resources to support companies to do this. The IFC s Stakeholder Engagement: A Good Practice Handbook ii is a useful business tool. Demonstrate leadership and accountability: Managing complex social and environmental issues starts from the top. Businesses can review how sustainability is reflected in their company values and principles and how they demonstrate leadership. For example, is there a Board Member appointed to oversee responsible business practices? Define policies, standards and objectives: Businesses need to ensure they have policies and codes of conduct, which define their company s commitments and strategies. Based on these, objectives and targets can be established. Ensure resources and capacity in place: It is important to ensure that sustainability related initiatives are properly resourced and that there is appropriate capacity as to fulfil commitments. Measure, monitor, review and evaluate: Recognising the old paradigm that you cannot manage what you cannot measure, businesses can ensure that systems are in place to measure and monitor impacts and outcomes and integrate findings for continuous improvement. Communicate and report: Being transparent about the business and its social and environmental impacts and ensuring strategies to address these are part of being a responsible company. By understanding the concerns and expectations of stakeholders, businesses can ensure that appropriate communication channels are in place. Numerous tools and guidelines exist for sustainability reporting at a company level. Context is critical: Effectively managing and implementing sustainable business strategies requires that these fit within the local context and are appropriate to the size and scale of the business. Appendix 4 provides a brief overview of some of the issues and challenges in different country contexts in the region. i IFC Performance Standards accessible online at: IFC+Sustainability/Sustainability+Framework/Sustainability+Framework /Performance+Standards+and+Guidance+Notes+2012/ ii IFC Stakeholder Engagement: A Good Practice Handbook available online at: external_corporate_site/ifc+sustainability/publications/publications_handbook_stakeholderengagement wci

8 Key Sustainability Issues While the sustainability issues are interconnected, the following section has grouped these issues within the broad headings, which the IFC uses: economic, social and environment. Through their engagement with stakeholders, agribusinesses can identify and build understanding of the important issues, analyse their potential impact on the company, and prioritise. Figure 1 below shows a materiality matrix of the type that is often used and adapted by business for mapping risks and opportunities. The prioritisation for different agribusiness will depend on their own operations and stakeholder concerns. The accompanying boxes show key issues that were identified through the research and interviews carried out for this briefing. It is by no means exhaustive. The following sections provide a brief overview of some of these key issues. Figure 1: Example materiality matrix for prioritising issues Increasing concern to stakeholders Increasing current or potential impact on company Source: CDC Toolkit for Fund Managers 14 Essential to prioritise Important to prioritise Issues for attention Issues not considered essential Economic & Governance Productivity Capacity Purchasing practices Risk of corruption Poor governance Lack of transparency Social Child labour and forced labour Farm and factory health and safety Minimum and fair wages Lack of contracts Freedom of association Migrant workers Land Cultural heritage Indigenous peoples Environment Climate change and energy Biodiversity loss and impacts Soil erosion and loss of productive capacity; Water contamination; reductions in local water supply from overuse; Waste management and hazardous effluents Impacts of genetically modified crops Pesticide and herbicide use ECONOMIC PRODUCTIVITY, CAPACITY AND PURCHASING PRACTICES Improvements in agricultural productivity are needed for growth and development, and to address the global demand for food. It is estimated that for each 10 per cent increase in small-scale agricultural productivity in Sub-Saharan Africa, almost 7 million people are moved above the dollar-a-day poverty line 15. While recent years have seen sustained growth in agricultural production in Sub-Saharan Africa, in comparison to other regions, productivity levels in Sub-Saharan Africa for many food products are extremely low 16. The root causes of low productivity are multifaceted and include: weather conditions; access to knowledge and resources; access to financing; and access to markets, technology, infrastructure and agricultural inputs. Throughout the region, agricultural research and development (R&D) investments have stagnated due to political, social, and economic unrest as well as institutional changes (such as mergers, subdivisions, relocation, reshuffling) Business Briefing: Sustainable Agribusiness in Africa

9 80 per cent of food grown in Africa is grown by smallholders. For example, in Tanzania, smallholders only cultivate average farm sizes of between 0.9 hectares and 3.0 hectares and cultivation is mostly by hand hoe 18. Most smallholder farmers, and particularly poor rural farmers, do not participate in formal value chains and are often limited to producing for informal markets. This is a challenge for businesses looking to engage smallholders and to find ways that add value to farm production and create jobs. Analysts have pointed to the fact that agribusiness in Africa does not add the same value that it does in other regions, which is a missed opportunity. Whereas in high-income countries, agribusiness adds about US$180 of value by processing one tonne of agricultural products, African countries generate only US$ While 98 per cent of agricultural production in high-income countries undergoes industrial processing, in African countries less than 30 per cent is processed. Rural areas in African countries have limited agro-processing activity and capacity. As such, Sub- Saharan Africa countries in particular experience large postharvest losses, especially for perishable commodities such as fruit and vegetables. It is estimated that post-harvest losses average per cent of total possible production for fruits and vegetables and per cent for grains 20. Research on cocoa production in Sub-Saharan Africa found that in Ghana and Cote d Ivoire, farmers harvest an average of 300kg-400kg of cocoa beans per hectare per year up to 50 per cent lower than their potential productivity. Reasons identified included outdated farming methods, the lack of access to technology and finance, and lack of incentives to improve depleted soil fertility or replace ageing trees, many of which are more than 25 years old and past their productivity 21. Contributing to building an enabling environment where there are economies of scale can help address some of these challenges. For instance, the Ethiopian Coffee Exchange has been cited as a positive intervention in terms of the role that government can play and has helped to increase incomes for coffee growers there by 60 per cent 22. Large consumer goods companies and retailers purchasing from Africa also note that there are key challenges in finding producers who have the capacity to be a part of their supply chain. Organised farmers groups and aggregation can help to support capacity building and productivity increases. However, participation in organised farmer groups ranges from an estimated 30 per cent in Côte d Ivoire to much lower levels in Nigeria and Ghana 23. This can pose a challenge for buyers who do not have organised farmers groups to work with. A lot of the agribusiness value chain is based on shortterm investments. This is a challenge for farmers to be able to get the knowledge and resources needed to take on risk to diversify and produce food both for subsistence needs as well as for the market. In Tanzania, only 3 per cent of agricultural households have access to credit 24. Even medium- and large-scale commercial farmers and agricultural investors face major financing constraints, and therefore refrain from larger-scale investments in the agricultural sector. When companies and other stakeholders were interviewed for this briefing the critical issue that came up time and again was in relation to purchasing practices vs. sustainable development commitments. One agricultural company noted how retailers have a great deal of leverage but that there is a dichotomy between what they say and their buying practices. Furthermore, uncompetitive behaviour by crop buyers especially for key cash crops, can force farmers to sell their produce at low prices, which will lead to continued and chronic rural poverty. GOOD GOVERNANCE,CORRUPTION AND TRANSPARENCY Doing business in an ethical and transparent way is critical for sustainable business. On Transparency International s Corruption Perception Index for Sub-Saharan Africa, 90 per cent of the countries scored below 50 (with a score of 100 indicating high level of corruption and 0 being very clean). Botswana was perceived to be the least corrupt and Somalia the most corrupt. The worst perceived region was Eastern Europe and Central Asia 25. If corruption involves politicians it can deplete a country s national wealth, particularly if agricultural projects are granted based on exchange for personal gains. Corruption undermines economic, social, and environmental goals, and keeps people and communities poorer. For agribusiness, corruption can impact the safeguards of standards, whereby those who are entrusted with ensuring workplace or product safety could be paid money to turn a blind eye. Access to land titles may require payments of bribes, putting companies and their employees at risk. Transparency is needed to facilitate land acquisition, valuation and compensation issues. Corruption can undermine trust in institutions, and contribute to a lack of or non-enforcement of environmental laws and regulations, leading to unsustainable exploitation of natural resources. Companies and communities can benefit from ensuring transparency. Growing numbers of companies now want to ensure the traceability of their supply chains to manage the associated business risks. Other stakeholders have increasing expectations that companies sourcing from Africa will disclose information about where their products and raw materials come from. Business Briefing: Sustainable Agribusiness in Africa 9

10 SOCIAL FOOD SECURITY Food is a human right and included in the 1948 Universal Declaration of Human Rights. Malnutrition stunts growth and development, affects productivity and helps to sustain poverty. Food security is an important issue for businesses, who have a responsibility to respect human rights, while ensuring the sustainability of their supply chains and whose companies cannot thrive in communities that fail. Although there have been improvements on many socio-economic development indicators, Sub-Saharan Africa has the highest prevalence of hunger in the world 26. At the same time, with changing diets, urbanisation, and an increasingly sedentary life for the emerging middle classes, the region is also experiencing an increase in obesity 27. Despite the positive economic growth, malnutrition continues to plague communities across the continent. The malnutrition rate for children in Africa under the age of 5 was 41 per cent in 2010, which was only a 2 per cent decrease from 1990 levels. In contrast, Asia went from 48.6 to 27.6 in the same period 28. In 2011, a famine in East Africa left more than 2.5 million people reliant on emergency assistance and was estimated to have killed up to 100,000 people. In 2012, West Africa was affected by severe and acute food shortages. In Mozambique, farmers have reported that households routinely experience a hungry season where there is not enough food to feed the household and that this is considered a normal part of life 29. Riots have broken out in countries such as Mozambique and Algeria in recent years due to the spike in prices of basic commodities. Although Africa has the means to be self-sufficient, the region is still a net importer of food. It is estimated that 95 per cent of the basic staples in Africa are not regionally produced, but imported 30. Agriculture exports are a major source of income for countries and communities in the region, while greater dependence on food imports leads to exposure to price and supply risk 31. The food retail sector on the continent has changed over recent years with the rise in supermarkets and a corresponding decline in more traditional shops and markets in some areas. Arguments in favour of Genetically Modified (GM) crops are that they could provide higher yields and help to meet the growing demand for food. However, other advocates and analysts have argued that GM crop developments to date have largely benefited northern countries and markets, not small scale farmers in the developing world 32. The knock-on effects of GM crops are not yet fully understood both in terms of their human and environmental impacts. While economic growth tends to result in improvements in nutrition this is not always the case. Increases in agricultural output do not always lead to better outcomes in the communities and for local nutrition. For example, in Malawi where farmers managed to dramatically increase their grain yields, moving the country from a grain importer to exporter, there was not a corresponding improvement in the nutritional status of many Malawians 33. FOOD SAFETY Aside from the availability and affordability of food, another important issue for agribusiness is food safety. Food poisoning can result in impacts for people ranging from mild discomfort to death. Well publicised outbreaks of microbial and chemical food poisoning cases are on the rise globally and in Africa. Globally, one of the most high profile cases in recent years was the 2008 milk scandal in China, where six babies died and 300,000 fell ill, when melamine, which is an industrial chemical, got into the milk supply 34. In Nigeria, in 2010, many people in Bekwarra Local Government of Cross River State suffered from food poisoning due to indigestion of beans (made into moi moi ). As a result about 122 people were hospitalised, while deaths of two children were recorded. The moi-moi and the beans it was made from were said to have contained a large dose of highly toxic pesticides 35. Agricultural supply chains are complex and have become more so over recent years. Stakeholders interviewed for this briefing emphasised the importance of traceability. Tracing the value chain and knowing where your products come from can help companies ensure that their products are safe and that social and environmental issues are managed well. However, other stakeholders pointed out that companies also need to bear in mind the cost implications of traceability and whether their need and their customers need for traceability could be having an adverse impact on the producers in their supply chains and in particular for small holder farmers. 10 Business Briefing: Sustainable Agribusiness in Africa

11 LABOUR AND WORKING CONDITIONS Agriculture in Africa employs roughly 60 per cent of the labour force. Companies are faced with managing risks and ensuring that workers rights are protected as well as balancing labour shortages. Agricultural work is the second most dangerous work after mining in terms of fatal accident rates. According to the International Labour Organisation, out of some 335,000 fatal workplace accidents worldwide, about 170,000 occur among agricultural workers. However, the injuries are often under reported 36. Working on plantations is labour intensive, and wages along with housing and social conditions may be a problem. There are often issues regarding lack of or poor facilities such as schools, pharmacies, health clinics, etc. 37 Labourers often cross borders in search of employment opportunities and reports have noted that in some supply chains there are risks of trafficking and forced labour 38. The International Labour Organisation (ILO) is the international organization responsible for drawing up and overseeing international labour standards. The ILO Declaration on Fundamental Principles and Rights at Work includes eight Conventions in four areas of Freedom of Association; Elimination of forced labour; Abolition of child labour; Elimination of discrimination The ILO Code of practice on safety and health in agriculture contains guidance and tools for agribusiness. Exposure to agrichemicals is a risk for agricultural workers. Chemicals (fertilizers and pesticides) have had negative effects on human health and on the environment 39. Chemicals are also often misused for the quick and artificial ripening of fruits and vegetables, which has can have negative impacts on the health of people. Additionally, agricultural workers are exposed to dusts and other biological elements which can be harmful to their health. Most agriculture is carried out by smallholdings. This can mean that home and work are interconnected and there is a reliance on family members and informal labour relations. Children are usually depended upon to help with the land. This can bring risks to companies in terms of having young workers in their supply chains. Child labour is a real risk and a particularly important issue given the hazardous work involved. Roughly 30 percent of children between the ages of 10 and 14 are employed in agricultural work in Africa and the majority are unpaid family workers 40. However, throughout the world agribusiness often consists of small businesses and family businesses. This can present a tricky issue for companies given that pulling children out of the supply chain or refusing to work with family businesses could potentially be detrimental to those children. Gender inequalities are an important sustainability issue for business. Women grow 80 per cent of staple foods in Sub- Saharan Africa 41, yet are usually in the lower paid jobs in the supply chains. In commodities like cocoa, tea, and coffee, women are often producers while men sell the crops to traders and control decisions and the money. Boys are still the recipients of most educational opportunities 42. Women workers earn less and often face barriers to credit and markets. Companies will often look to source from established producer groups, yet women are typically underrepresented in both membership and governance of these groups. Companies have recognised that they need to have policies and codes of conduct in place, which meet both national laws and international standards and include topics such as fair employment practices; health and safety; prohibition of forced and child labour; non-discrimination on the basis of race, gender, sexuality, national origin, or religious beliefs; and prohibition of harassment and abuse iii. In addition, workplace-specific risks and hazards need to be identified and action plans put in place to eliminate these. Ensuring workers have a voice and communication channel with management (trade unions or other forms of representation) is crucial, as is a grievance mechanism. If companies are dealing with any form of child labour, they should ensure that decisions are taken with the best interest of the child in mind. Furthermore, research has found that many international food companies could improve crop productivity and quality, grow the smallholder supply base and improve access to high value markets when they increase women s participation 43. iii See IFC Performance Standard 2: Labour and Working Conditions Business Briefing: Sustainable Agribusiness in Africa 11

12 POVERTY, HEALTH AND EDUCATION Growth in the agricultural sector has been the key factor in reducing rural poverty providing jobs and income. While poverty, health and education indicators across the region have increased, challenges still remain. As noted in the preceding section, a large proportion of children between the ages of 10 and 14 are agricultural workers. This is driven by poverty and also impacts and is impacted by educational opportunities available for children and young people. The ILO has estimated that in Kenya, during the peak coffee picking season, up to 30 percent of the pickers are under the age of High levels of illiteracy still exist across much of the region, particularly in rural areas and studies have found correlations between literacy and improvement in farm productivity. In addition, limited ability to access market information means that farmers may not have a clear idea of fair prices for products and cash flow challenges mean that many may need to sell their yields quickly and for lower than fair prices 45. Similarly rural poverty has been exacerbated by low investments in health and education. HIV/ AIDS and malaria have taken huge tolls on the potential workforce and combined with rural to urban migration, there are growing labour shortages for many farms. Poverty disproportionately affects girls and women. Girls are more likely to be impacted by any increases in infant mortality and face inequalities in their opportunities for schooling. Women are more likely than men to be doing unpaid work as family labourers or in the informal sector and overall have unequal access to economic opportunities. While women make up to half of the agricultural labour force in Sub-Saharan Africa, they have lower access to inputs such as extension services and fertilizer which can impact on yields 46. Through their core business models and additional community investments, companies can work to build shared value, so that the business benefits and communities thrive. Companies can work to put in place conditions, which enable longer term relationships with smallholders, providing a decent and fair income, and support investments, such as, agricultural services, credit and inputs. Interventions need to factor in gender considerations. With better prices, farmers can get out of extreme poverty, local industries can be promoted, unemployment can be reduced and gradually the country s standard of living can be raised. LAND ACCESS Since the global food price increases in 2008, there has been a growing demand for land for agricultural use and a growing increase in land acquisitions particularly in developing countries 47 and particularly in Africa. NGO campaigns have pointed to the challenges for local communities whose rights are often infringed through the land acquisitions 48. For smallholders in Africa land is often passed from generation to generation with ill-defined tenure rights, which can leave farmers and in particular women - at risk. Issues around land use and access to land vary between countries depending on the policy environment. However, for agribusiness, land acquisition and, land use can be significant risks depending on how it is managed iv. Companies around the world have found themselves faced with community protests and global campaigns if they have not ensured that they are respecting existing land rights. Many companies and other stakeholders such as governments, financers and communities recognise that obtaining Free Prior and Informed Consent (FPIC) can be an essential tool in managing community relations and protecting local people s rights. FPIC refers to informed, non-coercive negotiations between companies and local communities prior to development of business activities. It recognizes indigenous peoples inherent and prior rights to their lands and resources. It involves ensuring information about and consultation on any proposed initiative and its likely impacts are detailed in a way which communities will understand. It also involves meaningful participation of indigenous peoples and representative institutions. iv See IFC Performance Standard 5: Land Acquisition and Involuntary Resettlement 12 Business Briefing: Sustainable Agribusiness in Africa

13 Companies have found FPIC particularly useful where customary and indigenous rights are not fully reflected in national legal frameworks. Some standards such as the Roundtable on Sustainable Palm Oil (RSPO) have also included the FPIC topic in its framework. Although the FPIC framework should ideally be used to prevent conflicts through prior consent, experience shows that the framework can also be helpful in resolving existing conflicts and enhancing community trust 49. ENVIRONMENT CLIMATE CHANGE Sub-Saharan Africa is one of the most vulnerable regions in the world to climate change. While many countries are already prone to frequent droughts and/or floods and these events are cyclical, their increasing frequency and intensity are thought to be linked to climate change. The impact of these shocks on already vulnerable populations is often severe, affecting both short-term food securities as crops fail or are destroyed, and long-term food security as households lose or are forced to draw down on their few assets. The World Bank s 2012 Report Turn Down the Heat warned that temperatures could rise by more than 3 degrees above pre-industrial climate this century without further commitments and action, and that the most alarming impact may be on food production, with Africa being particularly affected 50. Climate change is a critical business issue. Agriculture itself can significantly impact climate change through land use change and cutting down forests or removing peat-lands which help to absorb carbon. Agribusiness will be impacted by climate change which can impact on the quantity and quality of crops, pasture, forests and livestock. It will bring changes in land, soil and water resources. There will be new and different challenges for weed and pest control. Resulting socio-economic impacts will include changes in yields and production; price fluctuation; increased food insecurity. Examples of climate impacts include: Research into maize has found that climate change affects the crop production and results in lower yields and harvests. For Kenyan tea farmers, changing weather patterns have stressed tea crops and hampered productivity which has depressed income and delayed cultivation of important staple crops. Crops such as Arabica coffee grown from limited genetic stock may lack the flexibility to be able to cope with climate change. between 4.5% (conservative estimates) and 9.8% (worst-case scenario) 51. Agribusiness needs to consider its operations in a resource constrained world, how it manages its own greenhouse gas emissions throughout the value chain and including land use change and how it is adapting to the risks caused by climate change. WATER Water is essential for agriculture and for all life on the planet. Globally, the agriculture sector is the largest user of water (more than twice that of all other sectors combined), and the greatest source of water pollution 52. It is estimated that agribusiness accounts for 70 per cent of freshwater consumption globally 53. Access to water is recognized as a human right. It is forecasted globally that there will be a 40 per cent gap between water demand and supply by 2030 under business as usual conditions. While Africa is endowed with an abundance of fresh water supplies, it is estimated that one in three people endure water scarcity and climate change will make things worse 54. The use of chemicals also has an adverse effects on the environment resulting in the pollution of surface and ground waters 55. Although most farmers cannot afford to use chemical pesticides, those who use them may apply incorrect doses and use improper procedures 56. While integrated pest management techniques can provide more sustainable options, pesticides continue to be attractive to most farmers and governments because they are simple to use. Stress on water sources are compounded by low levels of irrigation in the region. Only 4 per cent of arable land in the Sub-Saharan Africa region is irrigated compared to 35 per cent in Asia and 15 per cent in Latin America. For some agribusiness, poor water storage and harvesting is a key risk. Processing of agricultural commodities, which is not properly managed can wreak havoc on local water supplies and contaminate drinking water. Given the stress on water resources and growing global scarcity, successful agribusinesses in the future will need to ensure they have a water resources management system in place with procedures to conserve, measure and manage their water use, and manage the risks that water shortage can pose to their supply chain vi. Many companies are starting to develop such systems. Companies can help to make a positive contribution to sustainable development by recognizing that water is a human right and respecting this right as well, as by carefully managing their water footprint / use of water and helping to protect local watersheds. In Mozambique, it is estimated that climate change, combined with the effects of more frequent flooding on rural roads, could result in agricultural GDP losses v See IFC Performance Standard 3: Resource Efficiency and Pollution Prevention vi See IFC Performance Standard 3: Resource Efficiency and Pollution Prevention Business Briefing: Sustainable Agribusiness in Africa 13

14 BIODIVERSITY AND ECOSYSTEM SERVICES Biodiversity is the variety of life in our world or in a particular habitat or community. Ecosystem services are the benefits that people, including businesses derive from the ecosystems. Agriculture impacts and depends on biodiversity and the ecosystems it supports. As land is converted for agricultural purposes, it can reduce biodiversity. For example, palm and tea plantations can destroy biodiversity as a result of forest degradation and fragmentation from conversion to monoculture 57. Tea must be planted in steep, remote areas on terrain that often hosts high concentrations of vulnerable animals and plants. Converting such landscapes for tea production endangers species and, due to the slope of the land, can cause soil erosion. Forests and woodlands face pressures from a growing human population including encroachment and conversion for agricultural expansion, illegal logging and poaching of wild animals, overgrazing leading to loss of woody vegetation, and the impacts of conflicts 58. Only about 6 per cent of sub-saharan Africa, or 142 million ha, falls under protected areas 59. Agricultural production in sub-saharan African ecosystems is greatly affected by pests such as insects, nematodes, fungi, rodents, birds, weeds, viruses and bacteria 60. For smallholders, lack of access to fertilizer can be a key contributor to low yields and simple agricultural practices and correct application of fertiliser can significantly increase yields. However, incorrect use of fertiliser and chemicals can also create impacts on the environment and human health 61. Chemical use can not only impact drinking water, but can also affect soil quality and kill species. There are arguments both for and against the expansion of GM crops. Modifications of crops could enable their survival in unfavourable conditions and increase their ability to withstand climate change. However, critics are also concerned about an increased dependency on the companies who control and supply the seeds and the knock on impacts on biodiversity. Biodiversity loss is a significant risk for business and a critical sustainable development issue. For agricultural crops and innovation in seed production, biodiversity is fundamental. Some companies are increasingly recognising the importance of protecting biodiversity and the corresponding ecosystem services. Negative impacts should first be avoid but if avoidance is not possible then companies can work to ensure impacts are minimised as well as restoring impacted areas after usage. Some companies have biodiversity offset strategies to compensate for impacts that cannot be avoided, working to achieve no net loss of biodiversity or, alternatively a net gain vii. 14 vii See IFC Performance Standard 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources

15 Managing these issues for more sustainable business There are different ways of characterising and categorising the approaches that companies take to manage these complex issues. For IFC, interventions cut across 3 areas: standards; resource efficiency and supply chain / community investment. Table 1 maps activities and strategies in relation to these focus areas and the sections below provide further details and information. The examples that were chosen were those which were highlighted and elevated through the research and are based on publicly available information and do not necessarily imply any partnerships with IFC. IFC Sustainable Business Advisory Focus Area: STANDARDS Standards and certifications can help companies put management systems in place and to demonstrate to others how they are managing social, environmental and governance issues in their business. This in turn can build investor and consumer confidence, and increase access to markets. For agribusiness exporting to the European Union (and other markets), traceability of products with appropriate packaging and labelling are essential. IFC Performance Standards are viewed by banks and businesses alike as the gold standard for managing sustainability risks in their operations. They are directed towards clients, providing guidance on how to identify risks and impacts, and are designed to help avoid, mitigate, and manage risks and impacts as a way of doing business in a sustainable way. They include guidance on stakeholder engagement and the disclosure obligations of the client in relation to project-level activities. Together, the eight Performance Standards establish standards that the client is to meet throughout the life of an investment by IFC. The IFC also produces industry guidelines for the Environment, Health and Safety. Many businesses including retailers, processors and traders have made commitments to the environment and to the working conditions and human rights of workers in their value chains. This will often be expressed through their policies, principles and codes of conduct. Businesses use standards and codes (both internal and third party) to promote responsible practices in their supply chains and support traceability and food safety. Farmers and their associations can implement standards, which open up and increase access to different buyers and markets. There are numerous multi-stakeholder standards, which are important for agribusiness including Fairtrade, UTZ Certified and the Rainforest Alliance; and standards which are specific to commodities such as the RSPO. While timber was not included in the scan or the research for this project, the Forest Stewardship Council should also be emphasised as a key and important standard. Other standards such as ISO help companies with environmental management systems. Appendix 2 outlines some of the ones relevant for companies in this sector. Companies can invest in initiatives, which help suppliers and communities: Identify relevant Environmental, Social and Trade (EST) standards Adopt these standards Identify market opportunities based on the application of these standards Reduce costs of the adoption standards Examples of Standards for Agribusiness Fairtrade aims to improve the lives of farmers in the supply chains and give producers a better (fairer) deal. For a product to display the FAIRTRADE Mark it must meet international Fairtrade standards which are set by the international certification body the Fairtrade Labelling Organisations International (FLO). Rainforest Alliance (RA) Certified seal is awarded to farms that have met the environmental, social and economic standards of the Sustainable Agriculture Network (SAN), a coalition of local conservation organizations that first set the standard for sustainable farming in rainforest areas in the early 1990s. The SAN standards cover ecosystem conservation, worker rights and safety, wildlife protection, water and soil conservation, agrochemical reduction and education for farm children. UTZ CERTIFIED started as a certification standard for mainstream coffee and it is now expanding to other commodities such as cocoa, tea and palm oil. The program gives independent assurance of sustainable production and sourcing and offers online real-time traceability of agricultural products back to their origin. The Roundtable on Sustainable Palm Oil (RSPO) was established in 2004 with the goal of promoting the growth and use of sustainable oil palm products through credible global standards and engagement of stakeholders. RSPO has developed the most credible mainstream standard available for sustainable palm oil production, covering key environmental and social criteria. Business Briefing: Sustainable Agribusiness in Africa 15

16 While standards can have numerous benefits, companies need to bear in mind that the resources required to meet quality standards (not only traceability requirements) can pose several challenges for small-scale farmers (for example in the duty to keep records). As one stakeholder interviewed noted, There has been a lot of focus on certification money from development agencies to support certification without understanding what it means for producers on the ground. A lot of tea companies put in commitments to achieve 100% Rainforest Alliance certification without understanding certification costs to the producers on the ground. When money runs out, the producers will then need to spend the 20k for certification. Certification has been a good starting point but it has not always factored in how and if it is viable to maintain 62. In some markets, new standards required from buyers have resulted in the exclusion of small scale producers, who cannot afford the cost of certification viii63. Companies interviewed for the research pointed to cocoa and palm as examples where companies have worked together with each other and with other stakeholders to manage complex sustainability issues. EXAMPLE: COCOA For chocolate manufacturers, ensuring a sustainable supply of cocoa is essential for business. The cocoa trade in Africa is dominated by countries such as Cote d Ivoire, Ghana, Nigeria and Cameroon and the sector provides livelihoods for millions of people. However, demand for cocoa is rising and companies are worried that supply will not be able to keep pace. The crop is labour intensive and farmers often do not earn a living wage. Long hours, poor wages and lack of health and safety conditions have been documented in the industry. Most farms are small family enterprises of less than 2 hectares and it is often children (sometimes as young as 10) who are harvesting the cocoa. Climate change and environmental degradation are also posing challenges to cocoa farmers and their buyers. Companies see cocoa certification as a way to ensure that minimum standards are met and that there is traceability through the supply chain. Unilever have started rolling out Rainforest Alliance certification to smallholder cocoa growers in West Africa. Through certification, they are working to cut out the middleman to ensure farmers get a better deal and are also providing training to improve their farming practices. Mars committed to sourcing 100 per cent of its cocoa from certified sources by In 2009, Cadbury s Dairy Milk became 100 per cent Fairtrade in the UK and Ireland and was the first mass market chocolate bar to gain Fairtrade certification. The company which owns Cadbury s, Mondolez International has been working with the Rainforest Alliance, GTZ, and USAID, and cocoa trader, Armajaro, to support sustainable cocoa production in the Cote d Ivoire. This project has enabled six Ivorian cooperatives representing over 2,000 farmers earn the Rainforest Alliance Certified seal. This has resulted in improved yields and made significant productivity gains, in some cases above 50 per cent. The incidence of cocoa black pod disease was also reduced by one third and farmer incomes have improved. Divine Chocolates is a Fairtrade company set up by the Kuapa Kokoo cooperative of farmers in Ghana aiming to get a better deal for their farmers. For Ecom it is estimated that over 50 per cent of all of their purchasing is currently touched by certification (i.e. purchased from certified suppliers). The company states on their website that certification is only the first step on the improvement ladder and serves as a common language to communicate value and values throughout the supply chain. 16 viii A survey of ten exporters by Graffham et al. (2009) as referenced in the recent IIED report, found that after the introduction of compulsory Global Gap certification in Kenya in 2005, these exporters controlled over 50 per cent of the Kenyan export horticulture market. There was a 60 per cent drop in formal participation of small-scale growers in these companies supplier networks.

17 EXAMPLE: PALM OIL Palm oil is a food staple in Africa and is used around the world in food, soaps, detergents, cosmetics, plastics, and as fuel. Producers range from smallholders to large plantations. Palm oil originated in West Africa and although most of the world s production currently occurs in Malaysia and Indonesia global palm companies are looking towards Africa for new investments. Palm is a labour intensive crop and workers are often faced with poor working conditions and exposure to hazardous chemicals. The environmental impact is well documented as plantations require clearing of forests with land use change contributing to climate change along with methane use associated with the mills. The industry is water intensive and involves wide-spread use of agrochemicals. Land use and acquisition can result in communities being displaced and potential loss of land rights. Companies in the sector have been working together with other stakeholders to address these issues. The Roundtable on Sustainable Palm Oil (RSPO) was established in 2004 with the goal of promoting the growth and use of sustainable oil palm products through credible global standards and stakeholder engagement. In 2012, Unilever announced that it reached its target of 100 per cent certified sustainable palm oil and is working towards a new target of purchasing all its palm oil from traceable sources by In Ghana, Unilever has a 40 per cent stake in - the Twifo Oil Palm Plantation (TOPP). TOPP is in the preparatory stage for certification by the RSPO 64. Woolworths, which uses some 600 tons of palm oil each year in its products, has joined the RSPO in order to promote and raise awareness of the need for sustainable palm oil production. This commitment includes purchasing certified sustainable palm oil certificates for the tons of palm oil used in Woolworth s foods and beauty products. Woolworths has also undertaken to replace palm oil with alternatives where possible and has further committed to using only certified sustainable palm oil by The RSPO process also enables potentially affected communities to raise grievances if there are concerns that the requirements of the RSPO certification are not being fulfilled in country. IFC Sustainable Business Advisory Focus Area: RESOURCE EFFICIENCY Agribusinesses faced with issues such as food insecurity, climate change and water shortages must find ways to produce more food with less land, make more efficient use of water, reduce fossil fuel inputs and reduce greenhouse gas emissions. World Bank/Jonathan Ernst Environmental (and social) management systems can help businesses to manage their risks and impacts. This typically involves ensuring there is a policy in place, identifying impacts, planning and setting targets, implementation, checking and reviewing for continuous improvement. The efficient use of resources is critical for sustainable agribusiness and can reduce costs and increase profitability. Investing in relevant technologies can help reduce waste and greenhouse gas emissions, even as companies output levels rise. Initiatives which farms and firms can put in place can help with: Reducing costs by identifying opportunities to save water, energy, and inputs Improving water use efficiency along the supply chain by adopting advanced irrigation technologies Protecting soil and biodiversity Business Briefing: Sustainable Agribusiness in Africa 17

18 At a farm level, water conservation programmes can help to protect water resources. Water management for crops while conserving the quantity and quality of water resources, should aim to optimize crop yield. The Rainforest Alliance Standard requires that farms make use of the best available technology and resources, consider water re-circulation and reuse, maintain the water network and minimise use. It requires farms to record the annual water volume provided by source and the amount of water consumed by the farm. Ensuring appropriate treatment systems for any wastewater generated and preventing discharges would also be critical. Farms can help to conserve ecosystems through identifying, protecting and restoring natural ecosystems. This can include reforestation of areas within farms that are not suitable for growing crops. Soil erosion prevention and control programmes can help to minimise and reduce erosion while managing pesticides as part of an Integrated Pest Management (IPM) and considering alternatives (crop rotation and use of varieties) are important strategies. Agribusinesses can put in place energy management systems, which would involve understanding their current energy usage, identifying opportunities for improvement, setting targets and measuring progress. Low electricity penetration in Africa causes constraints for both production and consumption. Identifying opportunities for use of renewable sources, such as solar power, can save money and reduce emissions. EXAMPLES: Karsten Farms is an IFC client since 2006 that grows and packs grapes and other fruits in South Africa. Following an assessment of resource efficiency opportunities, the client received an IFC long-term loan of $1.1 million in local currency to install efficient lighting and refrigeration systems to reduce its operating costs. IFC worked with Karsten to install solar water heaters in approximately 300 farm-worker homes, improving the living standards of its employees. Karsten is expected to save $205,000 annually from energy savings of 1,500 MWh/year while also reducing greenhouse gas emissions by more than 1,500 MT CO2/year 65. Kenya Tea Development Agency has worked in partnership with the Rainforest Alliance to strengthen resilience to climate change amongst tea producers. KTDA makes drought-tolerant, high yielding tea varieties available to KTDA smallholders. Seedlings from the KTDA nurseries are distributed to the local community for farmers to plant along boundaries to provide buffers for waterways and forests. These native trees can store carbon and help farmers to adapt by stabilising the micro climate and increasing soil fertility. If trees are planted on steep slopes or degraded lands, it can also reduce the vulnerability to heavy rains and droughts. Significant sources of fuel are needed to power the dryers used in the processing plants and Rainforest Alliance is working with KTDA to share industry best practice to reduce fuel 66. Technoserve, in partnership with Mother Parkers Tea & Coffee the Brown Gold brand, is working with wet mill operators along the Kolla River in Ethiopia to implement a low-cost, sustainable approach to water treatment vetiver grass wetlands. The vetiver grass s deep roots suck up the water, slowing down flow and infiltration into the soil. The remaining effluent, if any, is stored in a small pond at the bottom of the wetland to evaporate. Technoserve has found that water treatment will not only improve water quality for families who depend on the river but will also promote a more sustainable and competitive coffee industry Business Briefing: Sustainable Agribusiness in Africa Unilever s Integrated Pest Management (IPM), involves the integrated use of a range of pest (insect, weed or disease) control strategies in a way that not only reduces pest populations to satisfactory levels but also is sustainable and non-polluting 68. Unilever s Sustainable Agribusiness Code has established IPM as a mandatory commitment, which their growers must comply with and have a system in place which: clearly defines responsibilities; establishes processes and criteria for selecting suitable growing areas, fields rotation and varieties; includes cultural control of pests within the agricultural system; and identifies key pests, their life cycle and action thresholds 69. The Coca-Cola Company is actively working to maintain a water sustainable business. Their Water Stewardship Strategy focuses on three areas: Reduce the use of Water through specific water Efficiency targets; Recycling Water used in their operations (Wastewater Treatment); and Replenishing Water through Community Water Access and Watershed restoration and protection programmes. Their water sustainability programme also includes conducting a Source Vulnerability Assessment and creating a Source Water Protection Plan for each plant to identify and address local water resource issues and risks. In 2010, Coca-Cola and USAID announced an additional joint investment of $12.7 million in their global partnership, the Water and Development Alliance, focusing on watershed management, water supply and sanitation, hygiene promotion and productive water use. In 2009, The Coca-Cola Africa Foundation announced our Replenish Africa Initiative (RAIN) a six-year, $30 million commitment to provide access to safe drinking water to communities throughout Africa 70. Woolworths, a South African company, has invested in WWF s water neutrality programme, covering the water used in their direct operations. Through its Farming for the Future initiative, the retailer works closely with farmers and suppliers to implement water-conserving methods, including water storage, recycling, and improving water waste management during growing, production and manufacturing. This has resulted in a saving of 720 million cubic metres of water over the past three years 71.

19 Rajkumar Impex, a company of Indian origin, is the world s number two cashew nut processor. It revealed plans to open its first cashew plant in West Africa in November 2011, which would eventually be powered by a 5MW biomass plant fuelled by waste shells. This would help reduce the emissions when the shells are burned. The oil would then be sold onto chemicals firm Cardolite, which turns it into products such as thinners or non-corrosive coatings for ships 72. H&M is the world s biggest user of certified organic cotton. H&M works with cotton farmers to grow more cotton with less water and fewer chemicals through trainings conducted by Better Cotton Initiative s partner organisations such as WWF and Solidaridad 73. Water Efficient Maize for Africa (WEMA) WEMA is a public/private partnership, initiated in Its stated aim is to help smallholder farmers mitigate drought risk and manage insect pressure. Led by the Kenyan-based African Agricultural Technology Foundation and funded by the Bill and Melinda Gates and Howard G. Buffett foundations, WEMA key partners include the National Agricultural Research Institutes in Kenya, Mozambique, South Africa, Tanzania and Uganda, the International Maize and Wheat Improvement Centre (CIMMYT ) and Monsanto. The WEMA partnership has developed new drought-tolerant hybrids that will be available to local seed companies royalty-free over the next five to six years and the first WEMA products are expected to be available to farmers in early Monsanto estimates this effort could result in new white corn hybrids that may provide 20 to 35 per cent more yield during moderate drought. WEMA has faced criticism from NGOs due to issues related specifically to Monsanto and genetically modified crops 74. The SIFCA Group is one of West Africa s largest agribusiness and their brand Sania has a large refinery in the Cote D Ivoire. The company has undertaken several efforts to recycle most of its waste. For instance, they spread the husks of the palm nuts around the nursery to prevent soil erosion and this also provides the seedlings with the nutrients they need. The palm oil refinery, which relies largely on fossil fuels, is switching to burning the shells of palm kernels. Through this switch, they expect to curb their yearly greenhouse gas emissions by just over 45,000 tons (roughly the equivalent of taking about 8,200 cars off the road for a year). According to the company switching to greener energy enables the company to cut their production costs and become more competitive in the market place 75. World Bank/Arne Hoel Business Briefing: Sustainable Agribusiness in Africa 19

20 20 Business Briefing: Sustainable Agribusiness in Africa

21 IFC Sustainable Business Advisory Focus Area: SUPPLY CHAIN AND COMMUNITY INVESTMENT: ENGAGING SMALLHOLDERS For agribusiness in general, secure and sustainable supply chains are critical, and buyers and retailers are looking for appropriate ways to engage smallholders in sustainable agribusiness as part of their supply chain and community investment strategies. Smallholder engagement strategies have helped companies to minimise production costs, stimulate local demand and grow products suited to local markets. More direct control over crop production can also reduce commodity price fluctuation risk. The way in which agribusinesses carry out their business will have the biggest impact on local communities. Given the numbers of households that rely on agriculture for their livelihood, responsible sourcing strategies have the potential to have a positive impact on communities. Approaches that help farmers to boost productivity, diversify their production (to reduce reliance on a single product and therefore manage risk), and to adopt techniques which are ecologically sustainable, promoting things like soil management, can all help build sustainable supply chains. Providing training to farmers on simple, low-input techniques to help build sustainability of small-scale farming can also bring notable benefits to both the farmers and the companies, along with effective farmers organisations can significantly support the capacity building of smallholders and the access to appropriate resources. In developing such strategies, businesses should consider partnerships with other parties, particularly local organisations who may have relevant skills and trusted relationships with smallholders that companies do not. Some of the good practices which companies can undertake include: Building capacity and creation of farmers organisations, supporting out-grower schemes and contract farming, which have longer term agreements and facilitation of access to inputs (bank loans, seed and advisory services). Helping to ensure financial services are in place for growers and others in their value chains. Investing in the much needed technical assistance in production and postharvesting techniques and operations, and training and capacity development to enhance farmers management, negotiating and bargaining skills. Ensuring transparency in dealings with small holder farmers. Paying a price to producers that at least covers the costs of sustainable production. Paying a Fair-trade Premium so that producers can invest in development. Partially paying in advance, when producers ask for it. Signing contracts that allow for long-term planning and sustainable production practices. Supporting and ensuring traceability and record keeping systems. Enabling long term contracts through supply chains. Enabling access to market information, taking care that if you deal with middle men the benefits are not lost for small holders. Business Briefing: Sustainable Agribusiness in Africa 21

22 EXAMPLES: Waitrose: Recognising the need to invest in their value chains, the Waitrose Foundation was established in 2005 to help improve the lives of the farm workers and smallholders who grow the company s produce in South Africa, Kenya and Ghana. Instead of funding through a price premium, Waitrose - in conjunction with growers, importers and exporters - passes a percentage of profits into a trust to pay for projects. These include educational, social and healthcare projects, and are chosen by farm workers and smallholder committees. Money raised by the sale of Waitrose Foundation produce is therefore spent on projects that are chosen by and directly benefit the farm workers and smallholders 76. Cargill is investing $US 1.35 million in a three-year partnership with the Aga Khan Foundation (AKF) to provide support for the Bilibiza Agriculture Institute (IABil) in order to enhance and expand educational possibilities for farmers in northern Mozambique. The partnership, which has been supported by Cargill s businesses in Switzerland and Africa, will enable IABil, the only full secondary vocational school for agriculture in Cabo Delgado Province of Mozambique, to improve its teaching capabilities and to reach more student farmers in the northern region 77. SAB Miller started contract farming in Africa when yields were low and injected their management skills and technologies to boost standards. In Zambia and Uganda the company engaged smallholder production in order to minimise production costs, stimulate local demand and grow products suited to local markets. The other advantage is that direct control over crop production reduces commodity price fluctuation risk. Given the strict standards, not all smallholders can get on board. The company has put over 10,000 of their subsistence farmers into job-creation schemes. SABMiller s economic footprint in South Africa shows that beyond its 9,000 direct permanent employees, the company has created an additional 378,000 jobs through its operations along the supply chain 78. TechnoServe is helping nearly 2,000 smallholder tea farmers to turn their main cash crop into a business, tripling their productivity and improving the quality of tea being produced. Farmers are organized into business groups so they can benefit from economies of scale when selling their products and buying supplies. The program is also helping farmers to acquire business financing and to register with Fairtrade, which offers price premiums to support community investment. The key supporters are the West Foundation and the U.S. Agency for International Development 79. chain. This is a direct move to eliminate child labour from Nestle s supply chains, promoting and facilitating school attendance. Nestle is working with its certification partners to incorporate this process into certification itself 80. M&S was the first major UK retailer to switch all its tea and coffee to Fairtrade back in 2006 and has continued to strengthen relationships with suppliers across the world. M&S is also the first retailer in the world to launch a Kenyan tea that s packed by the smallholders who grow it. M&S has helped the Kenyan farmers acquire the skills and technical knowledge to not only grow, but also package their tea. The aim is to enable the farmers to become self-sufficient and build their future business 81. The Grow Africa platform is an example of how large private sector players are working in partnership with national governments to accelerate investments and initiate transformative change in African agriculture. This work is linked to The New Vision for Agriculture 82, a global initiative led by the consumer industries community of the World Economic Forum, which recognises agriculture s potential as a driver of food security, environmental sustainability and economic opportunity 83. Southern Agricultural Growth Corridor of Tanzania was launched at WEF Africa in 2010 as a public-private partnership that aims to boost agricultural productivity in Tanzania and the wider region, and thereby achieve the country s agricultural strategy. SAGCOT will promote clusters of profitable agricultural farming and services businesses, with major benefits for smallholder farmers and local communities. By catalysing large volumes of responsible private investment, the initiative aims to deliver rapid and sustainable agricultural growth and thereby tackle food security, poverty reduction and reduced vulnerability to climate change 84. Unilever has set a target of improving the livelihoods of at least 500,000 smallholder farmers and to provide the evidence that their intervention has had a positive effect. The company recognises that this is a win win relationship in which the company benefits from increased yields, sustainably produced crops and security of supply, and farmers enjoy training, support and security of livelihood 85. Nestle has launched The Nestle Cocoa Plan, which is a range of initiatives to improve farm profitability, cocoa quality and traceability in the cocoa supply chain. Nestle is the first cocoa purchaser to set up such a system of monitoring though community liaisons, who will raise community awareness and report on the conditions of farmers and their children at each stage of the supply 22 Business Briefing: Sustainable Agribusiness in Africa

23 Table 1: Models of Engagement: Standards, Resource Efficiency and Supply Chain / Community Investment Strategies and initiatives which agribusiness are undertaking at different levels of the value chain mapped in relation to IFC Sustainable Business Advisory Focus Areas Farmers and Farmer Associations Traders Processors Retailers Standards Implementing standards which open up and increase access to different buyers Sustainability training/ Certification Implementing an effective traceability system that allows better knowledge of suppliers and the opportunity to develop the right interventions. Supply chain management system (ESMS) Having environmental and social management systems to manage risks and reduce impacts. Supply chain management system (ESMS) Food safety standards Implementing standards which manage risk and show traceability in the value chain. Partnerships for shared value. Transparency and good governance Food safety standards Traceability systems Traceability systems Sourcing & contractor system Supply chain management system (ESMS) Sourcing & contractor systems Transparency and good governance Transparency and good governance Food safety standards Traceability systems Sourcing & contractor systems Resource Efficiency Viable irrigation solutions and water (and watershed) management Waste management Pesticide and fertilizer use Energy management Water efficiency Water management Waste management Energy management Water efficiency Water management Waste management Investing in initiatives and technology to cut carbon emissions and reduce water usage in their operations and through the value chain. Energy use Climate smart agriculture practices Access to information on price & weather Access to finance to purchase low cost efficient irrigation equipment Supply Chain / Community Investment: Engaging Smallholders Access to inputs, credits and on a long run, better planting material availability of service / support businesses Investment in new crops and hybrids, educational, social and healthcare projects chosen by farm workers and smallholder committees Infrastructure Expanding capacity of communities to cope with climate change Fair purchasing practices Investment in new crops and hybrids which benefit producers Extension services Smallholder and community engagement Contract arrangements longer term and advance payments Commercially viable aggregation models Partnerships to grow farmer outreach Investing in research to identify key nutrient-dense staple crops, which can be used in locally produced nutritious foods and snacks Extension services Smallholder and community engagement Commercially viable aggregation models Partnerships to grow farmer outreach Supply chain mapping Fair purchasing practices Extension services Smallholder Engagement Product responsibility which benefits local communities Commercially viable aggregation models Finance Partnerships to grow farmer outreach Supply chain mapping Supply chain mapping Business Briefing: Sustainable Agribusiness in Africa 23

24 Measuring the impact Measuring the impact of sustainable business strategies for businesses and for those affected through the value chains - is often stated as the holy grail in that it is an important pursuit but not an easy one. For agribusiness the impact can be in more sustainable supply chains, improved yields, improved market access, an enhanced reputation, and better relationships with stakeholders including governments, financers and consumers. For communities the impact can be in areas such as improved access to markets, improved financial outcomes or greater sustainability and improved nutrition and standards of living, as a result of changes in farming operations and improved relationships with others in the value chain. Companies are starting to see the benefits of ensuring that they understand their community impacts and transition from measuring their inputs and activities (what they provide and what they do), to really understanding the differences that their sustainability strategies can make. There is emerging evidence of the impact of standards, resource efficiency and supply chain / community investment both in terms of business benefits as well as for affected communities and a few examples have been included below. Standards: Implementation of standards helps business to manage risks and address issues such as traceability in their supply chain. There is clear evidence that standards have had demonstrated impacts in improving specific issues such as health and safety but there has been less evidence of improvements in other more context specific issues, such as freedom of association 86. In relation to the impacts of standards, commentators note that so far there are very few independent evaluations available on the costs and benefits for producers and workers of participation in certification schemes 87. However, in 2012 WWF undertook research to understand the benefits of RSPO certification. The conclusion was that benefits outweigh the costs and in many cases this was significant for community relations, for improvements to yields, for reduced turnover and occupational health and safety as well as for revenues and market access 88. Resource Efficiency: The efficient use of resources is critical for sustainable agribusiness and can reduce costs and increase profitability. Investing in relevant technologies can help reduce waste and greenhouse gas emissions, even as companies output levels rise. Understanding the benefits of resource efficiency is usually more straightforward as it often results in both cost savings as well as resource savings. The example cited earlier of Karsten farms noted that they expected to save $205,000 annually from energy savings of 1,500 MWh/year while also reducing greenhouse gas emissions by more than 1,500 MT CO2/year. Supply Chain / Community Investment: Smallholder engagement strategies have helped companies to minimise production costs, stimulate local demand and grow products suited to local markets. This can help with increased yields, sustainably produced crops and security of supply, while farmers can benefit from training, support and security of livelihood. A partnership between The Coca-Cola Company, Technoserve and the Bill & Melinda Gates Foundation called Project Nurture was set up to bring more than 50,000 smallholder fruit farmers in Kenya and Uganda into the fruit value chain by Results in 2012 were that for more than 42,000 farmers recruited to the programme, and incomes from fruit more than doubled due to increased productivity and better sales outlets Business Briefing: Sustainable Agribusiness in Africa

25 Mondelez has reported that quadrupling the volume of cocoa sold under Fair-trade terms in Ghana, has helped generate 2.3m in Fair-trade premiums to help improve farming communities livelihoods 90. Some of the companies we interviewed and other stakeholders stressed the importance of sustainable livelihoods for farmers. Sustainable livelihoods is a concept that has been used by many development agencies recognising the interconnectedness of poverty alleviation with environmental sustainability, capacity of institutions, and social networks and the vulnerability to shocks, seasonality and changes x. A sustainable livelihood framework includes notions of the following types of capitals: Human Capital: including local community health, education, knowledge and skills Natural Capital: such as water, land, and other resources Physical Capital: access to energy, communications, transportation, tools and technology Social Capital: decision making structures, participation and engagement mechanisms Financial Capital: such as money, wages, savings, credit and debt Businesses also depend on various forms of capital for their success. This idea is underpinning the International Integrated Reporting Framework xi and the current draft framework emphasises the importance of: Financial Capital: includes availability of funds to use for production of goods and services Manufactured Capital: includes buildings, equipment and infrastructure available for the business Intellectual Capital: intellectual property, knowledge, systems and procedures as well as brand value Human Capital: people s competencies and capabilities Social and Relationship Capital: institutional and community relationships Natural capital: renewable and non-renewable environmental resources and processes Combining these two concepts can provide a framework for agribusiness to consider the long-term impact of its work and its sustainability both for the business and for the community. Activities undertaken in relation to standards, resource efficiency and smallholder engagement should ultimately be bringing shared benefits. Sustainable Agribusiness for Shared Value and Benefits COMMUNITY BENEFITS (as per a Sustainable Livelihoods Framework*) Human Capital: What is the impact on the health of the local community? What are the impacts on the standard of child education in the local community? Is there evidence of development of skills and transfer of knowledge in the local community? Financial Capital: Are farmers and workers able to meet basic needs? What income does the business bring to the wider community? What credit facilities are available? Natural Capital: What impact does the site have on the local environment? Physical Capital: How has the business helped or hindered local infrastructure? What tools and technology are available? Social Capital: Are there mechanisms to enable workers and the local community to engage with the business on matters that affect them? BUSINESS BENEFITS (as per the Integrated Reporting Framework*) Financial Capital: Does the strategy help further accesses to financing and funding? Manufactured Capital: As a result of the sustainability strategy does the company benefit from better access or improved buildings, equipment and infrastructure? Intellectual Capital: Is the sustainable business strategy helping to develop and retain intellectual property, and knowledge? Are there improved systems and procedures as well as brand value? Human Capital: Is the strategy supporting recruitment and retention of workers and staff and furthering the development of people s competencies and capabilities? Social and Relationship Capital: Are institutional and community relationships being strengthened and helping to achieve and retain a social licence to operate and market access? Natural capital: Will the strategy help protect renewable and non-renewable environmental resources? *See *See x For more information on a Sustainable Livelihoods framework see resources from IFAD online at xi For more information on the IIRC see the draft framework for consultation online at 25

26 Conclusion With agribusiness in Africa on the rise and with more and more interest from international companies and investors, there is a need to further identify and understand models which can bring shared benefits for both the business and for the communities. As noted in this guide, businesses in the region are faced with a multitude of different pressures and are increasingly recognising that long term success will mean addressing and engaging on issues such as poverty, climate change, and food security. Companies that can do business in a way which provides opportunities for smallholders, generates decent work and jobs, respects human rights and protects the environment can better manage risks, seize opportunities and help build more resilient communities and create and foster sustainable livelihoods. We recognise that the issues covered as well as the examples of good practices in this guide are by no means complete and that different companies, working at different stages in the value chain and in different country contexts will have diverse risks to manage and opportunities to seize. Nonetheless, it is our hope that this guide will further support companies, to better manage the risks and identify those opportunities, which are both good for business and good for communities. The appendices that follow were prepared to provide additional supplemental information for companies who may be just starting out on a journey towards a more sustainable business. Appendix 1: Provides a simple tool / check list for integrating sustainability into your management systems. Users can develop spider graphs to map their strengths and areas for improvement. Appendix 2: Lists some of the standards and multi-stakeholder initiatives relevant for the sector Appendix 3 Provides a brief snapshot of the issues and initiatives for the following commodities: cocoa; palm; cashews; coffee; tea; horticulture; and cotton. Appendix 4 Provides summaries of the country contexts for: Burkina Faso; Ghana; Kenya; Mozambique; Nigeria; Senegal; Tanzania; and Zambia 26 Business Briefing: Sustainable Agribusiness in Africa World Bank/Samson Mulutega

27 APPENDICES Business Briefing: Sustainable Agribusiness in Africa 27

28 APPENDIX 1: A COMPANY SELF-ASSESSMENT TOOL We have included here some key questions, which companies who are starting on their journey for more sustainable business practices can use to think through some of the key elements for their management systems. This has been developed based on research undertaken for the project and adapting an earlier version published by the Global Compact Vietnam Network 91. This adapted tool is not specific for the agribusiness sector and could be used by any business. Companies can use the checklists (below) to determine their strengths and areas for improvement. The following diagram shows a mock up for Example Co. Ltd whereby each question in the beginners category was scored out of 1; each question in the achiever category was scored out of 2; and each question in the leader category was scored out of 3. The final result was converted to a percentage under each of the categories. This company performs fairly well across all categories but could invest more resources into stakeholder engagement and the identification of risks and opportunities. Important Note: Stakeholder engagement. A company s journey towards more sustainable business practices requires engaging with various stakeholders. These could be internal stakeholders such as employees or external stakeholders such as government, investors, customers, suppliers and communities surrounding operations. Stakeholders are individuals or groups that are affected, or likely to be affected, by an organisation. Sustainable business practices will look differently in different places and different contexts. Identifying what is most important for your company requires effective stakeholder engagement and identifying issues that concern your stakeholders. How do I know what is important? What s materiality? Materiality refers to things that are most important to your business and to society. What issues can cause the most risk and harm to your business and what issues have the potential to bring the most benefit? We all know that good business is about managing risks and opportunities. We need to include the social and environmental risks and opportunities as these ultimately affect the financial returns. EXAMPLE CO. LTD. Communications/ Reporting Measuring & Monitoring Leadership & Accountability 100% 80% 60% 40% 20% 0% Identification of Risks and Opportunities Policies, Standards and Objectives Stakeholder Engagement Organisation, Resources and Capacity 28 Business Briefing: Sustainable Agribusiness in Africa

29 SELF ASSESSMENT TOOL To help companies on their journey towards more sustainable business Issue Beginner Achiever Leader Leadership & Accountability Our senior management has committed to some aspects of sustainable business which integrate financial, environmental and social aspects. This is primarily focused on avoidance of risk. We have a designated person in charge of sustainability We recognise both the risks and the opportunities sustainability brings. Our company has appointed a Board Director to oversee sustainability. The vision and values of our company reflect our commitment to sustainable development. We are working towards increased commitment from our CEO. We recognise that we need a team of people to engage with sustainability issues. We work to ensure that our relationships and activities fall within the legal framework. We are working toward clarifying what compliance means to us in any identified grey areas. We have begun developing a programme in at least one area of sustainability. In addition to national compliance, we strive to respect international norms of behaviour that are embedded in international conventions, treaties and declarations. We are examining our corporate visions and mission to incorporate sustainable development. We have programmes to ensure we achieve sustainability objectives in a few areas. We have begun to integrate policies, programmes and practices into our supply chains. We try to avoid being complicit in another organisations activities that fail to meet international norms of behaviour. We are working to create business models which create shared value benefits for the business and for local communities. We are a signatory or involved in global sustainability partnerships or other local or regional networks. We have identified internal leaders or champions. We have specific programmes and practices in place. We engage stakeholders in all these practices and take a lead within the industry. Identification of Risks and Opportunities We have some general information about the significant impacts of our activities. We have a good understanding of our company s risks and impacts in relation to: Health and Safety Security Human Rights Social and community issues Environment and biodiversity We have carried out structured impact assessments (EIA/SIA/ HIA) to understand the impacts and determine our management approach. Assessments are carried out by suitably qualified professionals. We have identified not only the risks and impacts from our operations and activities but opportunities for contributing to community development. We have a strategy for contributing to community development Our priorities are closely aligned with the local development challenges and issues identified by the local community. We have a strategy for contributing to community development which is linked directly with our business activities and creates shared value for the business and for the community. Assessments have been carried out in a participatory manner which engages stakeholders and, in particular potentially affected communities. We work in partnership, as appropriate, with other organisations to achieve our goals. We have plans established for managing impacts. Business Briefing: Sustainable Agribusiness in Africa 29

30 Policies, Standards and Objectives Organisation, Resources and Capacity We have general workplace policies on labour, health and safety, environmental management, human rights and community involvement We recognise the need to internalise these policies through awareness raising, training, capacity building and monitoring. We recognise that social and environmental issues bring risks to our business and are working to begin to assess and understand the risks and impacts that are most important / material to our business We are beginning to develop objectives that go beyond compliance and which can demonstrate our commitment to sustainable development. Our aims and objectives are focused on the issues that are most important/ material to our business. We have identified the resources that we need (time, money, consultancy and technical services) to begin to implement systems and programmes in relation to sustainability topics. We have undertaken an internal gap analysis where we need to develop capacity. We are putting plans in place to roll out training programme to key personnel within the organisation. We have identified possible external expertise and consultants that can help us with capacity building. We have specific policies and codes of conduct for managers addressing social, environmental, health safety and governance related issues. We have made a public commitment to working towards the full integration of sustainability issues within our business We have started work on developing the systems that will be required to deliver this We have a comprehensive risk management system in place and systematically measure our impacts. We have specific aims and objectives covering some aspects of sustainability that are most important/material to business. We have published those aims and objectives and will review than and communicate on progress periodically. We comply with recognised industry standards. We have sufficient resources to support a designated manager and programmes. Our senior management recognise that the resources allocated to our initiatives are part of an investment in our long terms brand and reputation. We are carrying out training and capacity building activities internally with our staff. We have identified specific champions and leaders internally to lead work in terms of labour issues, environmental management, health and safety, or anti-corruption. We are beginning to identify possible external partners with suitable capacity who we can work with to deliver on our objectives. We have detailed policies and codes of conduct in place that outline our commitment and strategy for: Good labour practices Health and safety Environmental protection Human rights Anti-corruption Community involvement and development We have created a system of economic and non-economic incentives related to performance to social responsibility We take a systems based approach to our social responsibility We are part of a broader industry network to promote sustainable development, more broadly. We have a system in place to identify and analyse the opportunities for creating long term community benefits in our value chains. We have detailed aims and objectives, revisited periodically, that guide our sustainability programmes and practices. We have developed a sustainable development strategy for our organisation that clearly sets out who is responsible for delivering specific aims and objectives. Our aims and objectives are linked to the performance assessment of senior management and those tasked with implementing them. We have a long term resource commitment from our senior management to ensure that we can continuously improve on our sustainability impacts over time. Our staff are aware of the importance of social responsibility and receive on-going training to ensure that they are aware of all the issues, our own aims and objectives and the means by which we aims to meet our commitments. We are working with business partners and other stakeholders to build capacity to meet our own sustainability objectives and develop broader strategies to contribute to the sustainable development. 30 Business Briefing: Sustainable Agribusiness in Africa

31 Stakeholder Engagement Measuring and Monitoring Communications / Reporting We have identified our stakeholders. We know who they are. We are conscious of and respect the interests and needs of our stakeholders. We engage with regulators. We have identified potential partners to work with on CSR issues. We are aware of the most significant impacts of our business on society and on the environment and we have in place plans to begin to measure those impacts (positive and negative) in a more systematic way in the future. We recognise the benefits that outside assurance of our CSR can bring us in the future once we have developed meaningful policies, programmes and strategies. We have some public information about the significant impacts of our activities and some policies linked to those. We have started engaging with our prioritised stakeholders on sustainability issues. We understand our stakeholders concerns and the issues that are important to them. We have started interviews and focus groups with key stakeholders relating to the sustainability issues. We have begun to engage partners in order to involve them in our programmes where they can help us make progress on sustainability related goals and the development of communities around us. We have identified the most material impacts of our activities through our own assessments and those of our stakeholders. We are starting to measure some aspects of our social and environmental footprint. We seek external assurance for our programmes, initiatives and communications through our stakeholders and the provision of third party opinions. We are aware of the need to communicate balanced and timely information about of social responsibility. We communicate on environmental or social performance. We have established a two-way communication process with key stakeholder groups. We have on-going two-way communications with our key stakeholders. We have a systematic approach to stakeholder engagement. We have a stakeholder engagement strategy. We have grievance mechanisms in place so that stakeholders can raise issues and make complaints. We have joint partnerships and programmes in place and can demonstrate the impact of these programmes both internally and externally. We are part of networks of businesses and other stakeholders prompting sustainability principles and sustainable development, more broadly. We have begun systematic (quantitative and qualitative) measurement of our impacts. Our measurement strategy is based on key performance indicators in place in relation to our aims and objectives. We have a system for measuring the impact of programmes and longer term strategies to understand the value for business and the value for society. We have formal third party assurance for our social, governance and environmental performance. We have developed a communications strategy for our socially responsibility that demonstrates our on-going commitment to sustainable development. We have complete disclosure of our most significant social and environmental impacts and are reporting on this. We communicate internally and externally about our performance and involve our stakeholders in that process We communicate regularly and appropriately in Vietnam with the aim to raise awareness about our own activities and the importance of sustainable development more broadly. Business Briefing: Sustainable Agribusiness in Africa 31

32 APPENDIX 2 STANDARDS AND MULTI-STAKEHOLDER INITIATIVES RELEVANT FOR THE INDUSTRY The following standards and multi-stakeholder initiatives were identified through the research. The list is not exhaustive but provides some of the key ones for the industry. Rainforest Alliance works to conserve biodiversity and ensure sustainable livelihoods by transforming land-use practices, business practices and consumer behaviour. The Rainforest Alliance s sustainable agriculture program oversees the certification of farms that produce tropical crops, including coffee, bananas, cocoa, oranges, cut flowers, ferns, and tea. To obtain certification, farms must meet a set of environmental and social standards, including agrochemical reduction, ecosystem conservation, and worker health and safety. The RA Certified seal is awarded to farms that have met the environmental, social and economic standards of the Sustainable Agriculture Network (SAN), a coalition of local conservation organizations that first set the standard for sustainable farming in rainforest areas in the early 1990s. The SAN standards cover ecosystem conservation, worker rights and safety, wildlife protection, water and soil conservation, agrochemical reduction and education for farm children. In this way the Rainforest Alliance strives to foster the values of economy, ecology and ethics in its value chain. Ethical Trading Initiative (ETI) is an alliance of companies, trade unions and voluntary organisations working in partnership to improve the working lives of people across the globe who make or grow consumer goods. The Ethical Trading Initiative Base Code provides minimum standards for companies to adopt founded on the conventions of the International Labour Organisation. GLOBALGAP is becoming a compulsory standard as most retailers in Europe now require it as evidence of good agricultural/fish farming practices. Producers of crops and farmers raising animals/fish to produce food for human consumption need GLOBALGAP certification. Without it, their products cannot be stocked by those retailers. UTZ CERTIFIED started as a certification standard for mainstream coffee and it is now expanding to other commodities such as cocoa, tea and palm oil. The program gives independent assurance of sustainable production and sourcing and offers online realtime traceability of agricultural products back to their origin. Organic: The organic agriculture system is based on the principles of health, ecology, fairness and care. It is a holistic system certification system that has been incorporated into law in many countries around the world. The Organic certification is also the only certification that covers all stages of the value chain, which is fundamental to its principle of traceability. In 2007, the East African Organic Products Standard (Kilimo Hai) was developed as a common standard for organic agriculture in Tanzania, Kenya and Uganda. ISEAL Alliance develops guidance and facilitates coordinated efforts to improve the effectiveness of sustainability standards and scale up their social and environmental impacts. Fairtrade Certification is a label for products sourced from producers in developing countries. For a product to display the Fairtrade Mark it must meet international Fairtrade standards which are set by the international certification body Fairtrade Labelling Organisations International (FLO). These standards are agreed through a process of research and consultation with key participants in the Fairtrade scheme, including producers themselves, traders, NGOs, academic institutions and labelling organisations such as the Fairtrade Foundation. Forest Stewardship Council (FSC) is an international not for-profit, multi-stakeholder organisation established in 1993 to promote responsible management of the world s forests through setting standards, certification and labelling. FSC has 10 Principles and associated Criteria (FSC P&C) that form the basis for all FSC forest management standards and certification. FSC International sets the framework for developing and maintaining international, national and sub-national standards. This is intended to ensure that the process for developing FSC policies and standards is transparent, independent and participatory. Global Food Safety Initiative (GFSI) is an independent non-profit foundation managed by The Consumer Goods Forum in It is an industry led initiative that was created following a directive from food business CEOs after several food safety scares led to a loss of consumer confidence. It is a benchmarking organization promoting convergence between food safety standards through a benchmarking process for food safety management schemes. Common acceptance of these by manufacturers and retailers will lead to improved cost efficiency in the food supply value chain. It is also a stakeholder platform that brings together food safety experts to network, exchange knowledge and share information on best food safety practices 92. Sustainable Commodity Initiative is a multi-stakeholder initiative dedicated to lifting the more than 2.5 billion commodity dependent rural poor out of poverty through sustainable production and trade. The SCI s work revolves around providing key support to the mainstreaming of sustainable commodity production by improving efficiency and impact of existing initiatives. The Roundtable on Sustainable Palm Oil (RSPO) was established in 2004 with the goal of promoting the growth and use of sustainable oil palm products through credible global standards and engagement of stakeholders. RSPO has developed the most credible mainstream standard available for sustainable palm oil production, covering key environmental and social criteria. Localising the RSPO principles for Africa would mean interpreting the guidelines in each national context. ISO: Guidelines from the ISO, for environment management systems (ISO 14001), Occupational Health and Safety (OSHAS / 1) and broadly for Social Responsibility (ISO 26000) can help companies to ensure their business not only manages risks but helps to meet evolving stakeholder expectations. 32

33 APPENDIX 3: COMMODITY SNAP SHOTS While there are common issues across agribusiness, the following sections provide brief summaries of key commodities based on the information gathered. The issues are inter-connected but have been headlined into economic, social and environmental sections. Initiatives, partnerships and company examples have been included for each section. Cocoa Key economic, social and environmental issues Economic The cocoa sector provides livelihoods for millions of people in Africa. The world cocoa trade is currently dominated by Cote d Ivoire, Ghana, Nigeria and Cameroon. The industry is dominated by a handful of companies. Demand for sustainably produced cocoa is expected to reach 50% of total world demand by The majority of cocoa farmers are not organised in cooperatives in Africa. Participation in organised farmer groups ranges from an estimated 30% in Côte d Ivoire to much lower levels in Nigeria and Ghana 94. A high percentage of aging cocoa trees throughout the industry, resulting in lower yields. Cocoa trees are highly vulnerable to pests, fungal diseases and climate change resulting in major losses for cocoa farmers, affecting their productivity. Social Poor pay and working conditions: long hours and lack of health and safety conditions has been documented in the industry. Child labour: Most of the cocoa farms are family run enterprises of less than 2 hectares (5 acres). Historically, it is often the children (sometimes as young as age 10) harvesting the cocoa 95. Migrant workers and risk of trafficking: Ghana and Côte d Ivoire have relied on migrant labour from Burkina Faso, Mali and Niger. Studies have documented how children from countries such as Burkina Faso, Mali and Togo are also regularly trafficked into Ivory Coast and Ghana, and forced into child labour 96. Risk of forced labour: Tenancy agreements can result in a forced labour situation for migrant workers. Environmental Climate change: Expected temperature rises caused by climate change will leave many areas in West Africa unable to grow cocoa 97. Water: Cocoa requires access to soil moisture (water) nearly year round and thus benefits from regular watering during dry periods. Drought stress leads to leaf and flower drop and poor fruit production. In West Africa, there is a high reliance on rain fed agriculture, which is a threat to high productivity. Pollution: Improper use and management of chemicals in the form of fertilizers, insecticides, and fungicides can result in water and soil pollution. Biodiversity: Removal of original forests. Tradeoffs between shaded cocoa tress (which help retain biodiversity) and un-shaded plantations where cocoa trees will be denser and hence further productivity for farmers. Initiatives / Partnerships / Standards Africa Cocoa Initiative (ACI) is a public private partnership launched by the World Cocoa Foundation, USAID, and IDH. The aims of ACI are to foster public-private cooperative investments in cocoa and agriculture, improve the genetic quality and productivity of the cocoa varieties under cultivation, expand farmer education and training programs, and improve the agriculture input supply chains that serve the farmers. It is a public-private partnership. Private sector funding for this program comes from WCF companies: ADM Cocoa, Barry Callebaut, Blommer Chocolate Company, Cargill, Continaf BV, Ferrero, Guittard Chocolate Company, The Hershey Company, Kraft Foods, Lindt & Sprüngli, Nestlé, and Olam International Ltd. The four national governments of Côte d Ivoire, Ghana, Cameroon and Nigeria have each endorsed WCF/ACI and are committing their agencies to participating and investing in its sponsored activities. The success of this initiative will largely depend of the effective ownership of the initiative by local authorities. Côte d Ivoire Sustainable Cocoa Initiative (CISCI) is a partnership initiative aimed at contributing to the promotion of sustainable cocoa supply chain system by institutionalizing sustainable production practices; building the institutional capacity to support the systems and tools needed to deliver services to producers and business alike; and supporting policy development and enforcement, and support the national institutions with the mandate for providing long-term assistance to the sector 98. Business Briefing: Sustainable Agribusiness in Africa 33

34 Palm Key economic, social and environmental issues Economic Palm oil is a food staple in Africa making up to 65% of edible oil consumption. Although palm originated in West Africa, most of the world s palm oil production currently occurs in Malaysia and Indonesia. Around the world it is used in food, soaps, detergents, cosmetics, plastics and as a fuel source. More and more global agribusiness companies are now looking towards Africa for palm production. Producers range from small holders (i.e. 80% in Ghana) to larger plantations. Processing and production of palm oil is an important income generator for women in West Africa. Palm oil is increasingly being recognized as an agro fuel with millions of hectares of land already being earmarked for large scale production. Social Working Conditions: Palm industry generally considered to be labour intensive. In plantations, workers are often faced with poor working conditions and living conditions including lack of fair wages, discrimination and worker health and safety. Workers on plantations can be exposed to hazardous chemicals. While women manage to do fairly well in the informal sector, there have been some documented cases of sexual harassment in large plantations, which is largely male dominated. Smallholders using families may mean that children are working and exposed to hazards such as chemicals and not able to attend school. Land use: Increasing conflicts between palm oil companies and local communities, often leading to displacement of people and loss of land rights. Free, prior and informed consent (FPIC) for any land acquisition from the community should be obtained. Environmental Deforestation, Greenhouse Gas Emissions, and Climate Change: Palm plantations may require clearing of forests for palm oil plantations and drainage for peat lands, which result in increased CO2 Emissions. Methane associated with palm oil mills effluent treatments contribute greatly towards climate change 99. Pollution: Soil erosion, pollution and water contamination are serious environmental challenges associated with Palm Plantations. This can lead to reductions in yield and returns in the future. Water: Palm plantations can be water intensive, and the use of agrochemicals can polluting local water resources. Biodiversity: In other parts of the world palm oil growth has meant the removal of original forests which has in turn affected natural species. Companies should make sure that they do not start new plantations on primary forests or high conservation value (HCV) land. Initiatives / Partnerships / Standards The Roundtable on Sustainable Palm Oil (RSPO) was established in 2004 with the goal of promoting the growth and use of sustainable oil palm products through credible global standards and engagement of stakeholders. RSPO has developed the most credible mainstream standard available for sustainable palm oil production, covering key environmental and social criteria. There are already national interpretations of the RSPO principles in a few African countries. WWF s Palm Oil Scorecard 2011, now in its second edition, analyses companies commitment to sourcing sustainable palm oil as a key driver to push the market forward. The Sustainable Palm Oil Investor Working Group (IWG) is a rapidly growing group of investment organizations representing assets under management of over US$1.4 trillion. IFC s Biodiversity and Agricultural Commodities Program (BACP) is designed to address the threats posed by expansion in agricultural commodities through market transformation strategies for target commodities, initially palm oil and soybeans 100. Cashews Key economic, social and environmental issues Economic 40% of the world s raw cashew nuts come from Africa. Cashew Trees were introduced to Africa round the 1600s and are now grown through the region. Historically, Mozambique and Tanzania were the main cashew-producing countries in Africa, with smaller amounts produced in a number of other countries. During the last five to ten years, Nigeria has emerged as a leading producer of cashew nuts in Africa. Mozambique is one the largest producers of cashew nuts with some being exported for processing and some being processed in the country. Between 750,000 1 million smallholders have cashew trees, producing over 80,000 MT of raw cashew nuts (RCN) annually. Although 40% of world s raw cashew nuts come from Africa only 10 % of the processing takes place in the region. Where cashew factories are located there is wage labour. Increasing the processing of cashew in Africa will help to ensure more of the value of the supply chain stays in Africa. The cashew marketing chain is very long, which inevitably leads to high marketing costs. There are issues regarding productivity and quality. Access to raw cashew markets is variable and the prices are controlled by a few large traders 101. By processing cashew in Africa the ecological footprint of the industry in terms of transportation can be decreased Business Briefing: Sustainable Agribusiness in Africa

35 Social Poor pay and working conditions: In the cashew factories, wages are low and working conditions are poor 103. The industry is also characterized by a high percentage of internal migrant labourers. Trade unions may not exist in the factories or they are weak. Women are poorly represented in unions and tend to work longer hours than men. Traditionally, women play an important role in cashew production and processing, however in factories, women are discouraged from working on machines and the roles, which traditionally belong to women, are passed on to men. Recognizing women as primary actors in cashew production might contribute effectively to revival of the sector and help in poverty alleviation among cashew growing communities 104. Child labour in cashew plantations is present across plantations and farms in Africa. In Tanzania for example, children as young as age six are reported to be working in commercial farms. Health: HIV is highly prevalent among migrant cashew workers in Mozambique. In spite of this, many factories do not have any health care resources or HIV education for their workers. Smallholder Cashew Producers are mainly poor and with little education and often without experience with savings and credit. Environmental Waste: Export of raw nuts is creating a high ecological footprint as 80% of the shipped volume is waste (husks). Climate Change will reduce suitability for growing cashews in many regions. Sea level rises resulting and saltwater intrusion could lead to crop failure in many coastal countries in Africa. Water: Cashew trees do not tolerate arid conditions (i.e. mean annual rainfall <600mm). Issue of irrigation highly important in Africa. Soil: Cashew trees have the ability to stabilize the soil in which it grows. The additional tree cover provided by cashew plantations help alleviate pressures on local vegetation and increase soil fertility. This in turn helps mitigate the effects of droughts and desertification. Initiatives / Partnerships / Standards ACA quality and sustainability seal The ACA Seal is an industry-accepted mark that represents compliance with internationally recognized quality, food safety, and social/ labour standards. African Cashew Initiative focuses on organizing and supporting cashew producers in five African project countries in order to enable them to increase their yields and the quality of their products, to improve business linkages with the medium and large scale processing industry, brokers and traders and the competitiveness of African cashew production and to achieve a sustainable reduction in poverty. The program has started by piloting the approach with two processing facilities, one in Burkina Faso and one in Côte d Ivoire. Focus of the pilots is to register and aggregate 13,000 smallholder farmers in the catchment areas of these factories. At the same time the program has started to develop the supply chain management information system with all supply chain actors involved. Coffee Key economic, social and environmental issues Economic In Africa s 25 coffee producing countries, it is estimated that over 40 million people depend on coffee to a greater or lesser extent for their livelihood 105. Africa contributes approximately 12.5% of world coffee production 106. About 95% of coffee is grown by smallholders on average holdings of 1 2 hectares, and 5 per cent is grown on estates. Only a quarter of smallholders use purchased inputs. Most African countries produce Robusta coffee, with a few having a mix of both Robusta and Arabica varieties. The Columbian Mild coffee variety only totals 9% of the world s total production and is considered the top quality bean and commands the best prices in international markets. Tanzania accounts for roughly 6% of the Colombian Mild group production. Price fluctuations in the global market and low prices for coffee farmers leaves farmers with little or no incentive to improve productivity and quality, leading to long term decline. In the last two decades, there has been a tremendous fall in prices for traditional agricultural export crops in the world market, partly due to structural changes in the world coffee market and changes in corporate strategies among largest roasters 107. Coffee sector suffers from under investment, poor production practices and adverse climatic conditions. As a result production has remained below demand. In recent years major coffee roasters have made serious commitments to increase their purchasing of sustainable coffee 108. Social Poor pay and working conditions: Coffee is a labour intensive crop that frequently yields very little financial return. Child labour: Most of the coffee plantations employ child labour. Child labourers at coffee plantation are exposed to health risks and harm from wild animals, snakes, and insect bites. Migrant workers: Many migrant workers work in the coffee plantations often subjected to forced labour and harsh working and living conditions. Migrant communities are also highly vulnerable to HIV/AIDS. Low Productivity: Coffee production in Africa is still dominated by a heavy reliance on traditional methods of cultivation, lack of access to improved inputs, high number of aged trees which are more than 25 years old, along with pest infestation and plant diseases. Business Briefing: Sustainable Agribusiness in Africa 35

36 Environmental Climate change: Climate change will severely reduce the areas suitable for wild Arabica coffee before the end of the century, with smallholder farmers being most affected. Water: More coffee may need to be grown under irrigation, thereby increasing pressure on scarce water resources 109. Pollution: Use of chemicals in the form of fertilizers, insecticides and fungicides. Organic coffee production is increasingly gaining prominence. Biodiversity: Intensified coffee production is responsible for a diverse set of impacts to biodiversity in many coffee producing regions across the globe. Industrial coffee farming also leads to the extinction of songbirds through habitat destruction 110. Initiatives / Partnerships / Standards Rainforest Alliance works to conserve biodiversity and ensure sustainable livelihoods by transforming land-use practices, business practices and consumer behaviour. The Rainforest Alliance s sustainable agriculture program oversees the certification of farms that produce tropical crops, including coffee, bananas, cocoa, oranges, cut flowers, ferns, and tea. Fair Trade Certification is an international system of standards for producers and terms of trade for their goods that ensure the world s most marginalised farmers, workers and their families in 59 developing countries are adequately protected and can build a more sustainable future. The Sustainable Agriculture Network (SAN), a group of non-profit environmental organizations coordinated by the Rainforest Alliance has developed standards for sustainable cocoa farming. Farms that meet the SAN s standards may earn the Rainforest Alliance s green frog seal. UTZ CERTIFIED started as a certification standard for mainstream coffee and it is now expanding to other commodities such as cocoa, tea and palm oil. The program gives independent assurance of sustainable production and sourcing and offers online real-time traceability of agricultural products back to their origin. Organic: The organic agriculture system is based on the principles of health, ecology, fairness and care. It is a holistic system certification system that has been incorporated into law in many countries around the world. The Organic certification is also the only certification that covers all stages of the value chain, which is fundamental to its principle of traceability. Tea Key economic, social and environmental issues Economic Tea is the second most consumed beverage in the world, after water. Estimated 18 to 20 bn cups of tea consumed every day, globally. Tea has become an important cash crop for East African countries such as Kenya, Tanzania, Uganda, Rwanda, and Burundi, as well as the southern African countries of Zimbabwe and Malawi 111. Tea production in the East African Region contributes 28 per cent of the world market supply. Kenya is the leading African tea producing country. Kenya is the world s third largest tea producer and the sector directly and indirectly employs around 3 million people, 8% of the country s total population. Over 60% of Kenyan tea is produced by smallholders 112. In Tanzania, the tea industry provides employment to 50,000 families and directly or indirectly affects as many as 2 million Tanzanians 113. Tea productivity in the smallholder sub-sector has been relatively lower compared to the estates sub-sector over the years and the yields are still well below potential. Social Poor pay and working conditions: The tea industry is labour intensive. Workers in large tea estates often undergo a range of violations, ranging from discrimination of female workers, permanent casual status of employees used by the management to circumvent labour laws. Tea plantation workers often live in poor housing and social conditions with low wages. Child labour: Most tea plantations across African countries employ child labour 114. Many times, workers are forced to ask their children for help when plucking tea due to the high targets set by the management of the estates. Small holder estates are usually purely family based and normally employ children. Child labour is hazardous with high exposure to pesticides, and work is also physically demanding. Migrant workers: In Africa, male migrant and seasonal labour represents the majority of workers in tea plantations. Kenya particularly absorbs a lot of migrants from its rural areas as well as neighbouring countries to work in Tea plantations. Migrant communities are also highly vulnerable to HIV/AIDS. Environmental Climate change: Increasing temperatures, decreasing rainfall, and increased propensity of droughts, will affect how and where tea is grown and will particularly impact smallholders. Tea is a crop that requires well distributed rainfall and thus Climate Change poses a threat to tea supply chains. The processing of tea, which requires both electrical and thermal energy, has made it necessary for all tea factories to install backup diesel generators that are highly polluting and greenhouse gas emitting. Water: Since the early 1990s, increased pressure on water resources and limited supplies of irrigation water has restricted the expansion of commercial tea estates in parts of East and Central Africa 115. Pollution: Use of chemicals in the form of fertilizers, insecticides and fungicides. Organic tea production is increasingly gaining prominence. Kenya s Tea Board however, boasts that the Kenyan tea is free of pests/ diseases and hence, free of any agrochemicals 116. Biodiversity: Tea production has a negative impact on the environment. Natural habitats, rich in biodiversity, are converted into vast swathes of tea plant monocultures. Initiatives / Partnerships / Standards Ethical Tea Partnership (ETP), The ETP began in 1997 as the Tea Sourcing Partnership when a number of large tea companies made the ground-breaking decision to work together to promote sustainability in the sector, rather than competing on ethics. The purpose of the ETP standard is to make this picture transparent to monitor living and working conditions on tea estates, with the aim of making sure that the tea you buy from the members of our 36 Business Briefing: Sustainable Agribusiness in Africa

37 Partnership has been produced in a socially responsible way 117. The Ethical Tea Partnership is an association of tea packers comprising: Accord Tea Services Ltd, Bettys & Taylors of Harrogate Ltd, DJ Miles & Co Ltd, Drie Mollen, Imporient UK Ltd, Keith Spicer Ltd, Metropolitan Tea Co Ltd, The Nambarrie Tea Company Ltd, Republic of Tea, Sara Lee, Tazo Tea, The Tetley Group, R Twining & Company Ltd, The Windmill Tea Co Ltd. Rainforest Alliance works to conserve biodiversity and ensure sustainable livelihoods by transforming land-use practices, business practices and consumer behaviour. The Rainforest Alliance s sustainable agriculture program oversees the certification of farms that produce tropical crops, including coffee, bananas, cocoa, oranges, cut flowers, ferns, and tea. Fair Trade Certification is an international system of standards for producers and terms of trade for their goods that ensure the world s most marginalised farmers, workers and their families in 59 developing countries are adequately protected and can build a more sustainable future. UTZ CERTIFIED started as a certification standard for mainstream coffee and it is now expanding to other commodities such as cocoa, tea and palm oil. The program gives independent assurance of sustainable production and sourcing and offers online real-time traceability of agricultural products back to their origin. Organic: The organic agriculture system is based on the principles of health, ecology, fairness and care. It is a holistic system certification system that has been incorporated into law in many countries around the world. Particularly important for Tanzanian tea are the EU regulation and the US National Organic Program (NOP). Horticulture Key economic, social and environmental issues Economic High demand for horticultural products from many tropical African countries including fruits and vegetables, but also flowers. Kenya remains the largest horticultural exporter in Africa, with export volumes increasing 10% to 15% per year 118. Internationally many African countries face the problem of being a small player with limited visibility. Like all other sectors, smallholder farmers are responsible for a majority of horticultural activity in Africa. Without representation from an international marketing organisation, small scale growers struggle to break into the lucrative European markets where horticultural products are mainly sold 119. They also face constraints in the areas of production, post-harvest handling, marketing, regulatory compliance and capital 120. New threats from increasingly carbon conscious western consumers who now prefer fresh produce from their own countries to those imported from abroad 121. Local small and medium-sized food industries rely on outdated technology and have only a limited production output. Low productivity keeps people poor. Recent studies indicate a growing trend wherein small farmers are excluded from supermarket-driven horticultural marketing and trade 122. Due to export quality requirements, some exporters are no longer prepared to buy small holder produce unless they can ensure quality and food safety compliance via training and close supervision. Farmers at risk of losing out on good prices for their produce. Quality is paramount in horticulture exports due to legal and commercial necessities 123 and traceability of value chains is very important 124. Investments in post-harvest infrastructure starting from temperaturecontrolled vehicles to carry the produce from the fields, to temperature-controlled facilities for cleaning, grading and packaging are extremely important. Social Low pay and working conditions: Horticultural industry is labour intensive requiring good knowledge of crops and sufficient monitoring. Labour in African countries is considered to be cheap and abundant, which means low pay and more work for African farmers. In commercial farms, wages in most countries are reported to be insufficient to meet their basic needs with many farmers living in precarious circumstances 125. Child labour: Most children under 15 are economically active, often working in family farms. According to an ILO report, the percentage of children working in Senegal reaches as high as 40% when seasonal work is taken into account. Gender: Women are concentrated in jobs such as picking, packing and value-added processing activities. Women are more likely to be located in temporary, seasonal or casual employment than permanent, with the exception of flowers where there is a higher concentration of permanent work 126 Pregnant women are often discriminated against. Women are also under represented in trade unions, where they do exist. Temporary and Migrant Workers: Temporary workers faces much discrimination, especially non-permanent pregnant are deprived of maternity leaves or sacked. Environmental Climate change: Climate change will increase temperatures, reduce precipitation, making the region more prone to droughts, and impacting agriculture and worsen food insecurity. It will also lead to an explosion of diseases. Agrochemicals: Although most farmers cannot afford to use chemical pesticides, those who use them often apply wrong doses and use improper procedures. Farmers struggle to manage the hazardous chemicals because of insufficient information, training, resources and inadequate means of protecting themselves 127. Intensive use of chemicals also leads to water and soil pollution. Biodiversity: Land use and land cover change, mainly through conversion of natural ecosystems, particularly forests and grasslands, to agricultural land and urban areas reducing biodiversity. Business Briefing: Sustainable Agribusiness in Africa 37

38 Initiatives / Partnerships / Standards GLOBALGAP is becoming a compulsory standard as most retailers now require it as evidence of good agricultural/ fish farming practices. Producers of crops and farmers raising animals/fish to produce food for human consumption need GLOBALGAP certification. Without it, their products cannot be stocked by those retailers. Increasingly, exporters to Europe and more and more in other markets areas (Asia and America) also need to comply with the production standards determined by the GLOBALGAP certification scheme. Phytosanitary certification: Phytosanitary certificates are issued by a qualified authority, which has to guarantee that the product is free from all diseases covered by quarantine laws. For the so-called quality organisms, certification guarantees the user that the product is suitable for the purpose for which it was purchased. The Codex Committee on Food Hygiene (CCFH) initiated work on a Code of Hygienic Practice for the Primary Production, Harvesting, and Packaging of Fresh Produce. Fair-trade Certification is a label for products sourced from producers in developing countries. For a product to display the FAIRTRADE Mark it must meet international Fair-trade standards which are set by the international certification body Fairtrade Labelling Organisations International (FLO). Organic Certification is a certification process for producers of organic food and other organic agricultural products. In general, any business directly involved in food production can be certified, including seed suppliers, farmers, [food] processors, retailers and restaurants. Global Food Safety Initiative (GFSI) is an independent nonprofit foundation managed by The Consumer Goods Forum in It is an industry led initiative that was created following a directive from food business CEOs after several food safety scares led to a loss of consumer confidence. It is a benchmarking organization promoting convergence between food safety standards through a benchmarking process for food safety management schemes. Common acceptance of these by manufacturers and retailers will lead to improved cost efficiency in the food supply value chain. It is also a stakeholder platform that brings together food safety experts to network, exchange knowledge and share information on best food safety practices. Sustainable Commodity Initiative is a multi-stakeholder initiative dedicated to lifting the more than 2.5 billion commodity dependent rural poor out of poverty through sustainable production and trade. The SCI s work revolves around providing key support to the mainstreaming of sustainable commodity production by improving efficiency and impact of existing initiatives. Cotton Key economic, social and environmental issues ECONOMIC About 8% of the cotton traded in the world market is harvested in Sub-Saharan Africa 128. African cotton is almost exclusively grown by smallholder farmers and there are very few large plantations. 10 million people in central and western Africa are dependent on income from cotton exports 129. Low productivity in the smallholder sub-sector due to pests and plant diseases. Rudimentary technology still used. Cotton producing countries in Africa are facing the challenge of commodity dependence due to a high concentration of merchandise exports in few commodities like cotton traded on often volatile markets. This has led to unbalanced growth and economic vulnerability 130. The cotton industry worldwide is looking for genetically modified cotton that is resistant to some of the pests. Between 60 and 70% of cotton grown in the main growing countries (USA, India and China) is now genetically modified. Many African cotton farmers likewise see genetically modified cotton as technical progress, and do not want to be left out of it. The only country in Sub- Saharan Africa where smallholder farmers grow genetically modified cotton is Burkina Faso. GM Cotton s impacts on the environmental and human health are not yet fully understood. Companies hold patent rights to GM crops so if a farmer s crops are contaminated with GM cotton varieties, then the farmer can be required to pay royalties to the company. SOCIAL Poor pay and working conditions: Poverty among smallholder cotton producers is very high in Sub-Saharan Africa. Some of the disadvantages for small farmers include access to credit, timely access to and use of appropriate inputs, and depressed world market prices for cotton lint, caused in part by massive subsidies provided to cotton farmers in developed economies. Child labour: A risk to the cotton industry globally is child workers on farms. Workers under 18 should not be exposed to chemicals and hazardous substances based and normally employ children. Child labour is hazardous with high exposure to pesticides, and work is also physically demanding. Farmers run the risk of forgoing essential food crops to focus on cotton. This can have massive knock on impacts on food security. ENVIRONMENTAL Climate change: Cotton production is both a contributor to and impacted by climate change. Cotton production contributes to between 0.3% and 1% of total global GHG emissions. Changes in precipitation are likely to lead to crop failures and production declines 131. Biodiversity: Cotton growing is often characterised by monocultures, with a high level of pesticide use and high water consumption, thus threatening the biodiversity in the surrounding area. Soil: Cotton growing is hard on the soil. Pesticides: Cotton is more attractive to pests and pathogens than practically any other plant, which means a high-volume usage of pesticides. Only a very small proportion of alternative growers produce organic cotton. However, the organic cotton market is quite small given the high production costs, lack of higher market prices for organic cotton 132. Water: Cotton is one of the most water intensive crops. Consumption of cotton products represents 2.6% of the global water footprint of consumed goods and services 133. Most of the smallholder farmers in Africa work with rainfed cultivation. 38 Business Briefing: Sustainable Agribusiness in Africa

39 Initiatives / Partnerships / Standards The Better Cotton Initiative: BCI is a collaborative project aimed at promoting significant improvements in the key social and environmental impacts related to cotton production. To enable millions of farmers around the world to grow cotton in a way that is healthier for the farming community and the environment, and more economical. BCI is a global initiative with Mali the African country in the current Pilot phase. Organic cotton emphasizes environmental and health benefits by replacing synthetic pesticides and fertilisers, with farming methods that enhances soil fertility and biodiversity. Fair-trade Certification: Fair Trade cotton focuses on social aspects by guaranteeing a minimum price and providing a fair trade premium for social community-based projects. Cotton Made in Africa: The Cotton made in Africa (CmiA) initiative promotes improvements in cotton production in SSA in compliance with ecological, economic and social sustainability criteria. In order to participate in the CmiA initiative, smallholder farmers must not only fulfil these sustainability criteria, but also honour exclusion criteria (such as the worst forms of child labour or cultivation of cotton on clearly marked nature reserves). Private cotton companies working with the cotton producing families commit to introducing farmers to sustainable cotton production methods as part of their role in the CmiA initiative. The small-scale farmers participating in the CmiA initiative receive intensive training in sustainable agricultural practice and micro credits to finance production assets. Cotton sustainably produced under these conditions is sold under the label Cotton Made in Africa (CmiA). Ethical Trading Initiative is an alliance of companies, trade unions and voluntary organisations working in partnership to improve the working lives of people across the globe who make or grow consumer goods. Competitive Africa Cotton Initiative (COMPACI): The private sector, represented by private cotton companies such as Cargill, Dunavant, Industrial Promotion Services West- Africa, and Plexus Ltd, and international development organizations such as GIZ, German Ministry for Economic Cooperation and Development (BMZ), the Bill and Melinda Gates Foundation, have started the COMPACI initiative. COMPACI intends to implement a program between 2013 and 2015 to improve the livelihoods of smallholder cotton farmers and provide increased cotton supply for its corporate partners. This program aims to affect 450,000 smallholder cotton farmers and their 2.7 million family members in focus countries. COMPACI aspires to accomplish these goals by investing $27 million in the cotton value chain between 2013 and 2015 by a) training farmers on soil and water conservation techniques, balanced crop rotation schemes, and business principles, and b) expanding demand for cotton from these countries by promoting the Cotton made in Africa (CmiA) brand with a goal of increasing CmiA lint cotton sourcing from 8,000 tons to 30,000 tons in

40 APPENDIX 4: COUNTRY SNAPSHOTS The following section has been prepared based on background research gathered for this report. It has been included in this business briefing to support companies who may be new to a particular area to have a basic overview of the country context. Indicator Ivory Coast Mozambique Nigeria Senegal Zambia Ghana Burkina Faso Tanzania Kenya GDP (Bn USD) Agriculture as % of GDP Population (millions) GDP per capita at purchasing power parity USD Ease of doing business (World Bank) 80/ / / /185 90/185 63/ / / /185 Corruption (Rank) (Transparency) / / / /183 91/183 69/ / / /183 Freedom of Information (Rank) / / /179 75/179 86/179 41/179 68/179 34/179 84/179 Human Development Index (Rank) / / / / / / / / /187 Key Agricultural Crops Bananas, cassava, yams and sugar; cocoa, coffee, cotton, oil palm; timber and rubber. Livestock: Sheep, Swine, Goats and Poultry 142 Tea, cassava, maize, coconuts, sisal, citrus, tropical fruits, potatoes, sunflowers, beef and poultry, Cashews; Cotton; Sugar Cocoa, rubber peanuts, palm oil, maize, rice, sorghum, millet, cassava, yams, timber and livestock. Peanuts, millet, maize, sorghum, rice, cotton, tomatoes and green vegetables Maize, sorghum, rice, peanuts, sunflowers; Livestock: cattle, goats, pigs, poultry; Cash Crops: Tobacco, cotton, sugarcane, cassava and coffee Crops: Cereals and Starchy Crops Livestock: Cattle, Sheep, Goats, Pigs, Poultry Fisheries: Marine, Inland and Aquaculture Forestry Cocoa 143 Cotton, peanuts, shea nuts, sesame, sorghum, millet, maize and rice. Burkina Faso is only Second to South Africa as a major producer of Biotech Crops (Cotton with biotech seeds) (after Australia). Coffee, Cashews, Cotton, Tobacco, Sisal, Pyrethrum, Tea, Cloves, Horticultural crops, Oil Seeds, Spices and Flowers. MAJOR STAPLES: Sorghum, Millet, Rice, Wheat, Pulses (mainly beans), Cassava, Potatoes, Bananas and Plantains. Cabbages, onions, Snow peas, avocados, passion fruit and Mangoes. beans, potatoes, cassava, maize, sorghum, and fruits Key Exports Cocoa, Coffee, Timber, cotton, bananas, pineapples, palm oil, fish Prawns, Cashews, Cotton, Sugar, Citrus, Timber. Cocoa, Rubber, Sesame Seeds and Cocoa Butter 144 Fish, Groundnuts, Cotton Tobacco and Coffee Gold, Cocoa Beans and Timber Products Cotton Coffee, Cashews, Cotton, Tobacco, Sisal, Pyrethrum, Tea, Cloves, Horticultural crops, Oil Seeds, Spices and Flowers 145. tea, coffee, tobacco, cotton, sisal, pyrethrum, sisal, and cashew nuts Flower exports are also increasing in prominence Key Export Partners Nigeria 20.75%, France 14.19%, China 7.18%, Thailand 5.09% (2009) Italy 19.4%, Belgium 18.4%, Spain 12.5%, South Africa 12.3%, UK 7.3%, China 4.1% (2007) UK, the US, Canada, France and Germany South Africa Netherlands, Burkina Faso, South Africa and United Kingdom 146 UK 22%, India 14.8%, Germany 9.9%, Netherlands 6.9% 147 UK, Netherlands, Uganda, Tanzania, United States and Pakistan Key Imports Cattle from Mali Wheat (from Tete and Manica provinces) 148 Wheat, rice and sugar Rice and Wheat, Meat, Milk and Dairy Products Rice from Thailand Cattle; Rice from Vietnam and Thailand Pulses and Vegetable oil Key Import Partners Nigeria 20.75%, France 14.19%, China 7.18%, Thailand % (2009) South Africa, Netherlands, Japan, China and Portugal US and EU EU (dairy) and US (rice and wheat) Thailand US US US 40 Business Briefing: Sustainable Agribusiness in Africa

41 Cote d Ivoire General Background The Republic of Côte d Ivoire (or Ivory Coast) is a lower middle-income developing country in West Africa with a population of 20.1 million. The country has a GDP (US$) Billion 150. Ivory Coast endured economic and political turmoil for almost ten years 151. Political instability degraded the country s infrastructure and increased poverty. The country ranks 170 out of 187 countries and territories in HDI, which places it below the average for countries in Sub-Saharan Africa 152. Transparency International ranks Côte d Ivoire 154th out of 180 countries. This also places the country at number 177th in ranking according to the Ease of Doing Business Index. Following political instability, household food security remains a serious concern, with 30% of the rural population (especially the displaced population) having to rely on food aid 153. Gender inequality ranks high; political instability also saw a rise in violence towards women. Côte d Ivoire has West Africa s highest HIV prevalence rate at 3.7 per cent. In 2000, the workforce in the agricultural sector declined to 5.6% because of HIV/AIDS; with a further projected decline of 11.4% in Degraded water infrastructures result in a lack of access to safe drinking water and appropriate sanitation. Agribusiness Agriculture accounts for 24% of Cote d Ivoire s GDP with 70% of the population engaged in agriculture. The following agricultural crops form the base of Cote d Ivoire s economy: bananas, cassava, yams, plantains and sugar; cocoa, coffee, cotton, oil palm; timber and rubber. Livestock: sheep, swine, goats and poultry. Smallholder farmers dominate the agriculture sector in Cote d Ivoire. Political conflict increased the vulnerability of small producers 155. Most cooperatives in Cote d Ivoire are not yet participative, with the added problem of corruption and farmer exploitation schemes 156. Water supply deficiencies exist in the country, along with a high dependence on rain fed agriculture. Climate change will have a tremendous impact on the country s agriculture sector, with reduced rainfall, and reduced climate suitability of current cocoa growing areas, which will negatively impact cocoa production. Cote d Ivoire has suffered significant deforestation with forest covering only 2% of the total land area 157. Cocoa: Cocoa is Cote d Ivoire s main export commodity. In 2011, despite the political crisis in the country, cocoa reached its highest production ever with a record crop of 1.5 million tons. Most of the cocoa farms are family run enterprises of less than 2 hectares and child labour is predominant. UNICEF estimates that 40% of children between ages 5 and 14 work at the cocoa plantations. Cocoa farming has contributed to severe deforestation in Cote d Ivoire and there is limited land for further expansion. The cocoa value chain is very long and disorganised, and farmers are forced to sell to a series of traders and middlemen. During the political crisis, a temporary ban on cocoa exports led to significant smuggling into neighbouring Ghana. Palm Oil Cote d Ivoire currently has a total of ha of oil palm 158. However, Palm oil production in Cote d Ivoire decreased after privatization in Family farmers who grow oil palm are (virtually) never producers of a single crop. They use a diversified farming system, which includes growing food crops and cash crops together on the same farm 160. Palm plantations can lead to displacement of communities, often indigenous populations, due to loss of land use rights. In the past, serious conflicts have arisen between the big palm oil companies and local communities living in the vicinity of large-scale industrial plantations in Cote d Ivoire 161. Palm industry is labour intensive, with labourers often working in poor and unsafe working conditions. Plantations are water intensive and contribute significantly towards climate change. Palm oil plantations often lead to soil erosion and soil degradation related to intensive production. Palm plantations are also notorious for destroying biodiversity. Poultry Smallholders produce the majority of poultry in Côte d Ivoire and common production practices lead to low productivity, poor biosecurity, and limited distribution opportunities. The poultry sector s growth in Cote d Ivoire is constrained by high production costs, lack of reliable inputs, safety concerns in the international market due to lack of sanitary controls and persistent disease outbreaks, and technical constraints in processing and marketing 162. In addition, the introduction of the Common External Tariff (CET) in West Africa reduced the tariff rate applied in most countries, facilitating an influx of cheap poultry imports from Europe and decreasing the ability of the regional sector to compete with imported products 163. Since the avian flu influenza, imports and consumption of poultry declined potentially increasing market for domestic poultry products 164. Business Briefing: Sustainable Agribusiness in Africa 41

42 Government Initiatives: Government support to the agricultural sector has focused on the following main strategies: The National Agriculture Investment Program (NAIP); The National Agricultural Research Centre (Le centre national de recherche agronomique, CNRA); The National Agricultural Development Fund (FNDA); Fund for Agricultural Research and Extension (FIRCA); The Agriculture Development Master Plan ; The National Agricultural Investment Programme (PNIA); (COCOA)Conseil du Café-Cacao (CCC); (COCOA)National Agency to Support Rural Development (ANADER); (POULTRY) Interprofession Avicole Ivoirienne (IPRAVI) (Palm Oil Sector) PALMINDUSTRIE and Plantations et Huileries de Côte d Ivoire. Various donor / government / international organisation partnerships and initiatives exist focused on the agriculture sector. For example: The International Fund for Agricultural Development (IFAD); IFC s CASA Program focusing its efforts in Côte d Ivoire on supporting growth in the agriculture sector; IFDC: Ghana Agro-Dealer Development Project (GADD), ; GIZ Sustainable cocoa cultivation; Comprehensive Africa Agriculture Development Programme, CAADP; IFDC: Marketing Inputs Regionally (MIR), Company Practices: In the Cocoa Sector, KRAFT Foods Inc. has entered into a partnership with Armanjaro Ltd, GTZ, BMZ and USAID to find sustainable solutions to social issues and low production associated with cocoa production in the Ivory Coast. To improve the quality of the cocoa beans, Nestle has increased distribution of high-yielding diseases-resistant cocoa trees. Additionally, Mars Chocolate has also launched a programme to revive the cocoa industry and improve the livelihoods of cocoa farmers. ECOM Agroindustrial Corp. has built a Cocoa Development Centre in Cote d Ivoire focusing on training farmers on good agricultural practices and implementing an effective traceability system; In the Poultry sector, SIPRA is one of the only ISO certified factories in agricultural feed production. SIPRA is trying to provide exceptional quality to both of their clients and all along the supply chain; In the Palm Oil Sector, SANIA, Ivory Coast s largest oil refinery is taking steps to be an environmentally responsible company, by reducing deforestation, recycling waste, and switching to green energy. 42 Business Briefing: Sustainable Agribusiness in Africa

43 Ghana General Background Currently a lower middle-income developing country with a GDP of (US$) 39.2 Billion. Ghana has many natural resources and its economy grew by 14.4% in 2011 boosted by the discovery of major offshore oil reserves 165. Ghana has demonstrated a remarkable economic performance since 2001, and poverty has been nearly halved since the 1990s. Ghana s Human Development Index (HDI) is above the regional average for Sub-Saharan Africa. Despite the progress made, poverty in Ghana continues to be extensive, particularly for farming households. While Ghana has a favourable investment climate, corruption is a challenge and there may be weak enforcement of the law, especially in rural areas. Ghana ranks 63 in the Ease of Doing Business Index. Serious macroeconomic challenges exist, such as: high inflation, significant deficits, and a growing debt load 166. Ghana faces the problem of persistent food insecurity and nutrition gap in its three northern regions. Major gender inequalities exist, with women and girls performing worse across all the main social indicators 167. There is a high prevalence of HIV/AIDS in Ghana, with about 2% of the adult population living with HIV 168. While Ghana has plentiful natural water resources and access to safe drinking water, basic sanitation is a serious concern. Water pollution from untreated sewage and agricultural effluents remains a significant problem in Ghana. Agribusiness Agriculture accounts for 27% of Ghana s GDP. Agricultural crops, including: yams, grains, cocoa, oil palms, kola nuts, and timber, form the base of Ghana s economy and 40% of the population of Ghana is involved in agriculture. 80% of land in Ghana is held under customary tenure 169. Ghanaian agriculture is overwhelmingly dominated by smallholders. Road infrastructure is very weak in rural areas, which affects agricultural productivity due to accessibility. Growth of agriculture is limited due to a lack of investment in infrastructure, irrigation and storage facilities. Reliance on rain fed agriculture is high. The economy is highly vulnerable to climate change and the North is prone to severe droughts and flooding 170. Ghana has one of the highest deforestation rates in Africa and the world, at 2% per annum. Cocoa: Ghana is one of the leading exporters of cocoa and the sector offers livelihoods for over 700,000 farmers in the southern tropical belt of the country 171. Ghana receives a price premium for its cocoa in the world market due to its slightly higher fat content, lower levels of debris and the lower level of bean defects 172. Reports of child labour and the use of a migrant workforce is widespread in Ghana s cocoa sector. Poor pay and working conditions are commonplace. Low productivity due to the underutilization of lands, need for improved farming materials and techniques and vulnerability to diseases, pests and climate change. Large tracts of tropical forest in Ghana have been cleared to support increasing cocoa cultivation. Many cocoa farming families suffer from HIV/AIDS, malaria and other contagious diseases. Palm Oil The other commodity that constitutes a major export market for Ghana is palm oil. Ghana currently has a total of 305,758ha of oil palm. More than 80% of this is cultivated by private small-scale farmers. It is estimated that demand currently exceeds supply by 35,000tons 173. Palm plantations have had a large impact on Ghana s production systems, employment and income levels. Unfortunately, palm plantations also raise several environmental and social concerns 174. The palm oil industry is labour intensive, with labourers often working in poor and unsafe working conditions. Palm plantations are water intensive, with impacts on biodiversity and soil quality. Land use change will contribute to climate change 175. Horticulture Horticultural products include fresh fruits, vegetables and flowers. There are significant efforts to promote horticulture to reduce Ghana s dependency on cocoa exports 176. Exports include pineapples, mangos, passion fruit, bananas, melons, citrus, yams, chillies, aubergine, Asian vegetables (to European markets) and fresh flowers 177. Ghana requires significant investments in post-harvest infrastructure starting from temperature-controlled vehicles to carry the produce from the fields, to temperaturecontrolled facilities for cleaning, grading and packaging 178. Government Initiatives: Government support to the agricultural sector includes: The Accelerated Agricultural Growth and Development Strategy (AAGDS), the Food and Agriculture Sector Development Policy (FASDEP) (2002), the Agriculture Sector Plan ( ) 179, the Millennium Challenge Account (MCA), the Horticulture Export Industry Initiative (HEII), and the Trade and Investment Programme for Competitive Export Economy (TIPCEE). Ghana Commercial Agriculture Programme has identified 3 priority geographical areas upon which to target investment, and build partnerships: the Accra Plains in the Volta River Basin, the SADA region in the Northern Savanna Agro-Ecological Zone and the Transitional Agro-Ecological Zone. Various donor / government / international organisation partnerships and initiatives are focussed on the agriculture sector. For example: IFDC Establishment of the Cocoa Abrabopa Association (CAA), ; IFDC: Ghana Agro- Dealer Development Project (GADD), ; IFDC: Agricultural Value Chain Mentorship Project (AVCMP), A number of donor agencies such as USAID, World Bank, AfDB, GTZ are active in the horticultural export sub-sector with a number of initiatives present in the area. Business Briefing: Sustainable Agribusiness in Africa 43

44 Company Practices The Kuapa Kokoo cocoa co-operative in Ghana represents 63,000 small-scale growers in 1,400 village societies and has been Fair-trade certified since 1995; it is the only farmer-owned organisation among the private companies in Ghana granted licences to trade cocoa to be used in hundreds of products, notably Divine Chocolate 180. Kuapa are also now supplying cocoa to Cadbury as part of the company s conversion of Dairy Milk to Fairtrade in Cargill s cocoa & chocolate business in close cooperation with the Ghana Cocoa Board is expanding its Cargill Sustainable Cocoa Program with the launch of an extensive four year commitment to farmer training in Ghana to be delivered in partnership with Ghanaian licensed cocoa buying company Akuafo Adamfo and the non-governmental organization Solidaridad West Africa 182. In addition, a five-year partnership between Cargill and CARE aims to raise the incomes of cocoa-producing farm families, while keeping children in school and out of fields 183. Nigeria General Background Nigeria is a lower middle-income developing country in West Africa with a GDP of (US$) 244 Billion. With a population of million, Nigeria is the most populous country in Africa. The country has the largest natural gas reserves in the continent and is the biggest oil exporter in Africa. This has resulted in strong economic growth for the country averaging 7.6% between 2003 and More than 50% of Nigerians live in poverty, with corruption and poor infrastructure being the main obstacles for future sustainable development. 185 Nigeria ranks 156 out of 187 countries in the HDI index, which is below the regional average for Sub-Saharan Africa. The country is handicapped by political instability, corruption, inadequate infrastructure and poor macroeconomic management. Transparency International ranks the country 143 amongst 182 countries; and 131st position out of 183 countries on the Ease of Doing Business Index. State and local government policies exacerbate intercommunal tensions and ethnic-based divisions leading to a cycle of violence. The oil rich Niger Delta region also faces significant problems relating to social, environmental and political issues. Although agriculture remains a key component of the Nigerian economy and employing about 70% of the active population, it receives less than 10% of the annual budgetary allocations 186. Food security remains a serious challenge for Nigeria and has steadily increased since the 1980s. Food insecurity rose from about 18% in 1986 to about 41% in In recent years, however, food access has been improving. USAID notes that over 80% of the population of households nationwide face none or minimal acute food insecurity 188. Gender inequality is a problem and 3.6% of the population in Nigeria lives with HIV/AIDS. More deaths occur in Nigeria from malaria than in any other country; approximately one third of all children who die from malaria are Nigerian 189. Nigeria has abundant water resources although they are unevenly distributed over the country. Water resources can be highly contaminated and unsafe for drinking, causing severe health problem for the population. Agribusiness Agriculture accounts for 31.1% of Nigeria s GDP, employing approximately two-thirds of the country s total labour force. Nigeria s main agricultural crops include: yams, cassava, peanuts, millet, sorghum, rice, maize, okra, cocoa, palm oil, rubber, sesame seeds, cattle, fish and timber. Most agriculture is carried out by small farmers. Processing and storage facilities are scarce thus limiting growth. Land tenure is very complex in Nigeria and is the result of the co-existence of several systems, none of which are completely dominant 190. Agricultural productivity is low and basically stagnant. Farming systems are still predominantly subsistence-based and weather dependent. The country s vast irrigation potential also remains largely unexploited. Farmers lack of technical knowledge is compounded by deficiencies in input distribution systems and bad rural roads, plus high cost of transportation reduces their competitiveness. Agricultural practice is predominantly rain-fed and vulnerable to the effects of climate change. Experts say that the country will be one of the worst-hit by the negative impact due to its low-lying coastal line 191. Nigeria has the world s highest deforestation rate of primary forests. Cocoa Nigeria is the fourth largest producer of cocoa beans in the world and cocoa exports are Nigeria s leading non-oil foreign exchange earner and fetched $822.9 million in Cocoa production provides employment and a means of livelihood to over five million people in Nigeria. The soil and the climate are favourable to cocoa cultivation in Nigeria, but there is a lack of land available for growing 193. There s high percentage of aging cocoa trees. Major losses from pests and diseases. Child labour is rampant in Nigeria s cocoa industry 194. Productivity is limited for Nigerian farmers due to lack of technical knowledge, access to improved inputs and lack of infrastructural facilities. Climate change will increase vulnerability of cocoa trees to pests and diseases. Temperature increase will leave many areas unsuitable for cocoa production. 44 Business Briefing: Sustainable Agribusiness in Africa

45 Palm Oil Nigeria is a key producer and exporter of palm oil. 80% of the palm oil in Nigeria comes from dispersed smallholders using traditional production methods. Processing of the palm fruit is carried out by women at the village level and is an important income generator. The sector has been neglected by the government in favour of the oil and gas industry, and the palm sector has suffered significantly as a result. Nigeria, which was once the world s largest importer of palm oil, is now a net importer of palm oil from Malaysia 195. The Government of Nigeria, in coordination with international donors like the World Bank, is now focusing on revitalising palm oil production in the country 196. Palm oil has negative environmental impacts and palm production is also labour and water intensive. Agro-Chemicals Nigeria has a large market for agro-chemicals, essential for the agriculture industry. Agricultural input markets are fragmented and underdeveloped in Nigeria. There are several private companies who have entered the fertilizer, seed, and CPP business during the last few years. There are fertilizer manufacturing and blending plants that have started acquiring marketing skills for developing dealer networks. The agricultural or farm supply companies in various states are also involved in the distribution of inputs 197. Company Practices MARS Chocolate provides training to Nigerian Ministry on Cocoa rehabilitation techniques. DM Cocoa and Saro Agro Allied launched the Golden Cocoa Project in Nigeria in partnership with the Matching Grants Program established under the World Cocoa Foundation/Bill and Melinda Gates Foundation s Cocoa Livelihoods Program with the goal of working to help farmers become more professional, productive and diversified. Italian company Fri-El Green Power uses palm oil as a basis for the production of biodiesel. Though the company is not supplying any electricity locally, it hopes to produce some electricity for local needs using waste products generated by each oil mill. Government Initiatives: Government support to the agricultural sector includes: National Economic Empowerment and Development Strategy (NEEDS II ); the New Nigerian Agricultural Policy (2001); National Food Security Programme; the root and tuber expansion program; the National Fadama development project (NAFDP); the Nigerian Investment Promotion Council (NIPC); and the Agricultural Credit Guarantee Scheme Fund (ACGSF). National Cocoa Development Committee (NCDC); Committee on Vegetable Oil Development Programme (VODEP); Nigerian Institute for Oil Palm Research (NIFOR); Directorate of National Agency for Food and Drug Administration Control (NAFDAC); Chemical Import Control (CIC) and Chemical Monitoring (CM) Units of the Narcotics and Controlled Substance (NCS) Directorate. Various donor / government / international organisation partnerships and initiatives are focussed on the agriculture sector. For example: The World Bank Agrochemical Industry Projects; IFDC Toward Sustainable Clusters in Agribusiness through Learning in Entrepreneurship (2SCALE), ; IFDC Cassava Plus, ; IFDC Marketing Inputs Regionally (MIR Plus), ; IFDC Nigeria Fertilizer Voucher Program, 2009-ongoing; IFDC NEPAD-FAO Fertilizer Subsidy Study, ; USAID; World Bank; The Netherlands Directorate General for International Cooperation (DGIS); and the Alliance for Green revolution in Africa fund a lot of initiatives in Nigeria s agriculture sector. Business Briefing: Sustainable Agribusiness in Africa 45

46 Burkina Faso General Background Burkina Faso is a low income developing country in West Africa with a GDP of (US$) Billion. Burkina Faso is a landlocked country with few natural resources. The country s economy is dependent on cotton exports and is vulnerable to exogenous shocks, although mining has grown a great deal in the economy over the past two years. The country is one of the poorest in the world, with its poverty rate being estimated at 46% in The country also ranked 181st out of 187 countries in the HDI index in Difficult economic conditions, high unemployment rates (77%), insufficient access to income, basic social services & education, severe intermittent droughts, have provoked considerable migration from rural to urban areas within Burkina Faso and to neighbouring countries, most notably to Côte d Ivoire and Ghana. Human rights abuses are commonly reported in Burkina Faso, and child labour is rampant in the cotton industry 198. Gender inequality is also persists with women facing numerous restrictions in all spheres of life. Widespread prevalence of HIV/AIDS. The national budget for tackling HIV/AIDS is limited and comprises almost exclusively of development aid payments 199. Water resources are scarce in Burkina Faso; the capital of Burkina Fuso suffers from severe shortage of safe drinking water, especially in the dry season. Only 11% of the population has access to sanitation. Approximately 40% of the population is at the risk of food insecurity; 42% of residents have limited access to safe drinking water; the national prevalence of chronic malnutrition is over 34% as many households are lacking access to food and other assets. The food and nutrition security situation is being aggravated by a decline in cereal production, 16% compared to last year 200. Agribusiness Agricultural sector accounts for 33% of the GDP of Burkina Faso and employs about 86% of the active population. Underinvestment in this sector - receives little investment in this sector compared to the mining sector. Agricultural investments are mainly concentrated in the cotton sector. Burkina Faso has a high potential for production and transformation in the agro-food sector, yet it is weakly valued and many investors are experiencing financial difficulties. Dominated by subsistence family farms and by micro enterprises in the informal sector to meet basic food and income needs. The principal subsistence crops are millet, sorghum, maize, peanuts, Shea nuts and rice. Climate Change will increase Burkina Faso s vulnerability to droughts and floods. Given the country s fragile high reliance on agriculture, droughts and floods can quickly create an emergency situation, and even with continuous foreign aid, food security continues to be an issue 201. Challenging business environment and poor overall institutional framework discourages entrepreneurs from investing in agro-food or large-scale trade because of unmanageable risks and hidden costs 202. Cotton: Cotton remains the principal cash crop and export commodity of the country. 35% of GDP comes from the cotton sector. The country is also Sub-Saharan Africa s largest cotton producer 203. The cotton sector provides income for 15 20% of the active labour force of Burkina Faso, supporting 1.5 million 2 million people. It is composed mostly of small farms and smallholders, with a small number of large farms led by rural elite 204. Government reforms in the 1990s helped Burkina Faso experience a tremendous boom period in cotton production, with annual growth rates of more than 20%. The high foreign currency revenues from cotton meant increased dependence of economic development on a single crop. Burkina Faso has one of the worst forms of child labour with children working in conventional cotton fields. 205 The cotton sector also faces environmental challenges, including the threat of soil impoverishment and emerging conflicts regarding access to land. Cotton is also one of the most water intensive crops. Consumption of cotton products represents 2.6% of the global water footprint of consumed goods and services 206.Cotton production is both a contributor to and a victim of climate change. Agricultural production of cotton, processing, trade and consumption contribute up to 40% of the world s emissions when forest clearance is included in the calculation. Cotton production contributes to between 0.3% and 1% of total global GHG emissions 207. Burkina Faso is also the only country in the region that has started confined field trials of BT (GM) cotton 208. Government Initiatives: Government support to the agricultural sector includes: Société Burkinabè des Fibres Textiles (SOFITEX) ; (Union Nationale des Producteurs du Coton du Burkina, or UNPCB); Caisse Nationale du Crédit Agricole; Banque Internationale pour le Commerce, l Industrie, et l Agriculture; Banque Internationale du Burkina; creation of SOCOMA, FASOCOTON; Interprofessional Association of the cotton sector (AICB); Association of cotton firms (APROCOB). Strategy for Accelerated Growth and Sustainable Development ( Stratégie de croissance accélérée et de développement durable (SCADD) for the period ; Bagré Growth Pole Project; Rural Sector National Program (PNSR) for improving food security and sovereignty; National food security policy (PNSA); the national nutrition policy (PNN); and the social protection policy (PNPS). 46 Business Briefing: Sustainable Agribusiness in Africa

47 Burkina Faso has passed a biosafety law under the supervision of the National Biosafety Agency of Burkina Faso (ANB), and it is the only country in West Africa that has taken this step thus far. The law establishes a National Biosafety Agency to be in charge of biosafety regulation with the help of several different governmental and non-governmental advisory committees 209 Various donor / government / international organisation partnerships and initiatives are focussed on the agriculture sector. For example: France and the European Union, in particular, provide significant aid. Other donors with large bilateral aid programs include Germany, Denmark, the Netherlands, Sweden, Switzerland, and Canada. The US remains the top importer of agricultural products for Burkina Faso s top valuing US$9 million. IFDC: West Africa Cotton Improvement Program (WACIP); IFAD Prevention of Seed Cotton Contamination in West Africa (Funded by EU and CFC); Agence Française pour le Développement (AFD)-the French Agency for Development-launched its Fonds de Lissage; Oxfam Cotton Initiative at the World Trade Organization (WTO). Company Practices HELVETAS Swiss Intercooperation has been supporting the production and marketing of organic and fair cotton in partnership with the National Union of Cotton Producers of Burkina since 2004; The corporate partners of the Competitive African Cotton Initiative (COMPACI) Cargill, Dunavant, Industrial Promotion Services West-Africa, and Plexus Ltd. intends to implement a program between 2013 and 2015 to improve the livelihoods of smallholder cotton farmers and provide increased cotton supply for its corporate partners; H&M is the world s biggest user of certified organic cotton. H&M works with cotton farmers to grow more cotton with less water and less chemicals through trainings conducted by Better Cotton Initiatives partner organisations such as WWF and Solidaridad. 210 Business Briefing: Sustainable Agribusiness in Africa 47

48 Senegal General Background Senegal is a lower middle income country with a GDP of (US$) Billion. The country is predominantly rural and has limited natural resources. High rural poverty and limited access to basic services and rural infrastructure facilities have fuelled migration to urban areas. The country s informal sector accounts for about 60% of its gross domestic product (GDP) 211. In 2011, Senegal s HDI rank was 155 out of 187 countries, placing it below the regional average for Sub Saharan Africa 212.Access to finance, tax rates and regulations, corruption and an inadequate supply of infrastructure are the most problematic factors for doing business in Senegal. Corruption is significant and is one of the main hindering factors for doing business in Senegal. The country ranks 112 out of 182 countries in the corruption index. Senegal also ranks 162 out of 185 countries in the ease of doing business index. Food insecurity is still high in many regions of the country and more than half of the country s food requirements are imported annually. Gender inequalities persist, maintained by cultural and religious beliefs and practices. Senegal has a low prevalence rate of HIV/AIDS with an infection rate of only 0.62%. Though Senegal has a good irrigation potential, it only has a 60% exploitation rate. The Government of Senegal is working with many international donors to reform its water supply and sanitation sector. Agribusiness Agriculture accounts for 18% of Senegal s GDP, with 77% of its workforce dedicated to agriculture. Key agricultural crops include peanuts, millet, maize, sorghum, rice, cotton, tomatoes and green vegetables. Senegal is a highly stratified society, and customary practices tend to favour elites. Land tenure issues are also difficult and there is insufficient legislation to meet the difficult land issues facing the country. Smallholder farmers are responsible for the vast majority of Senegal s agriculture activity. Heavy reliance on rain fed agriculture. Senegal lies within the drought prone region of Sahel, which is already vulnerable to climate insecurities. Climate change will increase temperatures, reduce precipitation, making the region more prone to droughts, and impacting agriculture. Climate change will worsen food insecurity in Senegal. It will also lead to an increase in disease 213. Deforestation, overgrazing, soil erosion, desertification, constitute some of Senegal s major environmental challenges, caused in part by the rapid expansion of and continued dependence on peanut cultivation. Senegal s burgeoning population is also putting increasing pressure on the forests 214. Horticulture Horticultural exports in Senegal are highly valued and have great potential. The country has a favourable climate which favours the cultivation of off-season crops; the closeness to European and US markets and modern port infrastructure 215. Senegal is now the second largest non-european supplier of tomatoes during the winter months, with most of its produce going to France and Belgium 216. The country is described as a showcase of donors support to horticultural export development in sub-saharan Africa 217. Donor assistance to Senegalese agriculture has evolved and donors are now applying a differentiated market approach for multiple private actors to work better with agricultural entrepreneurs. Despite the country s huge potential in horticultural exports, market opportunities at national, regional and international levels remain underexploited 218. Senegal faces supply chain constraints in terms of provision of inputs, production, logistics and marketing. Farmers have weak technical skills and struggle to manage the hazardous chemicals because of insufficient information, training, resources and inadequate means of protecting themselves 219. The Senegalese government has worked on validation of the label Origine Sénégal as a tool to promote Senegal s horticulture exports as a high-quality produce 220. In selected areas of Senegal, 25% of children under the age of 15 are economically active and the largest proportion of child workers is in the agriculture sector. As only 11% of arable land in Senegal is being actively cultivated, there is room for expansion. Compliance with European agricultural and food certification requirements (EUREPGAP, ARC, CITES, etc) pose barriers to entry into the export market for some farms 221. Some of the other problems faced by Senegal include inadequate freight capacity for horticultural products; insufficiency and poor quality of growers roads, and lack of infrastructures for storage and processing 222. Government Initiatives: Government support to the agricultural sector includes: The Integrated Framework (IF) for Trade-Related Technical Assistance in 2003; the REVA (Return to Agriculture) programme; The Agriculture, Forestry, and Livestock Act (LOASP); The Great Push Forward for Agriculture, Food, and Abundance (GOANA). Various donor / government / international organisation partnerships and initiatives are focussed on the agriculture sector. For example: Senegal is the region s biggest recipient of ODA after Ghana. Many major donors provide assistance to develop Senegal s agriculture sector. These include: The World Bank, IFAD, IFDC, USAID, CIDA, AfDB, EU. Company Practices Patisen, a food processing company, has become one of the most visible companies in Senegal by using clever print and billboard advertising associating its food products with pastimes Senegalese are passionate about, such as wrestling; Advens is the leading export-oriented company in the food-processing industry in Senegal. After initially exporting food from Europe to Africa, Advens has gradually engaged in local processing of groundnuts and cotton. Advens works with Senegal Ministry of Agriculture to provide groundnut producers with technical assistance. 48 Business Briefing: Sustainable Agribusiness in Africa

49 Mozambique General Background A low income developing country with a GDP (US$) of 12.8 Billion. Structural reforms, political stability along with significant FDI have helped spur growth 223. Poverty is widespread and the Human Development Index (HDI) puts it below the regional average 224. While the general investment climate in Mozambique has improved significantly over the last few years, corruption remains a significant challenge. Transparency International ranks Mozambique at number 120 out of 182 countries in the corruption index. Food insecurity remains a serious problem in Mozambique. Mozambique is prone to frequent floods and droughts. Increased vulnerability due to climate change. Mozambique is in the top ten of Sub-Saharan African countries that have been hardest hit by HIV/AIDS, with 1.3 million adults infected 225. Mozambique has abundant surface water resources, however they are unevenly distributed and usage of water for agricultural purposes is still a challenge. Water pollution from sewage and industrial and agricultural effluents is documented as an issue 226 Agribusiness Agriculture accounts for 32% of Mozambique s GDP. The main staple crops produced in the family agriculture sector are maize, sorghum, rice, millet, potatoes, sweet potatoes, cassava and beans. Grown vegetables (horticultural production) are most frequently tomatoes, cabbage, pumpkin, garlic, piri-piri, pepper, okra, cucumber and onions. Cash crops most frequently grown by households are copra, cashew nut, sesame, sugar beans, sunflower and sugar cane. 81 percent of the labour force involved in agriculture. All land in Mozambique belongs to the state. Citizens are legally permitted to use the land they occupy under customary tenure systems. Recent years have seen agriculture production grow slightly below the overall economy. Farming conducted by some 3 million families (average of 1.2 hectares of cultivated land), a small number of commercial farmers (cultivating a total of less than hectares), and refurbished agro-industrial units growing about hectares of sugar-cane 227. Poor rural infrastructure and markets are major constraints for agricultural growth, thus for food crops, the strategy highlights the importance of rural markets. Worries that Climate change could, combined with effects of more frequent flooding on rural roads, result in agricultural GDP losses between 4.5% (conservative estimates) and 9.8% (worst-case scenario) 228. Forest fires are a serious issue: both a natural occurrence as well as a result of slash and burn agriculture techniques. Deforestation is a significant problem in the country, deriving mainly from fuel wood collection, shifting agriculture, forest fires, timber exports, and lack of plans for land use Basic infrastructure, such as rural roads and irrigation, and a number of factors related to the enabling environment, including malaria and HIV/AIDS, are important issues constraining investment in agriculture. Cashews: Cashew nuts are one of the major income generating activities for households and the economy as a whole the cashew industry accounts for approximately two and half per cent of Mozambique s exports, generating nearly 33 million USD foreign currency surpluses. Cashew sales are also one of the main income sources for rural farmers: about 55% of households in Nampula districts surveyed earn up to 40% of their income from cashew. The quality of cashew nuts produced in Mozambique is relatively low and the average quality of Mozambique s nuts is below the international average. According to the ACi estimates, poor producers could at least triple their net earnings if they could afford to invest in new seedlings and develop basic pest management practices 229 In processing factories wages are low and working conditions poor. High percentage of internal labour migrants. Most workers do not earn the minimum agricultural wage of meticals per day (approximately $1.70). Lack of trade unions. Although the cashew factory employs many women workers, women are not encouraged to learn to use the cutting machines many jobs, which are traditionally considered to the domain of women such as cashew peeling and shelling, are given to men in factories. Men tend to dominate all the leadership roles in the factories. Women are required to work longer hours for less pay and less opportunities. Lack of financial flows to the small cashew farmers and while credit guarantees for the sector exist, they are concentrated only at the processor level 230 Grains Maize is the most important grain in Mozambique: needs high amount of water and susceptible to drought. Dominated by smallholders who sell their surpluses to generate income. Potential for rice production in Mozambique is also high and the country has the 3 rd highest rice consumption in Sub- Saharan Africa, but is mostly dependent on imported rice. Sorghum is considered as a food security crop in most of the provinces in the country, especially in regions where rainfall is a limiting factor for maize and rice production. Due to a lack of seed and poor distribution of improved sorghums, farmers continue to use their local varieties which have low productivity potential. Business Briefing: Sustainable Agribusiness in Africa 49

50 Government Initiatives: Government support to the agricultural sector has focused on three main strategies: The Green Revolution (2007), The Food Production Action Plan (Plano de Acção da Produção Agrícola, PAPA, ), and The Strategic Plan for Development of the Agricultural Sector (Plano Estratégico de Desenvolvimento do Sector Agrário, PEDSA, ). Various donor / government / international organisation partnerships and initiatives exist focussed on the agriculture sector. For example: Water Efficient Maize for Africa (WEMA) (Bill and Melinda Gates), CASCA Programme for the Cashew Sector (SNV and Technoserve), and EU and FAO Food Security Initiative Company Practices Cargill has committed to invest $1.35 million in a threeyear partnership with the Aga Khan Foundation (AKF) to provide support for the Bilibiza Agriculture Institute (IABil) in order to enhance and expand educational possibilities for farmers in northern Mozambique. Up to 400 students a year will be trained with relevant technical and entrepreneurial skills, as well as sharing knowledge that will help them to participate in the sustainable development of the agricultural sector in Mozambique. The funding will: help increase the number of teaching staff at the IABil; provide critical training on entrepreneurial and technical areas of agriculture including livestock and processing; improve infrastructure and equipment; and help establish a commercially operated farm to generate long term income for the school. In addition, as part of Cargill s commitment to support initiatives such as the G8 s New Alliance for Food and Nutrition Security and the Grow Africa partnership, the company recently announced it is exploring a public/ private partnership to support smallholder farmers and improve domestic grain production in Mozambique. 50 Business Briefing: Sustainable Agribusiness in Africa

51 Business Briefing: Sustainable Agribusiness in Africa 51

52 Zambia General Background Zambia has been a republic since independence from the United Kingdom in 1964 and has a GDP of US$ Billion, with 67% of the labour force employed in agriculture. Zambia has a multi-party parliamentary democracy since 1991 and is notable in the region for its social and political stability. The country obtains 65% of its export earnings from mining (mainly copper and cobalt), which has made Zambia one of Africa s most highly urbanized countries 232. According to World Bank classifications, Zambia is now considered a lower middle-income country 233. The country, however, is still ranked 164 out of 187 in the 2011 UN Human Development Index and is one of the poorest in the world. Transparency International ranks Zambia 91 out of 182 countries in the corruption index. Zambia has complex dual land tenure system: customary tenure and formal title registration. Customary tenure covers 93% of the Zambian area 234. Poverty and food insecurity are widespread in both rural and urban areas, and the country remains extremely vulnerable to recurring natural disasters, including floods, drought and animal disease. The lack of proper infrastructure, inadequate provision of inputs, poor access to markets, and the slow pace of change in attitudes towards crop and livelihood diversification also continue to undermine farming capacity. HIV/AIDS is a big problem. The disease has a tremendous negative impact on agricultural production in that it debilitates productive labour and time. It also exacerbates food insecurity in the country. Zambia has some of the best surface and underground water resources in Africa, with many rivers, lakes, and dams, however only 6% of their potential is utilized 235. This makes the country vulnerable during times of droughts, greatly reducing yields and causing large losses of livestock. Under ground water pollution from effluents is also a problem for Zambia. Zambia has poor infrastructure facilities, which has created difficulties in agricultural inputs and produce marketing especially in the outlying areas of Zambia. Agribusiness The agriculture sector is an integral part of Zambia s economy; more than 90% of people in rural areas depend on agriculture for their source of livelihoods. Urban agriculture is also common in townships. The agriculture sector employs more than 70% of the country s total labour force. Key agricultural crops include: maize, sorghum, rice, peanuts and sunflowers. Livestock: cattle, goats, pigs and poultry. Cash crops: tobacco, cotton, sugarcane, cassava and coffee. Arable land is estimated at 74 million hectares, and about 14 per cent of this is currently used for agriculture 236. Maize is the main agricultural export commodity and preferential government policies 237 were a major contributing factor for the growth of maize production. Tobacco and coffee are also major export commodities. Smallholder farmer s account for more than 80% of the national output but because of their dependence on rain fed agriculture, poor access to agriculture inputs and poor produce marketing arrangements, their productivity is still poor and vulnerable to environmental change. This situation has resulted in intermittent spatial food insecurity, which the country has continued to encounter over the years. Zambia s agriculture sector is still underdeveloped and is yet to achieve food security. Climate change will pose significant challenges to the sector through rise in temperatures, decreased rainfall, frequent occurrence of droughts and floods, which will increase the country s vulnerability and food insecurity. Zambia also suffers the second highest per capita deforestation in the world. Grains Maize is an important export commodity in Zambia: it needs high amount of water and is susceptible to drought. Due to low maize prices and political pressure the subsidy was increased (to about 80%) instead of reduced. Many of the people who benefit are only part time farmers or those who only farm in the rainy season. The levels of corruption and resale are fairly high 238. Maize requires a substantial amount of water for growth, and some of the current planting areas are not deemed suitable for maize production 239. The Food Reserve Agency (FRA), which is state owned and responsible for ensuring food security in the nation, only buys maize from farmers and not wheat. This shows the high reliance on maize as an export commodity. This could have serious implications on food security as well as the sustainability of maize in Zambia. 52 Business Briefing: Sustainable Agribusiness in Africa

53 Initiatives: Government support to the agricultural sector: Agricultural policy has undergone a major change since the early 1990s. Before the 1990s, agricultural policies were restrictive, distortionary and counterproductive due to heavy government intervention and not sustainable because of their high reliance on subsidies 240. Liberalisation started in the mid-1990s and aimed at bolstering private sector participation in input supply, marketing and processing. Some of the major government policies since then include: The Agricultural Sector Investment Programme (ASIP); the Agriculture Commercialisation Programme (ACP) ; The new National Agricultural Policy (NAP) ; The Agricultural Market Development Plan (AMDP), the Agricultural Inputs Marketing Plan (AIMP) and the National Irrigation Plan (NIP). Fifth National Development Plan (FNDP) s initiatives also include the Food Reserve Agency (FRA) and the Fertilizer Support Programme (FISP); the Food Security Program (FSP), mainly through the Food Reserve Agency (FRA), the Program Against Malnutrition (PAM); The Agriculture Support Programme (ASP) and the World Bank supported Market Improvement and Innovation Facility (MIIF). Various donor / government / international organisation partnerships and initiatives exist focussed on the agriculture sector. For example: Creation of the Irrigation fund, the Agriculture Support Programme (ASP) and the World Bank supported Market Improvement and Innovation Facility (MIIF). The Agriculture Support Programme (ASP) funded by Sweden; the Smallholder Enterprise and Marketing Programme (SHEMP) funded by the International Fund for Agricultural Development (IFAD); various USAID-funded projects, such as the Co-operative League of the USA (CLUSA), the Zambia Agribusiness Technical Assistance Centre (ZATAC) and Land o Lakes; USAID s Production, Finance and Improved Technologies (PROFIT) and Market Access, Trade and Enabling Policies (MATEP) projects, the Finnish Programme for Luapula Agriculture and Rural Development (PLARD), the World Bank Agriculture Development Support Programme (ADSP) and the AfDB s Smallholder Agricultural Production and Marketing Support Project (SAPMSP); the European Community (EC) has also launched a major new project in agriculture, which has, however, a narrower food-security focus. Several projects work to improve smallholders access to term capital through targeted lines of credit, such as the WB, ADSP and IFAD s Rural Finance Program. Access to finance is also facilitated by the USAID-funded Zambia Agricultural Commodity Agency (ZACA), which has developed a warehouse receipt system, and the Zambia Agribusiness Technical Assistance Centre (ZATAC), which provides technical advice for production, marketing and financial/business planning for groups of smallholders. Several donors (WB, EC, Finland and the Netherlands) support small and medium enterprises (SME) access to credit and business development services (BDS), including in agribusiness; IFAD Zambia National Farmers Union SMS Market. Company Practices: Zambian small-holder farmers engage primarily in mono-cropping maize with low productivity, and lack connections to markets and the private sector. The Better Life Alliance is a public-private partnership that strengthens the link between smallholder farmers and agricultural markets while promoting agricultural diversity and conservation farming. The partnership brings together the U.S. government, the Norwegian Royal government, the non-profit organization COMACO, the Wildlife Conservation Society, and private sector companies General Mills and Cargill. SAB Miller started contract farming in Africa when yields were too low and injected their management skills and technologies to boost standards. In Zambia and Uganda the company engaged smallholder production in order to minimise production costs, stimulate local demand and grow products suited to local markets. The company has put over of their subsistence farmers into job-creation schemes. Business Briefing: Sustainable Agribusiness in Africa 53

54 Tanzania General Background A developing country with a GDP (US$) of 23.7 Billion and is a democracy which officially adopted a multi-party system in Significant natural resources including: forests and woodlands, wild animals, rivers, lakes and wetlands. Tanzania s Human Development Index (HDI) is ranked 152 out of 187 countries, putting it above the regional average 241. Transparency International ranks Tanzania 100 out of 182 in the corruption index. While corruption remains a major challenge, the World Bank notes positive trends in corruption control. According to the World Bank, Tanzania has experienced high and relatively stable growth rates over the past decade. However, despite the growth of the economy, poverty remains prevalent and stagnant. The major constraints facing the agriculture sector include: falling labour 242, reduced land productivity due to application of poor technology, high transport costs, lack of adequate market information, infrastructural impediments, movement restrictions, lack of storage capacity, limited access to authentic quality fertilizers, pesticides and fungicides, regulatory and tax environment 243 and difficulties in acquiring land 244. Tanzanian agriculture is mainly rain fed and uses little irrigation, storage or water harvesting which results in associated challenges and sensitivities to future climate change 245. In addition, crops and livestock are adversely affected by periodical droughts. Food insecurity is a problem in Tanzania and an increased dependence on food imports leads to exposure to price and supply risk 246. Agribusiness Agriculture accounts for up to 27% of Tanzania s GDP and accounts for approximately half of the national income. Tanzania s agricultural sector is a combination of subsistence and commercial activity, which is dominated by smallholder farmers (peasants). The key agricultural crops are: coffee, cashews, cotton, tobacco, sisal, pyrethrum, tea, cloves, horticultural crops, oil seeds, spices and flowers. The main staple crops are: maize, sorghum, millet, rice, wheat, pulses (mainly beans), cassava, potatoes, bananas and plaintains. The key export crops include: coffee, cashews, cotton, tobacco, sisal, pyrethrum, tea, cloves, horticultural crops, oil deeds, spices and flowers. Agriculture provides employment opportunities to about 80 percent of Tanzanians and women constitute the main part of agricultural labour force. Coffee Coffee is one of Tanzania s primary agricultural export commodities accounting for about 5% of total export value. The industry provides direct income to more than 400,000 farmer households thus supporting the livelihoods of an estimated 2.4 million individuals and contributing approximately (US$) 115 million to export earnings 247. Production has declined overall due to reduced production in public estates, old age of trees, low input use, increased incidence of diseases and low returns in the face of escalating costs of production. However, this decline in production has been compensated by expansion in new areas where most of the area expansion has taken place 248. Child labour is a serious issue for coffee plantations in Tanzania. The coffee sector in Tanzania today is characterized by extremely low yields, poor maintenance of coffee fields and poor quality. Tea Tea contributes more than (US$) 30 million to Tanzania s export earnings, making it the fifth largest export crop after cashews, coffee, cotton, and tobacco. The tea industry provides employment to 50,000 families and directly or indirectly affects as many as 2 million Tanzanians. Though tea is economically important for Tanzania, the country produces less than 1 percent (25,000 tons) of estimated world tea production of 3 million tons 249. Grains Maize is the major cereal consumed in Tanzania and is grown in all 20 regions of Tanzania and is grown on about 45% of the cultivated area in Tanzania. Maize production, especially in Southern Tanzania, is a risky business since rainfall is erratic and maize is susceptible to drought. Rice is the second most important crop in Tanzania and is used mostly as a cash crop. Tanzanian productivity is lower than most neighbouring countries and one of the lowest in the world. Tanzania is the second largest producer of rice in Southern Eastern Africa yet it does not meet its own domestic demand. Government Initiatives Government support to the agricultural sector: Gender Policy (2000), mainstreaming gender issues. Special attention is directed towards ensuring that women have access to land, other productive resources, training and labour saving technologies 250. Some of the early agricultural sector reforms include: the National Investment Policy (1990), the National Land Policy (1995), the Agriculture and Livestock Policy (1997), the Plant Protection Act (1997) and the Crop Boards Acts. Implementation overview can be found in the Agricultural Sector Development Strategy (ASDS), which was prepared in Other programmes to promote the agriculture sector include the Agricultural Sector Development Programme (ASDP), the Integrated Road Projects (IRP), the Southern Agricultural Growth Corridor of Tanzania (SAGCOT), and the Agreement on Agriculture (AoA). Various donor / government / international organisation partnerships and initiatives exist focussed on the agriculture sector. For example: Sida (Swedish International Development Cooperation Agency) financed a program to promote exports of organic products from Africa, the Tanzanian Organic Agriculture Movement (TOAM). The US Global Food Security Response funds to promote food security. Oxfam is working to scale-up agricultural production in Tanzania and they work with producers to improve all stages of rice production, to find new markets and establish secure and sustainable incomes. 54 Business Briefing: Sustainable Agribusiness in Africa

55 Company Practices As part of its regional Coffee Initiative, TechnoServe is helping small-scale farmers increase their incomes by producing higherquality coffee for the lucrative specialty coffee market. TechnoServe helps farmers to organize themselves into business groups, obtain credit and install processing equipment. Key supporters: Bill & Melinda Gates Foundation, U.S. Agency for International Development, the Swiss State Secretariat for Economic Affairs (seco) and the Swiss Agency for Development and Cooperation. TechnoServe is also helping nearly 2,000 smallholder tea farmers to turn their main cash crop into a business, tripling their productivity and improving the quality of tea being produced. Key supporters: West Foundation and the U.S. Agency for International Development 251. Kenya General Background Kenya is endowed with a wealth of natural and human resources, and has a GDP of (US$) Billion. Kenya has relatively advanced agricultural and industrial sectors and substantial foreign exchange earnings from agricultural exports and tourism. Kenya is considered a low income country, with an HDI ranking of 143 out of 187 countries. Poverty remains one of the most critical development challenges facing Kenya. Corruption poses a significant challenge to business. Transparency International ranked Kenya number 154 of 183 countries in Kenya also ranks 106 out of 185 countries in the ease of doing business index. Lack of clear land policy causing risks for land use, management, tenure reforms and environmental protection 252. Child survival and malnutrition remains a significant threat to the majority of Kenyan women and children. Access to safe water and sanitation facilities are also limited, with malaria and other waterborne diseases weighing heavily on Kenyan families 253. HIV/AIDS is most prevalent among young and middle-aged Kenyans, the most productive segment of the population, thereby affecting income, food security and development potential. Kenya boasts better infrastructural facilities than most other low Sub-Saharan African countries; however, significant challenge still lies in the power sector, access to water and sanitation, particularly in Nairobi s slums 254. Kenya is a water scarce country, whereby demand for water exceeds renewable freshwater sources. Agribusiness Agriculture accounts for 28% of Kenya s GDP, employing 75% of the national labour force. Over 80% of the Kenyan population live in the rural areas and derive their livelihoods from agriculture. Approximately 17% of the country s land is high and medium potential agricultural land where most intensive crop and dairy production take place. There is over-reliance on rain fed agriculture and low utilisation of irrigation potential with only less than 7% of the cropped land under irrigation 255. This is a major cause of food insecurity. Half of the population is food insecure and issues regarding nutritional value and quality 256. However, Kenya is broadly self-sufficient in major food items except in drought years. Kenya is a leading producer of tea and coffee, as well as the third-leading exporter of fresh produce, such as cabbages, onions, snow peas, avocados, passion fruit and mangoes. Flower exports are also increasing in prominence. Climate change will lead to a decline in precipitation in the semi-arid areas. This will lead to reduction in agricultural yields. Climate change will also increase incidences of vector and water borne diseases, which can be especially hard hitting for people living in the slums. Kenya s huge potential for economic growth is threatened by environmental degradation. According to the UN, Kenya s forest cover has reduced from 12% to 1.2% in 2010 as a result of subsistence agriculture, plantation expansion and encroachment by up to 600,000 illegal settlers 257. Business Briefing: Sustainable Agribusiness in Africa 55

56 Tea: Tea is Kenya s leading export crop. Kenyan tea is famous the world over for its consistent high quality throughout the year. The tea industry performance in 2011 posted Shs 109 billion in foreign exchange, which is 12.4 % higher than the 2010 earnings 258. In 2008 and 2009, Tea accounted for 20% of total exports earnings for Kenya followed by coffee, which accounted for 15% while horticultural produce accounted for 9% 259. Currently there are about 420,000 small-scale tea farmers in Kenya who contribute to over 60% of tea production in Kenya 260. Large foreign owned tea estates are also growing in Kenya. The tea industry is labour intensive. Workers in large tea estates often undergo a range of violations, ranging from discrimination of female workers, permanent casual status of employees used by the management to circumvent Kenyan Labour laws, high presence of child labour 261. Kenya has also had over reliance on traditional tea markets namely to Pakistan, UK, Sudan and Afghanistan, which has led to limited market diversification 262. Changing weather patterns have stressed tea bushes and hampered productivity, depressing income and delaying the cultivation. Tea production has a negative impact on the environment. Natural habitats, rich in biodiversity, are converted into vast swathes of tea plant monocultures. Kenya Tea Board boasts that the Kenyan tea is free of pests/ diseases and hence, free of any agrochemicals 263. Horticulture Horticulture is one of Kenya s key export sectors. Horticultural products include fresh fruits, vegetables and flowers. Kenya is the second largest horticultural exporter in the sub-saharan Africa after South Africa. The sector employs about 2 million people, and accounts for up to 21% of all agricultural exports 264. According to the Ministry of Agriculture, in 2011, the country exported 382,638 tonnes of fresh produce 265. Vegetables and Fruit production is dominated by small holders who contribute 80% to the sector. Flower Production and marketing chain is dominated by medium and large companies who export about 72.4% of total volume and smallholder production covers an average of 2-20 ha contributing only 27.6% 266. Smallholder production faces many constraints mostly in the areas of production, post-harvest handling, marketing, regulatory compliance and capital 267. Climate Change will have a major impact on Kenya s Horticulture industry due to reduced water availability for irrigation purposes and frequent droughts. The Horticulture industry is also under threat from increasingly carbon conscious western consumers who now prefer fresh produce from their own countries to those imported from abroad 268. Government Initiatives: Government support to the agricultural sector includes: District Focus for Rural Development (DFRD) strategy; The Strategy for Revitalising Agriculture (SRA ); Kenya Rural Development Strategy (KRDS) 2002; National Food and Nutrition Security Policy (NFNP), 1994; National Agriculture Sector Extension Policy, 2005; National Horticultural Development Policy, 2005; The Agricultural Produce (Export) Rules, 2007; Agriculture Act; Smallholder Production Service Programme (SPSP); Integrated Agricultural Development Programme (IADP). Various donor / government / international organisation partnerships and initiatives are focussed on the agriculture sector. For example: IFAD: Reducing Rural Poverty in Kenya; Belgian Survival Fund Joint Programme; Belgian Fund for Food Security Joint Programme; IFAD: Smallholder Horticulture Marketing Programme; IFAD Southern Nyanza Community Development Project; IFDC: Toward Sustainable Clusters in Agribusiness through Learning in Entrepreneurship (2SCALE), ; IFDC Accelerating Agribusiness in Africa Bridge (AAA-Bridge), ; USAID s Kenya Maize Development Strategy. Company Practices Unilever: As the first major tea company to source tea sustainably on a large scale, Unilever has worked hard to engage farmers and build relationships with producers. Their efforts have been a catalyst to the industry and other tea companies have followed their lead. The tea industry as a whole is now moving to sustainable farming practices. The journey began at Unilever s tea estates in Kenya and Tanzania. These were the first to achieve Rainforest Alliance certification in 2007 and 2008 respectively. 56 Business Briefing: Sustainable Agribusiness in Africa

57 END NOTES 1 The Economist. Aspiring Africa. 2 March com/news/leaders/ pride-africas-achievements-should-becoupled-determination-make-even-faster 2 Devarajan, S and Wolfgang, F. Africa s MICs. Africa Can End Poverty. World Bank Blogs. 19 November africas-mics 3 FAO 4 The World Bank. Live Event: Growing Africa: Unlocking the Potential of Agribusiness. 4 March Larsen, K; Kim, R; Theus, F. (Editors) Agribusiness and Innovation Systems in Africa. The World Bank bitstream/handle/10986/2643/490540pub0agri101official0use0only1. pdf?sequence=1 6 Larsen, K; Kim, R; Theus, F. (Editors). Agribusiness and Innovation Systems in Africa. The World Bank bitstream/handle/10986/2643/490540pub0agri101official0use0only1. pdf?sequence=1 7 The World Bank. Live Event: Growing Africa: Unlocking the Potential of Agribusiness. 4 March FAO. Global Agriculture towards How to feed the world High Level Expert Forum. Rome Oct fileadmin/templates/wsfs/docs/issues_papers/hlef2050_global_ Agriculture.pdf 9 Nestle. The Nestle concept of Corporate Social Responsibility as implemented in Latin America. Agriculture and Sourcing. Pg Specific%20regions/Concept_CSR_LATAM_2005_English.pdf 10 IFAD. Viewpoint Smallholders can feed the World. February OXFAM GROW REPORT files/bp166-behind-the-brands en.pdf 12 World Commission on Environment and Development (WCED). Our common future. Oxford: Oxford University Press, 1987 p A recent report from Oxfam pointed out that today s food system is broken and unsustainable and highlighted the responsibility of companies to address this. Oxfam. Behind the Brands: food justice and the big 10 food and beverage companies. Oxfam briefing paper. February finalcdctoolkitforfundmanagers20101.pdf uploads/finalcdctoolkitforfundmanagers20101.pdf 15 McIntyre, B. et al. International Assessment of Agricultural Knowledge, Science and Technology for Development (IAASTD). Agriculture at a Crossroads, International Assessment of Agricultural Knowledge, Global Report. 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59 85 Unilever. Helping Small Holder Farmers. Unilever unilever.com/sustainable-living/betterlivelihoods/farmers/ 86 Ethical Trading Initiative. The ETI Code of Labour practice: Do workers really benefit? ETI Impact Assessment, Report Summary. ethicaltrade.org/sites/default/files/resources/impact%20assessment%20 summary.pdf 87 Oxfam Grow behind-the-brands en.pdf Oxfam Grow sites/ 88 RSPO. WWF Study Confirms Profitability of Sustainable Practices Under RSPO Certification. 19 June php?nid= Technoserve, The Coca-Cola Company, The Bill and Melinda Gates Foundation (2012). Project Nurture Case Study 90 Mondolez International. Kraft Foods Sustainability Goals & Agriculture Fact Sheet. May Pg 6. SiteCollectionImages/ImageRepository/news/mmr / %20 FACT%20Goals%20Ag%20Sustainability%20Release%20FINAL.pdf 91 Global Compact Network Vietnam. Briefing For Business A guide to the Global Compact Principles in Vietnam with sector supplements from the Extractive, Food Processing, and Construction Industries. globalcompactvietnam.org/upload/attach/briefing%20for%20business.pdf 92 International Trade Centre. Global Food Safety Initiative. December Pg 1. aspx?id= Wegner, L. Seas of Change: Cocoa Fact Sheet. wp-content/uploads/downloads/2012/04/05.04-soc-cocoa-fact-sheetfinal_cover1.pdf 94 Wegner, L. Seas of Change: Cocoa Fact Sheet. Pg net/wp-content/uploads/downloads/2012/04/05.04-soc-cocoa-fact-sheetfinal_cover1.pdf 95 Dickerson, K. The place for Children is in Schools. Africa AgriBusiness Magazine. 6 December Schrage, E. and Ewing, A. The Cocoa Industry and Child Labour Pg Industry%20and%20child%20labour.pdf 97 New Agriculturalist. West Africa too hot for Cocoa by September Halvoy, A; Kebede, T; Adeba, P; Elvis, C; Towards Cote d Ivoire Sustainable Cocoa Initiative (CISCI). php/sjokolade/final%20baseline%20report.pdf 99 WWF Report. Palm Oil Investor Review: Investor Guidance on Palm Oil The role of Investors in supporting the development of a sustainable palm oil industry,2012. Pg 9. awsassets.panda.org/downloads/ wwf_palmoil_investorreview.pdf 100 WWF Report. Palm Oil Investor Review: Investor Guidance on Palm Oil The role of Investors in supporting the development of a sustainable palm oil industry Pg awsassets.panda.org/downloads/ wwf_palmoil_investorreview.pdf 101 Kanji, N; Vijfhuizen, C; Braga, C; and Arthur, L. Cashing in on Cashew Nuts: Women Producers and Factory workers in Mozambique. Pg Chapters/Kanji%20Vijfhuizen%20Braga%20Artur%20Cashing%20in%20 on%20cashew%20nuts.pdf 102 IDH The Sustainable Trade Initiative. Cashew Sustainability. idhsustainabletrade.com/cashew-sustainability 103 Kanji, N; et al. Liberalization, Gender, and Livelihoods: The Mozambique Cashew Nut Case. March Pg pdf 104 Kanji, N; Vijfhuizen, C; Braga, C; and Arthur, L. Cashing in on Cashew Nuts: Women Producers and Factory workers in Mozambique. Pg Chapters/Kanji%20Vijfhuizen%20Braga%20Artur%20Cashing%20in%20 on%20cashew%20nuts.pdf 105 Café Africa. Unlocking Africa s wealth through its coffee Café Africa Kucel, P. et al. Status and Current Research Strategies for Management of the Coffee Berry Borer (Hypothenemus hampeiferr) in Africa. National Agricultural Research Organization (NARO). cbb/presentations/kangire.pdf 107 Lazaro, E; and Makindara, J. Sustainable Coffee Exports from Tanzania. Safe Policy Brief No. 3. Jan Pg IDH The Sustainable Trade Initiative. Coffee. idhsustainabletrade.com/coffee 109 International Trade Centre. The Coffee Guide Trade practices of relevance to exporters in coffee producing countries. thecoffeeguide.org/coffee-guide/climate-change-and-the-coffee-industry/ summary/ 110 Global Exchange. Coffee FAQ. Coffee in the Global Economy The Excellent Tea Company. What s so great about Tea from East Africa? Ethical Tea Partnership. Securing tea supply & livelihoods. Adapting to Climate Change, Kenya. Pg Baffes, J. Tanzania s Tea Sector Constraints and Challenges. The World Bank. Africa Region Working Paper Series No. 69. June worldbank.org/afr/wps/wp69.pdf 114 United States Department of Labor. Child Labour in Commercial Agriculture. commercial.htm 115 Netafim Irrigation India Pvt. Ltd. Success Stories >> Outside India >>Tea in Tanzania Kenya Teaboard. Kenya Tea Industry > Tea Marketing teaboard.or.ke/industry/marketing.html 117 Loconto, A. Sustainably Performed: Reconciling Global Value Chain Governance and Performativity. Michigan State University. Journal of Rural Sciences, 25(3), 2010, pp Pg auxiliary/srsa/pages/articles/jrss%202010%2025%203% pdf 118 Women Working Worldwide. Promoting Women Workers Rights in African Horticulture. Overview of Research into conditions on horticultural farms in Kenya, Zambia, Tanzania and Uganda. Sept Pg New Agriculturalist Online. Getting Vegetables off the ground Brief on the Horticulture Industry in Kenya. downloads/brief%20on%20the%20horticulture%20industry%20 IN%20KENYA.pdf THE%20HORTICULTURE%20INDUSTRY%20IN%20KENYA.pdf 121 Stiftung, H. Climate Change Vulnerability and Adaptation preparedness in Kenya Pg Climate_Change_Adaptation_Preparedness.pdf 122 Maertens, M; Dries, L; Dedehouanou, F; Swinnen, Johan, High Value supply chains, food standards and rural households in Senegal. 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60 132 Cotton Made in Africa. African Cotton In demand Worldwide Environmental Justice Foundation. Cotton and Water. ejfoundation.org/cotton/cotton-and-water 134 G8 Cooperation Framework to Support the New Alliance for Food Security and Nutrition in Burkina Faso, Pg wp-content/uploads/2012/04/burkina-faso-coop-framework-eng-final-w. cover_.pdf 13 OECD.OECD. Burkina Faso: A new Investment Framework for Agriculture. burkinafasoanewinvestmentframeworkforagriculture.htm 136 Trading Economics. Indicators. GDP Per Capita PPP. tradingeconomics.com/indicators 137 IndexMundi. Zambia GDP Per Capita PPP. zambia/gdp_per_capita_%28ppp%29.html 138 Trading Economics. Kenya GDP per capita PPP. tradingeconomics.com/kenya/gdp-per-capita-ppp 139 Transparency International. Corruption Perceptions Index cpi.transparency.org/cpi2011/results/ 140 Reporters Without Borders. Press Freedom Index en.rsf.org/press-freedom-index ,1043.html 141 Human Development Reports Statistics. 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Cote d Ivoire Human Development Report hdrstats.undp.org/images/explanations/civ.pdf 153 World Food Programme. Cote D Ivoire Overview. countries/c%c3%b4te-d-ivoire/food-security 154 International Monetary Fund, Country Report Cote d Ivoire: Poverty Reduction Strategy Paper. Pg pubs/ft/scr/2009/cr09156.pdf 155 IFAD. IFAD to fund agricultural development project to reduce rural poverty in Cote d Ivoire Halvoy, A; Kebede, T; Adeba, P; Elvis, C; Towards Cote d Ivoire Sustainable Cocoa Initiative (CISCI). Pg getfile.php/sjokolade/final%20baseline%20report.pdf 157 Cote d Ivoire Carrere, R. World Rainforest Movement series on tree plantations No.15. Oil Palm in Africa past, present and future. Dec Pg USDA. Production Estimates and Crop Assessment Division Foreign Agricultural Service. Favourable Palm Oil Production for Cote d Ivoire. htm 160 Carrere, R. World Rainforest Movement series on tree plantations No.15. Oil Palm in Africa past, present and future. Dec Pg Carrere, R. 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61 Sustainable Cocoa Program. NA jsp 183 Cargill. Fighting Global Poverty. Cargill and Care Partner to strengthen rural communities. jsp 184 World Bank. Nigeria Overview. nigeria/overview 185 Trading Economies. Nigeria GDP Growth Rate. tradingeconomics.com/nigeria/gdp-growth 186 Abu, O. Food Security in Nigeria and South Africa: Policies and Challenges. J Hum Ecol, 38 (1): (2012). Pg krepublishers.com/02-journals/jhe/jhe web/jhe abst-pdf/jhe abu-o/jhe abu-o- Tx[4].pdf 187 Abu, O. Food Security in Nigeria and South Africa: Policies and Challenges. J Hum Ecol, 38 (1): (2012). Pg krepublishers.com/02-journals/jhe/jhe web/jhe abst-pdf/jhe abu-o/jhe abu-o- Tx[4].pdf 188 USAID. Nigeria Food Security Outlook. Oct 2011 to March reliefweb.int/sites/reliefweb.int/files/resources/full_report_2769.pdf 189 The carter Center. Fighting Disease in Nigeria. org/countries/nigeria-health-malaria.html 190 Tajudeen, B; and Rasheed, A. 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Chapter 6 Cotton Dependence in Burkina Faso: Constraints and Opportunities for Balanced Growth. Pg Resources/ /Burkina-cotton.pdf 204 Kaminski, J. World Bank Document. Chapter 6 Cotton Dependence in Burkina Faso: Constraints and Opportunities for Balanced Growth. Pg Resources/ /Burkina-cotton.pdf Environmental Justice Foundation. Cotton and Water. ejfoundation.org/cotton/cotton-and-water 207 International Trade Centre. Cotton and Climate Change Impacts and Options to Mitigate and Adapt Pg ix. downloadasset.aspx?id= Birner, R; Kone, S; Linacre, N; Resnick, D. Ag Bio Forum, The Journal of AgroBioTechnology Management and Economics. Vol 10//Number 3// Article 9. Biofortified Foods and Crops in West Africa: Mali and Burkina Faso Birner, R; Kone, S; Linacre, N; Resnick, D. Ag Bio Forum, The Journal of AgroBioTechnology Management and Economics. Vol 10//Number 3// Article 9. Biofortified Foods and Crops in West Africa: Mali and Burkina Faso Textile Exchange. TE Featured Member, Dec 2012 H&M. textileexchange.org/featured-member/te-featured-member-hmdecember The World Bank. Senegal Overview country/senegal/overview 212 HRD Stats. Senegal Human Development Report undp.org/images/explanations/sen.pdf 213 Buckley, C, and Gibbons, H. USGS Sound Waves, Monthly Newsletter. Ecologists Question Effects of Climate Change on Infectious Diseases. May Illegal-Logging.INFO; Senegal. php?a_id= African Development Bank, African Development Fund, Sept Republic of Senegal Country Strategy Paper , Pg Operations/SENEGAL%20-% %20CSP.pdf 216 Kuiseu, J, March Food and Fairness. Pesticides News 71. Challenges for safer smallholder horticulture in Senegal Izadifar, Y, OECD. Senegal: Making better use of Agribusiness potential., Pg Izadifar, Y, OECD. Senegal: Making better use of Agribusiness potential., Pg Pesticide News 77. Sept Senegalese farmers discuss pesticide issues pdf 220 Maertens, M et al. High Value Supply Chains, food standards, and rural households in Senegal. Leuven Interdisciplinary Research Group on International Agreements and Sustainable Development. Working Paper No 9 May papers/archive/wp09.pdf 221 FAO Snapshot Africa Senegal. Benchmarking FDI Competitiveness. Pg FAO Standards and Trade Development Facility. Overview of SPS Needs and Assistance in Senegal. Nov Pg 2. org/files/countrybrief/final_senegal.pdf 223 The World Bank. Mozambique Overview. en/country/mozambique/overview 224 UNDP, International Human Development Indicators, Mozambique HDI Nilsen, R. Top Ten Countries with HIV. Livestrong. 10 March Wingqvist G. SIDA s help desk for Environment and Climate Change. Environment and Climate Change Policy Brief Mozambique. Generic Outline. Oct Pg 2. wp-content/uploads/2012/01/mozambique-env-and-cc-policy- Brief_20111.pdf 227 FAO. Special Report : FAO/WFP Crop and Food Security Assessment Mission to Mozambique. 12 August ak350e/ak350e00.htm 228 Wingqvist, G. 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62 229 Mennonite Economic Development Associates. Value Chain Finance Assessment of the Cashew Nuts Sector in the Province of Nampula, Mozambique. Prepared for GIZ and African Cashew Initiative (ACI). April ac.uk.technology.mozambique/files/pics/d pdf 230 Value Chain Finance Assessment Of the Cashew Nuts Sector in the Province of Nampula, Mozambique. Final Report. Prepared for GIZ, African Cashew Initiative. Prepared by Mennonite Economic Development Associates. April pics/d pdf 231 Olam. Mozambique UNCTAD. Investment Policy Review Zambia. United Nations, United Nations Conference on Trade and Development, Investment Policy Review - Zambia.Pg XI. en.pdf Loenen, B. Land Tenure in Zambia. May maine.edu/~onsrud/landtenure/countryreport/zambia.pdf 235 Mwanaumo, A. Agricultural Marketing Policy Reforms in Zambia. Michigan State University, Pg UN Conference on Trade and Development Investment Policy Review: Zambia Pg unctad.org/en/docs/iteipc200614_ en.pdf 237 Smale, M; and Manson, N. Harvest Plus, Working Paper, MAY Demand for Maize Hybrids, Seed Subsidies, and Seed Decision Makers in Zambia. Pg 1. Harvest_plus-working_paper_8.pdf 238 Henson, R. Zambian Economist, 24 Sept Maize Policy: A Farmer s View Japan Association for International Collaboration of Agriculture and Forestry, March The Maize in Zambia and Malawi, Pg 1. jaicaf.or.jp/publications/zambia.pdf 240 Bonaglia, F. Business for Development: Zambia Sustainable Agricultural Diversification. OECD Publicaiton. dev/ pdf 241 UNDP, International Human Development Indicators, Mozambique HDI Rutta, E. Food, Agriculture and Natural Resources Policy Analysis Network (FANRPAN), April Current and Emerging Youth Policies and Initiatives with a special focus and links to Agriculture. fanrpan.org/sites/default/files/case_studies/country_case_study- Tanzania-April2012.pdf 243 The World Bank. Tanzania Overview. September worldbank.org/en/country/tanzania/overview 244 Value Chain Analysis of Rice and Maize in Selected Districts in Tanzania, Nov Pg VOL_I_CONTEXT.pdf 245 FAO Forum, The special challenge for sub-saharan Africa, p.2 Rome October FAO Forum, The special challenge for sub-saharan Africa, p.2 Rome October Tanzania Coffee Board and Tanzania Coffee Association. Tanzania Coffee Industry Development Strategy News_publications/startegy_english.pdf 248 Ministry of Agriculture and Cooperative Development. Agriculture and Livestock Policy, Pg english%20docs/tanzania%20agricultural%20and%20livestock%20 Policy%20%281997%29.pdf 249 Baffes, J. Africa Region Working Paper Series No. 69. Tanzania s Tea Sector: Constraints and Challenges. June afr/wps/wp69.pdf 250 United Republic of Tanzania. Agriculture Sector Development Strategy. Oct Documents/ASDS.pdf 251 Technoserve. Business Solutions to Poverty. Tanzania. technoserve.org/work-impact/locations/tanzania 252 Future Agricultures. Agricultural Policy in Kenya: Issues and Processes. 62 Business Briefing: Sustainable Agribusiness in Africa March Pg Futureagriculture/Ag_policy_Kenya.pdf 253 UNICEF. Kenya at a Glance. overview_4616.html 254 Garmendia, C. and Shkaratan, M. Kenya s Infrastructure A Continental Perspective. The World Bank. Africa Region Policy Research Working Paper handle/10986/3361/wps5596.txt?sequence=2 255 Future Agricultures. Agricultural Policy in Kenya: Issues and Processes. March Pg 5. Futureagriculture/Ag_policy_Kenya.pdf 256 Gitau, R et al. Agricultural Policy Making in Sub Saharan Africa: Kenya s Past Policies Pg 6. Wp34-Agricultural-Policy-Making-Africa-Kenya-Past-Policies.pdf 257 Illegal Logging. INFO. Kenya. php?a_id= Republic of Kenya. Ministry of Agriculture. index.php?option=com_content&view=article&id=448:-tea-industry-perfor mance&catid=149:news&itemid= Ochanda, S. A review of Development of the Tea (Camelia Sinensis) Industry in Kenya and Possible Areas of Exploitation for Value Addition. Afr. J. Hort. Sci (June 2012) 6: ajhs/article/download/105/ Report on small scale tea sector in Kenya. Pg 4 and abstract. somo.nl/publications-en/publication_ Kenya Human Rights Commission. A comparative study of the tea sector in Kenya. A case study of large scale tea estates Pg A review of Development of the Tea Industry in Kenya and Possible areas of exploitation for value addition. June Pg Kenya Teaboard. Kenya Tea Industry. Tea Marketing teaboard.or.ke/industry/marketing.html 264 Embassy of Kenya to the Kingdom of Belgium, the Grand Duchy of Luxembourg, and Mission to the EU. Kenya s agricultural produce The East African. Kenya s Horticulture Industry feted. Oct Brief on the Horticulture Industry in Kenya. downloads/brief%20on%20the%20horticulture%20industry%20 IN%20KENYA.pdf 267 Brief on the Horticulture Industry in Kenya. downloads/brief%20on%20the%20horticulture%20industry%20 IN%20KENYA.pdf 268 Stiftung, H. Climate Change Vulnerability and Adaptation preparedness in Kenya Pg Climate_Change_Adaptation_Preparedness.pdf World Bank/Jonathan Ernst

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