The African Union (AU) says a $15 billion private sector investment is required to guarantee an increase in local manufacturing of mineral fertilizers in Africa.
This was disclosed by the union in a statement on its website dated May 6, 2024.
The bloc explained that regional cooperation in fertilizer policy, research, and development as well as investment pooling for production capacity will facilitate cross-border trade in Africa.
AU plans to increase local production of mineral fertilizers by 2033.
The statement partly read,
“A significant $15billion of private sector investment will be needed to increase the local manufacturing of mineral fertilizers.
” For accelerated impact, the target is to triple the local production of organic and inorganic fertilizers by 2033.
“Consolidation of financial tools like trade credit guarantees, working capital, and targeted subsidies is therefore necessary in order to minimize market distortions, lower expenses, encourage innovations and fortify input supply chains.”
Recall that in a bid to reverse the poor productivity of the African soils, the Heads of States and Governments of the AU endorsed the Abuja Declaration on Fertilizer for the Africa Green Revolution in June 2006.
The declaration recommended “raising the use of fertilizers from 8 kg/(nutrients)/ha to 50 kg (nutrients) /ha in 10 years and the establishment of an African Fertilizer Financing Mechanism (AFFM) with the objective of improving agricultural productivity by providing financing required to boost fertilizer use in Africa to achieve the target of 50 kg of nutrients per hectare, as mandated by the Abuja Declaration.”
Overdependence on global market
The AU decried Africa’s unusual reliance on global market, noting that the continent can be self-reliant if the needed cooperation crystalizes.
It maintained there is a dire need to expand the last-mile delivery system in Africa, thereby shortening the distances that African farmers travel to access fertilizer and other critical farm inputs.
However, the union advised stakeholders to identify local organic sources that can be leveraged locally to manufacture and blend fertilizers so as to decrease overdependence on global markets while shortening the supply chain.
It added,
“The target is that by 2033, at least 70% of the farmers in Africa should be linked to accessible and affordable input markets as well as agricultural extension services.
” The continent has many success stories to share and is actively and collectively addressing the issues under its 50-year development plan, Agenda 2063.
“Africa is the only continent endowed with natural ingredients that can easily be used to greatly expand agricultural production.
“Africa has 60 percent of the world’s available arable land, the largest share globally, and suitable for agricultural production expansion, and abundant untapped water resources. Agriculture is the source of livelihood for 70 percent of the population on the continent. “
More insight
- AU’s call agrees with a 2022 World Bank report, which disclosed the anomalies associated with agricultural produce from Africa.
- The report stated that while the African continent produces approximately 30 million metric tons of fertilizer annually, twice as much as it consumes, approximately 90 percent of fertilizer consumed especially in Sub-Saharan Africa is imported out the continent
- But the AU says it is set to hold an Africa Fertilizer and Soil Health Summit, where stakeholders will brainstorm on pathways to agricultural revolution.
