Influences
Investing in Africa’s Agricultural Future: Findings from the Latest BCG Report
African agriculture is critically underfunded despite being a key lever for achieving global development goals. Urgent investment is needed to address food insecurity, poverty, and climate resilience across the continent.
The transformation of African agriculture is recognized as a crucial driver for sustainable development globally. A report by the Boston Consulting Group (BCG) highlights that enhancing agricultural productivity in Africa could help achieve 30% to 50% of the United Nations’ Sustainable Development Goals. However, the agricultural sector is significantly underfunded, attracting only $49 billion in investments in 2022, while the estimated need is around $200 billion.
Younès Zrikem, Managing Director & Partner at BCG and co-author of the report, stated, “Investing in agriculture is not merely about food security; it is also essential for reducing poverty, empowering women, and enhancing climate resilience.”
In Morocco, agriculture plays a vital economic and social role, accounting for approximately 15% of the GDP and nearly 26% of total employment. With projected cereal import needs of nearly 11 million tons for 2025/26, it is evident that urgent investments are essential in areas such as efficient irrigation and mechanization. Across Africa, agriculture supports the livelihoods of about 70% of the population, with women making up a significant portion of the workforce. Despite its importance, African farmers receive an average of only $140 per year in investments, starkly contrasting with the global average of $1,300. Consequently, Africa faces a yearly import bill of over $27 billion for cereals, which could rise to $110 billion by 2030 without immediate action.
Zrikem emphasized, “The agriculture sector is a powerful lever for progress. By increasing investment, we can not only address food insecurity but also create jobs, empower women, and build resilience against climate change.” Currently, over 400 million Africans live in extreme poverty, and 60% of the world’s severely food-insecure individuals are located on the continent. Malnutrition affects 290 million people, hindering the education of 45 million children under five.
Political commitment is critical, as public spending on agriculture in Africa constitutes just 3% of government budgets, far below the African Union’s target of 10%. Private investment also remains low, comprising only 3% of total agricultural financing in Africa. To address these challenges, the Agricultural Transitions Lab for African Solutions was launched in June 2024, aiming to double annual agricultural funding to $100 billion by 2030.
Zrikem concluded, “Prioritizing African agriculture is not just a moral imperative; it is also a strategic opportunity for global progress in poverty reduction, gender equality, climate resilience, and food security.”
SOURCE: BOSTON CONSULTING GROUP
