Africa's untapped agriculture potential make it an ideal partner for resource-constrained Middle Eastern countries that seek to improve their food security, a new report from Standard Chartered Bank said. The African continent is relatively land-abundant, land utilization rates are low, and - contrary to widespread perception - has plenty of water. Given its potential, Africa therefore appears to be a natural destination for agricultural investment by Middle Eastern countries, but there are valid concerns about whether it can play a significant role in addressing the Middle East's food security issues, the report said. Africa's agricultural potential has not been realized so far. It has abundant arable land and water relative to Asia and the Middle East. According to the Food and Agriculture Organization (FAO), Africa's per-capita water resource averages 4,600m3, compared with just 164m3 in the Middle East. Not only are Africa's agricultural resources considerable, but they are underutilized too. The FAO estimates that less than 15 per cent of Africa's total arable land is under cultivation. The ‘green revolution' in the 1960s, which sowed the seeds of the astonishing economic progress made by many countries in Asia, has not yet occurred in Africa, for a number of reasons. Africa continues to depend on rain-fed agriculture and there is low use of fertilizers, low investment in research and development, and poor infrastructure. Key constraints to investment, in turn, have been a generally poor investment climate and complex tenure arrangements. The FAO estimates that 90 per cent of land in Africa is not covered by formal legal frameworks. This is a daunting prospect for potential investors, and also reduces investment incentives for those currently utilising the land. As a consequence, despite its potential, Africa is not self-sufficient in terms of food. In addition, yields from cultivated land tend to be low compared with other regions. Since the food crisis in 2007 and 2008, there has been a growing emphasis on this sector - which has been neglected by domestic policy makers and donors for decades - and food security is now firmly back on many countries' policy agendas. Developing agriculture is important to establish food security and reduce poverty. Agriculture remains of central importance to African countries' economic prospects, and in addition, most Africans still work on farms (on average, agriculture represents 34 per cent of GDP and 64 per cent of employment, according to the World Bank. Geographical considerations also make Africa attractive as a source of food imports for the Middle East. It is no surprise that East African countries rank among the top African exporters to the Middle East, given their huge agricultural potential and geographical proximity. South Africa is Africa's top exporter to the Middle East as it is one of the few countries in Africa that has traditionally operated a relatively advanced commercial farming model. Moreover, South Africa does not face many of the challenges - including weak agricultural investment - that less developed African countries do. Overall, Africa currently plays a minor role in providing food to the Middle East. According to data from Comtrade, food imports from Africa represent only a fraction of total food imports to the Middle East (1.2 per cent for the UAE in 2008 and 1.4 percent for Saudi Arabia in 2007). The Middle East still relies on large advanced agricultural countries for its food imports. The importance of Africa as a food supplier has probably increased recently.
