African Agricultural Transformation Agenda

ENABLE Youth Program Concept

Dr. Chiji Ojukwu Director Agriculture and Agro-industry Department African Development Bank Group

Program Design Workshop, 21-22 April 2016, Abuja, Nigeria OUTLINE

• The Reality and Challenges facing Africa’s Youth Today

• AfDB’s Response: High 5s, Jobs for Youth and Feed Africa

• Agribusiness as a Solution to Youth Unemployment:  ENABLE Youth Program

2 Africa’s Youth: Future Leaders for Agricultural Transformation

THE REALITY AND CHALLENGES FACING AFRICA’S YOUTH TODAY

3 Africa: The Youngest Continent

40% of Africans are between the age of 15-35 and classified as “Youth”

Over 65% of Africa’s 1 Billion 40% population is under the age of 35

65%

50% 50% is under 25 years

By 2030, one in four youth in the world will be African Africa’s Youth unemployment rates are too high

In almost every African country, youth unemployment rates African youth constitute are about twice as high as adult unemployment rates

around 40% of the 60,0 continent’s working age Youth unemployment rate Adult Unemployment Rate population, but makes 50,0 up 60% of the total unemployed 40,0

% 30,0

20,0

10,0

0,0

Source: AfDB computations Youth unemployment – a critical barrier to growth 31% of African youth are This lack of opportunity affects Of those who have jobs, >80% work unemployed or discouraged youth in every country in the informal sector Employment status in Africa, by age Youth unemployment, by country Distribution of employment in Sub-Saharan Africa % of age group, 2015 % youth unemployed, 2015 % of total labor force, 2010

11% 31% 16% 32% 22% 19%

41%

35% 62% Informal sector workers sector Informal 15% 17%

Employed workers Youth (age 15-35) Adult (36-64) % Unemployed Youth 0-7 Unemployed or Discouraged 7.1-11 Wage Employment Economically Inactive 11.1-22 Non-Wage Industry & Services Vulnerable Employment >22.1 Agriculture

Wage Employment No data Africa’s Youth: An Asset or A Weapon? Why Africa’s Youth Unemployment Challenge?

Challenge Description

• In Africa, the gap between wage jobs and labor market participants widens There are NOT ENOUGH by ~8 million each year DEMAND JOBS for Africa’s working- age population • Policy challenges such as lack of access to credit and inflexible labor markets impede job creation and hiring of young workers

• Employers cite costs and challenges of identifying talent as a key bottleneck to growth It is DIFFICULT TO LINKAGES • There is a mismatch between skills supplied and abilities demanded by CONNECT skilled youth to employers employers • Youth have low awareness of opportunities and few networks to access them

• Two-thirds of African youth do not have any secondary education, and Many YOUTH DO NOT those who do are often unprepared for the workforce due to a lack of HAVE SKILLS demanded SUPPLY practical training by employers • Education policies do not incentivize demand-driven curricula or support internship and apprenticeship opportunities Some Implications of an Unemployed and Unengaged Young Population Illegal Migration Scramble for Jobs

34% of migrant deaths Over 65,000 Nigerian applicants showed up at a 60,000 are of Sub-Saharan capacity stadium to interview for only 5,000 positions. African origin 16 died in the stampede. Hundreds were injured. Africa’s Youth: Future Leaders for Agricultural Transformation

AFDB’S RESPONSE: HIGH 5S, JOBS FOR YOUTH AND FEED AFRICA

10 The AfDB’s Response

AFDB’S “HIGH 5” GOALS

1. Power and Light Up Africa

2. Feed Africa

3. Industrialize Africa

4. Integrate Africa

5.Improve the quality of life of Africans

11 Improve the quality of life of Africans Vision for Africa’s Youth Equip Africa’s youth to realize their economic potential and drive inclusive growth across the continent Jobs for Youth in Africa Strategy

INNOVATION INVESTMENT INTEGRATION

Public sector and civil society Bridge Private sector • Youth employment flagship programs: • Catalyze private sector capital to  Agriculture Directly link all skills stimulate youth employment and  Industrialization development entrepreneurship ecosystem  ICT programs to private • Investments in new business formation • Design of Youth Employment Index sector job and and growth to drive youth jobs • Policy dialogue and harmonization entrepreneurship • Support to entrepreneurship ecosystem • Integration across Bank operations opportunities • Integration across Bank operations Flagship Programs in Strategic Sectors

23-35 million jobs and skill 11-15 million additional youth in 10 years across 28 countries

Rural Microenterprise Youth participate in a short business skills training, and then submit agriculture-focused micro-enterprise business plans. Youth receive seed capital and ongoing mentorship

Agro-industrialization Agro-industrial companies co-design curriculum with trainers. Students participate in a 1- Pipeline

Agriculture year training and apprenticeship program and are then placed into full time positions

Computational Thinking Equipment and curricula to promote digital literacy will be deployed to secondary schools throughout the region

ICT Coding Institutes Coding Institutes will teach in-demand programming languages and provide ICT business advisory services; successful graduates will either be linked to jobs or supported in the creation of new ICT business ventures

Skills Enhancement Skills Enhancement Zones throughout Africa will be located near industrial clusters and Zones provide industry-aligned training and apprenticeships for youth for 6 months. Upon graduation, youth are placed into full-time roles.

Corporate partnerships and SME support will provide direct and indirect opportunities. Industrialization FEED AFRICA

 October 2015  Over 600 Ministers of Agriculture and Finance, Central Bank Governors, Development Partners, RECS, Academia and Private Sector  4 Goals and18 Actions Points adopted to transform African Agriculture Africa’s Agriculture Today

Gap between employment and income...... resulting in widespread poverty.

Agriculture as a share of employment and GDP; % 2014 Millions of Africans living on less than $1.25/day; 2014 96 9 417 61% % of total employment 103 10 50% 47% % of GDP 42% 137

25% 62 18% 18% 15% 12% 10% 6% 3% Humid Sub- Semi- Arid Highland Sub- Total humid arid tropical Africa India Thailand Vietnam Brazil China % people: 49% 57% 53% 23% 44% 31% 49%

Relatively low productivity...... and rapidly rising imports.

Average yields across Africa versus best practice2; mT/(hectares or Imports vs exports3; billion USD animals), 2013 50 Africa Best practices2 Imports 25.4 40 Exports 19.2 30 10.0 9.4 8.3 20 2.5 3.6 2.0 1.2 0.5 1.3 0.2 0.4 0.5 10 0 Cassava Maize Rice Soy Cocoa Beef Milk 1985 1990 1995 2000 2005 2010 2015 Issues of African Agriculture: 1. Extreme Poverty

Where we are … Where we want to be …

• 49% of Africans or 420 million live under the poverty line of $1.25 per day (2014) • This will rise to 550 million by 2025 if we do nothing Contribute to ending Extreme • This is as high as 57% in the humid zone Poverty by 2025 2. Hunger and Malnutrition

Where we are … Where we want to be …

 33% of African children live in chronic hunger  There are 40 million stunted children under the age of 5 years in Africa today. This is more than 20 years ago  The economic impact of child malnutrition in Africa is 2% to 16% of GDP per year End Hunger and Malnutrition  Productivity is reduced by 25% of best practice for most By 2025 commodities (5% for milk) 3. Unsustainable Food Imports

Where we are … Where we want to be …

 Staggering food import bill of USD 35.4 billion per annum (2015)

 About 15 food imports of which the top 5 are staple commodities such as Wheat, Sugar, Rice, Beef, Soybeans Turn Africa into a Net Food  Imports projected to increase to USD 111.0 Exporter by 2025 billion by 2025 if we do nothing 4. Low Value Addition

Where we are … Where we want to be …

 Low Value Addition to Agricultural commodities  Predominantly primary production Move Africa to the top of key global  Africa’s share in global production of cocoa agricultural value chains by 2025 beans is 73 % vs. share in ground cocoa is 16% Instability in commodity prices is creating an imperative for African countries to diversify sources of foreign exchange earnings

There is a need to diversify sources of economic growth; food commodities are one of the least volatile groups

Commodity price indices; 2005=100, 2005-2015 Food 260 Metals

in Africa in 240 Fuel (Energy)

220

200 Transformion

180

160

140

120 Opportunity for Agricultural Agricultural for Opportunity 100

80 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Source: IMF Primary Commodity Price System Feeding Africa: Agriculture Transformation Agenda targets The Bank and its partners will pursue an agenda to transform a selection of key agricultural commodities and agro-ecological zones

In particular, the Wheat in North Africa Maize, soybean, ATA will take a livestock, and poultry across the Guinea commodity- Sorghum, millet, Savannah focused integrated cowpea, and livestock approach – across the Sahel simultaneously addressing multiple Rice in West Africa bottlenecks across entire prioritized Tree crops (inc. agricultural Cassava in humid and sub-humid zones cocoa, coffee, commodity value cashew, and oil palm), horticulture chains and within and fish farming related agro- across all of Africa ecological zones

Agricultural commodity value chains and agro-ecological zones targeted by the ATA

Source: CGIAR “Technologies for African Agricultural Transformation (TAAT)“ proposal; Dalberg analysis AFDB Agricultural Transformation Agenda : Enablers and Programs

Enabler #1 : Enabler #2 : Enabler #3 : Enabler #4 : Enabler #5 : Enabler #6 : Enabler #7 : Increased Realized value Increased Expanded Improved Increased Partnership for realized of increased investment in agricultural agribusiness inclusivity, Agricultural productivity production hard and soft finance environment sustainability Transformation infrastructure and nutrition in Africa (PATA)

CGIAR TAAT Postharvest ATA Risk-sharing Policy ENABLE Youth House and Loss Infrastructure Facility Reforms convene Input systems Prevention Coordination Matrix Climate PATA • land tenure Resilience and finance Program Non-SME • input subsidies Farmers Finance and • incentives for Funding production Mechanization Agropoles & e-Registration Capacity and processing program Corridors Building • financial sector AFAWA Fund deepening • regional integration and Nutrition trade Trust Fund Africa’s Youth: Future Leaders for Agricultural Transformation

AGRIBUSINESS AS A SOLUTION TO YOUTH UNEMPLOYMENT: ENABLE YOUTH PROGRAM

25 Job opportunities along agricultural value chains

26 ENABLE YOUTH: Agribusiness as a Solution to Empower and Employ Africa’s Youth Target Intervention

USD12.5 billion to support enterprise and job creation for youths and women

CAPACITY AND SKILL Investing in 25 African BUILDING ENTERPRISE AND * countries 12 month training BUSINESS FINANCING DEVELOPMENT incubation of young Crowd in private graduates as business Transformation into 1.25 million men and women in investment and creditworthy commercial lending agribusiness jobs in agribusiness Agripreneurs the next 5 years Deploy risk sharing mechanisms 250 000 agribusiness enterprises to be created in Africa

*Benin, Burkina Faso, Burundi, Cameroon, Cote d’Ivoire, 10,000 unemployed Need to leverage DRC, Ghana, Guinea Bissau, Kenya, Liberia, Madagascar, graduates (50% women) USD 0.5 billion Malawi, Mali, Mauritania, Morocco, Mozambique, Nigeria, per country Rwanda, Senegal, Sierra Leone, Sudan, Tanzania, Tunisia, trained and financially Uganda and Zambia empowered in each country Program Structure

Business Expected Enabling Environment Agribusiness Incubation Development Results

National Level Value chain identification At the end of the program: • Policy dialogue • Promotion of agriculture • Stakeholders’ as a business Transition from USD 12.5 billion invested coordination • Value chain mapping and agribusiness incubation • Design of risk-sharing planning of interventions cycle to self-standing 250,000 youth-led agro- facility • Strengthening governance businesses enterprises created • Kowledge management • Managing the (50% by women) • National Coordination Agribusiness incubation startup process Office • Skills development for • Linkage to 1.25 million agribusiness Agripreneurs (in some appropriate jobs created State/Province level cases commercial resources (mentors, • Parallel public investment attachments will be agroprocessing Reduced youth • Negative mindset change interspersed with training) zones, professional unemployment • State/Provincial Technical • Development of organizations, etc.) Hub setup competitive business plans Increased food security and loan application Program Coordination Increased manufacturing • Monitoring & Evaluation value added in agriculture • Knowledge management and information exchange • Quality management and Innovation support – Link to R4D Increased export earnings • Linkage to other initiatives (e.g. Agropoles, Youth entrepreneurship, Youth/Gender empowerment, etc.) Achieving ENABLE Youth goals will cost at least $12.5 billion, and will therefore require the Bank collaborating with and relying on its partners.

Key Potential Actors and Partners to Deliver the ATA Enabling Inclusivity, Increased Realized Hard and Soft Agri Finance Agribusiness Sustainability, Productivity Productivity Infrastructure Environment Nutrition

Co-development

Co-financing + Partnership Regional Member Countries Multilateral, Bilateral Donors, Foundations, Small and Large Scale Agribusiness; Farmers Government Organizations Organizations; Food Companies Africa’s Future Agripreneurs IITA-IBADAN IITA-ABUJA

IITA KINSHASA LET’S JOIN FORCES AND MAKE YOUNG AFRICANS LEADERS IN AFRICA’S AGRICULTURAL TRANSFORMATION

31 AFRICAN DEVELOPMENT BANK GROUP

Thank you / Merci

Contacts: Dr. Chiji Ojukwu Ms. Mariam Yinusa Director ENABLE Youth Program Coordinator Agriculture and Agro-industry Deptarment Agriculture and Agro-industry Department Email: [email protected] Email: [email protected] Tel: +225.20.26.20.42 Tel: +225.20.26.23.57 32