Agribusiness Sector

Dr John Purchase has been appointed the new CEO of the Agricultural Business Chamber and the new Agribusiness Sector Head for the NBF, with effect from 01 September 2007. The NBF would like to congratulate him on his new appointment.

Agricultural Business Chamber
Telephone: +27 12 300 9502
Fax: +27 12 320 0787
Email: admin@agbiz.co.za
Website: www.agbiz.co.za

Commencement date of sector

Mid-2004.

Aim of the sector

Mission

To promote and develop bi-directional intra-African trade and increase agro-industrial investment into Africa.

Background

The Agribusiness sector consists of the entire food and fibre value chain, from input supply to product distribution. Through these linkages, agriculture plays a major role in African economies, and especially in the welfare of rural areas. Agriculture is regarded as the driving force for economic development on the African continent.

The Comprehensive Africa Agriculture Development Programme (CAADP) was adopted by the African Ministers of Agriculture in 2002. This plan identifies the following important contributions by the agricultural sector to the continental economy that it:

• Provides 60% of all employment;
• Is the backbone of most African economies;
• The largest contributor to GDP;
• The biggest source of foreign exchange;
• Makes up 40% of the continent's hard currency;
• Is the main generator of savings and tax revenues;
• The dominant provider of industrial raw materials;
• Supports some 70% to 80% of the total population; and
• It supports 70% of the continent's extremely poor and undernourished.

African agricultural leaders agree that the agricultural sector should maximize the contribution of the sector to achieve Africa's goal of becoming self-reliant and productive.

As the sector with the biggest impact on the social and economic reality of African people, agriculture must contribute substantially to the delivery of broad-based economic empowerment.

"The NEPAD goal for the sector is agriculturally-led development which eliminates hunger and reduces poverty and food insecurity, thereby enabling the expansion of exports and putting the continent on a higher economic growth path within an overall strategy of sustainable development coupled with preservation of the natural resource base." (CAADP 2003).

Core Focus Areas

• Facilitate engagements with stakeholders in the targeted countries.
• Initiate the establishment of bilateral relations agreement with targeted/prioritised countries.
• Develop the capacity of organisations which have an existing mandate to promote agribusiness, agro-processing and agricultural trade and investment in Africa.
• Brand African value chain project (promoting South Africa in Africa).
• Information on African trade and agro-processing:
  • Country information
  • Regulatory information
• Role-players in the African Agribusiness, agro-processing and farming sector.
• Trade facilitation.

Vision

A conducive trade environment in which agribusiness and farmers enjoy improved trade, border and market access, improved access to information and positive participation in CAADP.

The vision for the continent is that agriculture should:

• Attain food security in terms of both availability and affordability, thereby ensuring access for the poor to adequate food and nutrition
• Improve the productivity of agriculture to attain an average annual growth rate of 6%, with particular attention paid to small-scale farmers, especially focusing on women
• Create dynamic agricultural markets between nations and regions
• Integrate farmers into the market economy, which will result in better access to markets and Africa becoming a net exporter of agricultural products
• Achieve a more equitable distribution of wealth
• Be a strategic player in agricultural science and technology development, and
• Practice environmentally-sound production methods and have a culture of sustainable management of the natural resource base (including biological resources for food and agriculture) to avoid their degradation.

This vision is incorporated in the CAADP which rests on four mutually reinforcing pillars:

• Extending the area under sustainable land management and reliable water control systems
• Improving rural infrastructure and trade-related capacities for market access
• Increasing food supply and reducing hunger, and
• Agricultural research, technology, dissemination and adoption.

AFGRI Africa

AFGRI Africa was established in November 2003 as a division of AFGRI Financial Services. Its objective is to develop successful customer-focused operations north of the Limpopo, creating a substantial regional agricultural services business of substance in Southern African Development Community (SADC) and Common Market of Eastern and Southern Africa (COMESA) countries through leveraging the resources and skills based in AFGRI South Africa. Current operations in Lusaka, Zambia, and Lilongwe, Malawi (excluding Clark Cotton) are the responsibility of AFGRI Africa. AFGRI constantly evaluates expansion opportunities throughout the region.

Services and Products

AFGRI Africa's head office is in Centurion, South Africa. It is a support centre to Zambia and Malawi where activities include:

• Business development in new markets and territories;
• Handling and Storage, especially the management of strategic storage sites such as food reserve agencies and ports;
• Development of markets and a local presence for AFGRI Equipment, comprising John Deere farming equipment, irrigation, inputs and other related activities;
• The provision of financial services to producers and consumers of crops;
• Grain trading, and
• Seed production and marketing.

AFGRI's Zambian grain handling, storage, marketing, trading, financing and equipment business is operated through Zambian-registered AFGRI Corporation Limited. AFGRI's entry into this market offers both farmers and millers a range of value-added services such as:

• Handling and storage of maize, wheat and soya;
• Trading of maize, wheat and soya;
• Mechanisation and irrigation services;
• Input, crop and equipment financing, and
• Farming inputs, from chemicals to seed.

Foreign market development for Potatoes South Africa

Certain countries in western and northern Africa were identified by PSA and the Exporter's Forum as countries with export potential for ware and seed potatoes. This identification was made possible through data supplied by the Department of Agriculture (DOA) as well as supermarket groups that are currently involved in these countries.

As European countries are forced to store potatoes for at least half of the year, the potatoes imported from Europe are not fresh. South Africa, on the other hand, is in the position to supply fresh table and seed potatoes 12 months of the year. A combination of several of these facts did lead to a visit by PSA and the Exporter's Forum to investigate further export possibilities.

In view of the high travelling costs, a small delegation consisting of two people, namely Etienne Booyens (Marketing Manager: PSA) and Jandrè Duvenhage (Chairperson: Exporter's Forum) engaged in the fact-finding mission.

The objectives of the visit were:

• To use the opportunity to gather information on potato imports and related issues in western Africa;
• To establish contact with relevant bodies, whether official or non-official and to introduce them to Potatoes South Africa;
• To establish contact with different role players in these countries;
• To start the development of a databank regards information on local production, imports, exports, important regulations, tariffs and contacts in each of these countries;
• To create new markets and grow existing markets for potatoes in these countries and build long-term relationships with individuals and/or institutions in these countries.

It is recommended that the outcome of the fact-finding mission be communicated to the following parties:

• PSA Board,
• Marketing Committee
• Potato Exporter's Forum, Regional meetings,
• ARC
• NAMC, and
• Departments of Foreign Affairs and Agriculture

At the first possible opportunity to keep them up-to-date with developments as far as foreign-market development is concerned and to formulate a combined or integrated strategy between the different institutions. Such an integrated strategy can address the potential for trade between different countries on different levels.

The next step in formulating the integrated strategy will be to schedule a workshop between the different parties.

Legal Sector

Contact Details:
Mr Joe Nalani - Director
Werksmans Incorporated
Tel: +27 (0)11 535 8000
FAX: +27(0)11 535 8600
EMAIL: jnalane@werksmans.com
Website: www.werksmans.com

Background

The purpose of the sector is to look at the legal issues affecting the NEPAD Business Foundation. The law is central to the regulation of the affairs of nations. NEPAD has very laudable and noble goals. One of the motivations behind NEPAD is to ensure that human and political rights are respected and protected on the African continent. NEPAD's other key objective is to ensure that the economy of Africa grows by attracting investment.

In order for NEPAD to realise these objectives, it is imperative that African countries are governed by conducive laws. Institutions of democracy are essential. A proper, functioning and independent judicial system is critical to the realisation of human rights.

Properly organised parliamentary systems are also necessary to ensure that people are able to exercise their political rights. The law is essential in order to ensure that effective political and legal systems are in place.

The legal sector therefore aims to encourage debate and reform in the legal systems of African countries, in order to ensure that there is transparency, fairness and respect for human rights, and that the rule of law is upheld. Only then can NEPAD's goals be realised.

It is imperative that current, modern and efficient laws are enacted to enable business people to invest in the African continent, and enable them to transfer foreign currency in and out of the continent for the benefit of local economies and foreign investors.

Proper and functioning systems of laws, which facilitate and encourage conclusion of commercial transactions and the flow of trade amongst countries, are also critical if NEPAD is to realise its objectives.

A culture of human rights and the rule of law are vital in order to realise the aims of NEPAD. Legal instruments like constitutions are charters enshrining human rights and are necessary. They should be drawn up by experienced legal practitioners who come from the continent, and therefore understand the needs and requirements of the people living here.

Projects Planned

In line with this, the legal sector has formulated a programme to publicise the activities of the NBF amongst legal practitioners on the continent. It is crucial that the activities and objectives of the NBF are well known across Africa, so as to attract the greatest number of supporters.

The legal profession must be a key player in the attainment of NEPAD's goals, as the sector is responsible for protecting and advancing human rights in the various judicial institutions. The legal profession is also responsible for the drafting of laws and the application thereof. In the promotion and fostering of a culture of human rights, the legal profession will play a central and critical role.

Another project undertaken by the legal sector in this regard is promoting and publicising the role of the NBF, and its legal academic work, amongst the institutions of the organised legal profession.

Joe Nalane is a director of Werksmans Incorporated and the leader of the legal sector. Werksmans Inc. is a founder member of a network of law firms, LexAfrica, based in all the major centres of the African continent.

Part of the objective of LexAfrica is to encourage the development of a PanAfrican legal practice. LexAfrica will be used as a means of publicising the NBF.

Infrastructure sector

Contact Details:
Roelof van Tonder
International Business Development Manager
SAACE
Tel: +27(0)11 463-2022
Fax: +27 (0)11 463-7383
Email: roelofvt@saace.co.za
Website:

Commencement date of sector

12 November 2003

Aim of the sector

Core focus areas/objectives

The objectives of this working group are to find ways of mobilising resources for the execution of projects in new and innovative ways and to:

• Establish a virtual organisational structure, within which a consortium of companies could participate in the pursuit of NEPAD projects:
• Support the NBF and the programme office to the mutual benefit of all the members of the NBF;
• Develop strategic access to secure avenues of financing for NEPAD projects in which member firms of the NBF can participate;
• Devise strategies to actively engage financiers of and secure financing for infrastructure projects in Africa. This may include funds and banks such as the African Development Bank, Development Bank of Southern Africa, the new Pan Africa Infrastructure Fund, the Capital Goods Feasibility Study Fund, the SA National Treasury, the SA Consultants Trust Fund at the World Bank and the International Finance Corporation;
• Develop relationships with the relevant sector stakeholders in the African Development Bank and other similar institutions;
• Evaluate the establishment of a strategic plan that will lead to the selection of a limited number of NEPAD Infrastructure Projects that can, and will be actively pursued to position the member firms of the NBF to benefit from the NEPAD Medium and Long term framework;
• Develop strategies related to securing high level access to political decision makers in the African infrastructure community;
• Stimulate private sector interest in projects by combining or augmenting NEPAD projects. This would then act as the starting point for the execution of the larger NEPAD project and aid in developing sustainable opportunities for private sector participation. In this manner the private sector could, in partnership with the NEPAD Secretariat, mobilise resources for the execution of projects that may not otherwise have been available to the Sector;
• Establish the status of the various projects in the Transportation Infrastructure Recovery Project in Angola and the Democratic Republic of Congo (DRC).

Stakeholders

The two main stakeholders within the Infrastructure Working Group are the members of the South African Association of Consulting Engineers and the South African Federation of Civil Engineering Contractors and its members who have been participating in the activities of the Working Group.

Projects undertaken to date

Transport Infrastructure Recovery in Angola and DRC

Following interaction with the Secretariat and a careful screening of the potential of the NEPAD Short-Term Action Plan (STAP) projects it was agreed that the Working Group would pursue NEPAD's 'Transportation Infrastructure Recovery Project' in Angola and the DRC.

This project was chosen for its regional impact and potential for generating opportunities for the private sector. Projects in this regard cover road, river, rail and port infrastructure recovery.

The prolonged war situation in Angola and the DRC has destroyed the economic fabric and the infrastructure of these two countries, along with their transport network. Post-war economic recovery will depend on the rehabilitation of transport infrastructure, which includes the reconstruction for roads, rails, ports and airports, as well as services. Prior to the definition of an action plan, sectoral studies by each mode of transport will be necessary to determine a short-term to medium and long term priority programme, focusing on regional integration.

The total value of the project is $37 million which is divided and sponsored as outlined below:

• Roads reconstruction and rehabilitation evaluation study valued at $10 million sponsored by Angola and the DRC.
• Benguela railway evaluation study valued at $5 million sponsored by Angola.
• Evaluation of transport infrastructure requirements valued at $2 million sponsored by Angola and the DRC.
• Congo River evaluation and rehabilitation study concentrating on ports infrastructure requirements, navigation aids and institutional aspects valued at $9 million and sponsored by the DRC.
• The evaluation and rehabilitation of the port infrastructure, equipment and organisation of the Port of Benguela in Angola valued at $6 million and sponsored by Angola.
• Evaluation of the Lobito port rehabilitation study valued at $5 million and sponsored by Angola.

The above activities will be implemented by 2008.