In Africa, the agricultural sector accounts for about 30 to 60 percent of GDP and provides employment to the range of 70 to 80 percent of Africa's labour force. In most African countries, smallholder and subsistence farmers account for about 50 percent of total agricultural output.

With the exception of the few oil exporters and South Africa, the agricultural sector in most African countries play four key roles in overall economic development and political stability. The first role is to increase domestic food supplies in order to keep pace with the fast growing population. Africa's current average rate of population growth is 3.2 percent per year, the highest in the world. In the last twenty years or so average rate of food production growth was about 50 per cent of the 3.2 percent rate of population growth. The gap has been filled by commercial food imports and food aid. The second role is to provide a growing market for domestic manufacturers in order to support import - substitution growth. The essence of import-substitution policy was to make domestic manufacturing profitable. A combination of exchange rate policy and tariff protection, to mention just the main instruments, has been used to effect import substitutions policies. However, these policies had adverse effects on the agricultural sector in two respects. The overvalued exchange rate penalized exporters of farm products while artificially higher prices of domestic manufacturers turned the domestic terms of trade against farmers and consequently reduced incentives for agricultural production.

The third role, namely, to provide foreign exchange through agricultural exports conflicted with the second role. Export duties and taxation of agricultural output have also negatively affected agricultural exports.

Apart from these domestic constraints, agricultural exports have also been limited by world demand for primary exports. This demand is now rising too slowly and at times unstable to provide an adequate rate of increase in foreign exchange available to Africa. The forth-key role of agriculture is to contribute to domestic saving and capital accumulation.

Agricultural performance in Africa has been very disappointing during the last thirty years. It is important to examine why this has been the case.

First, high population growth rate has led to a rise in the man/land ratio. In a system of smallholder farming with low technology, the result has been large inputs of labour per unit of land and a decline in labour productivity. This trend is likely to continue well into the 21st century.

Second, African governments have generally neglected agriculture and food production in particular since independence in the early 1960's. The majority of African countries devoted less than 10 per cent of their public expenditures for all sectors to agriculture. At the same time most African governments taxed heavily the agricultural sector.

Third, massive climatic changes and soil erosion are taking place, causing drought and famine.

Fourth, technology based agriculture has not come to Africa on a significant scale. Productivity in "traditional" agriculture has depended largely on the kinds of inputs and other resources smallholder farmers have been able to gain control of over many years. However, these traditional methods have not been able to increase farm output rapidly enough to match either present population growth rates or increases in demand for agricultural products resulting from more rapid growth in per capita income.

Fifth, poverty and particularly rural poverty as manifested by increasing food insecurity are a major problem in Africa. The poverty situation has been made worse by Structural Adjustment programmes that began in early 1980.

Sixth, women play a central role in Africa's agriculture. Most food producers are women. Women support children through subsistence farming and informal sector. But they are a neglected group of farmers. The land tenure system and agricultural credit in many African countries favours men. These and other factors have adversely affected womens' contribution in agricultural productivity.

Seventh, many African countries have invested very little in rural infrastructure which include physical infrastructure (roads, railways, communications, power, irrigation etc) institutional infrastructure (property rights, agricultural research and extension, agricultural finance, information systems etc) and soft infrastructure (postage, registration of land, cooperative societies, education health, insurance companies, community based organizations etc.) Apart from little investment, African countries have made little attempt to integrate these infrastructures spatially. The list is long but these are the major factors.

Going into the 21st century, Africa faces a number of challenges, which will have to be addressed before agricultural development, can occur.

First, because of low agricultural technology, agricultural development strategies in Africa in the 21st century must focus on scientific, institutional and human capital development. The main challenge is to create and manage the continuously shifting disequilibria in agriculture resulting from technological change, institutional change, investment in human capital and investment in research and extension. There should be no over-optimism about the potential for direct technological transfer. The experience of Asian countries, which benefited from the green revolution, tells us that the success was to a large extent, due to the indigenous research capability to follow up on the direct "material transfer". Indigenous research capability is normally a result of a long-term process of institution building. The problem is that Africa, which has the greatest need for sustained programmes to support institution building for agriculture, has not been receiving significant levels of foreign aid. Unless efforts are made to attract donors in this endeavour, no foreign support will be forthcoming because aid policies have shifted away from institution building to other priorities. Furthermore limited experience with successful agricultural research programmes make it more difficult to mobilize the needed political and financial support for strengthening research.

The Second challenge relates to the high rate of population growth. Serious efforts have to be made in order to control population growth rates. A kind of population policy is needed.

Thirdly, Africa faces the challenge of dealing with environmental degradation particularly deforestation.

Generally, environmental problems reflect market failures. Markets for natural resources have not developed in a manner which induces individual decisions to be consistent economically and socially with desirable outcomes.

Fourthly, the challenge is that Africa needs to invest in rural infrastructure. This is quite costly and none of the African countries have the financial resources to establish networks of physical, institutional and social infrastructures. Donor support will be needed.

Fifthly, the challenge for Africa is to foster the progressive modernization of smallholder farms which dominate the agrarian structure. This would require, among other things, accelerating the rate of output growth and expanding farm and non-farm employment opportunities. The biggest challenge perhaps is that Africa will require a good deal of patient waiting because the most important elements of the "new" strategy of agricultural development require a much longer time horizon. Since the poor do not live in the long-run, African countries also face the challenge between meeting the short-run welfare of the poor and the long-run economic development.

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