Akinwumi Adesina, currently President of the African Development Bank (AfDB), said recently he believes that farming will produce the next generation of millionaires and billionaires than any other sector in Africa.
Adesina previously served as Nigeria’s minister of Agriculture and was in 2013 named Forbes magazine’s African of the Year for the success of reforms he championed in his country’s agricultural sector.
Most business leaders across the continent agree with Adesina’s belief that farming is re-emerging as Africa’s lucrative industry. Successful Kenyan businessman and lawyer, Victor Ogeto Swanya, recently said African farmers who shall quickly embrace modern farming methods of farming will realise that there is also gold in the shallow soils. Swanya has a number of high market greenhouses in Kenya.
His sentiments are shared by Danish whiz-kid Kresten Buch, who was quoted in international media recently that farming has come a long way as a practice and that it is now the most profitable business for those who adopt modern techniques. Buch has already announced plans to venture into mechanised farming in Africa.
Malawi can be part of the transformation if as a country we can once again start doing the right things in agriculture.
Between the 1960s and 1980s when the government under Dr. Hastings Kamuzu Banda made agriculture a priority sector, farming became a money-spinning business in the country and many people, especially in the rural areas, made fortunes from gardens, farms and estates.
Tobacco farmers became the first locally bred millionaires while those who grew cotton, maize, rice, beans and groundnuts also enjoyed good returns from their ventures. Through the Agricultural Marketing and Development Cooperation (Admarc), the government was able to buy these crops from farmers and found export markets around the world.
This was complemented by sugar grown and processed by the Sugar Corporation of Malawi (Sucoma) and tea grown by white farmers in Thyolo and Mulanje.
Appropriate policies were introduced while structures such as the tobacco auction floors were set up to support the agriculture sector.
Banks and donors responded as well with products, services and programmes that supported the agriculture sector, from smallholder farmers to processing factories such as Mulanje Canning Factory.
Indeed, farming thrived and drove the economy and rural development and Malawi was able to realise significant GDP growth over that period.
Fast-forward to 1994, economic liberalization and the emergence of trading as alternative businesses pushed farming to the peripherals of the economy as government policies started to skew towards the retail, wholesale and distribution sector.
Many people ventured into minibuses, passengers carrying pick-ups (matola) and vending. Imports jumped, overtaking exports in the country’s international trade profile.
The liberalisation also removed strict regulations in tobacco and anybody could venture into its farming, even without proper knowledge in the production of the crop. This coupled with a growing anti-smoking lobby around the world increased supply of the leaf, which came at the expense of good prices for the crop.
Agriculture steadily took a nosedive and banks stopped providing loans to estates and smallholder farmers and default rates from the sector skyrocketed.
Climate change and high demand for food around the world has, however, started to revive agriculture as a lucrative sector and farmers in Malawi now have an opportunity to make a killing out of farming than any time before in the last 20 years.
Apart from tobacco whose demand around the world continues to decline, all other crops such as maize, groundnuts, pigeon peas, soya beans, sunflower, sugar beans, rice and others are on high demand around the world, with prices reaching record high levels lately.
A good example is pigeon peas which just two years ago was being bought by produce traders at below K100 per kilogramme. Today, the price of pigeon peas is hovering around K600 per kg and those who grew the crop are smiling all the way to the bank. The same is the case with maize, groundnuts, rice, soya beans, sugar beans and other grain and legume crops.
Farming is certainly bouncing back as a money spinner and those who are clever enough to venture into it commercially will certainly be strong candidates to be among the next generation millionaires and billionaires in Malawi.
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