The African Agri Investment Indaba (AAII), held in Cape Town from 18 – 20 November 2024, brought together over 800 key stakeholders, including governments, banks, financiers, investors, commercial farmers and agro-industry leaders, to discuss innovative solutions to Africa’s pressing agricultural challenges. Hosted by the African Agri Council (AAC), the three-day event explored opportunities and obstacles in agribusiness while emphasizing climate adaptation, investment in agri-tech, and sustainable practices.
Transforming Africa’s Food Security
Amid Sub-Saharan Africa’s most severe food crisis in decades, the Indaba highlighted the urgent need for collaboration to address food insecurity affecting millions. With over 16 million people in Malawi, Zambia, and Zimbabwe facing hunger due to inflation, drought, and economic instability, stakeholders at the Indaba emphasized the role of the private sector in tackling these challenges. In South Africa, nearly 250 000 households in Cape Town alone are experiencing hunger, the highest levels among the country’s major cities.
Ben Leyka, CEO of AAC, underscored the event as a vital platform for developing actionable solutions to ensure food security.
Reframing agriculture as a viable investment opportunity emerged as a key theme. By addressing social issues and unlocking economic potential, agriculture was positioned not only as a solution to the food crisis but also as a lucrative sector for investors. Dynamic panel discussions and networking sessions showcased innovative practices, with an emphasis on the underutilized potential of agri-tech solutions.
Bridging the Climate Mitigation-Adaptation Divide
A stark divide between climate mitigation and adaptation efforts was a central focus of the Indaba. Mitigation refers to efforts aimed at reducing greenhouse gas emissions to slow climate change, such as renewable energy adoption or carbon capture. Adaptation, in contrast, focuses on adjusting to the impacts of a changing climate, such as implementing drought-resistant crops or improving water-use efficiency.
Currently, 95% of global climate finance is allocated to mitigation, leaving only 5% for adaptation—a critical shortfall for African farmers who bear the brunt of climate impacts. Hayden Aldredge, a senior manager at ISF Advisors, emphasized the urgency of increasing private sector involvement in adaptation finance. The cost of addressing climate risks is estimated at $15 billion annually, compared to a staggering $200 billion if these risks remain unaddressed.
Panelists advocated for increased funding and support for smallholder farmers through tools like index insurance, digital training, and improved data accessibility. These measures aim to lower perceived risks for investors while empowering farmers to adopt climate-smart practices. Stephen Walker of Ground to Tap Water Solutions emphasized the need for technological advancements in water management, such as efficient irrigation systems and aquifer monitoring, to derisk agriculture and improve resilience.
Sustainability and Agritech Investments
The underinvestment in agri-tech—currently receiving less than 2% of agricultural investments—was another pressing issue. Changwe Kumalinga, CFO of Good Nature Agro Zambia, highlighted the potential of technology to revolutionize Africa’s food systems. The Indaba showcased innovative solutions, from digital platforms enhancing market access for farmers to renewable energy initiatives reducing the carbon footprint of agriculture.
Nestlé, for instance, shared its progress on sustainability interventions, including renewable energy, methane reduction, and improved water management. These practices not only reduce emissions but also enhance soil health and productivity, demonstrating the economic and environmental benefits of sustainable agriculture.
Building the Foundations for Success
Successful agribusiness requires more than just innovation; it demands sound financial and operational planning. Speakers stressed the importance of adequate working capital, efficient cash flow management, and a clear understanding of the agribusiness environment. Norman Celliers, CEO of AFGRI, highlighted the significance of aligning with long-term partners and addressing challenges such as export licensing and market access.
The event culminated with an awards ceremony recognizing exceptional contributions to Africa’s agribusiness sector, including categories like Woman of the Year and Innovation in Food and Agri. The Indaba’s discussions and collaborations reaffirmed the critical role of investment and innovation in shaping a sustainable and food-secure future for Africa.