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Africas fast growing cities present a major opportunity for the continents agricultural sector, says Amine Tazi-Riffi,
a senior partner at McKinsey & Company.
Lagos, Nigeria. Africa's rapid
urbanisation is creating
opportunities for the agricultural
sector.
Speaking during a session at the recent New York ForumAfrica that took place in Gabons capital Libreville, Tazi-Riffi said
that McKinsey is currently working on strategies for investors interested in agriculture on the continent. He explained that
the single biggest opportunity McKinsey has identified lies in supplying food to urban consumers.
Feeding African cities with high value agriculture veggies, fruits, everything related to this emerging middle class in
African cities, Tazi-Riffi noted.
There are already 52 cities in Africa with more than one million inhabitants. This number is going to grow to 75 in the next
few years, he added.
It is estimated that around 40% of Africans currently live in urban areas, making Africa more urbanised than India, and
slightly less urbanised than China. According to Standard Bank analyst Simon Freemantle 2030 will be the tipping point
whereby more Africans will reside in urban than rural areas for the first time in the continents history. By 2050 it is
expected that more than 60% of Africans will be urbanised.
Tazi-Riffis comments came in response to a point made by Shanta Devarajan, chief economist for Africa at the World Bank,
who said that the export of African agricultural produce should be encouraged because it boosts the earnings of farmers.
Tazi-Riffi said he is not against exports, but considering the logistical challenges of exporting fromAfrica, supplying the
continents cities with food will offer the greatest return on investment.
A solution to increase bank lending to African farmers?
A lack of access to financing is one of the major challenges holding back the development of Africas smallholder farmers.
Devarajan said that this is because many of these farmers are illiterate and have no way of maintaining a business and
repaying their loans.
He suggested that basic financial training could improve this situation. One thing we found is training farmers on just
bookkeeping actually increases their access to finance because then they can list their assets and then the banks are willing to
lend to them. So there are small things that we can do that can have a big effect on credit to farmers.
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Africas ballooning cities an opportunity for agriculture http://www.howwemadeitinafrica.com/africas-ballooning-cities--an-op...
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