It is now time to shift agro-investment paradigm in Liberia. Long ago, Liberia agro-investment policy practices have been enshrined into speeches delivered by policy makers; expressing what they think they know even if it does not positively impact majorities of those the policies were made for.
Over the period, it is been observed that agriculture is essential and can serve as a gate to poverty mitigation and wealth creation in Liberia as it accounts for about 55% of total employment ( in both formal and informal employment sectors) and about 25% of GDP. This suggests that agribusiness is strategically placed to drive Liberia’s future economic development. Agribusiness can create important linkages and encourages investment in a way that can have strong multiplier effects on growth and development of a nation and its citizens. Agro-investment take a lead role in fighting food insecurity, not only because it stimulates increased production but due to its potential to create wealth for smallholder farmers’ and rural communities.
However, developing a competitive and sustainable agribusiness sector will require focusing on various components of the agri-food chain. This will include a wide spectrum of initiatives from boosting productivity at farm level, to upgrading value chains by empowering farmers’ organisations and involving them in strategic partnerships. For example, we need to look at how to respond to local demand by adding value to commodities and to enhance technology and innovation in the agribusiness sector. Facilitating access to capital and credit is also essential for small holder farmers- investments that focus on rural infrastructure also need to be encouraged. We are cognizant that the challenges ahead are significant, but we are also extremely optimistic that if we can collectively engage with a new vision, the challenges ahead can be overcome.
Liberia has an enormous agricultural potential and if harnessed, it could help drive the country’s economic growth, stimulate development and improve national food security. There are considerable opportunities for accelerating the development of agriculture and the related agro-food value chain in Liberia. Nevertheless, Liberia is still net importers of food and many other agro-products. The situation is symptomatic of severe and long-term under-investment in Liberian food and agricultural systems. This is a major concern that needs to be address.
The need to reinvest in agriculture to reverse this neglectful trend has become increasingly evident in Liberia. Creating the right conditions for strengthen agro industry should be seeing as a priority when discussing the future development in Liberia. For the sector to trigger growth and development, it needs to have the right framework to operate which will serve as a sustainable vehicle for poverty alleviation. Improving small producers’ livelihood sustainably and equitably is central to achieving this. Evidence shows that investment in agricultural smallholdings provides the greatest returns in terms of poverty reduction and growth. Providing support to small-scale farmers who want to become more integrated into national agro-food markets is cardinal.
Liberia has one of the most undeveloped fertile lands in the West African sub-region. It is home to about 45% of the Guinea rain forest fertile land but accounts for less than 5 % of the West Africa sub-regional agricultural output. It also has substantial water resources, but less than 4 % is used.
Demographics and demand
About 55% on average, the Liberian population lives in rural areas and works in small-scale agriculture, indicating the importance and potential of agricultural development as generator of employment. Liberia’s population is growing steadily and will require an increase in food availability. A middle class with higher purchasing power is also emerging. This combination will boost the demand for processed foods and high-value commodities and may lead to a high demand food products.
A competitive and under-productive sector
Liberia’s agro-industry remains primarily small-scale. SMEs are predominantly informal and there are relatively few multinationals compared with other countries in the sub-region. There is also an increasingly large gap between national demand and supply, and between national supply and regional demand. These factors suggest that the situation is conducive to the development of a nascent Liberian agro-business sector that can deliver significant returns on investment. However, for prosperity to be genuine these gains must be inclusive and it must benefit smallholder farmers.
Shifting the paradigm
There are several issues which in many ways can have an impact on production and output which may subsequently discourage potential investors and damage existing efforts. These we need to critical look at and correct errors if we must get better.
These challenges include:
- Poor governance of land tenure systems
- Low productivity in farming and in the entire agribusiness chain.
- Insufficient financial resources, access to credit and productive assets for smallholders.
- High post-harvest losses, resulting in higher prices.
- Lack of market information and market access.
- Limited availability of, or access to, extension services, research, technology and expertise.
- Lack of financial safety nets such as agro-insurance.
- Poor infrastructure for transport, storage and electricity.
- Weak political institutions and the lack of trusted regulatory frameworks in some instances.
However, if the space is provided, Liberian can make the most of the opportunities in the agro-business sector. Therefore, there is a structural need for transformation in the agricultural sector.
This would involve a sustainable shift from subsistence agriculture to a productive agricultural industry that allows farmers to take part in the market economy. To achieve this, productivity must be increased in an environmentally and socially sustainable way. This can be done by increasing access to sustainable agricultural methods that are suitable for smallholders. It also requires technical training, facilitating access to extension services, investment in agricultural research, and improving technology transfer and access to credit. It is also crucial for addressing production factors such as the distribution of seeds, fertilisers and crop protection products. In addition to productivity, value chains must be upgraded to produce high value agro-food products. This will significantly boost national competitiveness and will help to match domestic, regional and international demand. There is also a need to improve logistics and transport services, as well as access to energy and water. Moreover, an enabling regulatory and legal framework that gives investors security while reducing bureaucratic bottlenecks is also necessary. Additionally, engaging the private sector, smallholder farmers, producer organisations and cooperatives will help to accelerate this transformation.