Agricultural growth corridors and African partnerships

The African Union, through its New Partnership for Africa’s Development (NEPAD), has identified two regions in southeastern Africa as potential breadbaskets having the conditions for strong economic development; corridors linked to the ports of Beira (Mozambique) and Dar es Salaam (Tanzania). Both projected corridors have large areas with high agricultural potential as well as a backbone of existing infrastructure to build on.

Together with several key partners Yara developed the new corridor concept, which was first announced at the UN General Assembly meeting in New York in September 2008. In January 2009, senior representatives from public and private sector organizations with an interest in African agriculture met at the World Economic Forum (WEF) annual meeting in Davos. At the meeting, which was chaired by Yara and our partner the Alliance for a Green Revolution in Africa (AGRA), it was agreed to fast-track a process that would see Mozambique take a lead role in developing an agricultural growth corridor incorporating the port of Beira.

The concept has been favorable received and supported by a number of key stakeholders.  An investment blueprint for the Beira Agricultural Growth Corridor (BAGC) and a concept note for the Southern Agricultural Growth Corridor of Tanzania (SAGCOT) have since been presented. Yara’s role has mainly been that of a catalyst, with the intention of remaining a partner in implementing the concepts.

The novel approach promoted by Yara and supported by our partners is linking the concept of economic corridors to agriculture, and inviting public-private partnerships to stimulate investments in regional value chains. The goal is that the growth corridors will ease farmers’ access to regional and international markets – a vital priority in making farming a viable business, a driver of rural development, and an engine for economic growth in Africa.

The value chain approach is crucial to overcome one of the main constraints in African agriculture – poor infrastructure – including storage and transportation. The corridor concept emphasizes the need to invest in infrastructure, including port and storage facilities, roads and railways. Priority is also given to establishing systems for improved financing facilities and credit schemes, especially for smallholder farmers and agro-dealers, in the form of ‘social venture capital’ and ‘patient capital’. Today, most of the agricultural activities in the identified regions are on a subsistence level.

Yara also acts as a catalyst in designing and establishing partnership projects on the continent – based on a holistic value chain approach and through fostering PPPs.  In addition to the growth corridors, we have since 2006 initiated and engaged ourselves in three major value chain partnerships in Tanzania, Malawi and Ghana since 2006.