Agriculture remains the mainstay of Eastern Africa’s economy providing:
- 32% of Gross Domestic Product (GDP)
- 80% employment of the labor force
- 65% of foreign exchange earnings and contributes more than
- 50% of raw materials contributed to the region’s industrial sector
Trade in agricultural products remains significant in the region with:
- 50% of household needs and income
- 31 % of the total region’s agricultural imports
Demand for cereals as with other staple food is expected to dramatically grow in the coming decades due to the high rate of urbanization and the climate induced food deficit rural areas.
This presents opportunities for:
- Production improvement
- Development of intra-regional trade in food staples
The region’s staple food surplus zones often lie across political borders translating into tariffs, export restrictions and other man made impediments to cross border trade that;
- Raise costs of doing business for traders
- Lower incentives to farmers
- Raise consumer food prices in cross border deficit markets
Agriculture in the region is dominated by small-scale producers, most of whom produce at subsistence level with little surplus for sale despite recognition that with help they have considerable scope to farm as a business.
Extensive investments by national governments, non-governmental organizations and development partners have gone into agronomy based support to farmers. However, without sufficiently addressing the market constraints, these efforts only result in production surges that lead easily to price collapse in thinly traded national markets. In order to maintain producer incentives in these surplus production zones, farmers need access to growing markets both domestic and cross borders.