Business Daily (Nairobi)
Steve Mbogo
5 May 2008
The African Development Bank (AfDB) Group has stepped in with Sh65 billion in new money as part of a short-term action to help address the food crisis in Africa.
The gesture by the bank came on Friday as more African governments continued to face possibilities of civil unrest because of the rising cost of food.
In Kenya, workers protested when President Kibaki did not increase their minimum wage during Labour Day celebrations. This was the second year in a row the workers were walking home without a raise.
In Nigeria, bakers have given a strike notice this week over the rising prices of wheat and cassava flour while riots have been going on in Egypt and some West African countries.
Africa is particularly vulnerable to the food shortage in the world because most of the countries are net food-importers.
This is attributed to the impact of the liberalisation of trade in agricultural products in the 1980s and 1990s, under the structural adjustment programmes.
The bank's president, Donald Kaberuka, said the group's agriculture portfolio has now hit US$ 4.8 billion (Sh312 billion) after last week's increase.
He said the group would also restructure some of its agricultural portfolio to provide a rapid disbursement facility to the tune of Sh16.2 billion.
The bank urged cereals exporting countries not to suspend their exports because the practice would compromise the existence of about 150 million food vulnerable people in a dozen African states, especially the population of fragile countries, the sick and elderly.
The bank said it will find further ways of assisting countries in difficulty by considering additional measures for budget support.
According to figures released by Food and Agriculture Organisation (FAO) last month, the cereal import bill of the world's poorest countries should rise by 56 per cent in 2007/8, coming in addition to an already spectacular rise of 37 per cent in 2006/7.
"For low-income food-deficit countries in Africa, the bill is expected to rise by 74 per cent, an increase which is a combined effect of the rise in the international price of cereals, freight costs, and oil," said the United Nations agency.
Recently, the bank's board of governors approved the establishment of the African Fertiliser Financing Mechanism Special Fund with a view to mobilising resources from donors to finance in particular, fertiliser production, distribution, procurement and use in Africa.
The approval is based on resolution of the African Green Revolution Summit in 2006 called on the bank to host the fertiliser fund. It is generally agreed that for Africa to improve her food security situation, the use of fertiliser has to increase from the current average of 8kg per hectare to at least 50 kg per hectare in 2015.
Another critical area for Africa food situation is improving the whole agriculture infrastructure for instance considering that current average post-harvest losses stand at a whopping 40 per cent.
The AfDB whose membership takes in 53 countries in Africa and 24 non-African others as donors, lends to strong countries in the continent at commercial rates and at reduced rates to poor economies.
The global food crisis has seen riots in Asia and Africa while leaders look for possible solutions to the challenge.
There have been mixed reactions to policies, especially the growing interest in the 'green fuels' which is seen as one of the causes of food shortages.
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