Why Africa has Fallen Shortof Building Dynamic Agroprocessing Capabilities:
Constraints, Options andProspects

Wellington A. Otieno and Ada Mwangola

ATPS SPECIAL PAPER SERIES No. 29

Published by the African Technology Policy Studies Network, P.O. Box 10081, 00100
General Post Office, Nairobi, Kenya.

© 2006 African Technology Policy Studies Network (ATPS)

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ABOUT THE AFRICAN TECHNOLOGY POLICY STUDIES NETWORKThe African Technology Policy Studies Network (ATPS) is a multi-disciplinary network of researchers,
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Acronyms

ARCT
ARSO
ASARECA
DRC
FARA
FIIRO
IDDA
IITA
ILO
IMF
KIRDI
MVA
NEPAD
R&D
SPAAR
UNIDO
UNPAAERD
WTO

the African Regional Centre for Technology
African Regional Standards Organization
Association for Strengthening Agricultural Research in East and Central Africa
Democratic Republic of Congo
Forum for Agricultural Research in Africa
Federal Institute of Industrial Research, Oshodi
Industrial Development Decade for Africa
International Institute of tropical Agriculture
International Labour Organization
International Monetary Fund
Kenya Industrial Research Development Institute
Manufacturing Value Added
New Partnership for Africa’s Development
Research and Development
Special Programme on African Agricultural Research
United Nations Industrial Development Organization
UN Programme of Action for African Economic Recovery and Development
World Trade Organization

Table of Contents

1.

Introduction

1

2.

Targeted Objectives of Food Processing in Agriculture-led
Development Strategy

33.

Performance of the Agro-Processing Sub-sector in Africa

44Factors Constraining Agro-Processing Industries in Africa

95Strategic Policy Directions for the Future

10

6Personnel Management and Assessment of Training Needs

19

7

Conclusion

21

References

22

Introduction

The Food Industries in the food system
It is an accurate assessment to say that the prospects of Africa’s development as it evolves into the
21st century to say that agriculture holds the key to the future. Lewis (1955) foresaw this when he said
prophetically said that agriculture is the “sine-qua-non” of raising the African standard of living.
In the context of agriculture-led development strategies for African countries, vibrant food and allied
manufacturing industries to conserve and convert enhanced agricultural output into maximized
value-added products for global markets occupy a critical tactical niche. The food industries need
to be seen as a strategic, autonomous and growth-stimulating force within the cosmos of African
agricultural development. The food and allied industries constitute the motive force that drives the
agricultural industry of the developed countries of the world, African countries, therefore, must learn
to harness the same vital force to jump-start and sustain the engine of agricultural development in
the continent. In recent years, this process has been enacted and re-enacted in one country after
another in the Pacific Rim: in Taiwan, Malaysia and now progressively in Indonesia. The infant food
manufacturing industries of these countries became the arena in which to acquire the experienceand confidence for industrialization. In this role, food manufacturing has proved to be a veritable
instrument for targeting, sharpening and enhancing the value of agricultural commodities andfostering the global marketing of the resulting products.
Collectively, the agro-allied industries as part of the production complex with agriculture, animalhusbandry, fishery and forestry, constitute the heart of the food system of any country. The up-stream
provides capital goods (machines, know-how, etc); intermediate production factors (seeds, fertilizers,
pesticides, etc) and services. Down-stream industries are the distribution chain consumers of foodproducts. The range of services enables the food system to function and develop (education, health,hygiene, research and development, training, finance, management, transport etc). In countries
aspiring to transit from largely agricultural to predominantly industries economies, the food andallied industries assume, in addition to their Tran formative role, the vital function of economic
catalysts for wider industrial development.
Both the International Labour Organization ILO (1978) and the United Nations Industrial Development
Organization (UNIDO) (1977) estimate that food processing activities form the basis of nearly 30% of
industrial output and 20% of employment under manufacturing in developing countries within the1

2

ATPS SPECIAL PAPER SERIES NO. 29

formal sector of the economy. If activities in households and small-scale cottage industries invillages and urban homes are taken into account, output and employment in food processing, when
considered in their widest sense, would be much larger and much more pervasive than indicated.

2.

Targeted Objectives of Food Processing inAgriculture-led Development Strategy

The principal objectives of giving priority to the development of food processing in the context ofagriculture-led development strategy are:
• To meet urgent food and nutritional requirements of an expanding workforce whose healthis fundamental and anchored in the nutritional quality of the national diet• To reduce qualitative and quantitative losses of agricultural products by bringing industrial
processing nearer to the sources of raw material production• To augment foreign-exchange earnings by providing the basis of the export of processed
products rather than raw materials or semi-processed products• To provide much-needed experience and training in the dispersal of industrial growth tobackward and rural areas so as to generate new and enhanced employment opportunities• To create enhanced opportunities for expanded spread of ownership of production unites• To stimulate the development of technological capabilities in terms of the capacity andengage in different scales of productive technologies in food processing• To foster the development of engineering capabilities to design and manufacture foodprocessing and ancillary machinery
In each of the above stated objectives, there is a primary component of “learning by doing” that is vitalto wider industrial development. As the super-ordinate infant industry, food processing can provide
the experience as well as become a learning guide for industrialization.
If food processing holds such vast potential has been suggested, why has it not prospered in Africa?
It is necessary to understand that the development of food processing is basically an entrepreneurial
activity. It is, therefore, plagued by well known problems of enterprise-development. Food processing
has not prospered as other agro-industries probably because of the African culture. There are many
problems and obstacles that can be cited but, in the final analysis, the absence of an ingrainedenterprise culture that comes from training and widespread practice is a major causative factor.

3

3.

Performance of the Agro-Processing Subsectorin Africa

In most African countries, ago-processing is the most important manufacturing sub-sector accounting
for at least 50% of manufacturing value added (MVA) (Table 3.1). Food and beverages represent thelargest part in some countries, the beverage industry (mainly breweries) is three or four times that of
the food industry, such as in Cameroon, Niger, Togo and the Democratic Republic of Congo (DRC).
This performance has to be considered against the 33.64% for developing countries (excluding
China) and the 20.95% for the developed countries. These figures underline the agricultural basisof the African economy.
Table 3.1: Value Added in the Manufacturing Sector, by Main Agro-Industry Branches in Selected
African Countries
Sectoral
BRANCH PERCENTAGE SHARE
Value Added inMillion US$ at 1980

WORLD(I) Developed countries(ii) Developed countries(excluding China)
AFRICANORTH AFRICA
SUB-SAHARA AFRICA(I) Burkina Faso(ii) Burundi(iii) Cameroon(iv) Congo(v) Kenya(vi) Madagascar(vii) Mauritius(viii) Niger(ix) Nigeria(x) Sudan(xi) Tanzania(xii) Togo(xiii) Zaire(xiv) Zambia(xv) Zimbabwe

PricesFood
3,543,372 10.89
3,137,564 10.6

Beverages Tobacco
2.22
1.29
1.97
0.99

Textiles
4.59
4.11

Total
Wearing AgroApparel Industries
2.45
22.41
2.39
20.95

405,829
26,831
14,038
12,793
207
85
1,365
64
893
172
1,173
30
4,291
363
144
46
200
1,003
1,763

4.15
10
3.25
18.33
15.83
27.43
1.98
16.59
8.79
14.57
6.27
19.85
1.87
7.63
36.1
28.69
23.56
16.96

8.25
10.7
11.44
15.86
1.92
1.45
6.56
8.13
12.28
5.51
3.11
14.2
7.68
15.06
25.86
4.81
8.88
13.05

3.03
4.25
2.52
1.77
2.89
1.38
1.75
2.67
10.24
27.94
0.25
0.27
1.23
0.02
1.95
3.94
2.97

13.07
17
16.64
16.43
45.71
40.55
32.75
14.91
27.68
26.53
42.48
28.07
10.72
45.16
20.99
10.53
8.61
11.32
15.03

4

3.57
4
4.77
1.03
13.64
3.45
5.95
2.66
1.76
1.67
21.81
2.75
14.39
6.09
9.22
7.18
7.92

33.64
49
42.2
55.84
83.73
87.55
19.05637
51.17
51.07
70.41
82.8
59.73
50.19
72.19
55.19
76.82
58.16
57.16
58.49

5

WHY AFRICA HAS FALLEN SHORT OF BUILDING DYNAMIC AGRO-PROCESSING CAPABILITIES

Source: UNIDO, Statistics Division, July 1989

Until recently, only a relatively small part of the agricultural commodities was industrially processed(Table 3.2). Most of the foodstuffs (cereals, roots and tubers, fruits and vegetables, pulses andoilseeds) are processed at home for subsistence with little surplus for sale. Operations in theinformal sector are increasingly being mechanized, although the level of mechanization is dominatedby milling of grains, dehydrated tuber chips or slices, fresh or dehydrated vegetables and grating of
cassava. Mechanizing whole processing operations for local foodstuffs is hindered by the inadequacyof local raw materials to meet the demands of procedures involving the use of imported technologies
or local adaptations. Processing of export commodities (fruits, cocoa, tobacco, coffee, tea) islimited, in quantity and stage of processing.
Table 3.2: Raw Materials Production and Level of Processing in 1985 in Africa
Commodities

Production*(1,000 T)

Maize
Sorghum/millet
Cassava
Other roots and tubers
Meat (beef, veal)
Fresh Milk (Cow, Sheep)

31,624
25.,130
56,52743,013
2,685
13,325

Fish
FruitsVegetables
Cocoa beans
Green coffee
Palm oil
Soya beans
Groundnuts
Sesame seeds
Sunflower seeds
Cotton seeds
OlivesRaw sugar
Tea

3,390
37,224
26,030
1,096
1,232
1,444
342
3,793
447
447
2,299
1,232
4,800
264

(**) Industrial
Processing
In % of raw materials
1.2
0.4
0.1
0.1
4.0

Final products

FlourGarl, Floor

16.5
0.6

CannedButter, cheese, evaporated
and condensed milk
Canned tune and sardine
Preserved fruits, jam

10.7
7.3
7

Butter, chocolate powder
Roasted coffee, instant coffee
Refined oil, margarine

4.4/0.8

Non-refined/refined oil

13/7
16

Non refined/refined oil
Oil, preserved olive*Source: FAO Production Year Book and United Nations Industrial Statistics Year Book, 1985**ECA Estimation

As a consequence, international trade statistics reveal that the region remains a net importer ofprocessed agricultural products for which it is supposed to have comparative advantages. TheseATPS SPECIAL PAPER SERIES NO. 29

6include sugar and edible oils, such as cotton seeds, sunflower and palm oil. Net imports of sugar, forinstance, increased from 1.6 million tons in 1984 to 1.9 million tones in 1986. The corresponding
figures for palm oil were 176,000 and 323,000 tons. Production of selected agro-based products ispresented in Table 3.3.
Table 3.3: Production of Selected Agro-based Products in Africa (1,000 tons)
Product
Flour, wheat
Flour, cereal other than wheat
Oil, Cotton-seed, crude
Oil, cotton-seed, refined
Oil, groundnut, crude
Oil, groundnut, refined
Oil, olive, crudeOils, others of vegetable origin crude
Fruits, tinned or bottled
Jams
Sugar, raw
Malt
Cocoa poweder
Cocoa butter
Chocolate and chocolate products
Coffee extracts, including instant coffee
Beef and veal fresh
Meat tinned
Mutton and lam, fresh
Poultry, dressed, fresh
Milk (cows), whole fresh*

1980
8,337
553
250
161
278
40
213
1,453
129
38
4,165
327
46
36
16
85
2,411
4
1,112
984
7,329

1981
9,330
601
263
161
193
24
145
1,492
139
39
4,350
321
40
34
21
96
2,489
4
1,140
1,028
7,559

1982
9,524
598
256
613
269
40
160
1,487
182
38
4,540
367
36
34
20
102
2,573
4
1,150
1,138
7,769

1983
9,107
475
277
161
309
53
234
1,458
164
34
4,613
444
46
40
21
83
2,591
3
1,176
1,201
9,258

1984
9,176
500
292
161
222
35
162
1,663
178
41
4,620
499
39
34
22
99
2,630
5
1,190
1,215
9,069

1985
9,660
374
299
161
167
29
196
1,592
188
44
4,800
566
50
42
26
90
2,685
4
1,239
1,275
9,116

Source: United Nations, Industrial Statistics Yearbook 1985 (Vol. 11: Commodity Production Statistics 1976 – 1985),
1987* FAO, Production Yearbook, Volumes 32,33, 36 and 39. ECA/IND/GEN/1/89

A number of processing activities, such as flour milling, manufacture of beverages (beers, softdrinks) are based mainly or wholly on imported raw materials. In the flour milling industry, about 66%
of raw materials were imported during the first half of the 1980s.
Production of wheat flour averaged 9.4 million tons per year during the 1980s with Egypt, Nigeria,
Tunisia, Morocco, Algeria, Libya, Ethiopia and the Sudan accounting for about 80% of this output.
Current trends are towards using local cereal grains and tubers to manufacture composite flour due
to rising import bill of wheat and deteriorating economic conditions in the continent. The shift
towards the use of local cereal grains by the flour milling, livestock feed, brewery, breakfast cereal,
infant formula and snack industries has put a demand pressure on grains, such as maize andsorghum. The shift towards using composite and non-wheat flours received much support duringWHY AFRICA HAS FALLEN SHORT OF BUILDING DYNAMIC AGRO-PROCESSING CAPABILITIES

7

the second Industrial Development Decade for Africa (IDDA). Many countries in Africa have adopted
the composite flour in their food processing industries.
Practically, all roots and tubers are processed by households involving family units with limited
mechanized operations. The practice of fully mechanized tuber processing is still in its infancy
despite the availability of locally fabricated machinery in countries like Nigeria and Cote d’Ivore,
Ghana and Cameroon. Commendable processing technologies have emerged from the Federal
Institute of Industrial Research, Oshodi (FIIRO), and the International Institute of tropical Agriculture(IITA) in Nigeria and the Kenya Industrial Research Development Institute (KIRDI) in Kenya.
The region is a net exporter of fresh fruits, such as citrus, banana, pineapple and dates. A number ofAfrican countries, for example, Ethiopia, Cameroon, Egypt, Kenya and Nigeria process fruits into
juices, jams and marmalade for local use and export. Canned pineapple export during 1984-1986
was about 118,000 tons. Production of bottled fruits and jams in 1985 was 188,000 and 44,000 tons,
respectively.
Although Africa used to play an important role in the production of vegetable oils, production has
been declining during the last 15 years. Africa’s share in the world groundnut production (continent’s
major oilseed crop), for instance, declined form 34% in the early 1969s to 25% in 1988. The same
applies to palm oil production whose share dropped dramatically from 74% in 1975 to 22% in 1986
due to the entry into the markets by players like Malaysia. As a consequence, African self-sufficiency
ratio which was 153 in 1961-65, went down to 112 in 1974-1976 and 102 in 1986 and is projected to
decline to 86 by 2000. There is the urgency to increase oil production substantially to ensure
increased self-sufficiency in cooking oil. It is, therefore, encouraging that a number of countries arecarrying out pilot field studies in palm oil production.
In general, food industries have performed poorly since 1980 when assessed in terms of the targets
set in the Lagos Plan of Action, the Industrial Development Decade for Africa (IDDA) and the UN
Programme of Action for African Economic Recovery and Development (UNPAAERD). The mostimportant aspect of the targets is that African countries must make every effort to process locally theirraw materials. Table 3.4 shows that many agro and livestock raw-materials are still not fully processed.
In the 1980s food-processing output declined by 4% annually up to 1985. This is deeply rooted in
Africa’s declining MVA (Table 3.5). In 1986 and 1987, however, there were increases of 3.5% and2.5% respectively.

ATPS SPECIAL PAPER SERIES NO. 29

8

Table 3.4: Tropical Africa: Manufacturing Value Added (MVA) by Industry, 1980 and 1987

Total Manufacturing
Food Products
Beverages(Millions of dollars)
1980
1987
14,484
16,105
2,635
3,443
1,632
1,903

% share of the region in world total
1980
1987
Change
0.52
0.49
-0.03
0.88
0.94
0.06
2.45
2.75
0.30

Source: UNIDO: Industry and Development. Global Report 1989/90

The declining MVA growth has partly mirrored the structural weakness of the region’s industry. The
majority of industrial establishments were initially designed for import substitution by processing
imported inputs using imported machines and spare parts. This strategy reflects the economic
environment and philosophies during the 1960s and early 1970s.
The world recession of the early 1980s affected industries in the region due to the failure to ensuresufficient imports or sustain rising raw material import bills. Domestic problems, such as lack ofmanagerial skills, frequent power failures, inadequate technical service facilities, absence of
information and marketing channels also play a role in underutilization of capacity. In industry,
capacity utilization declined to a regional average below 40% in 1988. A recent survey of the “Centre
Nord-Sud de I’institut de I’Entreprise” Paris, in 24 African countries representing 70% of the population
and 75% of GDP in sub-Sahara Africa, revealed that out of 204 enterprises, 111 (or 54% operated
below break-even capacity and 46 (23%) had closed down (Table 3.5).
Table 3.5: Survey of Capacity Utilization in Food Enterprises in 24 African Countries

Cereals
Oils and FatsFish, fruits andvegetables
Dairy products
Sugar
Beverages
TOTAL

Number ofEnterprises Surveyed
33
48
33

OperatingSatisfactorily
4
15Operatingbelow Capacity
26
31
16

Closed
Down
3
16
12

15
32
43
204

7
5
25
47

5
19
14
111

3
8
4
46

Source: Survey of Economic and Social Conditions in Africa, 1986 – 1987
Centre Nord-Sud de l’Enterprise, Bilan es Persoectives de l’industries Africaine (Paris, 1985)

4.
Factors Constraining Agro-Processing Industries in Africa

The depressed economic conditions that prevailed in the world in the 1980s and parts of 1990s andthe multiplicity of continuing crises in Africa have had and continue to have negative impact on theprocessing of African raw materials. The hope that African countries would progressively increase
exports of its raw materials with increasing value added has not been widely realized. Thus, theconstraints inhibiting the growth of Africa’s food industry include:• inadequate agricultural, industrial and economic policy• weak integration between agriculture, manufacturing and trade• conceptual mistakes in the establishment of enterprise• technological inadequacies• poor demand stimulation• inability to adapt to the increasing sophistication of international markets including thedevelopment of new packing materials• lack of inter-sectoral integration between large and small enterprises, low level of domestic
sub-contracting• inadequate infrastructure• debt service burden, inflation budget deficits and import dependence of industry
A keen awareness of these basic problems has led to the formulation of economic-reform policies by
about two-thirds of the 53 countries in the sub-Saharan region. Most of them have done so withsupport form the International Monetary Fund (IMF) or the World Bank, as in Angola, Guinea-Bissau
and Zimbabwe, while others have used their own initiatives with emphasis on foreign exchange
reforms as in the Gambia, Ghana, Nigeria and Mauritania. In the food processing sector, theemphasis is on liberalizing the environment in which manufacturing operates, reducing government
ownership and control, development of small and medium-scale industries using local raw materials
and strengthening domestic input-output linkages.

95.

Strategic Policy Directions for the Future

As a result of the economic reform policies in most African countries, the food processing industry
operates in an economy where:••••

many businesses have high operational costs limiting any planned expansion
devaluation of the local currency against main convertible foreign currencies has caused
severe cash flow problems
many small-scale businesses have folded up and caused a high level of unemployment
high cost of funds that can be invested does not encourage entrepreneurial initiatives

The pursuit of the objectives of the policy on self-reliance led to the ban on the importation of some
raw materials in some countries. However, the agricultural sector of the economy is not yet in aposition to supply agricultural raw materials while inputs from other sectors are equally inadequate.
This had led to increased costs of production, sales and marketing, while product pricing has
remained unstable. The disposable income of consumers has been on the decline and industries
are not making enough profits to replace their assets. However, with many African countries having
signed the World Trade Organization (WTO) protocol, tariff and non-tariff barriers is discouraged in
the liberalized international trade.
Against this background, the food processing industry has entered an era of survival for the fittest. To
remain in business, management must plan ahead, evolve good strategies and implement themsuccessfully because strategy is about survival in a highly competitive world.
The challenges confronting the food industry in the 1990s and beyond are the imperatives of
products of good value and consistent quality sustained by consumer demand at home andcompetitiveness abroad, to ensure profitable growth. This implies that all strategies must have astrong consumer orientation.
To meet the challenges, strategic directions should focus on the supply of raw materials, technology,
product diversification and markets.

10

WHY AFRICA HAS FALLEN SHORT OF BUILDING DYNAMIC AGRO-PROCESSING CAPABILITIES

11

InputsRaw materials
The regular supply of raw materials to industry throughout the year requires a master plan interlinking
agricultural and industrial developments that should be mapped out by the private sector and thegovernment. To achieve the objectives of self-sufficiency and food security, seasonal saturations ofprimary products require appropriate technologies for storage and preservation. The efforts ofgovernments to establish strategic grain reserves at the national level should be sustained, whileother raw materials (roots and tubers, oil seeds, palm products, fruits and vegetables) also need tobe emphasized in the interest of national food balance. Since agriculture has not succeeded inmeeting the demands of the food-processing industry, the following activities are recommendations
to boost food production, improve local value added and increase capacity utilizations:• setting up farm settlement schemes with necessary infrastructural facilities, such asaccommodation, access roads, water, energy, communication, health care and integrated
network of satellite storage facilities to reduce post-harvest losses, ease transportation,
reduce rural-urban migration and motivate more people to take to farming• providing soft loans to procure or hire productivity enhancing inputs, such as fertilizers,
herbicides, germicides, tractors and to expand areas cultivated• sustaining land reclamation efforts through irrigation, reforestation or drainage, as applicable• allocating land for agricultural production, with the zoning of crop production to areas
where best suited• formulating and effectively implementing a Guarantee Minimum Pricing policy as anincentive to local farmers to produce more• initiating regular agricultural extension services on new technologies either by direct contact
or through the electronic media• providing adequate funding for higher institutions of agriculture specializing in crop andanimal production, economics, soil science, extension, research, engineering, post-harvest
technology and education, to correct the structural and functional defects of inherited colonial
institutional framework for agricultural teaching, research and extension
The institutions should generate and disseminate agricultural technologies and produce the teaching
manpower required to perpetuate the proper use, maintenance and repair of these technologies.
Regional organizations, such as Forum for Agricultural Research in Africa (FARA) in Accra, Ghana;Special Programme on African Agricultural Research (SPAAR), the Association for Strengthening
Agricultural Research in East and Central Africa (ASARECA) in Uganda are playing pivotal roles.
There should be strong linkages between these institutions and all government arms, industry andfarmers to enhance productivity by disseminating research findings on improved agricultural
production and post-harvest technologies.

12

ATPS SPECIAL PAPER SERIES NO. 29

Intermediate raw materials
The future of food processing to a large extent depends on establishing sub-contracting andtrading links between large and small-scale enterprises within the industry. The production ofintermediate raw materials by small and medium-scale industries as inputs to large industries, forexample, will strengthen such linkages as long as the standards of quality of the intermediate products
are maintained. The production of glucose syrup form the conversion of roots and grains as an
input to the food and pharmaceutical industries, production of maize grits for the breweries andbreakfast cereal industries and cocoa butter for cosmetics and confectionery are typical examples.
Technological issues
African countries differ in their levels of technological development, particularly agricultural production,
food cultivation and commitment (investment) in industrial food processing.
In the 1990s and beyond, technological strategies should focus on achieving the broad objectives of
the African economic recovery and development that include:• developing industries to produce agricultural tools, equipment and inputs and smallscale irrigation equipment• processing raw materials and intermediate inputs• developing capacity for using renewable sources of energy, especially biomass andsolar energy• establishing engineering capacity for developing local spare parts and components• providing appropriate training and developing local capacity for designing andpreparing projects
Given the debt burden, an ever larger degree of local processing of indigenous raw materials should
be sought. The trend should be toward decentralized small-scale, rather than large-scale processing
units that are both suited to and sited in the food-producing rural areas. This arrangement would
provide greater employment, improve rural industrialization, and reduce rural-urban migration, losses
due to spoilage and transportation costs.
Expansion of storage systems
African governments should pursue, with vigour, a strategic crops reserve policy because efforts toboost agricultural production can only be meaningful if supported by a purposeful post-harvest foodloss prevention system. Satellite grain collection depots, for example, should be established at
strategic locations including rural and urban markets and agro-service centers. The warehousesizes should be determined by the level of agricultural activities in the area.
Upgrading traditional technology
Transforming traditional food crops, through mechanized processing, into acceptable forms, suchas shelf-stability and safety, consumer taste and eating patterns and convenience in handling andpreparation is a technological challenge for the development of the food-processing sub-systems
for the 1990s and beyond.

WHY AFRICA HAS FALLEN SHORT OF BUILDING DYNAMIC AGRO-PROCESSING CAPABILITIES

13Strategies for achieving this goal include:• Upgrading the current traditional technology in consonance with raw material supply andconsumer demand for the end-products. This should be preceded by detailed technoeconomic feasibility studies. Activities should include gradual mechanization of all unit
operations, and gradual upgrading of the scale operation.
• Research and development (R&D) support should focus on modifying processing
technologies and introducing design concepts for technologies especially where activities
are prototypes or replicates of processes already developed and tested in other developed
countries.
The informal sector
The bulk of processed food in domestic markets is produced by myriads of micro enterprises in theinformal sector, especially in sub-Saharan Africa. Unfortunately, governments have not given this
sector much support. There is an urgent need to improve processing technologies currently used byoperators in this sector to increase incomes, generate more employment and assist in increasing
raw material supplies from primary agricultural production. This calls for a comprehensive support
policy.
Technical assistance will be particularly rewarding in such areas as root and tuber processing,grain milling, dehydrating fruits and vegetables and producing vegetable. Some large-scalecommercial and fully mechanized operations have failed when compared with commercial operations
using simple to intermediate level technologies.
Areas of emphasis should include:• training of business owners to effectively arouse and reinforce entrepreneurial skills• upgrading processes to make unit operations more efficient and more responsive tomarket demands, for example, the African Regional Centre for Technology (ARCT),
based in Dakar, Senegal, has done a commendable job in injecting innovations into
traditional food processing in Africa• strengthening technical capabilities especially in fabricating and maintaining machine
spare parts (There is therefore a need for urgent support of the African Regional Center
for Engineering, Design and Manufacturing based in Ibadan, Nigeria)• providing infrastructure, for example, access roads, electricity, water, and storage
facilities in the factory /processing centers to improve working and living conditions(The New Partnership for Africa’s Development (NEPAD) has placed infrastructure asa priority among priorities)• prescribing grades and standards through regulatory agencies for the finished products
to ensure consistently high and uniform quality (The African Regional Standards
Organization (ARSO) based in Nairobi, should be supported and strengthened)• providing information about appropriate alternative technologies and marketing
assistance (A number of countries have seen the need for establishing commodity
exchange organizations alongside foreign exchange centres)

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ATPS SPECIAL PAPER SERIES NO. 29

Establishment of small-scale plants with possibilities of replications
A small-scale plant with possibilities for replication in a battery system offers a viable prospect forsuccess. Such plants involve lower investment and could be established in food producing rural
areas, matching processing capacity with raw material supplies. An investor could invest in one unit
and proceed to expand his capacity by adding more battery-type processing units to limit the highinitial investments and overheads due to underutilization of plant capacity at the initial period of
operation. Smaller plants provide an opportunity for developing managerial and technical skills
while avoiding the losses involved in making mistakes in large factories. Such an approach has
been amply demonstrated in China with much success. The approach is especially suitable for
Africa as investment funds are scarce.
Linkage development
Food-processing plants should be set up at, or near production sites for the manufacturing ofintermediate products. Such products could serve as raw material for a central plant of the parent
company or for other companies. Such an approach provides an immediate stimulus for nearby
farmers to produce at increased levels. Moreover, intermediate processing provides rural employment
thus arresting rural-urban migration. This enhances linkage development between primary foodproduction and food-processing industries and also within the food processing industry.
Development of support industries
Setting up service food-processing industries using local and imported technologies (such as thesteel, chemical and petrol-chemical industries) to supply plant components for machinery fabrication,
additives, packaging materials and auxiliary equipment has been found to be a desirable sidebusiness that increases the efficiency of food processing plant in addition to facilitating the diffusionof technologies into rural areas.
To aid the foregoing, government and the private sector should set up fully equipped foundries for
manufacturing machinery components to suit local machinery fabricators’ specifications and aid
the development of an indigenous technological base.
Research and development
Research and development (R&D) activities should include the following:• setting up zonal R&D institutes or upgrading existing ones and designating them as zonal
research centers within each country in the African region would be the logical step towards
re-organizing the agricultural production• fostering exchange of ideas in tackling similar food processing, packaging, storage,
marketing and food development problems, R&D centers, should include periodic regional
conventions, “trade fairs”, to build close linkages between inventors, investors andmanufacturers, jointly funded by member countries.
Scientists within local research institutes must take the initiative to trust one another and institutes
within African countries must co-operate and do away with “selfish” attitudes of holding back

WHY AFRICA HAS FALLEN SHORT OF BUILDING DYNAMIC AGRO-PROCESSING CAPABILITIES

15

information. Having achieved that, the opportunities are immense in technology development anddissemination among African counties. Africa must take a leadership role through action-oriented
measures such as:• Bringing together people with interest in processing food crops and animal products fromwithin the region. The idea is to enhance the exchange of information through face-to-faceinteractions about process research, focusing on a broad perspective of the problem areas
in storage and preservation, processing, product development, engineering chemistry,
microbiology and nutrition and equipment production. Sharing of local experiences would
strengthen education, especially at undergraduate and postgraduate training.
• Through R&D, African countries can evolve appropriate processes and adequate plants
and machinery for production by using facilities in the engineering and machine tools
industry and exploring ways of using and improving upon local raw material inputs. Local
innovations can make a big difference by incorporating local content into the whole process.
The need for rehabilitation and restructuring in the formal sector
Rehabilitation involves an in-depth diagnosis of the precise reasons and scopes for the problems
and constraints that industries face and the increasing challenges in a sub-sector of a country. The
diagnosis is to enhance the design and implementation of technical assistance projects, avoid reestablishing previous conditions for production and establish a new basis for viable production andgrowth. Rehabilitation and restructuring is important for Africa during this time of globalization andliberalization when goods manufactured in the continent are exposed to global competition. Suchan assessment would be directed at identifying areas where each country has a competitive edge
(advantage) in world trade.
At the micro-economic level, it is important to direct rehabilitation toward production and management
in existing industrial enterprises. This entails introducing an effective and dynamic marketing,concentrating human, physical and financial resources in a few manageable projects or markets,
analyzing market trends more closely and paying greater attention to technological development.
Emphasis should be on a more efficient utilization of existing industrial capacity rather than on newinvestment.
Establishing regional networks between enterprises for mutual self-help is also a crucial aspect of
rehabilitation. It is for this precise reason that the NEPAD initiative is timely and appropriate. NEPAD
advocates for regional integration in the face of globalization and liberalization trend. The East
African Business Forum that groups businesses from Kenya, Uganda and Tanzania to shareexperiences and knowledge is timely.

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ATPS SPECIAL PAPER SERIES NO. 29

Product Development
Many organizations will survive, given a commitment to local sourcing, development of new products
and government’s sustained will/policy to impose tariff and non-tariff barriers on similar products
entering African markets. However, since the advent of World Trade Organization (WTO) rules andregulations, many African countries who are signatories to the WTO Treaty do not have muchflexibility in imposing tariff or non-tariff barriers. The increase in the use of local raw materials insome countries poses tremendous technological and marketing challenges to many organizations.
Since the successful branding and positioning of products based on local raw materials in themarket place play an important role in the fortunes of the business, efforts of food industries in thisdirection should lead to new trends in market demands by monitoring quality products to compete
effectively against foreign goods.
With regard to the sub-system under study, efforts should be directed toward:• producing breakfast cereal, baby foods and cocoa-based beverage with cereal added• transforming yams into a dehydrated product capable of re-hydration• using 100% local grains to brew beer that matches the taste and quality attribute that isfamiliar with the consumers, for example, the model of using sorghum to produce beer in
Nigeria and South Africa• producing priority food additives, such as industrial enzymes, chemical preservatives, foodcolorants and flavors on a long-term basis to gradually phase out imported additives andreplace them with local substitutes• developing local raw materials and products, for example, soy flour as alternative to mix
powder in milk-based recipes• using special foods, such as military rations and diabetic foods• preparing composite bread from non-wheat flour similar to what the consumer knows andprefers• developing soy-based food products as a cheap means of providing nutrition for the young• producing various vegetable oils and fats form local sources, the key challenge being thatof maintaining quality through improved presentation using pilfer-proof competitive
packaging• producing many convenience foods for urban consumers
Success depends on effective Market Research that makes it possible to understand the consumer’s
reaction to the new products. It also depends on consumer habits and attitudes arising from adecline in purchasing power and his rating of the new product against the competition.
Use of by-products
An integrated development of the food industry involves using raw materials, by-products and residues.
Many technological and marketing challenges remain unsolved in by-product utilization resulting in
the waste of resources and sometimes damage to the environment. This is particularly notable inthe sugar industry.

WHY AFRICA HAS FALLEN SHORT OF BUILDING DYNAMIC AGRO-PROCESSING CAPABILITIES

17

A proper combination of different raw materials and by-products can make good animal feed, at alow cost. Inadequate knowledge of the potentials of food by-products and lack of baseline data on
quantity hinders the effective use of by-products.
By-products generated as some of the processing centers include rice bran and husks, cassava
peels and residues from palm fruit processing. Deliberate and concerted efforts should be made touse these by-products to add value and generate more income.

MarketingIn the 1990s and beyond, marketing strategies should give priority to products, pricing and distribution
over competition. This is crucial because the marketing situation, in many countries within theregion, has changed from that of a seller’s market to a buyer’s market since the introduction of
economic reforms. Domestic markets are shrinking. With increasing production costs, consumers
continue to re-order priorities.
A shift away from the old routine of maintenance marketing to a more purposeful and developmentoriented innovative market, fully backed by basic consumer research and opportunity identificationis required. Thus, marketing strategy should ensure that all sections of the organization are consumeroriented.
To expand the market, strategies should dwell on delivering products to consumers at affordable
prices. Packaging should be modified to accommodate smaller unites. The attributes of products
should be re-examined and recipes adjusted totally with consumer requirements or needs based onmarket research.
Regional markets
The development of regional markets presents an opportunity for cooperation among African countries
to strengthen their position in penetrating international markets. Given the current development of
economic units in Europe and the rest of the world, intra-African trade is a dynamic answer. Thisimplies measures, such as harmonizing trade regulations, cooperating in improving transport
infrastructure and organizing regional trade fairs.
Developing export markets
To generate foreign exchange and replace imported spare parts, food-processing industries are
exploring export markets. This need assumed greater importance in the 1990s. It is difficult topenetrate overseas markets. Export markets are highly competitive because of the stringent quality
standards of importing countries. Keeping up with trends in processing and packaging and legal
labeling requirements is a key industrial consideration. Where export documentation and fiscal
measures (trade flow charges, tariff) are unfavourable, export market access is difficult. The strategy
to overcome the constraints should include:

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ATPS SPECIAL PAPER SERIES NO. 29•

Contact packaging in the importing country through an agent. A classic example is to export
yam flakes or grain in bulk to another country in Europe for packing and marketing.
Joint venture: Both parties should jointly develop, monitor and assist in implementing strategies
that would encourage “best practices”, information flow, material back-up, training anddevelopment. Growth opportunities (new products, new markets, distribution channels) should
be defined.

•

The aim should be to develop a powerful brand personality, creatively positioned and supported bymarketing efforts to yield optimum profitability.

Advertising
The intensity of advertising must increase in the years ahead to put weight behind products madefrom local raw materials, for proper brand positioning and creation of the desired consumer
perception. Advertising must be unique, educative, give value for money and the selection of themedium must be appropriate for the target group.

Sales and distribution
The sales force must be trained and well equipped to operate in the years ahead when competitionis expected to get tougher. Sales will become difficult as costs of distribution will increase due toincreasing transportation cost. Packaging must be capable of effectively protecting the product andbe able to withstand the rigours in the market place.

Pricing
Pricing should strike a balance between what the consumer can pay and the profit margin requiredby the company to remain in profitable business. Shareholders should receive an acceptable returnon investment and put the company in a position to maintain or replace its assets. This is an up-hilltask in export markets. A product of good quality faces the threat of being pushed out of the international
market if the price is uncompetitive.

Effective protection of the food industry
Food products and machinery that are locally fabricated from imported materials, using tariff andnon-tariff barriers should be approved by governments.

6.
Personnel Management and Assessment ofTraining Needs

The success of business is measured in terms of its profitability. One of the cardinal features of goodmanagement is that qualified manpower and other resources are used as productively.
Maximizing the capacity of manpower involves making decisions on the performance standards
required for all categories of workers – managers, supervisors, technologists, craftsmen andoperatives. These workers must be trained to attain the performance standards required. Thus, toattain the company’s overall objective, a training policy needs to be formulated as part of the generalpolicy of the company.

Why companies train
Companies train personnel to meet current and future needs for labour and the changes in jobs due
to transfers or promotions. Other reasons include preparing people for future promotion and newly
introduced jobs. Therefore, management and supervisory development should be a continuousand systematic process in any progressive organization.
Systematic training can:• increase production• improve quality of workmanship• lead to less wastage of materials• lead to better utilization of machines• reduce damage to machines and tools• reduce labour turnover• lower accident levels• reduce unit costs• decrease amount of supervision• reveal employee’s talent• improve labour morale• help create greater manpower flexibility
Thus training is an investment in human resources. If the trained staff is allowed and motivated toapply the skills and knowledge acquired, the results could lead to significant benefits to industry.

19

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ATPS SPECIAL PAPER SERIES NO. 29

Within the overall corporate development objectives, workers have established targets against which
their performance is assessed. The set targets are expected to be realistic, attainable andmanageable within a given time frame.
Consequently, targets successfully achieved (strengths) are identified as well as those partly achievedin a performance review between the subordinates and the superior. Those not achieved(weaknesses) and the reasons for non-achievement are also identified. In practice, factors for nonachievement usually include:• lack of company support• government policies• environment changes, such as, transfers• weakness of performer, for example, lack of requisite skill and knowledge
If poor performance of staff is caused by personal weakness, then a training need arises. It is,therefore, necessary to probe and recommend the right course including the following:• The record of training both outside and inside the company should be evaluated to establish
the training received so far• The supervisor should probe the workers’ academic preferences, skills and aptitude.
• The workers’ career aspiration should be ascertained
The supervisor and subordinate should set realistic and achievable targets in clear specific language,
and express the required results in precisely measurable terms

7.

Conclusion

The conclusions drawn from the discussions follow below.
•

•
•

•
•

After 30 years of expansive experimentation with different fashions in development strategy,
African countries have come back full circle to accept agriculture-led development strategies
as the appropriate response of agricultural countries to deepening continent-wide crises ofpoverty-driven hunger and malnutrition.
The food industries have tactical and catalytical roles to play within agricultural-led
development strategies in Africa.
Food industries’ capacity to fulfill this role depends entirely on how the paradigms of project
analysis are applied to sharpen the problem-solving capacities of a new breed ofentrepreneurial payers emerging in Africa food processing industry.
Training and effective R&D support are required to build and sustain entrepreneurial
capacities in food processing in Africa.
Food research centres are well poised to contribute to the development of food industry inAfrica, through technology development acquisition and application.

21

References
African Intellectual Property Organization (AIPO). Information Booklet, Yaounde, Cameroon. 1993.
Appropriate Technology International (TI). Bulletin number 24, August 1992. Washington, D.C.
U.S.A.
Asiedu, J. J. Kojo (1993). A Strategic Approach to Pursuing Food Security in Sub-Saharan Africa
through Women, Document prepared for UNIFEM Regional Office Dakar, Senegal
Asiedu, J.J. Kojo et al. (1988). A Feasibility Study on Income Generating Activities for Women in three(3) Districts in Malawi – Centre for Social Research, Zomba, Malawi.
ECA-MULPOCK (1991). Rapport sur l’Evaluation des Agro-Industreis Existantes et les Perspectives
de Cooperation Sous-Regionale. Douzieme Reunion Ordinaire du Comite des Experts,
Yaounde, Cameroon, 25 – 28 Mars 1991
FAO. 1992. The State of Food and Agriculture. FAO. RomeMANSCI (1992). Inventions of African Scientists. ICIPE Science Press, Nairobi, Kenya.
Odgola, W.R. and Rolf Henriksson (1991). Post-harvest Management and Storage of Maize.
AGROTEC, UNDP/OPS Regional Programme on Agricultural Operations Technology for
Smallholders in East and Southern Africa. Harare, Zimbabwe.
Rukuni, T. (1994). Primary Processing of Cereals at Farm and Village Level. AGROTEC, UNDP/
OPS Regional Programme on Agricultural Operations Technology for Stallholders in East andSouthern Africa. Harare, Zimbabwe.
Sourcebook on African Food Technology. 1995 Production and Processing Technologies forCommercialization RANDFORUM PRESS, Nairobi, Kenya
Technology Transfer Centre (TTC) of (CSIR) 1990 Report on Food Processing Sector in Ghana.
UNDP/TTC Doc. 15. Accra, Ghana (1990).
Zikonda A.R. 1994. The Role and Function of the African Regional Industrial Property Organisaiton(ARIPO). Workshop on Intellectual Property System Livingstone, Zambia, July 1994.

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WHY AFRICA HAS FALLEN SHORT OF BUILDING DYNAMIC AGRO-PROCESSING CAPABILITIES

23

Wellington Otieno is a consultant with Foodlink Resources (Kenya) and Ada Mwangola is withOXFAM (Kenya)

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