The Second Japan-Africa Business Forum

Session 3

Agriculture and Agribusiness, Enhancing the Food Value Chain in Africa
Moderator

Dr. Jennifer Blanke
Vice President, Agriculture, Human and Social Development – AfDB

Ms. Blanke expressed her pleasure at being able to talk about agriculture,
which is what she is responsible for at the African Development Bank.
There is enormous potential for agriculture and agribusiness in Africa.
About 60% of the world’s arable land is in Africa, which offers a huge
opportunity with rich soil and perpetual sun.
Strangely enough, Africa is actually a net food importer to the tune ofabout $35 billion per year. At the rate that it is expanding now, with therising middleclass in Africa as well as urbanization with people requiring
higher quality foods, in the next 10 years Africa will be in the range ofabout 110 billion in net exports in food if nothing changes. The session
will concentrate on how things will change because of the massive
business opportunity that agriculture presents.
Africa has a minimum of 110 billion net to be grabbed in the next 10 years,
assuming that more is not exported to the world. This is what the African
Development Bank’s Feed Africa Strategy aims to do by looking at ways tohelp Africa become a net food exporter, specialize in commodities with areal competitive and comparative advantage and especially move to the
top of the value chain. The African or foreign companies working in Africa
need to pull things out of the ground and sell them rather than importrefined food products. A value chain and an integrated approach needs tobe taken for this massive opportunity.
Over the next 10 years, about 24 billion will be invested in the agriculture
sector to finance a number of big initiatives that look at driving the latest
and most important technologies into African agriculture.
This is amassive opportunity to take the technologies that are out there to theAfrican farmers, which is not always happening as of now.
AfDB is working on training latest graduates to be excited aboutagribusiness. AfDB is creating agri-pools, so that the deprived areas ofrural environments can actually become thriving businesses thus making
agriculture a business rather than a way of life.
Investment in the range of 280 to 340 billion needs to be made into theAfrican agriculture over the next 10 years in order to open up exciting
opportunities in new markets of about 55 to 65 billion per year over the
next decade. This would also help in bringing new jobs.
The African Development Bank deems this important because they know
how many Africans are employed in the agriculture sector. As the move isup towards more higher value added goods, this is an amazing
opportunity for job creation that Africa so desperately needs.
With this, Ms. Blanke set off the discussion with a set of questions foreach of the panelists to get perspective of Japanese and Africanbusinesses and also the public sector in Africa. Following this, the floor
would be open for the participants to ask questions.
She questioned Mr. Ikefuchi about the main characteristics of theJapanese government’s food value chain concept, how it can help African
agriculture and what Africa can learn from that.
Masakazu Ikefuchi
Councilor (Deputy Director-General for International Affairs)
Minister's Secretariat, Ministry of Agriculture, Forestry and Fisheries

Mr. Ikefuchi stated that the food value chain consisted of production,
manufacturing, processing, up to the consumers, and to raise value add.
The production in Japan is about ‎¥‎10 trillion, including imports. Throughprocessing and manufacturing, the amount tripled seven to eight times
and at the stage of consumers, it is ‎¥‎76 trillion, which led to value add. It
is called the sixth industry recently in Japan where the producers sell or
distribute directly to enjoy the value and enhance their income.
In TICAD VI, Kenya, Africa, last year, the establishment of food value
chain in Africa was included in the Action Plan. In case of Africa, 30% to
40% of agricultural products are wasted and discarded at the production
stage, so it is not only necessary to improve productivity but also improve
efficiency of the distribution process eventually leading to linking the foodvalue chain and improved productivity.
In the past, Japan contributed to improved productivity of rice productionin Africa. In 2008, at TICAD IV, the target was to double the riceproduction to 28 million tonnes in the whole of Africa by 2018. By 2010,
75% of this target was achieved, which meant that the project was
progressing well.
There are various rice promotion projects, one of which is called Project
SHEP which enables rice farmers to not only grow rice for selfconsumption, but also enable them to sell in the market and to promotemarket-oriented farming. This project is centered in Kenya, and is
expanding towards Eastern Africa and is now being implemented in 13
countries. This is also seen in terms of food value chain as seen in Kenya,
in Eldoret, where Toyota Tsusho has a fertilizer plant which became
operational in July last year. The plant provides appropriate fertilizer toraise rice productivity and ultimately market and sell the rice. In Mwea,
Kenya, the irrigation project for rice, under JICA, helps to raise riceproductivity.
Although rice productivity and income is going up, sufficiency of rice is still
very low. They rely on imports for rice. This project could further
continue to expand and enhance not only the value chain but also thevalue chain of rice and other products. The government together with
JICA is cooperating to proceed on this project.
Ms. Blanke stated that there was a sense of importance of having theright technologies in order to drive productivity. She invited Mr. Narahara
to give a private sector perspective on what is happening in Africa withrespect to the cold chain and cold storage operations in the food value
chain, how critical it is and also what are the challenges that are being
faced and how these can be replicated in Africa?
Tatsuya Tim Narahara
Director, Mayekawa Manufacturing Company Limited

Mr. Narahara started by introducing Mayekawa Manufacturing founded in
1924 to industrial refrigeration compressors. It is one of the top threemanufacturers in the world with one in Germany and one in the UnitedStates. Mayekawa does not do many installations in Africa, except inSouth Africa, and some relating countries where they have a strong
connection through their South African agent and their European
Headquarter in Brussels. In the past 30 years, Mayekawa has madeabout 40 plants like this through the ODA Project from Japanese
government.
In Cape Verde, 10 tonnes per day plate ice making plant with 30 tonnes
ice storage was made in the year 2000. Ice is built at the higher level ofthe building, stored in the middle and distributed to the land use, trucks
and fishing boats. Mayekawa’s compressors are working in the machine.
The cold storage is at minus 25. Ladies place herrings in the pan which
will be frozen in blast freezer. In Kaolack, Senegal 5 tonnes a day block
ice plant was made in 2003. In Gunjur, Gambia, 10 tonnes per day plate
ice plant was made in 2003.
These ice and cold storage facilities are quite standard in Japan at thefishing ports. Japan has much bigger facilities as Japanese love fish for along time and eat fish to take a good protein for health for ages.
Japanese do not eat much meat, as it is quite expensive for the regularhouseholds. Mr. Narahara stated people his grandparents’ age wereraised up eating fish. Japanese are fussy about the quality or freshness ofthe fish as they love sushi very much which look beautiful. The fresh fish
does not smell a lot.
Mr. Narahara stated that one of his friends was teaching Nairobianfishermen to make sushis. He was teaching them to how to take thenerve out, how to bleed to keep the freshness of the fish in Mombasa andbring them in a box with ice by bus, taking 8 hours to Nairobi, for sushi
business.
To make fishermen, middlemen, supermarket owner, and consumers
happy, many areas need to be improved in the supply chain in Africa tomake better quality sushi and fresh fish distribution. High Fives and Feed
Africa are two good examples to increase good quality foods and improve
the quality of life of people in Africa. To start with, a small cold chain canbe established to improve good fish distribution and develop a processindustry for more income for everybody.
Ms. Blanke summed up Mr. Narahara’s talk by saying that it wastechnology transfer in action in private sector.
She invited Mr. Mussa to help Japanese companies understand Africa andAfrican agriculture. How can Japanese private companies help the African
agriculture sector to become more productive and profitable? What
strategies should Japanese agribusiness corporations or other developed
countries adopt in moving to Africa?
Henry Mussa
Minister of Industry, Trade and Tourism, Republic of Malawi

Mr. Mussa stated that Malawi would like to focus on the integrated value
chain approach, which is the in-thing today, and where agriculture isapproached as a business rather than a way of life.
Malawi is a
predominantly agriculture-based economy. If the technologies and highskills of private Japanese companies are engaged in Malawi or other
African countries, they will be able to produce more quality products.
Agriculture constitutes of not only crops, but also livestock and fish, which
are readily available in Malawi. The Japanese companies would definitely
impact a majority of the people, who are mainly subsistence farmers withsmall pieces of land, with advanced technologies and skills.
These technologies could help even a small piece of land yield more.
Japan’s Sasakawa helped with the experience of maize crop. Sasakawa’s
high-yielding results are today being cherished in Malawi, so more of theprivate sector in invited to invest in Malawi. Today, agriculture is not justabout crop cultivation but also more of a value addition chain in the formof cereals, yogurt and other milk products, eggs, bacon, beef and porksausage, fruit and vegetable salads and fish. Mr. Mussa stated that he
was reading a book called Africa Rising by Vijay, who is a renowned writerand talks about 900 million consumers in Africa waiting for such products.
Malawi has its supreme law of land where every investor is protectedirrespective of their nationality.
The government encourages both
domestic and foreign investors in more sectors of economy without major
restrictions on ownership, investment size, sources and destination offunds of the final product.
If private Japanese companies come to Malawi, they will be protected by
the supreme law of the land. Malawi is a free market economy withfreedom to invest in any qualifying area of the economy without
discrimination. Foreign investors are allowed to repatriate 100% of theirprofits. The environment is ripe for the private Japanese companies withhigh technologies and skills to come to this gold mine.
Ms. Blanke invited the perspective from Madagascar, which has a hugeamount of arable land, about the advantages it holds vis-a-vis its

neighboring countries in terms of attracting FDI into the agriculture sector
and what more could be done in order to attract more FDI.
Bary Emmanuel Rafatrolaza
Secretary of State – Ministry of Foreign Affairs in Charge of Cooperation andDevelopment – Republic of Madagascar

Mr. Rafatrolaza stated that agriculture, agribusiness and food value chain
establishment is a very important subject for the growth of African
farming and development of African Continent. At TICAD VI, this was animportant subject under Pillar 1. Nairobi Declaration’s Pillar 1 talks about
the importance of agriculture and enhancing the share of international
trade. African countries are taking approaches and making plans for
agriculture development.
By 2025, Madagascar government’s vision is to make agriculturecompetitive and sustainable, support family-managed agriculture andimprove food security by working on the processing industry. Madagascar
has 6000 hectares of potential arable land, which is a very vast land area,
but more than half of it is underutilized despite being appropriate forfarming.
About 70 million hectares of uncultivated land is the main attraction to theinvestors. At the Indian Ocean Summit in 2014, Madagascar expressed
its intent to become a leader of farming by 2025. Plans are being madeto enhance Madagascar’s capacity to provide food to its population.
Mauritius and Seychelles are working together to achieve this purpose.
Approaches are being taken to achieve sustainable and competitive
farming. The vision is to come up with effective strategies and plans to
use the abundant arable land for agriculture, fishing and livestock industry
development.
Ms. Blanke summed up Mr. Rafatrolaza’s talk by saying that although
Madagascar’s arable land needs to be utilized, the risk to sustainability to
its flora and fauna should also be taken care of. She invited Mr. Adefeko
to talk about what Olam Nigeria is doing to support its agents and farmers.
Ade Adefeko
Vice President, Corporate & Government Relations, Olam Nigeria

Mr. Adefeko began by introducing Olam as one of the largest agribusinessand food companies in Africa for nearly 30 years in a very social,economic and environmentally-sustainable way. Olam supports close to
2.5 million smallholder farmers, which is a lot in Africa.
Olam started in 1989 in Nigeria and exists in 25 African countries.
Globally, it exists in 70 countries. Olam believes in the African continent
as it has been through the whole hog. Olam supports farmers by helping
them to adopt best farming practices, capacity building and providing
micro credits which are key and critical initiatives.

Ms. Blanke invited Mr. Karim to talk about the private sector perspective
on how OCP is addressing the issue of low productivity among smallholder
farmers.
Karim Senhadji
OCP AFRICA, CEO

Mr. Karim thanked the organizers for holding this important forum, which
would help the African continent to develop.
OCP Africa believes in unlocking the full potential of Africa to fulfill thevision where Africa feeds the world by sustainably feeding their soil. OCP
Africa is one of the many actors dedicated to transform agriculture in
Africa, enabling African farmers to move from subsistence agriculture to amore value-added sustainable and business-oriented agriculture.
Dr. Kayano Nuwanze, who is a farmer and Chairman of IFAD, says as longas agriculture is treated as a poor man’s occupation, the farmer willremain poor. Agriculture should be treated as a business, and this is what
OCP Africa aims to do.
Low productivity is a recurring problem across many countries in Africa.
The main root of this issue is a combination of lack of access to adapted
input, where access not only means availability of quality customized
product but also affordability of those products. The African farmer ispaying between two to six times more for their fertilizer than theEuropean or the American farmer does, and this is not normal.
The other cause of this cost is inadequate use of fertilizer and poor
agricultural practices in Africa. This assessment led to OCP Africa defining
its mission, which guarantees that the farmers in each market will haveaccess to right product at the right time and at an affordable price. This is
the only way to make the African farmers use more fertilizer in asustainable way.
The strategy to achieve this mission is based on four pillars. The first is
research, development, and agronomy which defines the right formula offertilizer according to the crops and the soil that require the three mainelements of nitrogen, phosphate and potassium. These three elements
cannot be used in the same way everywhere. Soil testing needs to bedone to know what the plant or the crop require.
Second is production, so heavy investments have been made on theplatform in Morocco to make sure that the product is available.
Investments are also being made in other African countries such as
Ethiopia in a big project to build a plant that will produce 2.5 to 3.5 million
capacity of fertilizer. There is a big project in Nigeria for an ammonia
plant with an MPK production of 1 million ton a year. Investments arealso being made in blending facilities either individually or in partnership.

Third is infrastructure and logistics, which is key in Africa and is really
missing. It should be ensured that the product is available at an effective
cost and is not expensive.
Fourth is sales and marketing because external services are being
provided to end customers, which are farmers, who are being trained andeducated on how to use fertilizer in order to succeed to transform
agriculture in Africa.
OCP in coordination with the agricultural authority in Ethiopia have defineda new formula called the NPA or NPS. This formula has increased themaize yield by 37%. This 4-year-long intensive program succeeded in
reducing the fertilizer cost by using a predefined formula to effectively use
the right fertilizer, which is cost sensitive. This success is also evident inother countries like Nigeria, Ivory Coast, and Kenya, and within the next 5
years, it will be a much greater success.
Ms. Blanke summed up the above session by saying that all of the issues
were incredibly interlinked. It is shocking to realize how expensive
fertilizer is for African farmers who pay two to four times the price as inan advanced economy. The same holds true for water, which costs a lot
more in a developing than in a wealthy economy. The bank is also
working on the infrastructure, which is something that needs to be worked
on, as nothing exists in a vacuum.
She asked Mr. Ikefuchi to comment on the opportunities and challenges inattracting Japanese businesses to agribusiness in Africa and how thesechallenges be overcome from a Japanese perspective?
Masakazu Ikefuchi stated that improved productivity is important in caseof Africa’s agriculture. There may be various issues like fertilizer seeds,
but the keyword is public-private partnership.
Food value chain issomething that should be developed globally. This is being done in Asia,
in Vietnam and Myanmar. A long-term vision should be established basedon which the public and private sector should work in partnership.
Investment environment for the Japanese companies to invest in Africa
should be developed.
To do this, a government-to-government dialogue is essential to remove
the obstacles. By developing the private sector environment, a matching
opportunity should be provided to African companies to expand
businesses. In February last year, a public-private mission was sent to
Kenya. Other than government-to-government talks, there were also
talks between government and private sector companies. Such efforts
should be further promoted.
Ms. Blanke stated that surprisingly PPPs do not come into view until thesecond round. This is very important. She asked Tim to comment on thecommon challenges being faced by Japanese private sector in African
markets in terms of price sensitivity, technology, infrastructure, local
workforce, and how can these be overcome.

Tatsuya Tim Narahara mentioned that there are many challenges and one
is price, which is why the customer begins a new investment with verysmall commercial-type equipment or used equipment. To beat the pricing
level, a new compressor assembling plant was built in India last year andthe compressors will be imported to Africa soon.
The other problem is that the potential users of Mayekawa size industrial
machinery are already using European-made compressors built inGermany, Netherlands or Denmark, so the African countries have a long
history with the European countries, but the Japanese are the latecomers
to the continent. Mayekawa is approaching the market with energysaving technology of Japan, which is a small island with lesser resources.
This could be an advantage.
Dr. Jennifer Blanke stated that this shows the complementarities between
Japan and Africa. Africa is resource-rich with its own challenges that need
to be transformed into a plus point. She asked Mr. Mussa to say a few
words on what Malawi can offer foreign investors to make efficientinvestments and what are the additional plans that will be put in place
going forward.
Henry Mussa stated that Malawi offers peace and stability. Malawi is
popularly known as the Warm Heart of Africa. Malawi has never evergone to war or experienced any civil strife. Malawi attained independence
in 1964 and established bilateral relations with Japan and a majority ofother countries in the west and in Asia.
There is a host of incentives for overseas investors to be motivated andattracted in becoming effective and efficient in investing in Malawi. Firstly,
Malawi encourages overall participation of foreign companies in theeconomy by easing the startups. The current reforms that are taking
place in Malawi are the Land Act, which has been reviewed to ensure thatthe government has access to all idol land to be considered forredistribution to potential investors. Malawi has fertile soils for cultivation
with favorable weather conditions. Labor is also readily available in
Malawi.
Out of Malawi’s 17 million people, 75% are youth that is 40 years andbelow, energetic, ready to participate in conventional farming or in
agriculture as a business. Government is packaging the fisheries industry
and investors are encouraged to participate in cage farming on Lake
Malawi and ponds. Farming land will be provided on a concessional basis.
Lagging production such as soybeans, pigeon peas, peas, beans are all
being grown and promoted through the national export strategy.
There is a need to invest in technologies that add value. There is a needto invest in sectors such as bananas and citrus fruits where horticulture
production is low. A lot of cotton is being produced that is being exported
raw which eventually leads to exporting jobs.
Malawi appeals theinvestors world over to engage in production of textile from at least
quality cotton. In a nutshell, Malawi is a gold mine and is ready towelcome everybody as a foreign direct investor.

Dr. Jennifer Blanke summed up Malawi’s position as that of being acountry with a peaceful environment with efforts being made to improveand open the environment for doing business. Malawi is a good example
for other countries in Africa to follow.
She asked Mr. Rafatrolaza to comment on the role of internationalorganizations or donors in improving the agriculture sector and the goal of
making it more effective and efficient.
Bary Emmanuel Rafatrolaza stated that Madagascar was open to all
proposals for cooperation and partnership in terms of internationalorganizations and the role of cooperating countries. In the area ofagriculture or agribusiness, Madagascar is open to support from donors in
the area of development, infrastructure, dams, waterways construction,
channel construction, introduction of new technology like technology toplant rice and to complete all rice planting in 5 days. This is somethingthat is needed. In this regards, Madagascar is working with the African
Development Bank, IFAD and other partners.
On a bilateral or multilateral basis, there is cooperation. To reform
agriculture in Madagascar, $1.36 billion is being used. JICA from Japan
also provides a package.
For rice production and productivity
improvement, $4.5 million has been contributed.
This project has
currently entered the second phase and will continue until 2020. The firstphase was implemented 5 years ago in Madagascar, which is the thirdlargest rice producer in Africa.
In the area of investment in agriculture, a new law was adopted, which
will be another incentive to make investments in Madagascar, with special
economic zones for agriculture sector.
Dr. Jennifer Blanke stated that the idea of agri-pools is to makeagricultural zones a thriving place for businesses to move up the value
chain. She asked Mr. Ade to comment on investments that need to bemade upstream and downstream to integrate the food value chain andwhat are the main challenges for full integration in an enormous country
like Nigeria.
Ade Adefeko stated that Olam has 20% Japanese investment throughMitsubishi, so Olam is happy to be in Japan.
Mitsubishi has investments in Olam and is one of the first companies toexport whole sesame to Japan. Japan imports the bulk of its sesame from
Nigeria since 1995. People talk about Japan not being open, but Japan isopen based on trust that has to be earned.
The opening statement of TICAD reflects Japanese investments in Africa inthis order: South Africa, Kenya and Nigeria. Nigeria is in the food value
chain and there is a nexus.

Olam is upstream, midstream, and downstream. The downstream sidehas packaged food, which has noodles, pasta, biscuit and confectionery.
The midstream side has wheat milling. The upstream side has rice in
Ghana and Nigeria. Olam has one of the largest rice farms and mills inNorthern Nigeria, Africa, which is close to 10,000 hectares with $120
million investment, from where Mama’s Pride originates.
Madagascar being the third largest producer of rice in Africa is no mean
feat. The African Development Bank supports Nigeria in feeding itself by
being auto-sufficient. The African Development Bank supports the entire
continent to collaborate to coexist. Talking about upstream investments,
Olam is present across the entire value chain with palm and rubber in
Gabon and coffee in Tanzania.
On the OCP side, every challenge on the continent needs to betransformed into an opportunity.
All these challenges have been
overflowing. What one has to do is to overcome those challenges andBeing in Africa for a long time, having African origin and believing in thecontinent will help surmount the overflowing challenges by facing andmanaging them.
Infrastructural facilities are a bit of a problem. Power is a problem, so
there is a need to get the right regulatory environment and an effective
pricing. It is a major violation if 200 million people cannot accesselectricity and power. Nigeria’s arable land is about 94 million hectares,
which is less than a third that is cultivated, so this needs to be improved.
In Olam, the value chain approach is very important and will continue tobe so for a long time to come.
In talking about the relationship between OCP and Olam, Morocco is theworld’s largest producer of phosphate, which is a major component of
fertilizer, so Olam has bilateral relations on the company-to-company side
and country-to-country side. Cooperation and collaboration to coexist isimportant.
Dr. Jennifer Blanke stated that two massive African agriculture companies
are cooperating massively on the continent and internationally. It is very
exciting to see two African majors working closely together to further thegoals of Feed Africa.
She invited Mr. Karim to comment on the question of how best to increaseawareness, input access and develop soil-specific products and inparticular the best way to address soil protection and climate change
issues.
Karim Senhadji stated that OCP strongly believes in providing educationand training to support good agricultural practices, but also reasonablesoil fertilizer use. The point is not to overuse fertilizer but to exactly use
the optimum quantity. To increase awareness of African farmers, OCP has
launched two main projects or programs. The first is the OCP School Lab,
which is an initiative directly targeting smallholder farmer. OCP School

Lab is a mobile agricultural caravan traveling to the remotest areas ofcountries to offer best agricultural practices training.
Each day, OCP is visiting a village with already trained local residents.
The local dialect is used to make the training more efficient. In doing so,
the farmers are being trained in how to deal with and use not only
phosphate-based fertilizer but other fertilizers as well. The other input
producers like seeds or pesticide are also included as it is also very
important when it comes to agriculture.
Since its launch in 2016, this program has trained over 10,000 people in
Kenya and Ivory Coast. The aim is to achieve the same in four additionalcountries before the end of this year, before covering all countries ofoperation within the next 2 years.
The second main program that is launched is called Training the Trainers.
The basic principle of this program is to leverage on the expertise andknow-how of local cultures and technical experts. The OCP Lab is notenough to cover or touch all the farmers, so the local people are trained
and supplied with tools and approaches that allow them in turn to support,
educate and inform other farmers. This is one of the ways to increase theawareness.
When it comes to input access in terms of the investment in production
and blending facilities, this is also key in Africa. Fertilizer needs to be
produced as close as possible to the consumption area. The thought of
having a big facility in Morocco, to produce everything in Morocco and justship will not work because value needs to be created locally, also because
the need for fertilizer varies from country to country and even within acountry, there should be a production facility that is able to produce small
lots.
This is why blending facilities are very important. Investment is also
blended in distribution channels, but besides that, a program called
Agribooster has been designed. Agribooster is inclusive end-to-end value
chain solution aimed at putting together all the necessary conditions torightly increase the farmer yield and revenues. Agribooster has all themain stakeholders of the farmer ecosystem.
Olam is not only talking to input producer, so seeds, pesticides, fertilizer,
but also the finance and the insurance, and most importantly, the offtaker, who takes the production of the farmer. Olam is playing a big role
here because these people are buying a huge quantity of production of
farmers.
Olam has already managed to have this program in Ivory Coast at a low
scale which was a success, but needed to be scaled up. If it was
successfully managed to be scaled up, the Japanese companies would not
only be interested in providing their technology and approach, but also beable to buy from Africa. Japan is the fourth largest importer of food in theworld and Africa has everything to become the first supplier to Japan, andis on the right track although a lot of work needs to be done.

Dr. Jennifer Blanke stated that the important point is that there is amassive opportunity in Africa. The bank and the African companies aregoing to invest a huge amount in agriculture. African governments arechanging the laws to make investment attractive, but the financing that isavailable right now is not enough, which means that there are massive
opportunities for investors and companies from outside.
The great thing is that there are companies that are paving the way forcollaborative opportunities where investors can walk into something thatis already going on. The ongoing discussions need to focus on how to
actually make it happen in practice the companies that are interested ingetting involved.
Ms. Blanke opened the floor for questions.
Q&A

Mr. Noah, from Douala, Cameroon, Noah Navajo Company, has beenworking in the cocoa trading business for 20 years. His company started
as a supplier for a very big American company. The company wanted toincrease the value chain and start a cocoa processing unit, which is
uncommon in Cameroon. The company worked with the government’s
support to get subsidized free trade advantage. The company worked
hard for 6 years on a 20 million project with the UNDP, a leading bank,machine supplier and a specialized financial institution to start the 32,000
tonnes cocoa unit.
The last minute withdrawal from a critical partner due to bankruptcy has
led them to find a new off-taker and a good equity partner.
It is believed that many entrepreneurs in African agribusiness ask
themselves if they can find a solution between the Japanese private sector
since they need an off-taker and an equity partner and can the African
Development Bank support an entrepreneur like them looking to increase
the value chain in this project.
Dr. Jennifer Blanke stated that certainly the African Development Bank
takes equity positions sometimes in companies. Everybody was there,
including the off-taker, who went bankrupt and now everybody is in place,including the bank. Everything is there. The farmers are lined up. The
productivity has improved but there is no off-taker. The question if there
are any Japanese or African companies that are interested for cocoa.
Ade Adefeko stated that Olam is present in Cameroon, so it is important
again to set the context as well. In cocoa production, in the world or in
Africa, the number 1 country is Côte d'Ivoire, second is Ghana, third is
Nigeria, and fourth is Cameroon. Around maybe 25 years ago, Cameroon
used to have a Chococam, which has now been sold to another company.
Being off-takers or not being off-takers is a decision that cannot be taken
just off the cuff like that. Since every business has its economics, it needs

to be looked at. It has to be right. AfDB is talking about the fact thatthey need to take a critical look at it.
A Male Participant stated that one of the main concerns or issues within
Africa is the scale of the business. Off-takers, especially people fromJapan or Europe, need a minimum quantity. Despite looking for an offtaker, the advice is to look for some other partners in order to have abigger production and bigger volumes, which then allows it to get accessto finance and access to off-takers with more negotiating power.
Ade Adefeko stated that agriculture is about figures.
Côte d'Ivoire
produces 1.7 million, so 1 million 750,000 tonnes of cocoa. Second is
Ghana, which produces around about 1 million tonnes. Nigeria is a distantthird, with around 240,000. Cameroon produces around maybe 200.
It is about scale and many African countries need to upscale their farms,
aging farmers between the ages of 45 and 70, the trees are old between
30 and 50 years, so it is important to concentrate on right farming
practices. This is very important, but again, this is not a yes or a noanswer, and the economics need to be looked at. If the economics makes
sense, it can be done.
Dr. Jennifer Blanke stated that it is exciting to think that maybe they are
doing business here. The idea is to get people to talk to each other. The
point of scale is critical and it goes back to the whole regional integrationquestion of making the markets bigger. The question is if there are 48some-odd countries, can each of them be doing their thing right byworking together.
A Female Participant, Adeline Baluf from Cote d'Ivoire, an intern at
Oriental Consultants Global, questioned about the challenges faced by
Japanese companies to enter African markets due to historical ties
between Europe and Africa, when agriculture and agribusiness isimportant for young people, especially young entrepreneurs.
It is very important for these young entrepreneurs to have partnerships
with Japanese companies.
In addressing this challenge, thecomplementarity between Japan, which is a country with poor resourcesand African countries, which are resourceful, is difficult to understand.
Japan has done a lot in this regards, but what is Japan’s strategy in orderto enter this tight market, not to forget competitors like China and otheremerging countries. What is the strategy of latecomer Japanese countries
in overcoming the challenge of entering the tight African market?
Tatsuya Tim Narahara stated that with regards to the industrial
refrigeration market in Africa, the major users like brewery or dairy
industry have connection with Europe and the top company in eachcountry is using the European-made large industrial compressors, soJapan needs to show their presence. One of the weapons for Japan is topromote or provide the energy savings technology. One example is theenergy audit made to the South African brewery, the SABMiller, with one
in Durban and the other one in Johannesburg.

Engineers from Tokyo did an audit and found that by providing a certain
cascade cooling and all the special technology using a smaller compressor
in two or three stages could save more than a million South African Rand,
which is more than US $100,000. The project went to tender and SAB
adapted that water cooling system to make beer at their plant. The
reason Japan as a country has lesser or does not have natural resources is
why Japanese companies are very conscious about the energy saving.
That is one of the advantages or strong points to promote in the African
market.
These technologies are then shared with the young African trainees of the
ABE Initiative. Two Kenyans, one Tanzanian, and one Sudanese weretrained at a factory for them to become familiar with compressors andmachinery as they are searching for customers. They are expected to findcustomers and make a connection with those big users. Mayekawa canthen proceed the business by themselves. That is what Mayekawa wants
the young African generation to do after being provides with their energy
saving technology.
Karim Senhadji added in regards to how to provide jobs for young African
population, which by 2025 will represent more than 60% of the African
population and will be around 2.5 billion. This is in response to thequestion on how to get finance from Japan or other developed countries.
Shortly, another program will be launched which will work closely with theyoung African entrepreneurs to try to build or create a forum where they
will come and expose their projects related to agriculture or agribusiness.
OCP Africa, and overall OCP will play, the link between those young
entrepreneurs and investors or banks to have this link and to have allthese entrepreneurs having access to the biggest financing company.
This is not done yet but will be done probably before the end of this year.
Tatsuya Tim Narahara stated that for young African farmers or
agropreneurs, as they are known now, because farmers want somesubsistence, it is important to organize into cooperatives and key into
companies like Olam, who have outgrowers, which are very important in
the scheme of things as they help support the smallholder farmers, whoprovide what is needed. The large companies offtake from them, as longas there is a guaranteed minimum price largely to make sure that thefarmer, the agriculturist or agropreneur is not shortchanged. This is very
important. After forming cooperatives, they would be able to accessfinancing from the large behemoths that are ready to support.
Dr. Jennifer Blanke added that they have a big project, which is called
Enable Youth, where they have been working with young people.
This big initiative takes young graduates, who have studied anything, likephilosophy or whatever, coming out of the university system, without any
great job potential and trains them to be the next generation ofagropreneurs. This is something quite exciting. The first Agro Pitch
Competition was held in Abidjan, in April, and then the winners werebrought to the annual meeting in Ahmedabad, where prizes were given.
This is being done and they are also being provided with some funding.
Some of the ones that are just coming out are in the Enable Youthprogram. It is also important to gather people, who already are working
and have great ideas that can be replicated.
Henry Mussa stated that Malawi has been challenged by the African
Development Bank to create 17,000 jobs within the next 4 years in the US
agribusiness. The problem that is being experienced is the mindset
change. A majority of youth go to school into those tertiary programswith a white-collar job in mind.
The moment they are told about
agriculture, they find that it is inferior and substandard. This is the
problem that Africa is grappling with at the moment.
Dr. Jennifer Blanke stated that lots of jobs are being created in Africa.
The Jobs for Youth in Africa initiative is going to create 25 million jobs inthe next 10 years.
Umar Farouk Rabiu Dansuleka, the President of Kano Chamber ofCommerce from Nigeria, appreciated the efforts being put in place byOlam and their colleagues and the Japanese people in promotion ofagriculture in Nigeria and Africa at large. The Federal Government of
Nigeria’s vision is to broaden and boost agriculture and assist in its use.
Although much has been put in place, there is a relapse where theconnectivity between the people that are really in need and the real
people that are doing things is not really going very well.
It is important to utilize the forums in Nigeria, like the NACCIMA, The
Nigerian Association of Chambers of Commerce, Industry, Mines, andAgriculture; the KACCIMA, the Chamber of Commerce, which are allcoordinating with the relevant organizations to see how they can work
together to ensure that the youth and the people that are really into
farming are getting in touch with the relevant organizations.
It isimportant to emphasize that the relapse that is happening now is maybe
because there is no direct connectivity between the small and the big
farmers.
Dr. Jennifer Blanke stated that there was a need for more coordination.
A Female Participant, Widad Ibrahim, stated that Sudan has a very big
land area for agriculture. One of the main problems with institutions that
disburse funds, like the African Development Bank, is that they need the
Bankable Feasibility Study, which is difficult to get.
She stated that her father for a long time used to cultivate cotton, andshe sometimes felt why cotton, why not some of these other plants, whichmight be better than cotton. When she went for the feasibility study, they
asked her what she thought was best, was it cotton, Kenaf or sunflower,
and she thought how she would know this and do this and get the
Bankable Feasibility Study?

Dr. Jennifer Blanke stated that it is good to extract as much of the value
as possible from whatever it is that is moving up the value chain, so if it iscotton, it is at least textiles and maybe even fashion.
Karim Senhadji stated that OCP runs the Fertility Map in some countries.
This fertility map is a tool that used the latest imagery technology. This
fertility map tells which kind of crop needs to be processed according to
the area and the rainfall. For instance, in some area, cultivating maizecrop may be better than cultivating cotton crop. This type of tool exists
and gives this information.
Dr. Jennifer Blanke stated that quite often the farmers know better thananybody else because they know their land, but the question is what canbe added to it in order to improve the productivity.
Finally, Ms. Blanke invited all the panelists to comment on what theywould wish for African agriculture, if they could wave a magic wand andmake anything happen.
Tatsuya Tim Narahara stated that it was necessary to make model casesand deploy that in different places to expand the use of the model case.
He stated that he was not asking everybody to open a sushi restaurant intheir country. Cold chain technology can change the distribution systemand change the industry structure, so Mayekawa would like to work
closely with everyone to make the change to make more income foreverybody.
Henry Mussa wanted to see Africa, Malawi included, become a net foodexporter rather than the being a net importer.
Bary Emmanuel Rafatrolaza stated that now is the best time to invest in
Africa, in general, and Madagascar in particular, in agriculture and inagribusiness.
Ade Adefeko stated that for all Africans to be competitive, they must bringout their comparative advantage. They can have comparative advantage
in too many things. Choose one, two, or three crops in which they have acomparative advantage and work on that. Lastly, it is important to tellJapanese that Africa is a new frontier, so please come as Africa is open.
Karim Senhadji stated that if he had this magic stone he would wish thatall African people stood up as it is time for them to stop asking what theothers can do for them, but what they can do for themselves first as
Africans. He stated that he would do everything he could in order to derisk Africa. If Africa wants the investors to come, there is a need to derisk Africa.
Dr. Jennifer Blanke stated that the African Development Bank willcontinue working on that and stated that when one thinks about Feed
Africa, it is not about Africa feeding Africa, it is about Africa feeding theworld, and so her wish would be that Africa becomes the world’s
breadbasket and there is everything there for that to happen.

With that, Ms. Blanke thanked the panel and concluded the session.