Agriculture is a key sector where trade can make a difference in improving livelihoods and reducing poverty. In Least Developed Countries, the highest share of employment is typically in agriculture, and most poor live in rural areas. There is evidence that the agricultural sector provides one of the highest returns on investment in terms of growth, poverty reduction and pro‑poor employment creation. Hence, the development, productivity and competitiveness of the agricultural sector are also crucial to facilitate the process of economic transformation and social development in developing countries. Agriculture and agribusiness are core to the EIF's implementation, with around two thirds of the EIF project portfolio focusing on this sector.
Despite agriculture being a strategic sector for economic and social development, trade and agriculture development strategies and investments plans (such as the EIF and those under the Comprehensive Africa Agriculture Development Programme – CAADP) are often weakly linked. These particular issues were highlighted in the FAO flagship report – The State of Agricultural Commodity Markets 2015-16 – which analyzes the links between trade and food security and the challenges and opportunities related to achieving better synergies between national food security objectives and trade‑related priorities.
Weak linkages between trade and agriculture policy-making processes can result in less than comprehensive strategies and diverging views on the national priorities for the development of agricultural trade. For example, Diagnostic Trade Integration Studies (DTISs) tend to focus on exportable cash crops, whereas CAADP investment plans often prioritize food crop productivity. By combining both perspectives, a more holistic view can be taken of agricultural development and food security, which includes sufficient consideration of the role of trade, including opportunities and constraints in obtaining access to, or competing on, regional and international markets.
A number of activities are underway to maximize these important synergies between agriculture and trade stakeholders.
At the invitation of the FAO, the EIF has been working with the organization in an effort to mainstream trade into agriculture policies (and vice versa). This follows a strategic initiative from the FAO to increasingly use its Country Programming Frameworks (CPFs) to mainstream trade into national agriculture planning processes and provide the relevant technical assistance to countries to ensure that strategies, policies and agreements are more supportive of agricultural development and food security objectives.
In May 2015, to start this process off, the FAO organized a regional workshop in Harare, Zimbabwe, with the participation of trade and agriculture officials from a variety of countries in Africa and key international partners, such as the EIF and regional bodies. In addition to building understanding between trade and agriculture officials and laying the basis for increased coherence and collaboration at the country level, specific opportunities to coordinate operational modalities emerged. Coordinated timelines between the EIF's DTIS and the FAO's CPF processes in Mozambique and Zambia have provided a mechanism to effectively utilize the analysis in the DTISs and open up opportunities for an effective dialogue in order to mainstream trade issues into the CPFs. Following on the modalities adopted in these two countries will enable an initial focus on a joint engagement in aligning the DTIS with agriculture strategies and investment plans and for providing targeted technical support to the countries.
Formulation and implementation of agricultural trade policy, food safety and sanitary and phytosanitary (SPS) issues are among the areas where closer collaboration will take place. The FAO is currently implementing an EIF project on enhancing Nepalese ginger exports through public‑private partnerships. It has also contributed to an upcoming joint EIF/STDF study on how SPS issues are addressed in DTISs and wider EIF processes, which will inform further areas where linkages need to be made.
This increased cooperation will help in better targeting donor-supported projects to the interlinked needs of trade, agricultural development and food security.