Do Better by Agriculture

he agricultural sector has proven itself! Arguably, the sector was more resilient than the traditionally revered tourism and hospitality sectors, during the recent COVID-19 pandemic. Local agricultural production can be relied upon to satisfy the food needs of the population and visitors, during other exogenous shocks and displacement from global supply chains disruptions.

It therefore makes sense for any country to focus on having a viable agricultural sector, if only for the basic need of food security.

Within the context of business modelling and marketing theories, the agricultural sector may not be seen as a cash cow or star, nonetheless, it is required to support sectors such as tourism and manufacturing, and sustain the nutritional needs of citizens.

Programmes like FEED (Farmers Empowerment and Enfranchisement Drive), which aim to boost local agricultural production, reduce food imports, and enhance food security, have enjoyed marginal success. Whereas these interventions present opportunities for small farmers to increase their output, they do not go far enough in engaging young people in agriprenuership and contributing to the overall reduction in the food import bill.

A viable agricultural sector must address several critical areas, inter alia, the sustainable use of land and natural resources, the contribution to healthy and affordable food for the population thus reducing the import bill, and the ability to enhance the livelihood of persons through job creation and actualisation. As an industry, agriculture can improve the labour market through the development of scalable and quality skills. Annually, these areas of focus should be assessed with quantitative and qualitative data to measure growth and improve as required.

A scan of the market at present suggests that while some programmes are in place to build capacity, there is much more to be done in areas such as financial assistance and capacity building for farmers, technological advancements, access to land and water, and the creation of an enabling policy framework.

Admittedly, programmes like the Agricultural Development Fund provide financial support for small firms in agriculture, facilitating access to necessary resources and technology. A grant scheme should be considered, particularly for those new entrants in the market, supported by the relevant training in business management.

Small farmers must be encouraged to adopt mechanisation and modern agricultural practices to enhance productivity. This includes the use of advanced machinery and irrigation systems, which can help reduce labour costs and improve yields.

The government and organisations like the Inter-American Institute for Cooperation on Agriculture (IICA) must go further in promoting the adoption of climate-smart technologies, which can help farmers manage water resources and improve resilience against climate change.

A review of the investincaribbean.org website suggests a recognition by the donor community and some regional governments of the feasibility in investing in agricultural programmes. The CARICOM initiative 25-by-25 underscores the Caribbean’s desire to increase local agricultural production and reduce dependency on imported products. This shift creates significant opportunities for investment in agribusiness and the agtech industry, attracting global investors.

Between 2003 and 2020, 26 agribusiness projects with a foreign direct investment (FDI) volume of USD$919.1 million were implemented in the Caribbean. This indicates a growing interest in the region’s agricultural potential.

The Caribbean market is valued at USD$369 billion, with 30 million local consumers and an additional 30 million affluent visitors annually, creating a robust demand for local agricultural products.

Investors are increasingly focusing on high-value crops, such as mushrooms, which are profitable for export. This trend highlights the potential for small businesses to engage in niche markets that cater to both local and international demands.

Events like the Agri-Investment Forum and Expo held in Guyana in May 2022, aimed to highlight investment opportunities and promote agricultural independence. Organised by the government of Guyana and CARICOM, the forum focused on addressing food insecurity, improving regional transportation, and supporting agricultural projects led by women and youth.

Even multilateral agencies have been eyeing the potential of the region’s agricultural sector. The World Bank invested some USD$25 million for the Belize Climate Resilient and Sustainable Agriculture Project to increase food production capacity and implement climate-resilient technologies. Millions were invested by the Inter-American Development Bank (IDB) in sustainable agriculture development across the region. Compete Caribbean hosting of an Agri-Tech Challenge, providing up to USD$120,000 in customised technical assistance to award recipients. They also organised webinars to discuss various ag-tech investment opportunities in the Caribbean’s agribusiness sector.

The IDB produced the AgTech Innovation Map, which serves as a resource for understanding investment opportunities in agtech throughout Latin America and the Caribbean.

These insights underscore the need to enhance local agricultural production through investment in agribusiness and technology. The region’s initiatives aim to create a sustainable agricultural sector that can meet local demands and compete in global markets, providing significant opportunities for small businesses. Admittedly, the 25-by-25 initiative has to be reviewed and revised, however a regional goal of reducing the food import bill should remain, with a finite and realistic timeframe to achieve.

Many countries may not be in a position like Guyana to invest approximately $1.8 billion in grants which, according to the Guyana Chronicle, has unlocked over 5000 small businesses nationwide, in developing their own agribusiness. However, the policy instrument is available to all governments to carve out a space for modern forms of agricultural initiatives that can address the need for innovation, increase food production, and provide opportunities for youth employment.