UN calls for more funding for organic farming in Africa

The UN has called for increased funding for organic farming in Africa, which, it said, has rich potential but is increasingly under-funded.

A survey conducted by the UN Conference on Trade and Development (UNCTAD) revealed on Monday that organic farming offers an excellent and lucrative export opportunity for Africa, but access to finance is harder to come by than five years ago.

In the survey, 64 percent of organic farmers, exporters, and experts from 16 African countries said the situation had not changed while 23 percent said they felt that access to financing had become more restrictive in the last five years.

"Based on our survey, the most critical areas in terms of the need for external funding highlighted by stakeholders in organic agriculture were certification, the organization of smallholder farmers into production groups, marketing, and the purchase of equipment," Malick Kane and Henrique Pacini, two experts wrote in the report.

While established organic exports like coffee and cocoa benefit most from the access to finance, the UNCTAD survey notes that crops like organic pineapples, mangoes, bananas and even potatoes have enormous export potential.

"Our work highlights the fact that limited credit-guarantee mechanisms and insufficient capacity of commercial banks to integrate the specifics of organic agriculture are major hindrances on the ability of organic farmers and exporters to finance their activities in Africa," said Kane.

"Unfortunately these are precisely the areas for which respondents said financing was becoming scarcer," added Kane.

According to the UN Food and Agriculture Organisation (FAO), funding for Africa's agriculture in general has come under pressure in recent years, falling to an average of 2.7 percent of national budgets in 2013.

This happened despite a 2003 African Union commitment to allocate 10 percent of national budgets to this area. Also, the share of commercial credit made available for agriculture in Africa fell to an average of 2.8 percent in the same year, while the global average is 5.8 percent.

Specialist organic farmers looking for financing have seen knock-on effects, despite the premiums they can charge to export their goods to lucrative rich markets.

"In view of the current situation, we strongly advocate for a coordinated effort to improve the data collected about both the domestic and export value of organic products so that a better business case for organic agriculture can be made in Africa," Pacini said. Enditem