Attracting FDI could become an issue in Africa, report states


By Our staff reporter
African countries should continue to monitor progress toward the Malabo Declaration on Accelerated Agricultural Growth and Transformation for Shared Prosperity and Improved Livelihoods, while engag-ing with regional commitments on environmental health, according to the 2018 Global Food Policy Report.
The publication reviews major food policy developments and events from the past year. Leading researchers, policy makers, and practitioners examine what happened in food policy in 2017, and why, and look ahead to 2018.
The seventh annual report explores the overarching theme of globalization and growing anti-globalization trends, looking at how current changes in the flow of goods, investments, people, and information impact global food systems.
The report states that country-level leadership and champions who work to end hunger and malnutrition are among the most important drivers of change. Some encouraging campaigns include China’s commitment to achieving Healthy China 2030 and Ethiopia’s Seqota Declaration on ending under nutrition by 2030.
The report underlines that in the face of economic slowdown and a decline in export revenues, attracting Foreign Direct Investment (FDI) becomes critical to sustaining economic recovery.
Findings show that FDI flows to Africa decreased by 3 percent in 2016 to USD 59 billion. However, FDI levels vary greatly across the continent, with over half of total FDI directed to five countries: Angola, Egypt, Ethiopia, Ghana, and Nigeria. Egypt’s increase of 17 percent in FDI reflects the discovery of gas reserves, while the 28 percent decline in the Democratic Republic of the Congo followed the sharp fall of global metals prices.
It also points out that in East Africa, FDI to Ethiopia increased by 46 percent, with rising investment in manufacturing and infrastructure. In West Africa, FDI grew by 12 percent, boosted by increased investment in oil and other natural resources in Nigeria and Ghana.
One of the biggest challenges for food security in a number of countries has been climate shocks. The report points out that continued poor rains in parts of Ethiopia, Kenya, and Somalia in late 2016 and early 2017 caused a major food security crisis, particularly in Somalia and Ethiopia. As of December 2017, emergency conditions were expected to continue in parts of the region into 2018. The drought has significantly impacted agricultural and pastoral livelihoods in the Horn of Africa, and sustained humanitarian assistance will likely be needed.
The report further states that, although agricultural research spending and human resource capacity in Africa south of the Sahara have grown considerably, this growth has been uneven and trends are driven by large countries such as Ethiopia, Nigeria, and South Africa. “Many countries are overly dependent on volatile and unsustainable donor funds,” it reads.