In the October-December issue of BBC Focus on Africa magazine I researched a piece on growing interest in African agriculture. Food security, after all, is increasingly viewed as the new energy security and Africa is the last major reserve of arable land.That land is abundant and the land comes cheap. Of course there are challenges too; land and food in Africa are big political hot potatoes.
A compelling argument for investing in Africa came from Susan Payne, the chief executive of Emergent Asset Management, a UK based investment company. Ranked in the top hundred most influential women in finance and having previously headed up emerging markets divisions at Goldman Sachs and JP Morgan, she calls this the most win-win thing she has ever done.
What EMAL is doing is buying up or leasing under capitalised farms in sub-Saharan Africa, introducing South American farming techniques, like no-till, as well as seed enhancing technologies and in doing so is boosting yields by three times in around a year. The so-called ‘ethical’ piece is that they work with nearby smallholders (increasingly seen as central to food security on the continent), who they are looking at providing microfinance to, set up hospitals where they buy land and are big on education. Right now exports are minimal part of the business – “feed Africa first” is the mantra, though some would argue the motives may not be as altruistic as they seem.
As early movers in this space they are laying low right now, and Payne appears clear that this is investing for the long-term, but this is one to watch. Read my article here.