Agricultural trade: ambiguous indicators

Import less. Export more. Among all the arguments put forward in favor of modernizing African agriculture, those relating to the poor performance of agricultural trade frequently come up. It is often said that it is not normal for Africa to import so much food; it must produce more to feed its population. And it seems obvious that it is not exporting enough, because for many products, particularly food, its farmers are not competitive on world markets.

Decline in imports, increase in exports: in reality, these indicators are ambiguous. An increase in the value of food imports is not a cause for concern if it occurs at a slower pace than consumption; in other words, if the market share of foreign products in the African "food basket" is decreasing. As for exports, their increase may reflect not greater agricultural competitiveness but rather a sluggishness of domestic demand, unable to absorb all production, which is not a sign of progress. Finally, from an employment perspective, a moderate increase in exports may be preferable to more sustained growth, if in the former case it mainly concerns processed products.

More than the amount of agricultural imports and exports, two indicators seem relevant to us for assessing the success of the policies implemented by African countries in terms of agricultural competitiveness and food security, respectively. The first is the agricultural trade balance. It provides information on the agricultural sector's ability to offset purchases of agricultural products abroad through its exports. This is not the case for Africa as a whole, at least for food products (including fishery products): in 2018, its food exports reached $43.1 billion compared to $66 billion for imports, a deficit of $22.9 billion.[1]And this deficit is structural, as the graph below shows.

The second indicator has a broader meaning: it measures the sum of the food trade balance and the non-food trade balance. If this sum is sustainably positive, then the country concerned does not have to worry unduly about a possible deficit in its food trade balance. It is simply that it has successfully specialized in other products and, thanks to its integration into trade, is managing to ensure its food security. Here again, this is not the situation in Africa, which, in addition to the persistent imbalance in its food trade, recorded a negative balance of $34.9 billion in 2018 for trade in other products, resulting in a deficit in its trade balance of $57.8 billion. This deficit is also structural, as the non-food trade balance has been negative since 2014.

Of course, assessing the competitiveness of agriculture and food security cannot be reduced to commercial criteria. It is also necessary to rely on relevant indicators if we approach these two questions from a trade perspective.

[1] These figures relate to Africa's trade with the rest of the world, excluding intra-African trade. Source: UNCTAD.