The African Development Bank (AfDB) has moved to tackle the hunger crisis emanating from the Russia-Ukraine conflict. The African Development Bank Group’s Board of Directors on Friday approved a $1.5 billion facility to help African countries avert a looming food crisis.

The impact of the conflict has spiked food prices globally, instigating inflation and urgent need for proactive measures to curtail the rising cost of food. The bank noted that the disruption of food supplies arising from the Russia-Ukraine war puts Africa in a shortage of at least 30 million metric tons of food, especially wheat, maize, and soybeans imported from both countries.

“African farmers urgently need high-quality seeds and inputs before the planting season begins in May to immediately boost food supplies. The African Development Bank’s $1.5 billion African Emergency Food Production Facility is an unprecedented comprehensive initiative to support smallholder farmers in filling the food shortfall,” it said.

Between 2018 and 2020, Africa imported $3.7 billion in wheat (32% of the continent’s total wheat imports) from Russia and another $1.4 billion from Ukraine (12% of the continent’s wheat imports). The AfDB is now looking at diversifying African wheat and other food sources by upping the continent’s farming capacity. The goal is to attain $12 billion increase in food production in just two years.

The Bank said the African Emergency Food Production Facility will provide 20 million African smallholder farmers with certified seeds, increase access to agricultural fertilizers and enable them to rapidly produce 38 million tons of food.

“Food aid cannot feed Africa. Africa does not need bowls in hand. Africa needs seeds in the ground, and mechanical harvesters to harvest bountiful food produced locally. Africa will feed itself with pride for there is no dignity in begging for food…” African Development Bank Group President Dr. Akinwumi Adesina said.

This move follows experts’ calls on African leaders to take proactive measures to mitigate the food shortage impact of the Russia-Ukraine war.

“Many families have been overtaken by hunger, undue inflationary pressure, etc, and we cannot throw a baby away with the bathwater. Helping Ukraine must not bring pain to all nations and I seek for a better strategy because bad things are brooding. I call on the African Union to show leadership urgently. If not, we may fight wars of extreme hunger in coming months, even with no visible military tanks on African streets,” Prof. Ndubuisi Ekekwe, Tekedia Institute, said in a note.

The AfDB said it has been consulting with finance ministers and other stakeholders to facilitate modalities, which includes efficient fertilizer production, to boost food production.

Read the ministers’ agreement and the AfDB’s long-term plan to make Africa food-sufficient below.

The ministers agreed to implement reforms to address the systemic hurdles that prevent modern input markets from performing effectively.

The price of wheat has soared in Africa by over 45% since the war in Ukraine began. Fertilizer prices have gone up by 300%, and the continent faces a fertilizer shortage of 2 million metric tons. Many African countries have already seen price hikes in bread and other food items. If this deficit is not made up, food production in Africa will decline by at least 20% and the continent could lose over $11 billion in food production value.

The African Development Bank’s $1.5 billion strategy will lead to the production of 11 million tons of wheat; 18 million tons of maize; 6 million tons of rice; and 2.5 million tons of soybeans.

The African Emergency Food Production Facility will provide 20 million farmers with certified seeds, fertilizer, and extension services. It will also support market growth and post-harvest management.

The African Development Bank will provide fertilizer to smallholder farmers across Africa over the next four farming seasons, using its convening influence with major fertilizer manufacturers, loan guarantees, and other financial instruments.

The Facility will also create a platform to advocate for critical policy reforms to solve the structural issues that impede farmers from receiving modern inputs. This includes strengthening national institutions overseeing input markets.

The Facility has a structure for working with multilateral development partners. This will ensure rapid alignment and implementation, enhanced reach, and effective impact. It will increase technical preparedness and responsiveness. In addition, it includes short, medium, and long-term measures to address both the urgent food crisis and the long-term sustainability and resilience of Africa’s food systems.

Over the past three years, the Bank’s Technologies for African Agricultural Transformation initiative has delivered heat-tolerant wheat varieties to 1.8 million farmers in seven countries, increasing wheat production by 2.7 million metric tons, worth $840 million.

Long-term sustainability to wean Africa off wheat and other food imports

A five-year ramp-up phase will follow the two-year African Emergency Food Production Facility. This will build on previous gains and strengthen self-sufficiency in wheat, maize, and other staple crops, as well as expand access to agricultural fertilizers.

The five-year phase will deliver seeds and inputs to 40 million farmers under the Technologies for African Agricultural Transformation program.

In April, UN Secretary-General António Guterres appointed Adesina to a select Steering Committee of the Global Crisis Response Group.

The U.S. Senate Appropriations Subcommittee on State and Foreign Operations recently invited Adesina to make a presentation about the African Emergency Food Production Facility.

The Global Alliance for Food Security spearheaded by the Government of Germany provides an excellent forum for the African Emergency Food Program Facility, which is part of a coordinated and collective effort by development partners and countries to accelerate food production in the short term while remaining focused on medium- and longer-term actions to build resilience.

For the Food and Agriculture Resilience Mission (FARM) supported by the Government of France, the African Development Bank (AfDB) is partnering with IFAD and has agreed to be part of the coordination team and steering committee of FARM. The African Emergency Food Program Facility lays out the foundation and complements FARM activities which aims to strengthen local production systems in Africa and reduce food loss to support development of sustainable and resilient food systems.

Happy to share that Visa has approved for KlaDot , a Tekedia Capital portfolio firm, to issue individual and business debit cards in 33 countries including US, UK, Canada, European Union, Nigeria, etc. Our neobank is launching in America and I am hoping that you will register – and bank with Kladot for a multi-currency bank account system. We’ve built this neobank for immigrants, expatriates and global citizens.

Many years ago, I landed on the soil of New York City from Lagos via Nigeria Airways.  With my friend Kunle, we took Greyhound from NYC to Tuskegee Alabama. It took 3 days, connecting Charlotte, Richmond, Atlanta, etc. That was a trip that would have taken less than 2 hours with a flight. But we had no payment system to buy a flight ticket!

Though that specific issue has been fixed, many challenges remain for new immigrants and minorities. We hope that our vision will bring solutions to these communities and others around the world. Our multi currency banking system will bring a new layer in global consumer banking.

Prepare for #ModernBanking with Kladot

Late transfers, slow deposits, and delays are real and expensive nightmares. Banks make errors; you take the hit. Trust us; we know the pain. Slow transactions affect income earners, family members, and friends. They also impact entrepreneurs, investors, and governmental organizations.

Many of us have experienced the frustration of waiting in line at a bank or supermarket only to find that the cashier is having trouble making a payment. We’ve all been there: you’ve been standing in line for 20 minutes, only to be told that your bill can’t be processed because of problems with your bank. It’s frustrating—not just for you but for everyone behind you who has waited just as long!

Most Nigerians Expect Slow Transactions

Recently, I heard a woman, a single mom, nagging about the stress of handling her small business while still having to keep up with uncleared bank transactions. It’s that bad. Most people expect their transactions to be delayed. This one affected a friend of mine. Some time ago, she felt unsafe walking through a dangerous environment. She knew how late it was, so she stopped at every available taxi. My friend had no physical cash and was completely relying on her Bank’s mobile transfer. Unfortunately, each driver refused to cooperate after considering their payment option. They were all sure about having slow transfer issues. The drivers even felt justified about avoiding the potential hassles they’ll go through if their payment delays.

For a long time, the Raven team considered the issue of slow bank transfers. It’s something that customers talk to us about all the time, and it’s something that many companies have tried to address in different ways. We considered this at length before launching our product last year and decided that what was needed was a solution that didn’t require any additional effort from our customers. First, let’s discuss the problems transactions face.

Why are bank transactions slow?

Suppose you complete a transfer checkout process instructing your bank to send money into another account. Your transfer begins as your bank notifies the recipient’s bank. The notification carries encrypted data with details about the executed transaction. The information is essentially permission for the recipient’s bank to make the payment on your behalf – using they are stored up money (assuming they have enough to go around).

Your bank knows that their message was successfully sent, and you receive a debit alert. (Regardless of your recipient’s account balance). In the end, both institutions take their time to balance their accounts and settle themselves.

This collection used to be a good enough method to maximize speed. Traditional Banks only had to trust that other institutions would follow the plan. The process, however, came with potential disadvantages for all parties. One challenge was that settlement depended on transferring large sums of physical cash constantly and needing to move them from bank to bank. But, payments between traditional institutions have the potential for many drawbacks. During unexpected events like the Pandemic, travel restrictions, curfews, etc., the process can take days. During that time, settlement funds can get delayed, lost, or stolen. Unfortunately, such events will lead to challenges that affect future transactions.

A temporal solution

The rise of digital banking made this process easier. Many banks reduced their reliance on human input when executing transactions (From interpreting bank tellers to forwarding transaction data to other banks), and most of the process became automated. The upgraded tech helped reduce the overall time per transaction; it also cut down certain errors that usually led to payment delays.

A digitized banking system was a significant step forward for the industry, but it still left room for improvement. While transactions were now faster, they still required human intervention. There were still points in which errors could be made – especially when dealing with non-standard transactions.

The growing population of banking services with the expansion of digital tech added gravity to the existing responsibility of traditional banks. The process needed for the management, interpretation, and settlement of multiple external bank accounts is already a tedious one, with mistakes ultimately resulting in delayed transaction processes for many banks.

In recent years, several technological innovations have changed this reality once again. To overcome slow transactions, innovative digital-only banks, including Raven, rely on transaction processes that improve speed.

Solution

Raven Bank uses a centralized system that specializes in clearing transfers. The system utilizes a centralized process focused on executing transactions well enough to deliver your money faster!

The process involves a secure receiving depository financial institution. They receive batches of transactions, sort them out, and make them available to the bank or financial institution of the intended recipient.

The receiving depository financial institution then checks for the authenticity and validity of the transaction before authorizing it for settlement recipients.

Because regulators have vetted these institutions, they provide security and convenience for banks and other financial service providers.

Conclusion

With our quick and seamless transfer system, you can send money to anyone. You don’t even need to worry about the recipient’s bank—it doesn’t matter which one they use! Because there is no need for the complex personal bank-to-bank settlement process, processing transactions reduces the cost of transfers.

If you’re one of the many people affected by a late transfer, slow deposit, or hold on your account, you need to act fast. Get started with Raven Bank, download our App on Google Play store and Apple Store; enjoy high-speed transfers.

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Registration for another edition of Tekedia Mini-MBA (June 6 – Sept 3, 2022) continues. Tekedia Mini-MBA, from Tekedia Institute is an innovation management 12-week program, optimized for business execution and growth, with digital operational overlay. It runs 100% online. The theme is Innovation, Growth & Digital Execution – Techniques for Building Category-King Companies.

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