It is the time for a new look at renewal of agricultural mechanization in Africa. A paradigm shift is required: from one of poverty alleviation to investment for economic growth, in which the focus is on sustainable economic growth.
On average, 700-1,850 tractors are used per 1,000 farmers in Europe and Northern America, exceptionally low levels of mechanization persist in many developing countries: a mere 5 tractors are in operation per 1,000 farmers in Africa.
Compare 5 tractors with 1,500 to 1,800 tractors per 1000 farmers
The total number of working tractors would have to be about 3.5 million (7 times more) to put Africa on a par with other regions. Agricultural would have to expand by a factor of about ten to approximately 400 000 tractors per year. Such a growth in tractor sales cannot be achieved immediately but could be in, say, 10 or 12 years. This would require urgent action to stimulate the market to attain sales of the order of 100 000 units per year within two or three years. As a comparison, tractor sales in India in 2005–06 were 264,790 units.
There has been a massive devaluation of many African currencies. This leads to very high cost of agricultural machinery which leads to reduced imports of machinery in Africa.
An illustrative quote (from FAO & UNIDO, 2008) helpfully summarizes the way forward: ‘If agricultural mechanization efforts are to succeed in Africa, there is an urgent need for all concerned, be they farmers, supporters, planners or policy makers,to understand and contribute to agricultural mechanization efforts across the entire farming system and with a value chain perspective’.
FAO & UNIDO must know and support our project. Please send a link of this to them…
How can African prosperity get started?
Over 60% of farm power is still provided by people’s muscles, mostly from women, the elderly and children. Affordability of mechanization is often beyond the reach of the small holder family. You can make a difference in so many lives.
Decades of counter-terrorism teaches that the best bulwarks against extremism are states that are prosperous and just. With your support, the middle class will band with the underclass to bring about regime changes.
You can help by expanding access to rich-world markets for African goods, particularly in agriculture and the opportunities for other African industry would also expand.
How does the world approach climate change? Unfathomable amounts of carbon emissions can be soaked up by trees? Your support will assist us in developing Today’s Tall Tree Nurseries in Africa.
A young African will move to the city if all he can earn is $10/day. This same African will return to the land because mechanization has changed the whole picture: the farms can now be more productive. Your support will take the pressure off African urbanization, which usually ends in abject poverty or crime in the city.
Designing an Agricultural Mechanization Strategy
The main objective of farm mechanization is increasing agricultural production. We focus primarily on the use of tractors as an indicator of all agricultural equipment.
The current lack of food security within Africa is a matter of international concern. Agricultural development should be the major area of focus in any discussion of food security, and mechanization is one of the key elements.
The small increase observed in these countries did not constitute a big gain in term of adoption of mechanization in these countries compared to the gain and the progress of mechanization in Asia and the Pacific countries for the same period. Compare the number of 32 tractors/1000 farmers of Cote d’Ivoire with 1,500 to 1,800 tractors/1000 farmers in the United States and Canada.
One factor that determines the potential adoption of agricultural equipment is the cost of labor. If the cost of agricultural labor remains cheaper, the farmers do not have the incentive to use costly machinery. This means that agricultural production relies heavily on human power using hand tool technology—not on machinery.
Businesses should rethink how they “sell” tractors
Few efforts in other countries have survived competition from the importation of low-cost tools from countries in other continents (e.g. China and India).
The newly emergent industrial economies such as India, China and Brazil have stepped in and have provided new sources of tractors and farm machinery which are continually coming on to local markets. This machinery is often more suitable for African conditions and is considerably cheaper than machinery manufactured in Western Europe or North America.
The size and the type of tractors matter. In small-scale farming, the powerful and large equipment frequently used in developed countries is irrelevant. The choice will be new walking tractors less than 75 HP.
Small-holder farmers—especially those with low profits—may still not able to afford a tractor, so a hire-service or rental tractor is a good working model.
Financing agricultural mechanization is a challenge.
Small-holder farmers cannot afford to buy a tractor without financial assistance. To overcome the financial hurdle, the common advice is to organize farmers into cooperative or association and they can purchase the equipment as a group. This approach works, but it is only efficient in the short term.
One of the major impediments to improving the agricultural productivity in Africa is the financing. Banks are reluctant to finance agricultural businesses because of their high risk and uncertainties. In the past, many African countries had implemented a government-led investment, which failed to achieve the expected results.
In any financial model, the mechanization strategy should be private sector driven, and farmers should be given the option to make payments towards the purchase of their equipment during the harvest using the rental fees as a portion of their payments.
Enter the world of Living Water MicroFinance Inc. Our company mission is to support women farmers and their families in Africa.
We are looking to bring innovative solutions to the African market. We negotiate with landlords to make land available to these subsistence families for a long term lease over 25 years. We help produce cash crops, which include cacao and inter-cropping with yams and banana plantain. All our seedlings are developed from seed in order to reduce our costs.
We also set apart a small portion of the land and develop it as a soccer field for the children.
Right now deforestation is causing 15% of the problem of global warming. The carbon dioxide capture of the trees addresses global warming, so the Carbon Tax Fund will support any forestation as long as there is a guarantee of longevity, which is provided by a third party, Living Water MicroFinance Inc.
We start with Today’s Tall Trees, that is supported by a Carbon Tax Fund, in which every cacao tree that is planted lives for 25 years and has a Net Present Value of $0.49/tree x 100 acres x 200 trees/acre= $9,600 for 200 trees/acre on 100 acres.
Please Note: another calculation of NPV of fruit trees living for 25 years = $0.49/tree plus $1.00/tree for maintenance: $1.49/tree. (Fruit trees are productive for 25 years and then are replaced.)
If we choose to plant longer-living fruit, nut and foliage trees, which will last 50 years on land with a 50 year lease, the Net Present Value support will be $2.59/tree for a maximum of $52,000 for 100 acres. This will happen on some 1.5 acre farms that are managed by women farmers and their families. Actually, there will be a combination of both types of trees with 25 year to 50 year longevity on the same farm.
Here is how we begin our REVOLUTION.
If agricultural equipment is sent to an African country, like Ivory Coast, it has a value of $200,000 if it was brand new. The nearly new equipment has a real value of $100,000 hypothetically. The agricultural equipment dealer or farmer working with the dealer receives a tax refund benefit at the rate of the last $1000 owed to the government; say 30% of 100,000 or $30,000 from Living Water MicroFinance Inc., a non-profit company.
The new owner, Living Water MicroFinance Inc., will sell the equipment in question in Africa and will feel indebted to the previous owner, the equipment dealer or the farmer. This indebtedness will be 50% of the net selling price. This indebtedness will be resolved in our hypothetical example, by the purchase of additional new equipment from the dealer.
If a farmer were to donate his or her used equipment there would be a large tax refund receipt and a cash credit from a third party, Coop Eau Vivante in Africa to a dealer of his or her choice or some other similar arrangement.
More important there will be a real contribution to poverty and famine in an underdeveloped country. We are talking about increased needed efficiency in the agricultural field, which will lead to more employment as well.
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Since the need for this equipment is so high, the equipment will enter duty free and since this equipment will be sent to Africa, copies of bill of lading will be made available to the dealer or farmer. We are presently interested in exporting to Cote d’Ivoire.
Why Cote d’Ivoire?
Good Power Supply
Africa as a whole lacks reliable power supply through a grid. This hinders business and business development. It also puts off tourists who are missing out on an amazing part of the world. The only complaint is that the power tends to be expensive.
Good educational system
We recruit all staff locally if possible including management and engineering personnel. The level of education is good enough to have local expertise.
Existing Industrial Base
There is already an existing industrial base with infrastructure and service companies in business.
Access to markets
Putting the local market aside, Cote d’Ivoire has direct access to ECOWAS – the Economic Community Of West Africa. This in itself is an enormous market both geographically and in terms of population. West Africa is increasingly moving forward in all areas with an expanding middle class and potential consumer market.
There is also the ongoing Agriculture Investment Program by the Minister for Agriculture in Cote d’Ivoire, which includes increased training for small holder farmers and increase in efficiency of land use.
Commercial cash crops from Cote D’Ivoire:
- Cocoa –a third of the world’s cocoa
- Cashew nuts
- Palm oil
Without specialized knowledge of agricultural machinery any donation schemes usually end up with disastrous consequences: we have the skills. In many cases where governments established tractor-hire schemes to serve small-scale farmers, planning was very short term and management was poorly trained and poorly supported.
We also offer a service to farmers including the provision of spare parts and repair services.
Partners with our company have a better chance to branch out and become agricultural equipment service providers to their own group members. In this way, business and entrepreneurship can evolve from the bottom up and may spread to medium-scale and larger scale sustainable agricultural mechanization scenarios.
What is the Next Stage?
We provide irrigation and electricity in remote areas without the use of dams to African landlords who cooperate with us.
In a changing climate, irrigation will become even more important. This suggests that increasing the irrigated area in Africa would make a major contribution to agricultural productivity. Investment in large irrigation schemes would be a long-term process but much might be achieved in small schemes for small groups of farms. In mechanization terms, this suggests a substantial opportunity for sales of pumps, diesel engines and related equipment. This is a parallel mechanization opportunity, a challenge for local African manufacturing industry to take on.
We provide the shipping and sale of used equipment in Africa. You promote the contacts who can provide donations of equipment and trucks and share in the profit as an Associate Partner. A third party will provide the quality assurance of the used product.
Agroforestry could help solve Climate Change.
HELPING SOLVE WORLD’S CARBON POLLUTION
New Trees are the only solution to soaking up Carbon Dioxide:
A Full Scale Aquaponic Tree Nursery in Africa supported by:
- A Micro Hydro Electric System: no dams: HugENERGY.us
- An Irrigation System: NORTHydro.com
- A Rabbit and Fish Farm: AfriCAPITALISM.us
- An Agroforestry Intercrop System: LivingWaterIs.com
- The Charitable Arm: SunnyUp.net
- God’s Loveletters: Godloveletters.com