China, India boost investments in the EAC, but agriculture skipped

Arusha. Foreign Direct Investments (FDIs) into the East African Community (EAC) increased marginally between 2015 and 2021, thanks to investments from China and India.

The bulk of the investments in the seven-nation bloc went to the manufacturing, construction, and services sectors, with only a fraction going to the agricultural sector.

This is according to the findings of a study launched a few months ago to profile investment opportunities in selected agricultural value chains in the East African region.

The study was aimed at addressing the region’s low foreign direct investment (FDI) in agriculture, its reliance on food imports, and its vulnerability to global shocks.

The East African Business Council (EABC) launched the study in partnership with Sequa GmbH under the Business Scouts Fund and GIZ Business Scouts for Development.

The GIZ Business Scout Fund-EABC project seeks to enhance the competitiveness of the agro-food industry and mitigate the impact of global crises to improve food security in the EAC region.

The findings of the study and investment opportunities were revealed during the webinar held on Friday, which attracted high-level policy decision makers and over 60 agro-value chain actors.

“FDI into the region increased marginally between 2015 and 2021, primarily driven by investments from China and India,” the findings obtained by The Citizen said in part.

The study reveals significant potential for developing value chains in wheat grains, edible oil, fertilisers, tubers, and leguminous plants within the EAC.

However, it emerged that the sector’s performance is hindered by challenges such as low production and productivity, technology development and transfer, post-harvest management and storage, trade and marketing, and policy-related issues.

The webinar emphasised the need for collaborative efforts among EAC Partner States, Development Partners, and the Private Sector to address the aforementioned challenges.

It was noted that increased investment in the value chains would create employment and increase resilience against agri-food disruptions amid global shocks.

EABC executive director John Bosco Kalisa emphasised the importance of scaling up the agricultural sector’s performance to boost intra-regional trade and investment.

He highlighted the need for deliberate action to build agricultural resilience in the region, particularly in response to global crises.

He also recommended the use of a policy mix to provide agricultural insurance, develop storage facilities, and address labour migration to urban areas.

For his part, Mr Michael Kleinbub, representing the GIZ Business Scouts for Development, commended the efforts of the business community in addressing food security issues.

He pledged the support of the Business Scouts for Development in facilitating engagements through programmes and public-private partnerships as well as providing financial and technical support to companies investing sustainably in developing or emerging markets.

During the webinar, Mr Innocent Kahwa, acting Investment Promotion Manager at the Tanzania Investment Centre (TIC), said investment opportunities in Tanzania offered great potential.

EABC, an apex body of private sector associations in the region, said it plans to showcase the results of the study on investment profiles on digital platforms to ease access to information on investment opportunities in the bloc.

The Arusha-based regional business body would also engage value chain actors in joint ventures and capacity-building initiatives under the project.