Millions of young Africans enter the labour market every year, but economies are failing to create enough productive jobs to absorb them. Closing the gap requires industrialisation, investment and skills that match market demand.

Every year, between 10 million and 12 million young Africans enter the labour market. The African Development Bank estimates that about 12 million seek work annually, yet only around three million jobs are created, leaving a shortfall of approximately nine million.

The problem extends beyond unemployment. Much of the work available is informal, poorly paid and insecure. According to the Mastercard Foundation’s Africa Youth Employment Outlook 2026, about 90 percent of employed young Africans work in the informal economy.

This is Africa’s jobs gap: the widening distance between the number of people seeking work and the productive opportunities available to them. The International Monetary Fund estimates that sub-Saharan Africa will need to create about 15 million jobs annually by 2030 to accommodate new labour market entrants.

The challenge is not simply to get young people working, but to create jobs that generate reliable incomes, improve productivity and support economic transformation.

A demographic dividend slipping away

Africa has the world’s youngest population, with a median age of approximately 19, compared with a global median of about 30. The United Nations projects that the continent’s share of the global population under 25 will increase from about 28 percent to 46 percent by 2100.

This presents an enormous economic opportunity. A growing working-age population can expand production, increase savings, widen the tax base and accelerate economic growth. East Asia demonstrated how a young workforce, supported by industrialisation and investment, can become an engine of development.

But demographic dividends are not automatic. They depend on whether economies can absorb growing numbers of workers into productive employment.

The distinction between employment and decent work is equally important. The Mastercard Foundation estimates that approximately 57 percent of African youth were working in 2025, yet about 104 million young workers lived in extremely poor households, surviving on less than US$2.15 a day. Meanwhile, the International Labour Organization estimates that informal employment accounts for 85.8 percent of employment across Africa.

A continent can therefore record high employment while millions of its workers remain trapped in poverty.

Why economic growth is not creating enough jobs

First, growth has not translated into structural transformation. Many African economies depend heavily on commodities such as oil, copper and cocoa. Although these industries generate export earnings, they are often capital-intensive and employ relatively few workers.

This produces jobless growth, where gross domestic product expands without a corresponding increase in productive employment. Between 2005 and 2023, every one percent of GDP growth was associated with only 0.44 percent growth in youth employment, according to the figures cited in the 2026 Outlook.

Industry performed considerably better, with an employment elasticity of 0.78, compared with 0.17 for agriculture. Yet agriculture continues to employ a substantial share of young Africans.

Second, labour is moving into low-productivity activities. Workers leaving agriculture frequently end up in informal trading and other services rather than manufacturing. While services can offer better earnings, their contribution to development depends on productivity, formalisation and opportunities for businesses to expand.

Third, manufacturing remains underdeveloped. Africa’s manufacturing sector accounted for approximately 12.7 percent of GDP in 2023, according to the Institute for Security Studies’ African Futures project. Its share of global manufacturing has also declined from around three percent in the 1970s to below two percent today.

Unreliable electricity, expensive financing and inadequate transport infrastructure make it difficult for local firms to compete, expand production and employ more people. Without a stronger industrial base, economic growth will continue to struggle to generate jobs at the scale required.

Finally, education and industry remain disconnected. Employers need technicians, artisans and workers with digital and practical skills, while many graduates struggle to find opportunities matching their qualifications. Education systems must respond more directly to changing labour market requirements.

The wider cost of unemployment

The consequences extend beyond lost income. Persistent youth unemployment can deepen poverty, encourage migration and intensify social instability. Families without reliable earnings struggle to invest in education, healthcare and productive assets, allowing deprivation to persist across generations.

Young women face additional barriers. Unpaid care responsibilities, unequal access to training and limited employment opportunities restrict their participation in the economy. Addressing the jobs gap therefore requires policies that expand opportunities while removing obstacles that disproportionately affect women.

Turning the jobs crisis into an opportunity

Closing the gap requires a coordinated strategy focused on productive investment.

Reliable electricity, roads, railways and ports must come first. Infrastructure reduces production costs, improves market access and makes businesses more willing to invest and hire. Tax incentives alone cannot compensate for unreliable power and expensive logistics.

Governments must also prioritise labour-intensive industries, including agro-processing, textiles, tourism and light manufacturing. Processing agricultural produce locally creates opportunities beyond farming, linking producers to factories, transporters, retailers and export markets.

The African Continental Free Trade Area offers another opportunity. Its potential market of approximately 1.3 billion people can help businesses expand beyond national borders, achieve economies of scale and build regional supply chains. However, this requires lower trade barriers, efficient border procedures and consistent implementation of agreed rules.

Access to finance is equally critical. Small and medium-sized enterprises employ significant numbers of Africans but frequently struggle to obtain affordable credit. Stronger credit guarantees, appropriate lending products and support for viable businesses could help firms invest, formalise and recruit additional workers.

Finally, technical and vocational education must be aligned with actual demand. Partnerships between training institutions and employers can ensure that young people acquire practical skills needed in manufacturing, agriculture, construction, technology and other expanding sectors.

Africa’s youth are not its economic problem. They are a potentially powerful source of productivity, innovation and growth. The challenge is to build economic structures capable of turning that potential into productive employment.

Every year of delay brings another generation of job seekers into an already strained labour market. Whether Africa captures its demographic dividend will depend on how quickly it transforms growth into jobs, informal activity into productive enterprise, and education into employable skills.

~KUNDAI GOREJENA

For more than a century, diamonds have been one of Africa’s most valuable natural assets. From the vast mines of Botswana to the diamond fields of Angola, South Africa, Namibia and Lesotho, these stones have funded public services, supported government budgets and provided livelihoods for thousands of families.

Today, that foundation is facing an unprecedented challenge.

The threat is not coming from another mineral-rich nation or a new discovery underground. It is emerging from laboratories thousands of kilometres away, where diamonds that are chemically identical to natural stones can now be created within weeks.

The rise of lab-grown diamonds is reshaping a market that African economies have long depended on. While consumers benefit from lower prices and wider choice, producing nations are confronting difficult questions about the future of one of their most important export industries.

The story began in 1954 when American scientist H. Tracy Hall successfully produced the first synthetic diamond at General Electric’s research laboratories. At the time, the breakthrough attracted scientific interest but posed little threat to the jewellery market. Natural diamonds retained their status as rare luxury items, formed under immense pressure deep within the earth over billions of years.

For decades, that remained the case.

Advances in technology, however, have transformed synthetic diamonds from a scientific novelty into a commercial force. Modern lab-grown diamonds possess the same physical, chemical and optical characteristics as natural stones. To the naked eye, there is virtually no difference.

What once took nature billions of years can now be achieved in controlled laboratory conditions in a matter of weeks.

This shift has dramatically altered the economics of the industry.

Lab-grown diamonds have become increasingly popular, particularly among younger consumers who prioritise affordability. Prices have fallen sharply as production capacities expanded, especially in China and India. A synthetic diamond that cost thousands of dollars just a few years ago can now be purchased for a fraction of that amount. For many buyers, the opportunity to acquire a larger stone at a significantly lower price has proven irresistible.

As a result, natural diamonds are no longer competing solely against each other. They are competing against a technologically manufactured alternative that is becoming cheaper every year.

The effects are already being felt across Africa.

Botswana provides perhaps the clearest example of the risks involved. Few countries have managed their mineral wealth as effectively. Diamond revenues have helped transform the country from one of the world’s poorest nations at independence into an upper-middle-income economy. Roads, schools, hospitals and public services have all benefited from the sector’s success.

Yet Botswana’s dependence on diamonds also makes it particularly vulnerable to changes in global demand. With export earnings, government revenues and economic activity closely linked to the industry, any sustained decline in diamond prices quickly feeds through to the broader economy.

Across the region, similar pressures are emerging.

South Africa’s diamond industry has experienced a steady decline in employment and revenue over the past decade as market conditions have weakened. Mining companies have responded by scaling back operations and delaying investment decisions.

Angola has managed to maintain production and export growth, but lower average prices suggest that producers are receiving less value for every carat sold. Namibia and Lesotho have also felt the impact of weaker demand, highlighting the challenges facing smaller economies that rely heavily on diamond revenues.

The problem extends beyond mining.

For decades, Africa has exported the majority of its diamonds in rough form, while much of the value generated through cutting, polishing, branding, marketing and jewellery manufacturing has been captured elsewhere. As margins tighten, the limitations of this model are becoming increasingly apparent.

This has sparked renewed calls for beneficiation and value addition across the continent. Rather than simply exporting raw stones, policymakers are pushing for greater local participation in processing, trading and jewellery production. The objective is straightforward: retain a larger share of the diamond value chain and create more jobs beyond the mine gate.

At the same time, natural diamond producers are working to strengthen their market position by emphasising what makes their product unique.

A laboratory can replicate the physical characteristics of a diamond, but it cannot reproduce the geological journey behind it. Natural diamonds remain finite resources formed over billions of years, each carrying a story that manufactured stones cannot replicate. Industry leaders believe this rarity remains their strongest competitive advantage.

That argument has become increasingly important as consumers weigh affordability against exclusivity. While lab-grown diamonds continue to gain market share, natural stones still benefit from their association with rarity, heritage and long-term value.

For Africa, however, the debate is bigger than consumer preference.

Diamonds are not simply luxury products. They are national assets that have financed development, generated foreign currency and supported economic growth for generations. The success or failure of the industry has real consequences for government revenues, employment and investment.

The emergence of lab-grown diamonds does not mean the end of Africa’s natural diamond sector. But it does signal the beginning of a new era, one in which producing countries can no longer rely on scarcity alone.

The continent’s future success will depend on its ability to move further up the value chain, strengthen regional cooperation and market natural diamonds more effectively to a changing global audience.

The diamond industry is entering a period of profound change. Technology has challenged one of the world’s oldest luxury markets and forced producers to rethink long-standing assumptions.

The question is no longer whether lab-grown diamonds will remain part of the market. They will.

The real question is whether Africa can adapt quickly enough to ensure that the wealth beneath its soil continues to translate into prosperity above it. That challenge, more than the competition between natural and synthetic stones, will determine the future of the continent’s diamond economies.

Rice connects farmers, millers, traders, transporters and consumers across West Africa. New efforts to strengthen regional business links are drawing attention to the importance of processing capacity, reliable supply, quality standards and cross-border trade in developing a more competitive rice industry.

Rice Is More Than a Staple Food

Rice is a key food commodity across many African markets, generating business opportunities throughout the value chain from seed suppliers and farmers to millers, wholesalers, retailers, and food-service businesses. For agribusinesses, opportunities extend beyond paddy production to milling, grading, storage, packaging, transportation, and supplying consistent products to local and regional buyers. However, agricultural production alone does not guarantee a competitive domestic industry. Farmers may struggle to access suitable inputs, millers may face inconsistent supplies, and traders may encounter high transport costs or difficulty meeting buyer specifications. These challenges raise operating costs and hinder local rice’s ability to compete. Strengthening the rice value chain therefore requires coordination across multiple businesses, not just a focus on production.

West African Businesses Explore Stronger Commercial Connections

On 28–29 September 2026, the United Nations Economic Commission for Africa (UNECA) convened business support organisations and SMEs for a Rice Value Chain Activation Programme focused on West Africa. The initiative aimed to encourage commercial partnerships, strengthen regional value chains, and support intra-African rice trade. According to UNECA, more than 150 SMEs in the rice sector participated in consultations.

Discussions highlighted constraints relevant to many agricultural businesses, including limited access to finance, weak market connections, inadequate processing capacity, and obstacles to cross-border trade. This focus on business linkages is significant because regional trade depends on more than produce availability. Buyers need suppliers who can deliver agreed volumes, meet quality requirements, and provide goods on time. Sellers need dependable payment arrangements, clear market information, and practical routes to reach customers beyond their immediate communities. Stronger connections between these groups can help businesses identify opportunities difficult to pursue independently.

Why Processing and Quality Matter

Rice milling is a key stage in determining the marketability of the final product. Equipment, handling methods, grain condition, and milling practices influence the proportion of whole grains, product appearance, and consistency. Buyers may also require specific packaging sizes, labelling, and food-safety standards. For millers, investment decisions should be guided by local supply and market demand assessing whether enough paddy rice can be secured to use equipment efficiently, whether customers will pay for the resulting product, and how it will compete with established brands.

Storage is equally important. Poorly managed storage can expose grain to moisture, pests, and contamination, reducing quality and financial returns. Better drying, handling, and storage practices help businesses protect produce between harvest and sale. Farmers can contribute by harvesting at the appropriate stage, drying grain correctly, and following buyers’ quality requirements. Clear communication between producers and millers can reduce disputes over grading and rejected deliveries.

Regional Trade Requires More Than a Market Agreement

Cross-border rice trade can offer access to a larger customer base, but expansion into neighbouring countries requires careful planning. Traders need to understand applicable customs procedures, product standards, transport arrangements, taxes, and any restrictions affecting agricultural goods. Market information is another essential factor. Businesses must compare selling prices with the full cost of delivering a product to its destination, including transport, handling, storage, financing, and border-related expenses. A market that appears attractive based on selling price may not be profitable once these costs are included.

Business associations, chambers of commerce, farmer organisations, and trade-support institutions can help companies understand requirements and identify potential commercial partners. Digital platforms can also support communication between suppliers and buyers, though personal verification and clear written agreements remain important.

Opportunities for Farmers, Millers, and Young Entrepreneurs

A stronger rice industry can create opportunities for businesses of different sizes. Farmers may access more organised buyers, while aggregators can earn income by collecting and supplying grain in commercial quantities. Millers can develop differentiated products, and entrepreneurs can offer transport, warehousing, packaging, equipment maintenance, and other services. Young people can participate without necessarily owning large farms depending on local demand, opportunities may exist in grain trading, digital market information, quality assessment, machinery services, and distribution. However, these opportunities depend on commercially sound operations, including transparent pricing, responsible financial management, and sufficient working capital. Small suppliers also need protection against unclear contract terms and delayed payments.

Building a More Connected African Rice Economy

The UNECA initiative underlines the importance of connecting agricultural businesses with the markets and services they need to grow. For West Africa, stronger regional rice value chains could support more commercial activity between farmers, processors, and buyers, provided practical barriers are addressed. The opportunity extends beyond rice similar approaches can support other regional agricultural industries where production, processing, and trade remain disconnected. For agribusiness leaders, the challenge is to turn discussions into dependable commercial relationships by investing in quality, understanding market requirements, and creating supply chains that work for producers and buyers alike .

The continent’s agricultural future will depend not just on how much it produces, but on how much value it captures before its produce reaches the consumer.

Ethen Masendu

There is a familiar narrative about African agriculture: the continent needs more farmers, more land under cultivation and higher agricultural output to feed its growing population and supply international markets. While these priorities remain important, they overlook a fundamental weakness in Africa’s agricultural model. The continent has focused too heavily on producing agricultural commodities and not enough on processing them into higher-value products.

Consider the paradox. Farmers undertake the difficult work of preparing land, purchasing inputs, managing crops, dealing with unpredictable weather and harvesting produce. Yet, in many agricultural value chains, they capture only a small proportion of the final product’s value. The businesses that process, package, brand and distribute agricultural commodities often earn considerably more than those who produce them.

This is not because farming lacks economic value. Rather, it reflects where value is created, how markets are organised and who controls the stages between the farm and the final consumer. Africa has an estimated 33 million to 40 million smallholder farms, while agriculture provides livelihoods for a substantial share of the continent’s population. The sector remains central to economic activity, food security and rural development. The continent also possesses enormous agricultural potential, including an estimated 60 per cent of the world’s remaining uncultivated arable land.

Yet abundant land and favourable growing conditions do not automatically translate into prosperity. Africa must move beyond the assumption that increasing agricultural production alone will deliver meaningful economic transformation.

The more important question is this: How much wealth can Africa generate from what it already grows?

From raw commodities to higher-value products

Kenya’s dairy industry illustrates both the progress Africa has made in agricultural production and the opportunity that remains. The country has substantially expanded milk production, establishing itself as one of the continent’s leading dairy producers, but milk is only the starting point. It can be processed into cheese, yoghurt, butter, ice cream and powdered milk, each serving different markets and offering opportunities for product differentiation, longer shelf life and higher-value commercial activity.

The economic opportunity is not simply to produce more litres of milk. It is to develop an integrated dairy industry capable of transforming those litres into a diverse range of products for domestic, regional and international markets. The same principle applies across African agriculture. Cocoa can become chocolate, coffee can be roasted and packaged, fruit can become juice and concentrates, and groundnuts can be processed into edible oils and peanut butter.

Each additional stage of processing creates opportunities for manufacturing, employment, technology adoption and business development.

Africa’s position in the global cocoa industry makes the case particularly compelling. The continent produces approximately 70 per cent of the world’s cocoa beans, yet much of the processing and chocolate manufacturing takes place elsewhere. Consequently, a substantial share of the value generated by one of Africa’s most important agricultural commodities is captured outside the continent. The pattern extends to coffee, tea, spices, horticultural products and medicinal plants. African economies supply the raw materials, while businesses elsewhere frequently transform them into finished goods that return to African markets at higher prices.

This is how a continent can be rich in agricultural resources yet capture a disproportionately small share of the wealth generated by them.

Processing changes the economics of agriculture

The case for agricultural processing goes beyond the difference between the price of a raw commodity and that of a finished product. Processing fundamentally changes the economics of production, storage, transportation and market access. Take fresh herbs and horticultural produce. Farmers selling fresh products face a narrow window in which to reach consumers. Perishable goods require efficient transport, reliable refrigeration and careful handling. Delays can result in spoilage, rejected shipments and financial losses.

Processing can significantly reduce these constraints. Drying, for example, can extend the shelf life of certain products from days to months or longer while substantially reducing their weight. This lowers transportation costs, makes storage easier and opens access to markets that would otherwise be difficult to serve. Dried herbs and spices can supply food manufacturers, seasoning companies and ingredient distributors. Fruit can be processed into concentrates, purees and dried products. Oilseeds can be transformed into cooking oils, animal-feed ingredients and other industrial inputs.

The commercial possibilities expand further when businesses invest in packaging, branding, product development and quality certification. Processing enables Africa to compete not only as a supplier of agricultural commodities, but also as a producer of ingredients, intermediate goods and finished consumer products. That distinction matters. A country exporting raw coffee beans participates in one segment of the value chain. A country that also roasts, packages and markets coffee develops additional capabilities, businesses and employment opportunities.

The objective should not be to eliminate commodity exports. It should be to ensure that exporting raw produce is a commercial choice rather than the only option available.

Turning post-harvest losses into economic opportunities

The urgency of agricultural processing becomes even clearer when considering the volume of food lost after harvest.

Inadequate storage, unreliable electricity, poor transport infrastructure and limited processing capacity contribute to substantial post-harvest losses across Africa. Fruit and vegetables are particularly vulnerable because of their short shelf lives and sensitivity to handling conditions.

These losses represent more than a food-security problem. They are an economic failure.

When produce goes to waste, farmers lose potential income, traders lose merchandise, processors lose raw materials and economies forfeit opportunities to create employment and earn export revenue. Processing can help address this challenge by creating alternative markets for produce that may not meet the appearance or size requirements of fresh retail markets but remains suitable for manufacturing.

Fruit that cannot be sold fresh, for instance, may still be appropriate for juice production, purees or drying. Certain crops can be converted into flour, animal feed or other industrial inputs. This creates additional outlets for farmers, reduces dependence on a single market and improves the commercial viability of agricultural production.

However, processing cannot operate in isolation. It requires reliable supplies of raw materials, appropriate technology, and access to finance, dependable energy and transport infrastructure. Without these foundations, processing plants risk operating below capacity, undermining their profitability and their ability to sustain demand for agricultural produce.

Building industries around agriculture

The economic benefits of processing extend well beyond the factory floor.

A processing plant generates demand for farmers, but it also creates opportunities for engineers, food scientists, technicians, packaging manufacturers, logistics companies, laboratory services and product developers. These activities help diversify rural economies, strengthen domestic supply chains and create employment beyond primary production. They can also encourage the development of small and medium-sized enterprises supplying packaging, machinery maintenance, transport, storage and other essential services.

The opportunity is significant. The African Development Bank has projected that the continent’s food and agriculture market could reach approximately US$1 trillion by 2030. Realising this potential will require more than expanding cultivated land. It will demand investment in processing facilities, cold chains, storage, packaging, quality assurance, laboratories and export infrastructure. Access to finance will be equally important. Agricultural processing is capital-intensive, and businesses often face difficulties securing affordable, long-term funding for equipment and industrial facilities.

Governments and development finance institutions should therefore prioritise financing mechanisms that support commercially viable processing businesses, particularly those that establish reliable purchasing arrangements with local farmers. There is also a need to strengthen agricultural research, improve the consistency of raw materials and align production with the requirements of processors and consumers. Processing capacity is only economically valuable when it is supported by reliable supply and competitive demand.

Africa must rethink what agricultural success means

In recent weeks, I have found myself thinking as much about dryers, processing equipment and ingredient markets as I have about planting schedules and greenhouse expansion. Those considerations have reinforced a simple idea: the future of agricultural businesses may depend as much on what happens after harvest as on what happens before it.This does not diminish the importance of farmers. On the contrary, a successful processing industry depends on productive farmers who can consistently supply quality raw materials. Without them, factories cannot operate, products cannot reach markets and value chains cannot function.

The challenge is to build a stronger relationship between agricultural production and industrial development. Africa must stop treating farming and processing as competing priorities. They are complementary activities that, when properly integrated, can create more resilient businesses and stronger economies.

The continent should measure agricultural success not only by tonnes harvested, hectares cultivated or yields achieved, but also by the proportion of produce processed locally, the value of finished agricultural exports, the number of jobs created and the income retained within domestic economies. Africa has spent decades discussing how to produce more. It is time to give equal attention to how to transform that production into wealth.

The continent does not simply need more farmers. It needs more processors, manufacturers and agricultural businesses capable of turning its abundant resources into products that command greater value in domestic and international markets. That is how agriculture can become not merely a source of livelihoods, but a foundation for industrialisation, economic diversification and lasting prosperity.

The continent’s development challenge is not simply to grow faster, but to capture more value from its resources, create productive jobs and build industries capable of competing globally.

By Kundai Gorejena

Africa accounts for roughly 17 per cent of the world’s population, yet its contribution to global manufacturing remains disproportionately small. The continent exports cocoa beans and imports chocolate, ships raw cotton abroad and buys back finished garments. It extracts minerals essential to modern technology but often captures only a fraction of the value generated when those minerals are processed into industrial products.

The problem is not a shortage of resources. It is the limited capacity to transform them into higher-value goods.

Economic development is about more than rising gross domestic product. It requires changing what an economy produces, how efficiently it produces it, the quality of employment it creates and how widely prosperity is shared.

Industrialisation remains central to that transformation. Without it, Africa risks remaining trapped in a model where raw materials leave its shores, finished products return at a premium, and many of the associated jobs, skills and profits are created elsewhere.

Why the factory floor matters

The experiences of Britain, South Korea and China offer an important lesson. Although their development paths differed, industrial expansion helped these economies move workers into more productive activities, develop technical capabilities and establish competitive industries.

Manufacturing raises productivity through machinery, economies of scale, technological adoption and learning-by-doing. As firms improve their processes and workers acquire specialised skills, they produce more with the same resources. Sustained productivity growth creates the foundation for higher wages, stronger businesses and improved living standards.

Factories can also help address Africa’s employment challenge. Millions of young Africans enter the labour market each year, yet many economies struggle to create sufficient formal, productive jobs. Informal trading and low-productivity services provide livelihoods, but cannot alone deliver the scale of economic transformation required.

Manufacturing offers employment opportunities across different education and skill levels, from food processing and textiles to pharmaceuticals and engineering. It also creates demand for transport, packaging, banking, insurance and professional services, spreading income beyond factory gates.

Industrialisation, therefore, is not simply about building factories. It is about developing an interconnected productive economy.

Why Africa is falling behind

Several African economies have struggled to expand manufacturing sufficiently to transform their economic structures. In some countries, manufacturing has stagnated or declined as a share of economic output, while employment has shifted towards informal services before industrial capacity has matured.

This premature deindustrialisation limits opportunities for countries with low incomes, rapidly growing populations and substantial unmet demand for goods and infrastructure.

The obstacles are familiar. Unreliable electricity increases production costs and disrupts operations, while dependence on generators undermines competitiveness. Expensive finance makes it difficult for manufacturers to invest in machinery, technology and expansion, particularly when industrial projects require substantial upfront capital and time to generate returns.

Inadequate roads, inefficient ports and costly logistics further weaken competitiveness. Even products manufactured efficiently can lose their price advantage when moving them to market is expensive.

Market fragmentation compounds these challenges. National borders, inconsistent standards and cumbersome customs procedures prevent firms from achieving the production volumes needed to compete internationally. Meanwhile, unpredictable tax, trade and investment policies discourage long-term commitments.

These constraints reinforce one another. Small markets discourage investment, weak investment limits productivity, and low productivity undermines competitiveness. Breaking this cycle requires a coordinated industrial strategy rather than isolated interventions.

Turning resources into an industrial advantage

The opportunity remains substantial. Ethiopia has attracted garment manufacturers through its industrial parks, while Morocco has developed automotive production and export capabilities. Rwanda has sought to attract investors through improvements in its business environment.

These experiences offer lessons, not universal templates. Industrial parks cannot succeed on incentives alone. The objective must be to develop local suppliers, transfer skills, strengthen technical capabilities and retain more economic value within domestic economies.

The African Continental Free Trade Area (AfCFTA) offers another opportunity. By creating a framework for a more integrated continental market, it gives manufacturers the prospect of reaching customers beyond national borders. Firms that cannot achieve sufficient scale domestically may become viable when serving several African markets.

Realising this potential requires more than signing agreements. Governments must reduce non-tariff barriers, improve customs efficiency, harmonise product standards and address infrastructure gaps that make cross-border trade expensive.

The global transition towards cleaner energy presents an additional opening. Africa possesses significant deposits of minerals used in batteries, electric vehicles and renewable-energy technologies. Exporting these resources without developing domestic processing risks reproducing the extractive model in a new market.

Not every country needs to manufacture finished batteries or electric vehicles. However, countries can pursue commercially viable stages of the value chain, including mineral processing, component production and specialised technical services.

From ambition to execution

A credible industrial agenda must begin with reliable, affordable electricity. Power infrastructure directly determines factory costs, output and competitiveness.

Governments must also make local value addition commercially viable. Agricultural commodities can supply competitive food-processing industries, while minerals and forestry resources can support downstream production where domestic processing makes economic sense. Local production targets must be matched by investment in technology, skills and infrastructure.

Special economic zones can concentrate infrastructure and investment, but their success should be measured by productive enterprises, exports, employment, technology transfer and links with local suppliers, rather than tax concessions alone.

Finance is equally important. Development finance institutions, commercial banks and institutional investors need mechanisms to support viable industrial projects with appropriate loan maturities and manageable risks. Public support should help overcome genuine market failures, not sustain permanently uncompetitive businesses.

Skills development must also reflect industrial needs. Technical institutions should work with employers to train engineers, technicians, electricians and other workers required by expanding industries. Research institutions can help firms adopt technology, improve product quality and develop new products.

Above all, industrial policy requires consistency. Investors need predictable rules, while governments must evaluate interventions honestly and withdraw support when they fail to deliver results.

The choice that will define Africa’s future

Industrialisation will not eliminate poverty overnight, and manufacturing is not the only source of productivity growth. Modern services, digital technologies and competitive agriculture all have essential roles to play. However, without a stronger industrial base, many African economies will struggle to create enough productive jobs, diversify exports and capture more value from their resources.

The ingredients for change are present: a young workforce, expanding consumer markets, abundant natural resources and a continental trade framework with considerable potential.

What remains is the ability to turn these advantages into competitive production.

Africa does not need more declarations of industrial ambition. It needs reliable power, affordable finance, efficient logistics, skilled workers and predictable policies that allow productive firms to grow.

The measure of progress should not be how many factories are announced, but how many become viable businesses that produce competitively, employ people and create lasting economic value.

The factory floor is not the entirety of Africa’s development story, but it will be one of the places where that story is decided.

Africa’s path to prosperity lies not just in its abundant natural resources, but in its ability to transform them into higher-value products, industries and jobs.

Rich in resources, poor in value capture

Africa’s persistent poverty presents a striking economic contradiction. The continent possesses vast mineral deposits, energy resources and fertile agricultural land, yet much of its economic potential remains unrealised. The problem is not simply a shortage of resources, but the failure to transform them into higher-value products, competitive industries and sustainable employment.

According to the United Nations Environment Programme, Africa holds substantial shares of global mineral, oil and natural gas reserves. The Africa Finance Corporation’s Compendium of Africa’s Strategic Minerals 2026 estimates the continent’s mineral wealth at approximately US$29.5 trillion. Yet much of this wealth leaves Africa in raw form, only to return as finished products at considerably higher prices.

The same challenge exists in agriculture. African countries export unprocessed crops while importing cooking oils, processed foods, animal feeds and other products manufactured from similar commodities. This results in lost industrial opportunities, employment and income.

The central question is therefore not whether Africa has enough resources to prosper, but whether it can capture more value from what it produces.

Value addition: Breaking free from the commodity trap

Value addition involves more than processing raw materials. It includes any activity that differentiates a product and increases the value consumers are willing to pay for it. In agriculture, this may mean processing maize into breakfast cereals, soybeans into cooking oil and animal feed, or sunflower seed into refined oil. Improved packaging, branding, certification and direct marketing can also enhance value.

Under a commodity-based model, farmers primarily compete on price and production costs. Their profitability depends on productivity, input prices and prevailing market conditions. When production costs rise while commodity prices stagnate, profit margins come under pressure.

Value addition offers an alternative by allowing producers to capture a greater share of the final product’s value. Smallholder farmers can participate through cooperatives, collective processing facilities and partnerships with established manufacturers, without necessarily investing in large factories individually.

However, processing is not automatically profitable. Capital, electricity, logistics, technical skills and market access all affect commercial viability. The price premium must justify the additional costs.

The consumer determines value

A fundamental principle of value addition is that value is determined by the consumer, not the producer. A product may be locally manufactured, but consumers will only pay more if they perceive meaningful benefits.

These benefits can include quality, convenience, nutritional value, reliable supply, attractive packaging and traceability. Locally produced goods may also appeal to consumers who wish to support domestic businesses, provided quality and pricing remain competitive.

For African businesses, branding and marketing are therefore economic necessities rather than optional extras. Products must offer compelling reasons for consumers to choose them over imported alternatives.

Innovation is equally important. Competitors can replicate products and packaging, making continuous improvements essential. Successful enterprises must understand changing consumer preferences and develop products that respond to actual market demand.

Following demand to unlock opportunities

Changing consumer behaviour creates opportunities for agricultural value addition. Health-conscious consumers may seek nutritious grain blends, fortified foods and protein-rich products. Urbanisation and increasingly demanding work schedules can stimulate demand for convenient foods, including packaged legumes, ready-to-cook cereals and prepared grain products.

There are also opportunities in premium and specialised products. Traditional African grains, indigenous foods, distinctive fruit products and specialty oils can be developed for consumers seeking particular tastes, cultural connections or differentiated products.

Local identity can provide a competitive advantage, but it must be supported by consistent quality, reliable supply and appropriate packaging.

The broader lesson is that agricultural innovation should not focus exclusively on producing more at lower cost. It must also identify unmet demand and develop products that consumers are willing to purchase at prices that sustain profitable businesses.

Turning agricultural production into industrial growth

The benefits of value addition extend beyond individual farmers. Domestic processing creates opportunities in manufacturing, transport, packaging, storage, marketing and distribution. It also strengthens links between agriculture and industry.

A soybean-processing plant, for example, creates demand for farmers’ produce while supplying cooking oil to households and oilcake to livestock producers. Such linkages can reinforce domestic supply chains and reduce dependence on imported finished goods.

For Zimbabwe, locally grown maize, wheat, soybeans, sunflower and other crops offer opportunities to expand domestic processing. Realising this potential requires predictable supply contracts, accessible finance, reliable infrastructure and transparent pricing arrangements.

Investments in irrigation, electricity, roads, storage, and research and skills development can reduce production costs and improve competitiveness. Import substitution should nevertheless be strategic: domestic production must become commercially sustainable rather than depend indefinitely on protection from competition.

Financing the transition

Access to affordable finance remains a major obstacle. Farmers need seasonal funding for inputs and production, while processors require longer-term capital for machinery, storage and working capital.

Banks, development finance institutions and private investors can support agricultural value chains through supply contracts, equipment leasing, credit guarantees and partnerships between producers and processors. Governments can complement these efforts by improving infrastructure, ensuring predictable regulations and strengthening agricultural research and extension services.

Entrepreneurs must also develop financial management, marketing, product development and regulatory compliance skills. For smaller producers, shared processing facilities and cooperatives may offer more practical entry points than independent investments in expensive equipment.

The priority should be to finance commercially viable value chains rather than isolated projects.

From resource ownership to economic prosperity

Africa does not need to abandon commodity production. Minerals and agricultural products will remain important foundations of its economies. What must change is the extent to which these resources are transformed into higher-value goods before they leave the continent.

Value addition is not a shortcut to eliminating poverty. Its success depends on productivity, sound investment decisions, infrastructure, competitive pricing and consumer demand. Poorly designed processing projects can waste capital rather than generate prosperity.

For policymakers, the task is to create conditions in which viable industries can emerge and compete. For farmers and businesses, the challenge is to move beyond selling raw commodities and identify opportunities to capture more value.

Africa’s development challenge is not simply to produce more, but to earn more from what it produces. Its long-term prosperity will depend on transforming resource wealth into competitive industries, better incomes and sustainable employment.

“The future millionaires of Africa will not come from the oil and gas sector, but from agriculture,” said Mr Similo Nkala at the National Agriculture Conference and Expo held on 24-25 September.

Agriculture employs an estimated 54% to 70% of our population, contributes around 16% directly to GDP, and accounts for 53% of export earnings. Minister of Agriculture Mr Anxious Masuka stressed the need to invest in rural communities and harness their population, because those communities must also contribute to, and benefit from, agricultural development.

“Move up the value chain”

Turning agricultural potential into an export machine requires a shift from raw commodity sales to high-value agro-processing, structured market linkages and strategic investment. Zimbabwe should focus on transforming raw crops such as maize, soybeans, fruits and tobacco into higher-value foods, beverages and oils, rather than exporting them unprocessed only to buy them back at a higher price.

Value chain investment should also target high-impact sectors such as blueberries, dairy, beef and horticulture, which command premium global prices. Partnering major export enterprises with local growers, by supplying certified seed, fertiliser and technical guidance, would guarantee a consistent, high-grade harvest and could raise agriculture’s contribution to GDP.

“Make rural producers part of the export strategy”

Another issue is aggregation. Many rural communities do not produce enough volume to meet export demand, and exports are a game of numbers. More than 80% of our fruit and vegetable exports go to Europe, mostly to the Netherlands. Other destinations include Germany, China, Hong Kong and France. This is the profile of our horticultural export markets.

Blueberry production has been performing and expanding well. However, according to figures confirmed by the Horticultural Development Council, we have only about 850 hectares under blueberries. The crop is in high demand and offers considerable potential to boost our exports. There is ample room to expand production of selected crops and become a leading exporter of horticultural produce.

Demand for avocados has also been substantial. Most were previously destined for Europe, but a recently signed protocol with China now opens the Chinese market. Citrus presents another significant opportunity. More than 60% of enquiries are for oranges, and farmers in Beitbridge report that their entire production is already committed for the next three years. This shows the opportunity to invest in and expand citrus production and exports.

Beyond crops, there is considerable potential to export meat products, including beef and pork. The Gulf Cooperation Council (GCC) market is estimated at around US$2.1 billion, with the UAE importing approximately US$479 million and Saudi Arabia around US$1.4 billion. This is a substantial market, but compliance is critical: the requirements of these markets must be met to export successfully.

“Meeting demand, building supply and unlocking export competitiveness”

Accelerating the agricultural sector requires us first to meet demand and then to build supply. The market is there. Peas, one of our leading export crops, are shipped to Europe between April and August or September. During certain months of that window, as the Horticultural Development Council can confirm, Zimbabwe is among the few suppliers to that market.

Demand is so strong that farmers need not hide their crops from their neighbours. The market is large enough to absorb increased supply, so we must meet demand, build supply and address logistical constraints, including road access and cold-chain management. We must also move up the value chain by investing in processing, branding, intellectual property and the development of premium export products.

Sugar, as a processed product, has led our exports for some time. Structurally, however, it was exported mainly to Europe and the Far East, and Zimbabwe’s participation in regional markets was not particularly strong. We were also exporting mainly raw material, which was then processed further in destination countries to their own specifications.

What, then, do we need to do to export into the region, compete effectively and displace existing sugar suppliers? The first step is to move away from supplying a vulnerable primary commodity and add value. This is partly what we are doing through processing.

Zimbabwe was historically a breadbasket, with the competence and experience to perform. At one stage, we had the largest sugar-processing mill in Africa. We therefore have a history of leadership, competitiveness and reliable supply, and we need to reclaim that status.

Export barriers often arise from policies and regulations. With free trade and regional trading blocs such as SADC and COMESA, we have access to markets in those countries. To enter them, we must make use of our natural advantages.

“Where will the surplus sugar be sold?”

As noted earlier, Zimbabwe has water resources that can sustain production for years, even during drought. Some countries in the region rely on rain-fed sugarcane and experience fluctuations in supply when rainfall is poor. Zimbabwe’s irrigation capacity can therefore help it become a reliable regional supplier.

The sugar industry recently developed a 10-year strategy that aims to double sugar output over that period. Since current production is broadly sufficient for domestic consumption, the key question is where the additional sugar will be sold. The regional market is a potential destination.

Several countries in the region do not produce sugar, including Botswana, Namibia, Lesotho and Comoros. Others have production deficits: the Democratic Republic of the Congo, Angola, Tanzania and Madagascar, while Malawi has also recorded deficits in previous years. Taken together, the region has an estimated sugar deficit of 1.1 million tonnes.

At the same time, some countries produce a surplus. Zimbabwe produces approximately 100,000 tonnes more than it requires, and Eswatini, Zambia and South Africa are also surplus producers. The question, therefore, is how Zimbabwe can compete with these suppliers and improve its performance in regional markets.

2^ND EDITION OF  THE ZIMBABWE AGRICULTURAL SECTOR SURVEY REPORT 2019-2020  KEY INSIGHTS ON CROP PRODUCTION.

The GOVERNMENT need to  come up with deliberate policies to improve smallholder contribution to national output, which is currently on a downward trend with a 54 percent decline recorded in maize production during the 2019/20 season. Communal areas and small-scale farmers contribute towards 69 % of total maize output in the country.

According to Professor Gift Mugano, the lead researcher for the Zimbabwe Agricultural Society and Financial Gazette commissioned Zimbabwe Agricultural Sector Survey, one striking observation from the 2019 maize yield is that, on average, maize yield per hectare declined by about 54%. “On a farming sector basis, in 2019/20, A1, communal areas and small – scale farmers who constitute 69% of total maize output, recorded an average yield of 0.27 metric tonnes/ha down from an average yield of 0.478 metric tonnes/ha in 2018/19. Because of the significant contribution of these small – scale farmers, from a hectarage perspective, the fall in yield per hectare weighed down heavily national output.” Prof Mugano noted that over and above the effects of climate change, policy significantly contributes to poor output in the agricultural sector. Similar to a trend observed in the inaugural sector survey report, the provinces with the highest area under maize production do not contribute the highest output. Midlands province had the highest area under production at 21% but contributed 12% of the output while Mashonaland West at 18% area produced the highest output at 29%. “Seed is being distributed in the wrong provinces. Our recommendation is for government to place more emphasis in growing maize in Mashonaland Central, Mashonaland West and East provinces while more focus on traditional grains and livestock is placed in Midlands, Masvingo and Manicaland provinces.

This will result in significant increase in production for livestock and grains. 

Impact of Climate Change on Agricultural Production adopted from 2nd Edition Zimbabwe Agriculture Sector Survey (2019-2020). 

The research shows that climate change vulnerability negatively impacted productivity in the sector. Climate change has manifested through incessant droughts and reduced precipitation which has reduced output of grains by more than 50%. Livestock production has also not been spared with cattle dying due to food and water shortages caused by droughts.  

According to the study, Masvingo and Matabeleland South provinces recorded the highest number of poverty deaths in cattle at 17518 and 16863 respectively. This trend, if not addressed, is likely to negatively affect the country’s progress towards rebuilding the national herd. The annual survey gathers sector-wide, in-depth, objective and independent data on agriculture, agribusiness, machinery, equipment, irrigation, climate change, investment, markets and comparative data from regional economies, to inform Zimbabwe’s stage of growth, highlight challenges and illuminate opportunities in agriculture.