We are poised on the edge of a breakthrough for agriculture in Africa. This is vital not only for the food security of hundreds of millions of Africans, but also for the African economy
and sustainable development on the continent. We see a transformation underway from a subsistence-oriented agriculture sector into one that is more commercialized, profitably
productive, and smallholder and entrepreneurled. This comes at a time when food systems across the continent are responding to rapid urbanization, rising incomes, and changing
diets.
Agricultural value chains are becoming more urbanized and consumer driven, with a greater emphasis on quality and food safety. These dynamics are creating many new growth
opportunities within Africa’s food systems. Output and employment in agriculture continue to grow, and a great deal of value addition and employment is being created along value chains in the form of agricultural trade, farm services, agroprocessing, urban retailing, and food services. However, these changes are not just happening on farms and in national governments.
This Report examines the crucial role played by small and medium enterprises (SMEs) in driving this transformation. The midstream of the food value chain is particularly important, as it is the closest the market gets to the farmer. This midstream consists of traders, truckers and processors. They connect the farmer with the downstream—retailers. The midstream constitutes about 40% of the total gross value of the value chains in sub-Saharan Africa. This is the same as the share from farms, and together, they are the essence of food value chains in Africa.
About 80% of the midstream of the value chains comprises SMEs. These are the motors of the value chain transformation, and of rural employment off farm. We call this sector the “Hidden Middle” because it is often hidden from the policy debate—but it is not a “missing
middle”. Contrary to perceptions, this Report shows not only that the private sector is present, but that it has already “taken off”, and is ready for support and investment to thrive further. In fact, this Hidden Middle is dynamic, and undergoing and driving a “Quiet Revolution”.
