NextBillion - A WDI Publication

In my 2025 book “The Future of Employment in Africa: Demography, Labour Markets and Welfare,” I demonstrate — based on population projections from the United Nations — that sub-Saharan Africa’s working-age population (15–64 years) will increase by more than 20 million jobseekers per year until 2050. This means that the region will have to create at least 20 million additional jobs annually in the coming 25 years to avoid a rise in unemployment. If the continent cannot create sufficient jobs, unemployment will inevitably increase and likely lead to more poverty, potential unrest and migratory pressures. This represents a major challenge, considering that during the first two decades of this century, sub-Saharan Africa was able to create “only” 9 million jobs per year on average.

This job creation challenge is especially urgent in fragile, conflict-affected and low-income countries. This is because these economies — such as Niger, the Central African Republic, Chad and the Democratic Republic of Congo (DRC) — have relatively higher fertility rates, which lead to comparatively higher population growth and more future jobseekers than in middle-income countries (such as Botswana and Ghana).

In my book, I provide an overview of the economic sectors that offer the biggest potential for job creation, with the agri-food sector ranking as probably the most powerful catalyst. In this article, I’ll take a closer look at the job potential of this sector, especially in light of some recent positive developments.

Growing momentum for the African agri-food sector

The agri-food sector includes both on-farm activities (e.g., crops, livestock, forestry, fishery and aquaculture) and off-farm activities (e.g., food- and beverage-processing activities, food trading and food services). On-farm agricultural employment represents 45% of jobs in Africa. Another 16% of Africa’s total employment is in off-farm agri-food activities. The on-farm and off-farm agri-food sectors combined hence represent more than 60% of the region’s total employment, making the agri-food industry by far Africa’s top employer.

Looking into these numbers further, several trends can be observed. For instance, although the share of on-farm agricultural employment has decreased, from 57% in 2000 to 45% in 2023 (in line with economic theories about development), the on-farm agricultural sector in African countries is still growing in terms of number of jobs: from 170 million employed in 2000 to 245 million employed in 2023. This is due to the abundance of labour resulting from demographic growth. In other words, the number of people employed in agriculture in Africa is still growing, even though the share of on-farm agricultural employment is decreasing. (And of course, most of these workers are self-employed smallholder farmers.) Another trend is the significant growth of off-farm employment due to an increasing and more sophisticated demand for food, especially processed food. The number of off-farm agri-food employees doubled from 39 million in 2000 to 82 million in 2020.

However, despite this growth, employment in the African agri-food sector — especially off-farm food processing — can increase further thanks to three enablers.

Firstly, Africa is gradually substituting imported food with locally processed food. Africa’s gross food imports from the rest of the world still amount to some $74 billion per year (as of 2023). This is more than twice the volume it imported in 2000. Of these imported products, wheat, rice, soy beans and other oilseeds, and frozen meat are the most important. I have often been surprised to find (low-quality) frozen chicken from Belgium at markets in the DRC, while Africa could produce these products domestically.

However, the picture is changing, including in Nigeria, the region’s largest net food importer. For example, the Nigerian company Flour Mills of Nigeria has launched a programme to substitute imported wheat from the U.S. with locally cultivated wheat. And as net exporters, Ivory Coast, Ghana and Kenya demonstrate how African countries can become agricultural export powerhouses, boosting employment as a result.

Secondly, food demand is booming. If food is processed locally, this growing demand will foster job creation in Africa. The demand is caused by unprecedented demographic growth, increasing urbanisation and the emergence of a middle class that’s consuming more food.

Finally, conditions for more intra-African trade in food products have improved, leading to more production and jobs in Africa. In 2018, the members of the African Union concluded the Agreement Establishing the African Continental Free Trade Area (AfCFTA). As it gradually comes into force across individual member states, it aims to promote intra-regional trade by reducing or eliminating import tariffs and other trade barriers between African nations. According to Claver Gatete, Executive Secretary at the United Nations Economic Commission for Africa (UNECA), by 2045 the AfCFTA will boost expansion in agri-food by 60%. As these commitments illustrate, the region’s supportive political context will increasingly enable African farmers and agribusinesses to meet the growing demand for food, with the resultant impacts on job creation.

Increasing food exports as a catalyst for job creation in Africa

It’s important to note that even though its food imports have been rising, Africa is also exporting much more food than it used to. Exports mainly include cocoa, coffee, tea and cotton. In terms of volume, African food exports have tripled since the beginning of the century, growing faster than imports. However, total food exports ($57 billion in 2023) remain lower than total imports of food, leading to a food trade deficit.

Further increasing food exports could provide a catalyst for job creation in Africa. And this is more than just a theory: The job generation potential of the African agri-food sector is becoming a reality thanks to the emergence of large (and thriving) African food manufacturing businesses.

This is clearly illustrated by the example of Dangote Industries from Nigeria, an established industrial company with a presence in 17 African countries. Starting out in the cement industry, the group has diversified its activities, and it has been moderately active in agri-food over the last 10 years. But in recent years, it has significantly expanded its footprint in the sector. The company built a processing facility for tomato paste in Kano State (designed to process 300 – 350 million tonnes of hybrid tomato seedlings) and it recently expanded its rice-processing capacity, making it one of Africa’s largest cereals producers. In 2021, it began operating a fertiliser plant in Nigeria that has already turned the country into a net exporter of nitrogen-based fertilizers — an accomplishment it plans to duplicate regionally by 2028. But the company’s largest agri-food investment is in a sugar refinery with a capacity of almost 1.5 million tonnes per year — the largest sugar refinery in Nigeria (and one of the largest in sub-Saharan Africa). In addition, Dangote invested $700 million into its sugar projects earlier this year, in support of the Nigerian government’s goal of making the country self-sufficient in sugar production.

These and other expansions of processing facilities are having a growing impact on employment across the region. In Kenya, I witnessed first-hand how recently created processing plants for macadamia nuts have grown into large employers. Incofin, the impact investment company I have been leading for 25 years, had invested in two such facilities in the country, where 1,500 (mostly low-skilled) employees process and package the nuts before shipping them worldwide. These plants also provide work to 15,000 smallholder farmers, from whom they source the nuts.

As these examples confirm, boosting agri-food exports offers a promising path toward greater job creation in Africa.

Opportunities and risks in Africa’s agri-food sector

As Professor Bitange Ndemo, Kenya’s ambassador to Belgium and the E.U., rightly observed in a recent article, “In nearly every sector in which Kenya participates — tea, mangoes, coffee, textiles, gemstones and even tourism — the same pattern repeats itself. We grow, harvest or extract, but someone else owns the rest: the processing, the branding, the distribution and the profit margins.”

He cites the example of the leather industry in Kenya, which ranks among Africa’s leading producers of hides and skins, and has the third-largest livestock population on the continent. Despite Kenya’s substantial infrastructural investments in this value chain, only about 2% of these hides are converted into fully finished leather, with most semi-processed and exported with little added value. As a result, the hide of a Kenyan cow sold for a few hundred Kenyan shillings can be found a few months later in a Nairobi shopping mall as a refined Italian leather handbag selling for 16,000 Kenyan shillings.

It’s clear that the time has come for this and other industries to seize the opportunity to add more value on African soil.

The example of the leather sector in Kenya can be extended to many value chains across the continent. African agri-food value chains, among others, need to be redesigned to focus on keeping more value local. Acquiring a larger share of the value chain means more local ownership, improved enabling infrastructure and enhanced negotiating power. This is precisely the opportunity Dangote Industries has seized, and it is the key to more high-value jobs on the continent.

However, betting on more jobs in the agri-food systems is not without risks and challenges. For instance, Africa’s domestic agri-food industry must compete with cheap imported commodities. A good example is palm oil, which is widely used for cooking in African countries. In 2022, Africa produced a total of 3.4 million tonnes of palm oil, led by major producers like Nigeria, Ghana, Ivory Coast and Cameroon — but it also imported 8.3 million tonnes. The Nigerian government took measures to reduce imports and promote the local production of palm oil. But despite these measures, the country’s crude palm oil is often less competitive than imported alternatives, primarily due to the high production costs. Consequently, local manufacturers of palm oil-based products often opt to import palm oil as a raw material rather than support local producers. Nigerian palm oil production is estimated to provide jobs to at least 1.8 million Nigerians: The international competitiveness of African palm oil is therefore a key factor in the sector’s ability to create jobs.

Climate change is driving other risks to the agri-food sector. Although Africa is a marginal contributor to global greenhouse gas emissions, its share of negative climate change impact is disproportionate. Further increases in global warming will expose it to major escalating risks, such as drought and land degradation. This is forcing the continent to invest in costly climate adaptation measures, which might come at the expense of investing in more jobs in sectors like agri-food.

To meet its need for at least 20 million new jobs per year across the coming two to three decades, Africa must take fuller advantage of its agri-food industry to boost employment. It must aim to transform itself into a food powerhouse, growing the sector and creating quality jobs. This is already gradually happening, thanks in part to big African players emerging in the space that — despite the challenges and risks — are providing a source of inspiration for the continent’s entire agri-food industry. They are the type of employers Africa needs to secure jobs for all.

Loïc De Cannière is the founder of Incofin Investment Management and the author of “The Future of Employment in Africa: Demography, Labour Markets and Welfare.” 

Photo credit: Aninka Bongers-Sutherland