The agricultural sector accounts for around 36% of East African GDP and is the main driver of growth. Historically, growth in East Africa has been driven by growth in agriculture. This is due to the sector’s contribution to GDP and employment.
Agriculture has a high potential for poverty reduction as well as catalyzing value chains in industry and services. 80% of the population of the EAC region live in rural areas and depend on agriculture for their livelihood.
A significant proportion of intra-and extra-EAC trade is in agricultural commodities which include tea, coffee, cocoa and horticultural products. The horticulture sector in particular can provide an avenue for product and market diversification, attraction of investment and upgrading of technology. It is also labour intensive, generating much needed employment especially among women and young people. Engaging young people across the agri-food chain is increasingly seen as a potential solution to youth unemployment, food insecurity, rural poverty and distress migration. Young people represent about 45% (48 million) of the total population of the EAC. This number is expected to nearly double to 82 million by 2038.
One way to unlock the potential of agriculture to drive industrial growth, diversification and inclusive development is by increasing intra-regional trade and exports of agro-based products to the European Union (EU) and other international markets.
EAC export trends indicate that food items and agricultural raw materials accounted for 51% of the region’s total exports between 2013 and 2017. Further, the volume of intra-regional food exports has increased almost 9-fold between 2000 and 2017 with Burundi and Rwanda exporting larger shares of their food exports to the region. Kenya, Tanzania and Uganda’s food exports are largely destined outside the region, mainly to the EU. Overall, the EU remains a key trade and investment partner for the EAC region.