Agriculture and rural development are key elements in African economies and provide an important route towards achievement of the critical development goals of promoting growth and reducing poverty in Africa. Yet the sector presents a challenging development agenda. This report presents the main findings, conclusions and recommendations of a major evaluation of assistance to agriculture and rural development (ARD) in Africa provided by the African Development Bank (AfDB) and the International Fund for Agricultural Development (IFAD). The evaluation was undertaken jointly by the evaluation offices of the two institutions.

The joint evaluation focused on the policies and operations of AfDB and IFAD in ARD in Africa. The evaluation had four objectives. These were to: (i) determine the relevance of ARD policies and operations, in the light of current and emerging issues; (ii) assess their performance and impact; (iii) evaluate the strategic partnership between IFAD and AfDB and other ARD partnerships on the continent; and (iv) develop recommendations to enhance the partnerships and development effectiveness of the two institutions. While reviewing past experience, the evaluation was intended to be forward looking, with a view to strengthening future ARD policies and operations.

Attention was devoted to analysing the changing context for agriculture and rural development in Africa, and to drawing out the relevant strategic implications. The evaluation found that although the economic situation has improved in many parts of Africa in recent years, and although sector policies have improved, many challenges remain, including poor infrastructure; weak sector institutions and insufficient regional integration; underdeveloped markets and limited private sector involvement; the low productivity of smallholder farmers; the need for effective management of natural resources and the environment, in the face of climate change; high levels of poverty, exacerbated by rapid population growth and the continued prevalence of HIV/AIDS; and pervasive gender inequality, which undercuts the contribution of women in a region where they play key roles in agriculture and agricultural trade. Access to both domestic and international markets is difficult and constrains production.

Recent shocks and crises have compounded these challenges.

Actions required to address these challenges include improving the investment climate; better infrastructure and regional integration; supporting innovation; and strengthening institutional capacity. However, the African context in all dimensions is complex and highly diverse, and solutions need to be tailored to fit local conditions. The country context is key.

Since they were founded, AfDB and IFAD have provided assistance to the sector in loans and grants with a combined total value of around US$10 billion. Although many donors and governments drew back from supporting agriculture in the 1990s, AfDB and IFAD continued to provide substantial support. Recent years have seen renewed support for the sector, including the launch in 2002 of the Comprehensive Africa Agriculture Development Programme (CAADP), under the New Partnership for Africa's Development (NEPAD), and the Maputo Declaration of 2003, which committed African governments to allocate 10 per cent of their national budgets to agriculture with the aim of raising annual agricultural growth rates to 6 per cent. Major donors are returning to the sector, along with a variety of new donors and private sector investors. Despite the wide consensus regarding the importance of a country-led approach to development, the sector's highly fragmented aid architecture requires the many players to establish a well-coordinated division of labour, based on respective areas of comparative advantage, specialization and track record. Yet there has so far been a lack of far sighted vision and a coherent, widely agreed policy framework. Bold leadership and political will are both needed to address this "policy gap."

With regard to institutional policies and mandates, the evaluation concluded that the two organizations have distinct but complementary roles, and are, separately and together, highly relevant to Africa's current and future needs in ARD.

An assessment of the performance of past operations assisted by each institution in ARD in Africa concluded that, at the project level, past performance has been moderately satisfactory, but sustainability was weak. Inadequate attention was devoted to promoting gender equality and, in this regard, results were modest. At the level of country strategies and programmes, performance was found to be weak in both organizations, especially in terms of relevance to country needs, as well as with regard to policy dialogue, knowledge management, and partnership building. Attention is needed to ensure better design and implementation of ARD strategies. In the case of IFAD, overall performance in Africa was lower than performance in other geographic regions covered by the Fund's operations. For the Bank, the performance of its ARD operations was found to be less successful than in other sectors. Benchmarking evidence indicates that the performance of other agencies working in ARD in Africa was at a broadly similar level, perhaps indicating the difficulty of addressing ARD sectoral challenges.

The evaluation found that the past performance of AfDB and IFAD as lenders, and of governments as borrowers, was generally unsatisfactory. This was a recurrent issue, with serious consequences for overall performance. IFAD and Bank performance in project design, supervision, problem solving and in making operational adjustments was found to be satisfactory in less than one out of every two projects financed. A number of recent reforms at IFAD and AfDB have been oriented towards improving lending agency performance, and evaluation of recently approved country strategies, programmes and projects found signs of improvement in quality. However, little attention has been given to improving government performance. There is, in consequence, an urgent need to strengthen government capacity. This will be critical for achieving successful results.

The evaluation also reviewed the partnership between AfDB and IFAD, which was formally established with the signing of a partnership agreement in 1978. Activities were largely confined to cofinancing of investment projects, with AfDB also providing supervision services for IFAD. Overall, the performance of the partnership was weak. A new memorandum of understanding was signed between the two organizations in 2008, with a stronger focus on results and joint action. But to channel efforts efficiently, there is a need for an action plan, backed by adequate resources and focused attention to management.

Each institution enjoys generally good relations with governments in the region, and with a range of sector partners. However, with many players now active in the sector, there is a tendency towards "partnership proliferation". Future partnerships need to be selective and purposeful, building on comparative advantage with a clear focus on results.

The two organizations have made and continue to make major contributions to support ARD in Africa. Their contribution could be further strengthened through focused attention to address the sector policy gap, improve the performance of both lenders and governments, and to strengthen the partnership between AfDB and IFAD, and between these institutions and other sector players.

Recommendation

Recommendations for both agencie

The joint evaluation makes the following recommendations for both institutions, focusing on the "three Ps" of policy, performance and partnership.

Filling the sector policy gap. AfDB and IFAD should work together to address the ARD policy gap in the following ways: (i) maintain alignment with CAADP and provide a joint statement of support for CAADP; (ii) at country level, support the development of sound national ARD policies, and align assistance with national strategies; (iii) at the level of global policy, develop knowledge and capacity to engage in international advocacy on trade issues affecting African producers.

Lender performance. AfDB and IFAD should make further efforts to improve their performance in the following ways: (i) increase skills, knowledge and capacity in the areas of policy, analytical work, knowledge management and managing partnerships; (ii) increase support to ARD in fragile states, giving careful attention to choice and sequencing of aid modalities; (iii) strengthen country presence; (iv) finance simpler, more tightly focused projects and programmes, undertaken within the framework of coordinated sector plans.

Borrower performance. AfDB and IFAD should aim to strengthen borrower performance as follows: (i) support governments to undertake capacity needs assessments in the ARD sector, and provide substantial support for capacity building and institutional development; specifically, support capacity building in relation to (ii) political decentralization; (iii) gender mainstreaming; and (iv) research and development.

Building purposeful partnerships. AfDB and IFAD should: (i) maintain and deepen their current bilateral partnership, based on the memorandum of understanding of 2008, setting clear, strategic regional priorities, backed by a clear Action Plan and adequate resources; (ii) focus their partnership on their respective areas of comparative advantage, specialization and complementarity, and strengthening the focus on results; and (iii) at the regional level, take forward their partnership within the wider partnership around CAADP

Recommendations for AfDB

It is recommended that AfDB should: (i) remain directly engaged in ARD, but develop a more selective strategy, closely linked to the Bank's medium term priorities, and aligned with CAADP; and it should widely publicise the revised strategy; (ii) expand support to regional and sub-regional development; (iii) ensure that sufficient human and financial resources are allocated for effective implementation of the revised strategy while seeking to leverage further funding from the private sector, private donors, Arab States and emerging donors. Steps should also be taken to ensure provision of adequate resources to regional member countries and operational departments to take forward important analytical work and sector studies.

Recommendations for IFAD

It is recommended that IFAD should: (i) engage more strategically in analytic work, by building in-house capacities and through strategic partnerships; (ii) differentiate allocation of administrative resources to allow increased support in developing strategies and operations relating to fragile states; and (iii) plan joint activities to share knowledge and experience between the three divisions covering Africa.