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AfDB and partners mobilise $30 billion for African farmers

Akinwuni Adesina02 AfDB President Akinwumi Adesina (right) signs a document

Sat, 28 Jan 2023 Source: theeastafrican.co.ke

The Dakar 2 Feed Africa Summit ended on Friday with a $30 billion pledge by the African Development Bank (AfDB) and development partners to finance food and agribusiness on the continent in the next five years. Of the amount announced at the summit held in the Senegalese capital, the AfDB pledged to mobilize $10 billion.

Leaders who attended the event called on the African Union Commission and the AfDB to help mobilize more funding to top up the amount announced and report on the overall investment at the February African Union Summit.

Some 34 African heads of state and government, leaders of international and bilateral development organizations, and the private sector attended the in Summit, whose theme was “Feed Africa: Food Sovereignty and Resilience”.

Food target

Concerned that rising food prices and disruption in global food supply due to Covid-19, climate change, and the war in Ukraine will worsen food insecurity in Africa, and noting that the continent has 65 percent of the world’s remaining uncultivated arable land — with the potential to produce enough to feed its people and the rest of the world — the leaders mooted national food and agriculture delivery compacts to embed food targets in their development agenda.

Among the resolutions was the establishment of Presidential Delivery Councils to oversee the implementation of the country-specific compacts and promote accountability.

AfDB President Dr. Akinwumi Adesina said that Africa’s agriculture sector will depend on strong political will and commitment of governments, development partners, and the private sector and the scaling up of highly impactful continental programs such as the Technologies for African Agricultural Transformation.

He emphasized the place of infrastructure in transforming rural areas into agricultural production and processing zones.

“Infrastructure is very important and Africa has a deficit of $68 billion to $108 billion per year. The African Development Bank has in the past six years invested $44 billion in infrastructure: from power to roads, to water, to sanitation, to digital infrastructure, to transport corridors to one-stop border posts. But a lot of infrastructure in Africa concentrates in urban areas because the economic viability of infrastructure is low in the rural areas because they're a source of livelihood — agriculture — is not viable. But we have special agro-industrial processing zones. These are going to change the density of infrastructure in rural areas around agriculture, power water, roads, irrigation storage, and logistics.

“It will make agricultural processing and value addition profitable, close to where the food is produced. So, you don't need to move raw materials; you will move finished agricultural products.”

Agro-industrial processing zones

He said the bank has in the past two years invested $1 billion on 23 projects in special agro-industrial processing zones in 11 countries.

Participants sought support for agriculture-based small and medium enterprises (SMEs), burdened with an unmet financing need of about $100 billion annually.

The AfDB and the government of Canada announced the Agri-SME Catalytic Financing Mechanism, a blended finance facility that is expected to de-risk investment into small and medium agri-businesses and strengthen food systems across the continent.

With an initial contribution of $85 million from the Canadian government, the Mechanism will provide concessional finance and technical assistance to financial intermediaries, including agribusinesses, commercial banks, micro-finance institutions, and impact funds.

The summit also saw the launch of Mission 1 for 200, a joint program of the AfDB and the International Fund for Agricultural Development to help 40 million African farmers to produce 100 million tonnes of food for 200 million people. Mission 1 for 200 is meant to build resilience by helping farmers adapt to climate change and reduce agriculture’s environmental impact and emissions.

Source: theeastafrican.co.ke