Crippled by Inadequate Finance


African Green Revolution Forum warns of severe finance gaps in African agriculture

|  By Maureen Chigbo  |  Sep. 23, 2013 @ 01:00 GMT

THE year 2014 is critical year for agriculture in Africa. It is the year when African governments will be setting investment targets and plans to develop agriculture over the coming decade. And one key barrier to achieving the continent’s target on agriculture over the years has been inadequate finance.

The global gap in finance for agriculture stands at $450 billion, an issue which is more acute in Africa than anywhere else. Evidence shows that only 10 percent of African smallholder African farmers have access to the financing they need to expand their production and raise their income. This must be why the African Green Revolution Forum, AGRF, at its forum which ended September 6 in Maputo, Mozambique, warned that a green revolution could not materialise in Africa without a major concerted effort to secure financing for agricultural production.

Irungu Houghton

The Forum brought together more than 200 delegates from across Africa and internationally to focus on the critical role to be played by public-private partnerships and inclusive business models in the development of Africa’s agriculture. The AGRF is committed to focus over the next year on a number of priority actions, including: ensuring that rising revenues from extractives industries are invested into the development of agriculture, reducing corruption in public-private partnerships and designing business ventures that are transparent, environmentally and socially responsible.

It will also focus on building the capacity of famers’ associations, finance institutions and agribusiness agencies to work together,  encouraging governments to offer tax incentives and make preferential procurement choices for companies that source from smallholder farmers; developing inclusive financial models that combine incentives, reduce debt risk and promote longer-term agribusiness models, and combining incentives, reducing debt risk and promoting longer-term agribusiness models

Irungu Houghton, convener of the AGRF, said: “Throughout the African continent, we are witnessing successful partnerships between the private and public sectors and smallholder farmers. But these partnerships are still too rare. We will only be able to transform Africa’s agriculture, and alleviate food insecurity and poverty, if smallholders have the funds to boost their crop yields and expand their business.”

Dyborn Chibonga, chief Executive officer of the National Association of Smallholder Farmers of Malawi, said: “Some African governments have gone some way towards addressing affordability and accessibility of production inputs, but challenges still persist.  Every year, smallholder farmers are pulled into a downward spiral of taking out high-interest loans in order to buy farming inputs for the following season. Without access to credit, smallholders cannot raise productivity.”

Antonio Limbau, deputy minister of agriculture for Mozambique, who formally closed the AGRF, said: “We are honoured and pleased to have hosted this important forum in Mozambique 10 years after the Maputo Declaration. This forum was a valuable opportunity to discuss practical steps to strengthen capacity and extend the use of modern technology to increase productivity.”


Jane Karuku, president of the Alliance for a Green Revolution in Africa, AGRA, – a partner in the AGRF – said: “2014 is a critical year for agriculture, when African governments will be setting investment targets and plans to develop agriculture over the coming decade. The African Union has recognised this crucial moment and designated 2014 as the Year for Food Security and Agriculture. We are delighted to announce that next year’s AGRF will be co-hosted with the African Union in Addis Ababa in September 2014.”

The African Green Revolution Forum is an initiative which seeks to bring together African heads of state, ministers, farmers, private agribusiness firms, financial institutions, NGOs, civil society, scientists, and other stakeholders to discuss and develop concrete investment plans for achieving the green revolution in Africa. The Forum focuses on promoting investments and policy support for driving agricultural productivity and income growth for African farmers in an environmentally sustainable way. The Forum consists of on-going stakeholder engagements as well as major events which bring together a significant number of stakeholders to review progress and re-strategize. The first major Forum event was an international convenance held in Accra in 2010. The second one was held in Arusha, Tanzania in 2012.

AGRF sponsors and partners of AGRF include Syngenta, FAO, Rockefeller Foundation, African Union, Nepad, Southern Africa Confederation of Agricultural Unions, SACAU, AGRA, Yara, IFAD, African Development Bank

The AGRF 2013 was attended by more than 200 high level government officials, non-governmental and other public and private sector organisations investing in Africa’s agricultural future – stakeholders who share the objective of improving and scaling up the productivity of Africa’s smallholder farmers.

The overall theme for AGRF 2013 was ‘scaling up and financing inclusive agribusiness through transformative public-private partnerships’. The AGRF had three sub-themes: Inclusive business models – what are the scalable models of smallholder inclusion into commercial agricultural value chains or that provide effective market access?  Innovative financing models – what are the scalable models to stimulate growth and value chain partnership expansion in Africa and Review of CAADP – key concerns in the next 10 years in relation to public-private partnerships for agriculture development.

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