Access to finance remains the biggest hurdle for African farmers as they attempt to move up the value chain from subsistence farming. This has stifled the progress of the Green Revolution the continent needs for inclusive economic growth and prosperity. The biggest and perhaps most important conference dedicated to this issue was held in Nairobi a couple of months ago. Anver Versi was there.
Despite a passionate desire to bring about Africa’s Green Revolution, actual achievement on the ground has been disappointing. One of the main reasons for this painfully slow progress is that ordinary African farmers, who form the backbone of agricultural production in Africa, have little or no access to finance. And the long and short of it is that without finance, you simply cannot increase agricultural output.
The challenge therefore is on finding ways and means of connecting sources of finance to those in the agricultural sector who need it to expand and thrive. This was the theme of the Fin4Ag conference held at the Kenya School of Monetary Studies in Nairobi in July.
The co-organisers were the Netherlands-based Technical Centre for Agricultural and Rural Cooperation (CTA), the African Rural and Agricultural Credit Association (AFRACA), the Central Bank of Kenya (CBK) and the Kenya School of Monetary Studies (KSMS).
The $36m Zimbabwe Agricultural Development Trust fund has provided loans to 209 small and medium enterprises in agricultural value chains, some 26,000 smallholder farmers
The CTA is a joint international institution of the African, Caribbean and Pacific (ACP) Group of States and the European Union (EU). Its mission is to improve food and nutritional security, increase prosperity and encourage sound natural resource management in ACP countries.
With more than 800 participants from over 80 countries worldwide, this was the largest conference ever held on agriculture value chain finance. An important aspect of the conference was a segment, Plug and Play, dedicated to bringing ICT solutions for agricultural finance to a mainstream audience.
The CTA director, Michael Hailu, set the tone and the mood of the conference when he emphasised that agriculture should be looked at as a business rather than as some sort of development issue. African agriculture in particular has enormous potential to generate wealth and could become one of the most lucrative businesses on the continent.
The presence of several central bank governors as well as the chief executives of commercial banks was an indication that both the public and private finance sectors were beginning to see the business case that African agriculture presents.