AFRICA – The African Development Bank (AfDB) and the African Fertilizer and Agribusiness Partnership (AFAP) have signed grant agreements worth US$5.4 million that seek to boost the agriculture sector.
The agreement aims to officially launch Africa Fertiliser Financing Mechanism (AFFM) trade credit guarantee projects in Nigeria and Tanzania to support the sector.
The African Fertiliser and Agribusiness Partnership will be the implementing partner operating on behalf of the Africa Fertiliser Financing Mechanism who designed the funds to provide sustainable financing solutions for fertilizers.
The project will be implemented over a two-year period, targeting 10 importers, 5 blenders/manufacturers, and 37 hub agro-dealers as direct beneficiaries, 520 retail agro-dealers as indirect beneficiaries and 700,000 smallholder farmers as final beneficiaries.
The agreement was signed by Dr. Jennifer Blanke, Vice President for Agriculture, Human and Social Development, African Development Bank Group and Jason Scarpone, CEO, African Fertiliser and Agribusiness Partnership at the African Green Revolution Forum (AGRF) 2019 in Accra, Ghana
Commenting on the partnership Dr. Jennifer Blanke stated, “We are just thrilled to be getting together with our partners in order to expand the efforts to make sure that we are financing the development of manufacturing and blending of fertilizer.”
These are the first agreements signed by AFFM, which is hosted by the African Development Bank, since it became fully functional last year.
The Africa Fertilizer Financing Mechanism (AFFM) was created in 2006 during the Abuja African Green Revolution summit. However, it became operational in 2015, after achieving the initial capital of US$10 Million.
Following the realignment of the AFFM’s Strategy by the Governing Council in June 2018, it was decided that the AFFM focuses on the provision of credit guarantee as a tool for de-risking the financing of fertilizer value chain across the continent.
African Fertilizer and Agribusiness Partnership CEO Jason Scarpone emphasized on the importance of value chain financing and expressed his optimism towards the project.
By supporting the fertilizer value chain in the two countries, the projects will go a long way to making fertilizer available to more farmers, a key objective of the Bank’s Feed Africa Strategy. Feed Africa Strategy 2016-2025 focuses on scaling up agriculture as a business through value addition, using innovative financing mechanisms and strategies that aims to end hunger and rural poverty in Africa in the next decade.