Kenyan government partners with AfDB, launches US$20m youth agribusiness fund

KENYA – The government of Kenya is spearheading the development of agribusiness enterprises in the country with the launch of Ksh2.2 billion (US$20m) fund, targeting the youth.

The project will be carried out through the Empowering Novel Agribusiness-Led Employment (ENABLE) Programme, co-funded by the African Development Bank (AfDB) and the government.

It will be implemented by the Ministry of Agriculture and aims to create youth agripreneurs through skill acquisition and creating an enabling environment in which they can become owners of profitable agribusinesses.

This will be attained through training, nurturing and mentorship in the Youth Agribusiness Incubation Centres (YABICs).

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The incubation process follows three key phases- pre-incubation, incubation and post-incubation for a period of between three to 12 months.

“With proper harnessing and equipping with the right skills, training and mentorship, job creation in many sectors of the economy, the youth are capable of transforming Kenya into a middle income country by 2030.”

Agriculture Chief Administrative Secretary – Anne Nyaga

ENABLE Youth Kenya Programme also has a financing component that seeks to support youth-owned agribusinesses by facilitating access to capital through financing and risk-sharing mechanisms.

With the fund set a side, the programme will finance youth agripreneurs through three financing mechanisms.

The mechanisms include interest-free loan to finance up to Ksh500 million (US$4.5m) to youth for start-ups and soft loan where Ksh900 million (US$8.2m) will be committed in the form of low-interest credit to the incubation graduates at an interest rate of five percent.

Third is the Risk Guarantee Fund where Ksh800 million (US$7.2m) will be for a risk sharing fund, which will provide back-stopping support to financial institutions to make available up to Ksh5 billion (US$4.5m) as commercial loans to agripreneurs.

The overall goal of the program, according to Business Daily is to contribute to job creation, food security and nutrition, income generation, improved livelihoods for youths in both urban and rural areas and bridging succession gap in agribusiness and related value chains.

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“A number of challenges that hinder youth engagement in the sector have been identified and include negative perception and attitude to agribusiness and limited access to financial services,” said Agriculture Chief Administrative Secretary Anne Nyaga.

“With proper harnessing and equipping with the right skills, training and mentorship, job creation in many sectors of the economy, the youth are capable of transforming Kenya into a middle income country by 2030,” she added.

The program targets to train and empower 10,000 agricultural entrepreneurs (agripreneurs) directly and create employment opportunities to another 50,000 youth along the value chains.

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