CEM REPORT, AGROFOOD | Africa will be getting a pool fund of $300 million to boost agriculture and food production in the continent. The funds will be employed to transform Africa’s underdeveloped rural areas into agro-industrial corridors of prosperity.
The funds committed by the Islamic Development Bank, Africa Development Bank (AfDB), the African Export-Import (Afrexim) Bank as well as the Arise Integrated Industrial Platforms (Arise IIP) and its partners, at the Africa Investment Forum 2023 in Marrakech, Morocco.
AfDB at the event committed $1.5 billion to promote the export of value-added agricultural products through the Special Agro-Industrial Processing Zones (SAPZs) initiative.
The Islamic Development Bank on its part committed $300 million to bridge the critical financing gap in agriculture and boost agriculture and food production in Africa. The rest of the fund will be provided by other partners under a new private sector-focused alliance.
President Of the AfDB, Akinwumi Adesina, speaking on the SAPZ initiative said that the bank has provided financing of $853 million to support the establishment of SAPZ, and has mobilised over $661 million from other development partners to support the initiative.
He explained that the SAPZ initiative goal is to increase household incomes, foster job creation in rural agricultural communities, especially for youth and women, and enhance food and nutritional security primarily in Nigeria.
Adesina continued that to expand SAPZs across Africa, and take advantage of the Africa Continental Free Trade Area (AfCFTA), countries must scale up resources, partnerships, and alliances.
“Africa must end the export of raw agricultural commodities. We must recognize that the fastest way to poverty is via the export of raw commodities, while the highway to wealth is from the export of value-added products.
“And that is why SAPZs are important. They provide critical infrastructure to support agro-industrial development in Africa.”
Speaking on the contributing partners, he expressed excitement that the number of partners joining hands to rapidly scale up the SAPZs across Africa was expanding.
“Our valued partners include the Islamic Development Bank, the International Fund for Agricultural Development, the Arab Bank for Economic Development, the European Union, and the Korean Export-Import Bank.
“We are also working with the African Union to support the Common Africa Agro-Parks Program.
“The Alliance has the goal of mobilizing at least two billion dollars in financing and investment commitments from Alliance members and partners over the next five years.
“Meeting this financing goal will deliver an additional 15 to 20 SAPZ projects in various countries across the continent.
“The Alliance will raise funds through various investment windows for project preparation, project development and construction, and financing for tenant companies,” Adeshina said.
Hani Sonbol, CEO of the International Islamic Trade Finance Corporation and acting CEO of the Islamic Corporation for the Development of the Private Sector, who represented the IsDB President, Muhammad Al Jasser on his part commented “Strengthening food sovereignty in Africa will require us to think differently in terms of investment. We look for self-sufficiency, climate change and adaptation, and how to attract private sector involvement.”