Abidjan: The Global Agriculture and Food Security Program (GAFSP) has allocated its first funding under a new private sector financing window to the African Development Bank Group (AfDB), committing $14 million to de-risking capital aimed at stimulating $200 million in private sector investments for enhancing food security in low-income nations.
According to African Press Organization, GAFSP provides financial and technical support, including grants, blended concessional finance, technical assistance, and advisory services, to the world's poorest countries to bolster projects across the agriculture value chain. The newly launched Business Investment Financing Track, GAFSP's second-generation private sector financing window, innovatively combines the program's grants and concessional finance with funding from multilateral development banks to attract private sector investment for smallholder farmers, producer groups, agribusinesses, and start-ups.
Natasha Hayward, Program Manager for GAFSP, emphasized the collaborative nature of this initiative, stating, "This first allocation demonstrates the appetite for funders to work together in this new model to solve an age-old challenge of finance for smallholder farmers: risk." By integrating GAFSP donor funds with multilateral development and commercial finance, each dollar from the program is set to draw in multiple dollars in private investment, thereby amplifying the positive effect on food security and resilience against climate change impacts.
The financing is designed to expand access to essential agricultural inputs such as certified seeds, organic fertilizers, soil enhancers, and mechanization. These resources will support agribusinesses in withstanding extreme weather conditions like heatwaves and drought. The initiative is expected to benefit over 1.5 million smallholder farmers and 500 agro-dealers and cooperatives.
Philip Boahen, African Development Bank Coordinator of GAFSP, highlighted the comprehensive benefits of the Agro-inputs Risk Sharing Facility, noting, "By targeting agro-input dealers and smallholder farmers, this facility intends to strengthen the entire value chain, from input supply to market access, building food systems able to withstand market shocks, including and especially environmental pressures." This allocation supports Africa's broader commitments to transforming food systems, in alignment with the Comprehensive Africa Agriculture Development Programme and the Kampala Declaration on Accelerating the Implementation of Africa's Food Systems Transformation.