The Zimbabwean Government is set to receive $20 million from a fund meant to boost agriculture and nutrition in Africa, the African Development Bank (AfDB)
The Phatisa Food Fund2 (PFF2) is targeting a capitalisation of $300 million to invest across Africa with a focus on Sub-Saharan Africa, the bank said on Wednesday.
AfDB said the fund was projected to cover the entire African continent, with a sharper focus on Sub-Saharan Africa, relying on its presence in South Africa, Kenya, and Zambia, Mauritius and London and a new office opening in Côte d’Ivoire.
“Presently, the fund targets average investment amounts of $20 million in Cote d’Ivoire, Ghana and Nigeria in West Africa; Kenya, Tanzania and Uganda in East Africa and Mozambique, Malawi, Zambia and Zimbabwe in southern Africa,” AfDB said.
On Wednesday, the bank’s board approved a $10 million equity investment in the fund.
PFF2 is a second generation fund which builds on the success of its predecessor African Agriculture Fund, sponsored by AfDB along with other development finance institutions including the French Development Agency, International Fund for Agricultural Development and the Spanish Agency for International Cooperation and Development.
AfDB said PFF2 would focus on food or consumer-related investments including integrated food production, processing, services and inputs (seed, fertiliser and chemicals), mechanisation, distribution, logistics and infrastructure, packaging, food services and retail.
“Considering the largely underserved needs of agricultural financing in Africa, the fund’s investment policy entails the deployment of equity or quasi equity instruments to provide expansion capital in the majority of the cases,” the bank said.
Agriculture is the backbone of a number of economies in Africa. It is estimated that net food imports are expected to grow to over $110 billion by 2025 from $35 billion in 2015 on the back of population expansion and urbanisation.
In Zimbabwe, farmers are struggling to obtain funding as banks are reluctant to accept 99-year leases as collateral, 17 years after the country embarked on a fast-track land reform exercise to redress colonial imbalances.
AfDB president Akinwumi Adesina is championing the High 5 priorities to transform the continent.
The priorities are light up and power Africa, Feed Africa, industrialise Africa, integrate Africa and improve the quality of life for the people of Africa.