Agri-Business Capital Fund for Rural SMEs Set Up
By Abdi Ali
Published May 2, 2020
A United Nations agency says it has set up a blended capital impact fund to help small-scale farmers and micro-, small and medium size rural enterprises in developing countries create jobs and increase incomes.
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International Fund for Agricultural Development (IFAD), a specialised UN agency and international financial institution, says it has invested US$9 million
(about €8.4 million) into the Agri-Business Capital (ABC) Fund.
“The private sector’s involvement in the eradication of hunger and poverty was crucial before the COVID-19 crisis. Now it has become even more important as
we work to reduce some of the immediate impacts of the crisis and plan for a longer-term recovery when it is over,” says Gilbert F Houngbo, President of
IFAD. “More than ever, we need to join forces with the private sector to help small-scale producers and rural SMEs preserve and create jobs for those who are
more likely to be left behind.”
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Saying it is the first time that IFAD has invested directly into a private sector entity, Houngbo says “Small-scale farmers and rural SMEs are the backbone
of the economy of their countries” as they create jobs and drive development.
IFAD says its investment in the ABC Fund is part of a wider plan to scale up its engagement with the private sector and design innovative instruments to help
increase investments in rural areas and help the private sector overcome the challenges of investing in small-scale agriculture, recognising that rural SMEs
constitute an untapped business opportunity.
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Under its private sector engagement strategy adopted in September 2019, IFAD says it can now directly fund private sector entities and invest in funds
targeting rural SMEs and small-scale producers’ cooperatives.
