The African Export-Import Bank (Afreximbank) has approved a US$400mn global credit facility agreement for the Export Trading Group (ETG), integrated agricultural conglomerates in Africa
The agreement will allow ETG to continue to play its vital role in the agri-foods supply chain of effectively connecting African farmers to markets, as well as expanding access to critical inputs to boost agricultural productivity in a continent with tremendous but unrealised potential.
According to estimates by Afreximbank, in 2019 Africa spent more than US$90bn on food imports, although it owns up to 60% of the remaining arable land in the world. In addition, the Food and Agriculture Organization ( FAO ) estimates that up to 50% of Africa’s agricultural production is lost from farm to market each year due to problems ranging from sub-optimal use of inputs to unsuitable post-harvest storage, processing and transport facilities.
The COVID-19 pandemic has exacerbated those challenges, which has disrupted supply chains, increased price volatility, and could further undermine household consumption.
Afreximbank’s facility will address major bottlenecks faced by African agricultural exporters, aggregating large amounts of produce to provide access to regional and international markets for small and medium-sized enterprises.
Expanding ETG’s work in this area will reduce post-harvest losses by improving access to yield-enhancing inputs and more robust networks to deliver regional and international market output while helping to boost African farmers’ scale and productivity to position Africa as the world’s bread basket. It will also support the vital flow of food supplies throughout the continent amid the COVID-19 pandemic disruption.
Kanayo Awani, managing director of Afreximbank’s Intra-African Trade Initiative, said, “This facility will not only support African farmers through the disruption caused by the pandemic but will provide added impetus to ETG’s vital work connecting the continent’s small and medium businesses to the agricultural networks and avenues critical for growth. With the African Continental Free Trade Agreement on the horizon, the timing is opportune to shape a more productive and resilient agricultural sector—delivering both prosperity and food security for the continent’s future.”