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Finnfund invests in Tanzania’s avocado farming

Finnfund, a Finnish development finance company, has provided a US$2.86mn secured loan to Africado, a Tanzanian avocado producer

avocadoAfricado promotes responsible agricultural and employment practices and generate export income in Tanzania. (Image source: Finnfund)

The price of coffee has fallen sharply in recent years primarily due to expanded production in Brazil and Vietnam. The impact is felt in Tanzania’s Kilimanjaro region where coffee farming has long been an important source of livelihood. Now local farmers are urgently seeking alternative crops.

Africado was established in 2007 as Tanzania’s first commercial and international grade producer of avocados. The company farms 137 ha around the Kilimanjaro area and contracts other commercial and local smallholder farmers. They are specialised in Hass variety, which is exported primarily to the EU.

Avocado farming provides the company’s employees and contracts farmers with higher and more secure income than coffee production.

With the help of the new financing, Africado has started to expand and develop its operations. For instance, the company is aiming to extend its avocado plantations and the operation of the present packing department. Furthermore, the company intends to diversify to other avocado varieties and nuts.

Avocados have been widely grown for domestic household consumption in gardens and small farms within Kilimanjaro for more than 100 years since it was introduced by the Germans. The humid tropical climate in the area provides ideal growing conditions where avocados flourish naturally but a lack of markets and knowledge of commercial varieties have meant that avocado production has provided no economic value.

The outgrower programme encompasses around 2000 local farmers, creating employment and income to thousands of people in the area. The company has received an international GlobalGAP certification for safe and sustainable agricultural practices. In 2016, its outgrower programme also became G.A.P. Award winner as the second African company.

With new development operations, it is expected that the number of jobs may double and provide employment, particularly for women. From the point of view of the Siha district and of the whole of Tanzania, Africado promotes responsible agricultural and employment practices and generate export income, strengthening the balance of current payments of the country.


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