Climate smart agriculture project invests € 2 million in East Africa
The Climate Resilient Agribusiness for Tomorrow (CRAFT) project has co-invested € 2 million in grants to 14 private sector companies working in the sunflower, soybean, sesame, common beans and sorghum value chains in Kenya, Tanzania and Uganda.
The project’s climate innovation and investment facility (CIIF) is part of the overall goal to increase availability and accessibility of climate-resilient food in East Africa.
Food production in Kenya, Tanzania and Uganda has to increase significantly to feed the population that is growing at an average of 3 per cent in Tanzania and Uganda and 2.5 per centin Kenya.
Adoption of climate smart production, harvesting and processing methodologies is key to improving productivity and efficiencies of the existing food crop production and supply systems.
It however requires concerted efforts and joint investments by supply chain actors, service providers and public sector partners, working in the different targeted value chains to support effective adaptation and mitigation strategies.
Co-investment with the private sector is one of the key strategies identified by the CRAFT project to achieve sustainable results. CRAFT invests in companies that have demonstrated from their own internally generated funds as well as from third party providers including financiers and beneficiaries that their businesses are viable.
The project will work with and through the private sector to promote climate smart agriculture related innovations at farming systems and value chain level and support public sector partners in creating the institutional environment for wide-scale adoption of Climate Smart Agriculture (CSA) practices.
Through the climate innovation and investment facility (CIIF), CRAFT will support performance-based grants so as to build the resilience of private sector agribusinesses and service providers in the targeted value chains. The CIIF contribution is not an end in itself but rather a means for attracting commercial funding for follow-on investments and scaling. The private sector companies invest their own funds and then leverage off the CRAFT grant to attract additional investment from commercial financial institutions.
This not only boosts their credit worthiness and relationship with the financial institutions, but ensures businesses continuity beyond the life of the project.
The CRAFT investment facility seeks to:
Reduce the financial risks of new business initiatives including those of small scale (women) farmers and of cooperatives, thereby contributing to an increase of the level of investment and private sector engagement in the climate resilient food systems in East Africa; and
Scale up structural investments by leveraging these with existing financial instruments and relevant institutions.
The Climate Resilient Agribusiness for Tomorrow (CRAFT) project is a multi–country (Kenya, Tanzania and Uganda) five-year effort implemented by SNV in partnership with Wageningen University and Research (WUR), CGIAR’s Research Program on Climate Change, Agriculture and Food Security (CCAFS), Agriterra, and Rabo Partnerships. The project is funded by the Netherlands Ministry of Foreign Affairs.