IFC invests in Fertiplant to boost agriculture in East Africa
International Finance Corporation has announced a $10 million loan to Fertiplant East Africa Ltd to enable the company to set up a fertilizer plant in Kenya. The plant will supply locally produced fertilizer at affordable prices, helping farmers improve crop yields and their incomes.
Better productivity of staple food crops will also be critical to food security in the region, which is currently suffering from drought.
East Africa’s economy is mainly agrarian, with more than 65 percent of its people dependent on agriculture for their livelihoods. Over 80 percent of the food in the region comes from small holders – farmers with less than 2 hectares of land.
Many farmers in the region have limited access to high quality fertilizers, due to high costs. Mismatches between fertilizer and crop type, as well as lack of knowledge on fertilizer use compound the problem.
Fertilizer application rates in Sub Saharan Africa are far lower than global averages, in some cases, as low as 10 percent of recommended levels. Crop yields and food production suffer as a result.
The new plant, which will be built in Nakuru, in Kenya’s Central Rift Valley, will produce 100,000 tons of fertilizer per year. The project is expected to create hundreds of jobs both during construction and operation.
Titus Gitau, Executive Director of Fertiplant, said, “The partnership with IFC is the culmination of MEA Fertilizers’ forty-year journey to transform and make regional agriculture rewarding and sustainable. We believe that profitable agriculture is the only way to sustain rural Africa and the Fertiplant factory through employing modern technology and advising on modern farming practices.
It is our hope that by using our tailor made fertilizers and other modern practices like mechanization and seed development; farmers will boost their crop yields and close the gap between actual and attainable yields.”
Hans Peter Lankes, IFC Vice President for Development Economics, said “IFC’s investment in Fertiplant is part of our strategy to promote development and competitiveness of East Africa’s agricultural sector. Responsible fertilizer companies like Fertiplant can support farmers, create jobs and increase food security in the region.”
Part of IFC’s investment will be provided through the Global Agriculture and Food Security Program. Donor partners to the program are the governments of Australia, Canada, Japan, the Netherlands, the U.K. and the U.S.
This funding makes it possible for IFC to support projects with strong focus on food security and poverty reduction.