IFC, BNP Paribas announce $100m risk facility for agric sectors in sub-Saharan Africa, Eastern Europe

The International Finance Corporation (IFC) and the BNP Paribas (Suisse) SA, on April 2, 2012 launched a $100 million risk-sharing facility that will improve access to finance for the agricultural sector in sub-Saharan Africa and Eastern Europe.

The programme will enable the increased production of export commodities including cashews, cocoa, and coffee to spur trade and economic development in low-income countries, according the IFC.

It will also help boost the availability of critical cereals like corn, rice, and wheat to promote local food security.

“The facility will provide $100 million for up to three years to support the financing needs of agricultural firms through the IFC Global Warehouse Finance Programme. IFC and BNP Paribas will partner to provide borrowers with short-term loans against the value of their produce, using warehouse receipts or similar stock-financing instruments,” the IFC said in a statement.

The IFC started the Global Warehouse Finance Programme in 2010 to increase working-capital financing for farmers, traders, and exporters in emerging markets, by leveraging their own production.

The programme is expected to reach up to 208,600 farmers across emerging markets in all regions and contribute to food availability for 7.5 million people by 2014.

By Ekow Quandzie

1 Comment
  1. M. A. Akudugu says

    The question that must be answered is, what happens after 2014? Besides, 208, 600 farmers in Sub-Saharan Africa and Eastern Europe is just an insignificant proportion of farmers who desparately need help to even produce for household consumption. To make matters worse, the focus is on cash crops which the poorest of the poor farmers do not cultivate because of lack of resources. The mention of cereals to me is just for political reasons. Even if they were involved, it takes at least four years for cocoa to start bearing fruits and so a programme that lasts for three or two years is simply not going to make any significant impacts.

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