AfDB President reaffirms support for AFAP’s work in boosting Africa’s Fertilizer SMEs

11 May 2015
African Development Bank (AfDB) President, Dr Akin Adesina has reaffirmed the Bank’s commitment to work with the African Fertilizer and Agribusiness Partnership (AFAP) in strengthening Africa’s small and medium enterprises (SMEs) in the fertilizer value chain.

During a meeting in Cote d’Ivoire with a four-member AFAP delegation led by AFAP President and CEO, Jason Scarpone on 27 November, Dr Adesina said there had been many changes in the African agriculture and fertilizer landscape since the Africa Fertilizer Summit, that was convened in Abuja in 2006.  He said the African Fertilizer Financing Mechanism (AFFM) should respond by shifting towards supporting agriculture as a business among smallholder farmers.

The AfDB President said there was now a critical need to strengthen innovative financing, and risk mitigation tools, including trade credit facilities and hub distribution financing, targeted towards the growth of SMEs in the fertilizer value chain.

“Agriculture is a business, building SMEs is therefore critical to creating rural employment and wealth. Strengthening the capacity, including financing distribution channels should be part of the new orientation of the AFFM,” said Dr Adesina.

The establishment of the AFFM was agreed on at the Africa Fertilizer Summit to meet the financial requirements of the various activities agreed upon at the convening, that would boost the growth of the fertilizer industry in Africa, including manufacturing.

Meanwhile, Scarpone briefed AfDB officials on AFAP’s targeted work in Tanzania, Ghana, Mozambique, Malawi, Cote d’Ivoire, Nigeria and Ethiopia.   He noted that AFAP, working with partners, has in the past three years developed innovative public-private partnerships to establish more competitive and sustainable fertilizer businesses that benefit smallholder farmers.

“AFAP believes that a united public and private sector can bolster the marketplace and encourage consistent and responsible fertilizer use,” he said.

Scarpone pointed out that through AFFM support, AFAP could scale up its current work in East, South and West Africa to strengthen emerging SMEs in importing, distributing, blending and retailing fertilizers. He said collaboration with AFAP would allow the AFFM to scale up fertilizer value chain investments by tapping into existing AFAP supported distribution networks and trade platforms.

Dr Adesina requested AFAP to work closely with AfDB and other organizations including AGRA, to prepare a concept to inform the modalities of co-operation that would lead towards the implementation of the AFFM.

It is anticipated that through collaboration with AfDB and other organizations, AFAP will play a major role in the development of a roadmap that will lead towards greater access to finance SMEs in the fertilizer value chain.  This in turn will provide greater and more affordable access to fertilizer for smallholder farmers.