…Nigeria, Ghana, others to benefit from IFC, Absa $50m export funding for farmers
Busayo Samuel
IFC, a member of the World Bank Group, and Absa Group Limited, a South Africa based bank, acting through its Corporate and Investment Banking division (Absa), will provide a commodity trade finance facility to Singapore-based Valency International Pte Ltd, a key player in Africa’s agricultural commodities market, to support the company’s pre-export of agricultural commodities in West and East Africa.
The $50 million facility will provide Valency with working capital for the purchase of agricultural commodities including cashew nuts, sesame seeds, shea nuts, ginger, and soya beans. These products will be sourced from Valency’s network of an estimated 150,000 smallholder farmers and local traders in Cote d’Ivoire, Nigeria, Ghana, and Tanzania.
An estimated 80 percent of Africa’s farmland is managed by smallholder farmers and agriculture is an industry on which they rely for jobs and livelihoods. However, many smallholder farmers lack access to financing.
Absa and IFC will each commit $25 million to the facility, which will allow Valency, through its procurement activities, to provide much-needed working capital financing to cooperatives and local buying agents to support sourcing from smallholder farmers, which in turn provides the farmers better access to the market. IFC’s investment is part of the Global Warehouse Finance Programme envelope of IFC’s $1 billion Africa Trade and Supply Chain Recovery Initiative, which is supported by the IDA Private Sector Window.
“As one of the largest global investors in agribusiness in Africa, IFC sees a tremendous opportunity to support economic growth and job creation in this critical industry,” said Sérgio Pimenta, IFC’s vice president for Africa.
He added, “We are pleased to work with Absa and Valency to help ensure that farmers across the region are better integrated into the marketplace and have the opportunity to grow and thrive.”
“IFC and Valency share our strategic vision of supporting Africa’s growth and development,” said Tshimbi Ntuli, head of structured trade and commodity finance for Absa’s Regional Operations at Absa Corporate and Investment Banking.
“At Absa, we believe that partnerships like these are crucial in driving the continent’s economic transformation and are excited to collaborate with the IFC and Valency to drive sustainable impact in the African agricultural sector. Together, we are making a meaningful impact on the continent’s agricultural sector and the communities we serve.”
“Valency is excited to work with partners like IFC and Absa as we continue to develop the West and East Africa agricultural sectors,” said Sumit Jain, Valency’s Group Chief Executive Officer. “This facility will enable us to engage more directly with thousands of farmers, further integrating them into the value chain and bringing their produce to more markets,” Ntuli added.
