Speaking at I2I Africa: Finance & Agribusiness Conference next month is the Lead Regional Economist for the International Fund for Agricultural Development (IFAD), Abdelkarim Sma, who gave us some time to discuss the work of IFAD in support of small holder agriculture and rural development in over 100 developing countries, many of which are African.
A large part of Mr Sma’s role is centred on the focus of IFAD to support the continent’s efforts to achieve inclusive and sustainable rural transformation. Being an international financial institution, IFAD is contributing to rural investments to spur agricultural productivity growth and create decent jobs along profitable agribusiness value chains.
“In Africa the proportion of the unused land is the greatest in the world, everywhere else in the world has reached the point where very few additional farmland is available for cultivation,” says Mr Sma.
“The arable land in Africa has great potential but it can’t materialise on its own. There needs to be supportive infrastructure.”
In the context of a rising food demand worldwide and high levels of rural poverty in Africa, IFAD works with several partners, often in the framework of regional initiatives funded out of grants, providing a synergy between investment portfolios and projects on the ground.
“Approximately 50% of the financial resources from IFAD go to Africa and Egypt is IFAD’s largest recipient of financial assistance in the Near East and North Africa,” says Mr Sma.
According to Mr Sma, Egypt currently has a portfolio of almost USD 300 million. Their most notable feature on IFAD in-country engagement is supporting the Egyptian government efforts to develop the ‘new lands’, which is hoped to reduce the impact of the majority of its population living along the Nile. .
“There is a strong case in general for investments in the agribusiness sectors of Africa. There is a huge potential both on the supply and demand sides.”
For such investments to be successful additional work in the areas of capacity building and policy dialogue are essential to poverty alleviation in the rural areas of African countries.
While country investments are demand given and channelled through Governments, IFAD is also involved in regional projects funded by private equity firms such as The African Agricultural Fund and the Uganda Equity Fund that are designed to inject resources into private businesses.
“The size of the need, potential and the ROI is quite high.”
Mr Sma explains that there a multitude of initiatives like this trying to capture the momentum of the agribusiness sector, which brings him to why he will be speaking at an event such as Ingredients 2 Inspire Africa.
“I think the importance of this Ingredients 2 Inspire Africa conference is to get all these people around the table to work together and to make partnerships. The challenges are big but the potential is bigger so we need to work collectively to reach the desired scale.”
Mr Abdelkarim Sma is currently the Lead Regional Economist of the Near East, North Africa and Europe Division of the International Fund for Agricultural Development (IFAD).
As a specialised agency of the United Nations, the IFAD was established as an international financial institution in 1977 that invests in rural people to empower them to reduce poverty, increase food security, improve nutrition and strengthen resilience.
IFAD is a key participating organisation of ‘Ingredients 2 Inspire Africa: Finance & Agribusiness’ Conference, which will be held in Cairo on May 22 & 23 2017. Register here to see Mr Abdelkarim Sma’s presentation and learn more about accessing finance for agribusiness.