The allocation is expected to help mobilise up to USD 200 million in private sector lending for agri-input dealers and smallholder farmers across Ethiopia, Uganda, Tanzania, Malawi and Zambia.
The GAFSP support includes USD 10 million as de-risking capital to establish an Agro-Inputs Risk Sharing Facility at AfDB, coupled with a USD 4 million grant for technical assistance.
According to GAFSP, small agricultural enterprises in low-income countries face limited access to credit due to high perceived risks. The new facility aims to incentivise commercial banks to extend finance to agro-input suppliers by offering credit guarantees.
AfDB officials said the financing will contribute to improving access to certified seeds, organic fertilisers, mechanisation and other inputs crucial for building resilience against climate shocks. More than 1.5 million farmers and 500 agro-dealers and cooperatives are expected to benefit.
“This first allocation demonstrates how donor resources can leverage private investment to strengthen food security in vulnerable regions,” said Natasha Hayward, GAFSP Program Manager.
The initiative supports the Comprehensive Africa Agriculture Development Programme and the Kampala Declaration commitments on food systems transformation.
