SPECIAL FEATURE Trade finance helps to provide
direct financing to farmers along the entire value chain.
Olumuyiwa Osibanjo, OPEC Fund Senior
Investment Manager, Private Sector & Trade Finance Operations
From farm gate to the dining table To achieve meaningful progress towards SDG 2, all this work must however include the private sector. Olumuyiwa Osibanjo, OPEC Fund Senior Investment Manager, Private Sector & Trade Finance Operations, says: “While governments need to create an enabling environment for agriculture through laws and regulations, the private sector also has a critical role to play in addressing the food security challenge. Expanding access to financing for the agriculture sector, especially in the light of skyrocketing commodity prices, has become more important than ever.” One way to provide much-needed
focuses on agricultural support services including research and extension services. Our partnership combines the particular strengths of each institution to maximize the impact of their support”, says Taylhardat. “In most countries the agriculture sector attracts multiple institutions, increasing the available funding but also competition among donors, and it can become difficult to allocate the resources in response to the emerging priorities. We can maximize the benefits of our interventions through improved harmonization and enhanced coordination.”
finance in support of agriculture is through trade finance. The OPEC Fund has supported various corporates and state-owned enterprises such as the Export Trading Group (ETG) and the Ghana Cocoa Board (see Spotlight pp 36-39). Osibanjo says: “Such interventions help to provide direct financing to farmers along the entire value chain to bring affordable and sustainable farming produce from the farm-gate to the dining table. We also provide trade finance facilities to address supply chain disruptions that prevent farmers from getting their products to the market safely and timely.”
EVERY
JOURNEY STARTS WITH A FIRST STEP
The OPEC Fund, through its grants program, has consistently funded agricultural research to help promote sustainable agriculture practices, improve the yield potential of staple crops and transfer best practice farming to developing country smallholders. Such projects may seem small in scale and can take years to complete, however their impact and potential are significant.
FACTFILE: ETG
The Export Trading Group (ETG) is Africa’s largest integrated agricultural supply chain operator. ETG’s operations include procurement, processing, warehousing, transport, distribution and merchandising. The company prides itself on connecting smallholder farmers to the global economy – and the global economy back to smallholder farmers through a value chain that operates between the farm gates of emerging markets and supermarket shelves around the world. The OPEC Fund has contributed US$40 million to a revolving trade financing facility helping sub-Saharan African subsidiaries of ETG to import and export agricultural commodities.
PHOTO: donvictorio/
Shutterstock.com
One such recently completed research project evaluated the situation of land and water productivity and the potential role of small-scale irrigation technologies in Burkina Faso, Mali, Niger and Senegal. The project's primary outcome was the introduction of promising irrigation technologies on pilot sites. The long-term outcome includes new thinking and awareness of the gains possible from new irrigation technologies and on-farm water management approaches, potentially expanding to other regions, increasing agricultural productivity and reducing rural poverty.
11 ILLUSTRATION: Vasya Kobelev/
Shutterstock.com
PHOTO:
jeffreymwalcott.com/Futurepump
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