Funded by SNRD Africa, the study of the Sector Project Agricultural Trade and Value Chains aims to provide an overview of existing activities within the field of agricultural finance, to identify needs and bottlenecks and to provide recommendations on how to strategically improve GIZ’s service delivery within the subject area. Africa-wide, 22 projects participated in form of personal interviews or submission of completed questionnaires.

Results

The analysis showed that even if agricultural finance is an important topic for more than 90 percent of the projects, it is rarely integrated into projects’ concepts right at the start. Typically, they’re considered rather ad-hoc during the course of implementation. Hence, little emphasis is given to the proper understanding of economic demands. Activities are seldom evaluated.

Most projects cooperate with farmer organizations, followed by financial institutions. Activities comprise both training and the development of business models. Half of all projects support financial product development and a quarter the development of alternative distribution channels. Women and youth are an important stakeholder group. However, they are rarely targeted by specific activities.

Recommendations

The study suggests incorporating agricultural finance activities right from the start, basing them on thorough economic value chain analyses and backing them up with dedicated staff as well as with sufficient funding. Partners should be chosen wisely, with clear commitments and responsibilities. Activities should always be carried out considering the agricultural calendar and be carefully monitored.

How can we make the best use of the analysis?

Which instruments are suited for implementation at which stage and for which level of proficiency along agricultural value chains? How can they be integrated into agricultural value chain projects easily? The sector project will continue to promote this discussion together with the respective SNRD working group and with other related sector projects at GIZ head offices.

More information

Please contact Julia Reimers (julia.reimers@giz.de), advisor for agricultural value chains and finance, who took over from Waqas Malik in October 2017.