A good article: Spotlight on African Agriculture by Lion’s Head Global Partners which goes beyond the often sterile debate of mega farms versus smallholders.
The article focuses on the “missing middle” – i.e. medium sized farming businesses of a few hundred hectares, which are starved of capital. Those farms can be the engine of growth for primary agriculture helping address food security and stimulating job creation throughout the agricultural value chain.
The authors, who have first-hand experience of investing in a seed potato farm in Tanzania, wonder why development finance institutions (DFIs) are not doing more in the sector:
“Yet so many DFIs find this sector too risky. . . A DFI setting out to promote African agriculture should find the blended return between financial and development payback very compelling. If DFIs don’t give extra weight to development outcomes, then they are no different than other institutional investors.”
Exactly right.
About me
- Chris Isaac is a founding director of AgDevCo, a >US$200 million social venture capital fund which invests in farming and agri-processing enterprises in Sub-Saharan Africa. Backed by development agencies and private foundations. AgDevCo’s mission is to reduce poverty, create jobs and improve food security. AgDevCo operates in eight countries (Ghana, Malawi, Mozambique, Rwanda, Sierra Leone, Tanzania, Uganda and Zambia) and has a rapidly growing portfolio, with more than 50 investments made to date.
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