Food for Africa:
Local Farms/Building Productivity

Africa has great potential in agriculture. But too often that potential goes unmet, with critical success factors left out of the equation. Yet when given the right support, its producers can break through, creating food, jobs, and income to change the rural economy.

IFC clients show it can be done. Linked to markets and financing, they have solid track records that are especially good to consider this year, as the G8 countries launch a $20 billion initiative to boost food security through increased agricultural aid in Africa and other low-income regions.

Zambia has hundreds of high-potential farmers. But few can afford the improved seed, fertilizer, and equipment they need to get ahead. Lacking business training, they rarely approach local banks. Presented the right way, however, their plans can succeed.

The world’s leading agricultural bank, Rabobank of the Netherlands, recently invested in a Zambian partner, ZANACO. Supported by IFC advisory services, its money is now starting to reach smaller-scale farmers. With our help in writing business plans and other technical training, 14 farmers now have ZANACO loans, typically doubling their production for the local market. Building a business case, up to 300 more may soon follow them to the bank.

In time, some may be like our Kenyan client, Vegpro. Small when we first met it in 1995, it had a vision for exporting to Europe but could not attract major investors. Our $950,000 loan financed a new airport packaging plant that set it on its way. Today Vegpro is Kenya’s industry leader, selling more than $100 million of food and flowers each year to top U.K. retailers Marks & Spencer, Sainsbury’s, and other demanding clients. Recently profiled in a Harvard Business School case study, it now has eight farms, employs 6,500 people, and buys from another 4,000 local farmers.