Ogbeh lauds rising private Agric financing
The Minister of Agriculture and Rural Development, Chief Audu Ogbe has commended the financing by private organization of agriculture in the country to provide capacity building and technical assistance to selected small and medium enterprises (SMEs) in the country’s agribusiness sector.
The Minister speaking in Abuja yesterday during the successful closing of the $ 65.9 million money under Fund for Agricultural Finance in Nigeria (FAFIN), a private fund initiated by the Federal Ministry of Agriculture and Rural Development said:
“This is to provide financial, capacity-building and technical assistance to selected Small and Medium Enterprises (SMEs) in the Nigerian agribusiness sector”.
This project is managed by Sahel Capital, an agribusiness focused private equity firm.
In this contribution, a total of $31million have been jointly committed to FAFIN fund by the African Development Bank, CDC Group (managing DFID Impact Fund) and the Dutch Good Growth Fund (managed by Triple Jump), joining existing co‐sponsors of the fund to drive agricultural transformation in Nigeria.
Also, the German Development Bank (KfW) has offered to increase its commitments to FAFIN by an additional $10 million subject to final approvals, which if provided would increase the fund size to $76 million by December 2017.
FAFIN, co-sponsored by Nigeria’s Federal Ministry of Agriculture and Rural Development, Federal Ministry of Finance, KfW, and the Nigeria Sovereign Investment Authority (NSIA), was initially launched in 2014 with $32.8 million commitments.
Chief Ogbeh who expressed full commitment of his ministry towards the development of the agricultural sector emphasized that “although key developments in the sector would continually be private sector‐driven, the federal government would provide the necessary incentives to grow the sector by facilitating financing and support for Small to Medium Scale Enterprises (SMEs) through investment vehicles such as FAFIN”.
Sahel Capital intends to invest these funds over the next two years, backing sustainable businesses that seek to revolutionize the Nigerian agribusiness landscape while creating jobs, improving productivity and strengthening priority value chains.
The Minister of Finance, Mrs. Kemi Adeosun in her contribution affirmed the focus of the federal government on acting as a catalyst for private sector capital to drive growth in the agribusiness sector.
“With this close we would have succeeded in partnering with various investors to secure $76 million for agribusinesses in Nigeria”, she said.
Mezuo Nwuneli, Managing Partner at Sahel Capital in his remarks said; “We are especially grateful for the immense commitment and support we have received from our existing investors especially the Federal Ministry of Finance, Agriculture and Rural Development, and the Nigeria Sovereign Investment Authority, in making FAFIN a reality.
“The successful final close of FAFIN is a testament to the confidence our investors have in the scaling up and sustainability of the fund that was conceived in 2013 by the Former Minister of Agriculture, Dr. Akinwunmi Adesina and KfW.
We also look forward to partnering with our incoming investors to driving catalytic growth in the sector through our partnerships with strong agribusinesses”, he added.
Sahel Capital has assessed over 100 companies since FAFIN’s launch in 2014, out of which it has elected to invest in four indigenous high growth companies, including dairy, edible oils, poultry and cassava value chains of Nigeria.
Through these, FAFIN has created over 500 new jobs, 50 per cent of which have engaged women and youth, and have improved the lives of over 1,000 smallholder farmers and their families by supporting innovative business incentives and out‐grower schemes.
Uche Orji, Managing Director and CEO of NSIA, co-investor in FAFIN observed that through FAFIN, NSIA will continue to tap into key commercial and sustainable growth opportunities in agriculture.
“Our strategic interest in the sector is predicated on our commitment to drive rural and urban infrastructural development and we believe FAFIN is well positioned to capture these opportunities”, he said.
