On May 9 the U.S. Agency for International Development, the African Development Bank (AfDB), and the government of Sweden launched a $25 million, first-of-its-kind Agriculture Fast Track fund. The fund will help grow private investment in agricultural infrastructure projects in Sub-Saharan Africa. The announcement was made at Grow Africa’s Investment Forum in Cape Town, South Africa. Agriculture infrastructure is seen as a critical element of improving African food security.
According to USAID, the Agriculture Fast Track will spur infrastructure projects in countries that are members of the New Alliance for Food Security and Nutrition by financing projects for up to $1.5 million per project. The New Alliance for Food Security and Nutrition was launched at last year’s G-8 Summit by President Obama. It includes six member countries: Burkina Faso, Cote d’Ivoire, Ethiopia, Ghana, Mozambique, and Tanzania.
Agriculture Fast Track funding will be focused on financing the upstream work of project design. The work could include: market analyses, site surveys, feasibility studies, business plans, financial modeling, and other activities that can help project bankability and quality, USAID said.
USAID pledged $15 million to the Agriculture Fast Track and the Government of Sweden committed $10 million. The African Development Bank will manage the fund.
“The African economy is currently overly dependent on public investment for infrastructure development,” said Donald Kaberuka, president of the AfDB. “The Agriculture Fast Track is a critical tool to better leverage donor funding to catalyze private sector investment in support of infrastructure construction and Africa’s long-term economic growth and food security.”
The New Alliance matches $3.7 billion from private sector commitments in agriculture with market-oriented regulatory reform in the six member countries.
“Since the New Alliance for Food Security and Nutrition was founded last year, we’ve seen member countries make serious reforms that have led to real progress, said USAID Administrator Rajiv Shah. “The launch of the Agriculture Fast Track allows African farmers to take advantage of these reforms through fast-tracked infrastructure projects that will better deliver their products to markets.”
Swedish Minister for International Development Cooperation Gunilla Carlsson said the targeted approach the Agriculture Fast Track takes will allow for more efficient use of private sector investments and “ensure the highest standards in terms of social and environmental sustainability.”
– Liza Casabona