KCB is set to lead other financial institutions in pledging more loans to the agricultural sector during a week-long Alliance for a Green Revolution in Africa (Agra) forum which began in Nairobi on Monday.
Commercial banks are set to allocate more credit to agriculture, giving fresh hope to small scale farmers despite an interest-capping law that threatens to ration loans to risky ventures.
The Kenya Commercial Bank (KCB) is set to lead other financial institutions in pledging more loans to the agricultural sector during a week-long Alliance for a Green Revolution in Africa (Agra) forum which began in Nairobi on Monday.
Banks have generally shunned the weather-dependent sector with Central Bank of Kenya data showing that just 4.04 per cent of the Sh2.165 trillion loans disbursed in 2015 benefited farming ventures.
“The KCB will outline efforts to give agriculture a higher profile in its loan portfolio and seek a similar commitment from other leading financial institutions,” the Agra board said on the first day of the forum which has brought heads of state and top officials from 40 countries to Nairobi.
Agriculture Cabinet Secretary Willy Bett said African countries will use the forum to discuss ways of funding and mechanising the sector in order to boost production at the farm level.
“For agriculture to be meaningful, we have to move with speed in mechanising it. Use of the hoe as a farming tool has been overtaken by events,’’ said Mr Bett.
He said that Kenya plans to raise farm mechanisation from the current 28 per cent to 50 per cent as the country targets to become food sufficient.
Mechanisation has been hampered by land subdivision.
Mr Bett said the forum had brought together stakeholders who will be key in helping Africa, and in particular Kenya, to solve challenges facing the sector.
Agra President Agnes Kalibata said it is time that small scale holders turned their farming activities into a serious business for them to benefit out of it.
Mrs Kalibata noted that a lot of small scale farmers have been taking agriculture just as a daily routine and not a serious business venture.
“We now have to move to the next stage where smallholders should take their farming as a serious business venture,” said Mrs Kalibata.
Underscoring the losses that farmers are incurring as a result of post-harvest losses, managing director of the Africa Rockfeller Foundation Mamadou Biteye said African governments should put in place proper mechanism to curb wastage.
Dr Biteye said that RockFeller has been working with farmers through offering funds and issuing technical expertise to curb wastage which claims more than 30 per cent of crops.
Strive Masiyiwa, the founder and executive chairman of Econet Wireless who also chairs Agra’s board, said a lot needs to be done to harness the potential of agriculture.
“While much has been accomplished over the last decade, we need to work far more aggressively to tap the potential of agriculture as a powerful engine of economic growth across Africa,” said Mr Masiyiwa.
“Just as we have seen in Africa’s telecom revolution, I believe the private sector can become a force for social change by transforming African agriculture,” he added.
He said that business-focused investments in production, processing and marketing can ensure that the soaring demand for food products among Africa’s urban consumers delivers new economic opportunities for rural communities and youths.
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