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Public money needs new job in Africa agriculture
When drought arrives or a season fails, adapting means buying better seed, investing in water harvesting, or accessing insurance before the loss becomes unrecoverable.
Africa's agricultural sector accounts for roughly a fifth of the continent's GDP yet receives less than 5.0 per cent of commercial bank lending. For two decades, guarantee funds, blended finance facilities, and donor-backed risk-sharing mechanisms have worked to close that gap, with real but uneven progress. Now the risk landscape they were built for is shifting, and the tools need to shift too.
Three lessons stand out from years of engagement with banks and value chain financing. Guarantees alone don't move money; capacity does: a $6.9 million guarantee facility in Kenya unlocked a $32 million loan portfolio only because it was paired with technical assistance for banks and borrowers.
