ESWATINI TO BENEFIT FROM E9.1bn AfDB FARMING FACILITY

MBABANE – Eswatini’s smallholder farmers are set to benefit from the African Development Bank’s (AfDB) newly announced E9.18 billion (approximately US$500 million) facility.

This facility aims to unlock E183.61 billion (approximately US$10 billion) in financing for farmers and small agribusiness enterprises across Africa.

The announcement was made by AfDB President Dr Akinwumi Adesina during the High-Level Conference on Scaling Finance for Smallholder Farmers in Nairobi.

The facility, currently under discussion with the bank’s Board of Directors, will provide financial instruments such as trade credit guarantees, blended finance mechanisms and origination incentives to reduce transaction costs for small enterprises.

Eswatini was well represented at the conference by Minister for Agriculture Mandla Tshawuka, underscoring the country’s commitment to advancing its agricultural sector.

Challenge

Eswatini’s agricultural sector is largely made up of smallholder farmers, who play a crucial role in food production and rural employment. However, access to finance has long been a challenge, with traditional financial institutions often reluctant to lend due to perceived risks. The AfDB’s initiative is expected to provide a much-needed financial injection to help bridge this gap.

Government initiatives such as the Lower Usuthu Smallholder Irrigation Project (LUSIP), spearheaded by the Eswatini Water and Agricultural Development Enterprise (EWADE), have already demonstrated the impact of investing in smallholder farmers. LUSIP has enabled thousands of farmers to transition from subsistence farming to commercial agriculture, improving household incomes and food security.

The AfDB’s support for agriculture has grown significantly since the 2023 Dakar 2 Feed Africa Summit, where 34 African heads of State committed to ensuring food security.

Development partner pledges have surged from E550.83 billion (approximately US$30 billion) to E1.32 trillion (approximately US$72 billion), with the AfDB alone committing E183.61 billion (approximately US$10 billion).

The bank has already approved 77 projects worth E71.52 billion (approximately US$3.9 billion) to support food and agriculture initiatives across 32 countries, with an additional E31.65 billion (approximately US$1.72 billion) in planned approvals this year.

Some of the AfDB’s key agricultural initiatives include:
l     Technologies for African agricultural transformation (TAAT): This programme has provided 25 million farmers with climate-resilient crops, increasing food production by 120 million tonnes.
l     African emergency food production facility: A E27.54 billion (approximately US$1.5 billion) initiative that has supplied 459 000 tonnes of seed and 2.8 million tons of fertiliser to 12.3 million farmers, yielding 37.6 million metric tonnes of food.
l     Special agro-industrial processing zones: Investments of E17.16 billion (approximately US$934.51 million), with E17.22 billion (approximately US$938.27 million) in co-financing, have supported 27 projects in 11 countries.
l     Affirmative finance action for women in Africa (AFAWA): This programme has approved E46.28 billion (approximately US$2.52 billion) for 24 000 women-led businesses.
l     African fertiliser financing mechanism: Trade credit guarantees in nine countries have distributed 125 193 metric tonnes of fertiliser worth E1.15 billion (approximately US$62.8 million) to 776 971 farmers.
l     Inputs supplier risk sharing programme: A E11.02 billion (approximately US$600 million) initiative reducing risks in agricultural supply chains in Uganda, Kenya, Tanzania, Ghana and Zambia.
l     Mobilising Access to the Digital Economy (MADE) Alliance Africa: A E5.51 billion (approximately US$300 million) partnership with Mastercard aimed at integrating three million farmers into digital financial systems.

AfDB Vice President for Agriculture, Human and Social Development Dr Beth Dunford expressed urgency in tackling these challenges. “We must act now to change this reality,” she said.

Pan African Farmers’ Organisation (PAFO) President Ibrahima Coulibaly also emphasised the importance of investment in agriculture. “If we want to save our continent from hunger, malnutrition and poverty, we must create jobs in the agricultural sector. There is no other sector capable of doing this.”

Diversification

The AfDB facility aligns with Eswatini’s broader agricultural development goals, including the National Development Strategy 2022–2032, which prioritises food security and economic diversification through agribusiness.

With government already promoting initiatives such as the ‘Made in Eswatini’ campaign, this facility will further enhance local food production and agro-processing capabilities. Minister Tshawuka reaffirmed the country’s commitment to ensuring that smallholder farmers can fully leverage this opportunity.

The facility represents a historic opportunity for Eswatini’s smallholder farmers to gain financial support, modernise their operations and contribute more significantly to national food security and economic growth. With the right policies and collaboration in place, Eswatini’s agricultural sector is poised for transformation.

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