Kenya has initiated a crucial dialogue on sustainable agricultural financing with the launch of the Financing Agriculture Sustainably (FINAS) 2024 Conference in Nairobi.
The two-day event, scheduled for March 27-28, 2024, in Nairobi, Kenya aims to bring together actors in the agricultural sector to take stock of the status of financing and investment in the sector and deliberate on the appropriate mechanisms for funding agricultural activities.
According to Dr. Paul Rono, Principal Secretary, State Department of Agriculture who presided over the launch, even as Kenyan agriculture sector has the potential to address the national challenges that include: a growing population, unempowered women and youth, a fragile food ecosystem and poverty, there is need, as stakeholders, to have a structured conversation on how to fund this ambition.
“Agriculture investment and funding is a conversation that is overdue and needs to take place in order to better position ourselves to transform our agricultural sector and define how best to bring on board all relevant actors. Through these engagements, we expect to chart tangible investment and funding action plans that are alive to the current realities of the country and the 47 Counties,” said the PS.
Among the conversations going forward will include but not limited to designing financing solutions to ensure relevance to the wide range of beneficiaries, and de-risking approaches for injecting capital such as blended financing.
“The discussion from now on should not only focus on creating sustainable food systems that put food on the table, but also increasing exports, reducing imports, and ensuring food security, as well as transition smallholder farmers into profitable enterprises and propel the nation forward into one that all can directly or indirectly improve their livelihoods,” said Dr. Rono.
Discussion areas
Themed “Positioning Kenya for Resilient Agricultural Enterprises”, the landscape conversations will include an overview of Government’s priorities for agricultural progression; Financing Transformation and Governmental Incentives and Frameworks; De-risking Investment in Agriculture; Technologies, Digitalization and Research; and Private Sector Involvement and Needs of MSMES and Financial Institutions.
Dr. Kawira Mutegi, the conference director, stressed the importance of extending the dialogue to different agricultural production zones, involving stakeholders to find solution-oriented outcomes for agricultural financing challenges.
“This conversation should continue from now and after the conference that we may help address some of the challenges deterring investment in the agricultural sector such as some redundant taxes imposed by counties especially in moving of farm produce to markets,” said Kawira.
Agro-financing challenges
Lack of inclusive financing through pulling of resources together to support the industry has been one of the key challenges in supporting farmers financially, according to Amdrew McCown, Chair, Agriculture and Rural Development Partners Group (ARD).
“Unlocking the financing system for agriculture in Kenya will have great impact on the industrialization of the country by adding value to the various produce thus the conference will keep us all engaged in finding ways to unlocking this potential,” said McCown.
Anne Mutinda, the Deputy Commissioner for Cooperatives Development in the Ministry of Cooperatives and Micro, Small and Medium Enterprise Development adds that the risky environment of agricultural sector caused by climate change among other factors make it vulnerable for investment by financiers.
“Our famers also have small level operations and many of them do not belong to cooperatives. However, if they can be organised into groups, finances can be channeled through savings and cooperative societies for their support and this can enable us go a long way,” said Mutinda.
Representing the livestock sector, Director of Livestock Research and Regulations State Department of Livestock, Dr. Christopher Wanga said the government will continue taking an active role in the discussion with an aim of attracting investment into the sector which is also key to the country’s economy.
During the conference, the government will further discussion on funding agriculture in the Bottom-Up Economic Transformation Agenda focusing on the government agricultural plan, agricultural investment and funding priorities and indicating where the investment opportunities are for the private sector.
