This call is aimed at strengthening food- and agriculture small- and medium sized enterprises (agri-SMEs) in Africa, and at the same time, improve availability of and accessibility to finance. Norad seeks an implementing organization to design, develop and manage a facility that can provide highly concessional capital to investments funds in order to mobilize commercial capital.
Agri-SMEs are the backbone of Africa’s economy, employing the majority and driving the transformation from subsistence to commercial agriculture. They are essential for providing employment, livelihoods, and food security in their communities. Despite their importance, these enterprises face a significant financing gap, with 75% unable to secure formal bank loans and being too large for microfinance, leading to an estimated $100 billion in unmet financing needs. Structural challenges in the investment landscape exacerbate this issue. Blended finance emerges as an effective solution, addressing investment barriers and risks, and preparing agri-SMEs for more substantial financial readiness.
“I’m so excited about this instrument. Firstly, of course, because this is one of the solutions to a problem that we have seen increase since 2014, which is the increasing food insecurity of the world […] What we are doing, we are putting up a fund that will support investment funds, that again, invests in agri SMEs. These investment funds have knowledge of the ground, of the region, and of the sector, and are able to detect the SMEs that can grow and scale but are still too small to get the capital from the banks. And they can also provide knowledge, technology transfer, and give strategic advice to the SMEs in questions. So, it is really filling a gap.”
Minister Anne Beathe Tvinnereim at UNGA September 18, 2023
Applicants can be multilateral, private or non-for-profit organizations with experience investing in investment funds and that has demonstrated deep understanding of the call for proposal objectives and specifically the food- and agriculture investment landscape in Africa.
The call is competitive, and all applicants will be assessed according to the criteria mentioned in the call for proposal. The application process will have two phases:
- Phase 1: Concept note
- Phase 2: Full application
The full call for proposals is published in the Grants Portal: Design and implementation of a first loss facility to catalyze agri-SME investments in Africa – Phase 1 – Insights (mfa.no)
Questions:
Please read through the call for proposals and FAQs closely.
Deadline for applications:
Applications must be submitted electronically and in English through the Grants Portal and will not be accepted later than 21 December 2023, 13:00 CET.
This article was originally published by: NORAD
