The government is targeting to increase funding to the agriculture sector through collaboration with private sector to boost productivity and help the country become food secure.
The Ministry of Agriculture and Rootooba have announced a announced a two-day forum themed Financing Agriculture Sustainably Conference(FINAS2024) that is expected to help mobilize both public and financial resources in a bid to curb the looming severe food insecurity in Kenya and help reduce food inflation.
The conference which will bring together players financial service providers, agribusiness firms and policy makers will deliberate on ways to review existing funding models and gaps in order to enhance investments in the sector and position Kenya for resilient agricultural enterprises.
“Agriculture is the backbone of Kenya’s prosperity, while it is the means of livelihood for millions of Kenya, this sector is grappling with insufficient financing. Counties are pivotal to collaboration and unpacking of solutions to establish credit and financing policies to empower farmers,“ said Mary Mwiti, Council of Governors Chief Executive Officer during the announcement.
Despite the sector contributing at least 23pc to the country’s gross domestic product and employing more than 40pc of the population, loans and investments portfolios currently are disproportionately low at around 3.6pc.
According to Financial Access Household Survey 2019 formal borrowing to service agriculture is used by around 3.2pc of Kenyans. This has created a gap that has resulted in the mushrooming of informal financing mechanisms that lack the capacity, quality, and quantity to respond to the needs. Alternative income sources, social networks and sale of assets have been sub-optimal alternatives for raising the much- needed capital for investing in the sector.
“We need to see how to invest and transform Kenya’s large and fertile land into a thriving agricultural ecosystem running efficiently and profitably to benefit not only farmers but also our economy as a whole. This conference will be the right place to do just that,” said Dr. Paul Rono, Agriculture Principal Secretary.
According to Conference Director Dr. Kawira Mutegi, FINAS 2024 slated for March will bring together actors in the agricultural sector to deliberate on financing the sector through appropriate models.
“The landscape conversations will bring out challenges that will inform subsequent discussions with financing solution providers and beneficiaries. The discussions will include designing financing solutions to ensure relevance to the wide range of beneficiaries, and de-risking approaches for injecting capital such as blended financing” she added.
