Financing Agricultural Value Chains aBi Experience Presentation by Josephine Mukumbya at the Launch of the Agricultural Finance Yearbook 201314 October 17 2014 UMOJA House, 2nd floor Plot 2, Nakasero Road P.O. Box 29851, Kampala Uganda
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Financing Agricultural Value Chains aBi Experience Presentation by Josephine Mukumbya at the Launch of the Agricultural Finance Yearbook 2013/14 October 17 2014 UMOJA House, 2nd floor
Plot 2, Nakasero Road
P.O. Box 29851, Kampala Uganda
Tel: +256 (0) 312 351600
fax: +256 (0) 312 351620
Email: info@abitrust.co..ug
www.abi.co.ug 1<br>
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aBi A local multi-stakeholder entity co-founded by the Governments of Denmark and Uganda to act as a vehicle for channeling financial and technical support to beneficiaries and partners for private sector agribusiness development 2<br>
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Who we are aBi comprises of aBi Trust and aBi Finance Ltd
Using a private sector approach to deliver public goods, aBi supports the GoU and the private sector in achieving the objectives of the CICS. 3<br>
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aBi Structure The structure of aBi is unique in the sense that the entity exists in perpetuity, where aBi Trust provides matching grants to subsidize agribusiness development on one side
and aBi Finance provides more commercially inclined financing mechanisms on the other 4<br>
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aBi VCD Strategy 5<br>
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aBi VCD Strategy VCD remains the hub of aBi where interventions are guided by using the value chain approach.
Opportunities and constraints are 6<br>
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PARTICIPATION AT VC LEVEL 7 PRODUCTION
100% VC Analysis MARKETING
22% Market PROCESSING
20% SPS&QMS GG FaaB Research
Inputs
Publications
Networks GG HRBA FINANCE SPS & QMS<br>
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Current Value Chains Coffee (Robusta & Arabica)- 34% of IPs
Oilseeds (Sunflower, Soybean, Sesame, Groundnuts) – 16% of IPs
Cereals (Maize, Rice, Sorghum, etc.)- 30% of IPs
Pulses (Beans, Pigeon pea, etc.)- 7%
Horticulture for export (Primarily Pineapple & Chilies)- 4%
Dairy (Western Uganda)- 4% 8<br>
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Funding mechanisms aBi Trust is the grant making part of aBi offering matching grants to:
VCD
Enhance productivity and competitiveness
Promote quality enhancement and Value Addition
Support market development and access to new market
Improve trade related SPS & QMS mitigation
Build institutional and technical capacity to CoE
Support collation and dissemination of information. 9<br>
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Funding mechanisms aBi Trust is the grant making part of aBi offering matching grants to:
FSD
Extend Outreach
Offer financier skills enhancement
Support Product Development
Support Savings mobilization
Risk Mitigation 10<br>
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Funding mechanisms cont’d aBi Finance is the investment part of aBi offering the following products:
Lines of Credit for on lending to Agribusiness
Agribusiness Loan Guarantees
Road Construction Guarantees
Complimentary to aBi Trust, the services of aBi Finance are intended to make FS accessible for the agribusinesses that aBi Trust grants, however not limited. 11<br>
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Outputs of VCD Productivity improvement
Quality enhancement
Market development
Promotional materials and dissemination of information
Enhanced resilience to change in weather patterns
Built institutional and technical capacity through centers of excellence (coffee & oilseeds) 12<br>
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Cross cutting initiatives aBi integrates:
Gender mainstreaming activities;
Village Savings and Loan Schemes;
Green Growth – promoting practices that enhance resilience to climate change
*To ensure holistic sustainable value chain development 13<br>
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Outputs of FSD Outreach extension
Risk mitigation
“Bank on Wheels” – Bank of Africa Post Bank - Amolator Branch
Enrolling an MCash Customer Launch of the Insurance Product 14<br>
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Specific examples Produce Trade - SMEs access working capital from partner FIs to purchase from FOs. Rice, Maize, Coffee and Bean producers either sell directly to such traders (depending on size) or other dealers.
Delivery of produce at Partner’s Collection Center 15<br>
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Specific examples- Coffee Establishment of Depot Committee & Washing Stations:
Grant facilitated partner to form and Strengthen Depot Committees as below, who can now access finance from partner FIs for trading.
Establishment of eco-friendly washing station to enable access to market for improved coffee quality and incomes. 16<br>
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Specific examples - Coffee Support to establish input shop of DFA
Support to establish SACCO for partner DFA to increase access to financing inputs from the above.
VSLAs in locality have been linked to this SACCO.
Savings growth recognized 17<br>
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Specific examples - Oilseeds Establishment of Village Centers for:
Supply of certified inputs to FOs and farmer- Partnering with FI who is accessing aBi products (ALG & LOC)
Collection and bulking of sunflower and soy, thereby easing access to market 18<br>
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Specific examples- Dairy Dairy Primary Societies accessing dairy equipment managed by VCD, were required to make a 50% contribution which they did not have – facilitated by linkage to FI, which in turn accessed a LOC and ALG.
Part of installation at a Dairy Primary Society 19<br>
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M&E DCED - results chains prepared and KPIs of change for every result in the results chain for all supported projects constructed.
