Tools and Strategies for Catalyzing Finance in the Agriculture Sector

This post was originally published on Agrilinks and was authored by Patrick Starr. 

In 2018, USAID produced a series of knowledge products to help global mission staff better integrate agricultural finance into mission activity within the context of the U.S. Government's Global Food Security Strategy (GFSS). These knowledge products are designed to help USAID staff better understand (i) the potential impact of agricultural finance, (ii) how to apply it in their day to day work, and (iii) learn from successful past examples of agricultural finance programming undertaken by USAID.

The knowledge products (linked in the sidebar on Agrilinks) encompass topics like youth employment in agriculture, USAID tools for agricultural financing, case studies on successful past USAID engagements and understanding an agribusiness’ basic finances. Three types of knowledge products are available for download: podcasts, written primers, and trainings.

• Podcasts: panel discussions and interviews with expert practitioners on different topics in agricultural finance
  • Blended Finance for Agricultural Development – this podcast explores the role that blended finance can play in agriculture, featuring insights from Dan Zook, Executive Director of ISF Advisors.
  • Applying Agricultural Finance in Reality – in this podcast, two agricultural finance practitioners (Hal Carey and Mukhtar Amin) talk about lessons learned from two different USAID projects in Ethiopia and Tanzania that helped catalyze private sector investment in agriculture
  • Investor Panel: Agricultural finance perspectives from the field - As part of a three-day Agriculture Finance Training at the Washington Learning Center, a panel of investors to spoke about opportunities and challenges of providing finance in the agricultural space. In particular, the panel focused on identifying the opportunities and challenges of financing agricultural projects, trends and innovations that are likely to shape the sector going forward, and reflections on where USAID can be most effective and impactful in this space. This panel discussion featured perspectives from Songbae Lee – Senior Investment Officer, Calvert Impact Capital; Mariana Petrei – Senior Investment Officer, International Finance Corporation; Titianne Donde-Ommes – Regional Advisor, Council on Smallholder Agricultural Finance; and, Chris Isaac – Director of Investments & Business Development, AgDevCo.
• Primers: short 3-5 page documents which outline various facets of agricultural finance
  • Driving Impact through Agricultural Finance Interventions – this primer showcases the importance of agricultural finance to economic development and includes examples of the impact of successful interventions.
  • USAID Agricultural Finance Tools – this primer explores the five principal tools available for USAID mission staff to implement financial interventions in agriculture: grants, guarantees, policy advocacy, convening and technical assistance.
  • Using Blended Finance to Mobilize Capital for Agricultural Development – this primer reviews the fundamentals of blended finance, the substantial potential impact it can have in agriculture, and several case studies of blended finance in agriculture.
  • Case Study: Improving the Investment Climate for Agriculture in Ethiopia – this primer outlines an impactful USAID engagement that resulted in policy recommendations for the Ethiopian government which upon implementation significantly increased private investment in agriculture.
  • Case Study: Driving New Investments into Agriculture in Tanzania’s Edible Oils Sector – this primer showcases a successful USAID program aimed at helping the Tanzanian government enact policy reform to increase private investment in a key agricultural sector.
• Trainings: 90-minute interactive recorded video webinars, presented and moderated by Dalberg Advisors and USAID staff members
  • Mobilizing Capital for Agricultural Development with the Development Credit Authority – this training explains how the DCA works, when it is best employed, what its five principal guarantee products are and how they can be utilized in agricultural interventions.
  • Investing in agribusinesses: What makes an agribusiness attractive from an investor’s perspective? – this webinar discusses the fundamentals of how investors balance risk, cost and return in evaluating agribusinesses and their financial positions, as well as key financial documents and ratios.
  • How to engage with finance providers on agricultural programs – this training reviews the role of different types of finance providers in agricultural finance programming and how USAID can select the appropriate financial partner for a given intervention.
  • How to use agricultural finance interventions to drive youth employment – this training covers the pressing global issue of youth under- and unemployment, the key barriers to youth employment in agriculture, how agricultural finance can address these issues and how USAID mission staff can go about designing impactful interventions for youth.