MICROCAPITAL BRIEF: EIB Lending $22m to Sahanala to Boost Sustainable Fisheries, Agricultural Value Chains, Mechanization of Farms in Madagascar

The EU’s European Investment Bank (EIB) recently agreed to loan EUR 20 million (USD 21.9 million) to Sahanala, a farmer-owned social enterprise in Madagascar, for a project to: (1) mechanise farms to increase agricultural yields; (2) develop enterprises that process grains, oils and animal feed for domestic sales; and (3) establish a central refrigerated facility and satellite ice stations to help fishers get better prices for their catch within Madagascar and via international sales. The program includes technical assistance to help producers conserve natural resources, such as by meeting the requirements of the Marine Stewardship Council.

Among the goals of the project are to increase producers’ incomes, create 1,500 jobs, reduce Madagascar’s reliance on food imports, support women’s leadership, and boost food security and financial inclusion.

Sahanala CEO Serge Rajaobelina said, “In line with its raison d’être, Sahanala and its partners are empowering Malagasy farmers to improve their living conditions in a sustainable manner by enabling them to sell their products at a fair price, by respecting their know-how, and by encouraging them to do their bit for local development and for the environment. Sahanala is owned by farmers – they are the ones deciding the company’s strategy.”

Sahanala, which was founded in 2010, seeks to strengthen underrepresented communities in an environmentally responsible manner. It is active in tourism, fair trade, food safety, financial education and social security. The organisation works with about 50 producer associations.

Established in 1958, EIB provides technical assistance, loans and financial guarantees in sectors such as climate mitigation and adaptation as well as financing small and medium-sized enterprises. The institution approved EUR 72 billion (USD 77 billion) in new financing during 2022. EIB has 23 offices in the EU – including its headquarters in Luxembourg – and 32 in other countries.

By Anaya Jhaveri, Research Associate

Sources and Additional Resources

EIB press release
https://www.eib.org/en/press/all/2023-284-madagascar-boost-for-farmers-fishers-and-food-security-with-eur20-million-eib-loan-for-sahanala-initiative

Sahanala homepage
https://sahanala.net/about-us/

EIB homepage
https://www.eib.org

EIB Global webpage
https://www.eib.org/en/global/