African Microfinance Week, also known as Semaine Africaine de la Microfinance (SAM), was launched this morning in Dakar, Senegal, by speakers including Minister Moustapha Diop of Senegal’s Ministry of Women, Family and Children. (While related meetings, training sessions and vendor presentations are running from June 25 through July 3, the main conference sessions are being held on June 30 and July 1.)
In keeping with the event theme, “Accelerating Innovative Rural Finance in Africa,” Minister Diop argued that climate change is expected to reduce crop yields in Africa over time and that “to focus on this challenge, family farms are needed, and they need access to finance. Government is helping them, but they need more…. We would like to attract financing to the rural zones; by merging the efforts of the public and private sectors, we will meet this challenge.”
Bonnie Brusky of French NGO Cerise explained a model of three-way agreements among producers’ organizations, importers and funders that allows producers to be paid a portion of their income before delivering their crop. While importers retain the option to refuse shipment based on product quality, the model has been successfully tested for crops including cocoa and coffee.
Erick Sile of German development agency Gesellschaft für Internationale Zusammenarbeit (GIZ) cited the 2003 Maputo Declaration, whereby African heads of state agreed to earmark 10 percent of government funding for agriculture. Although this commitment was reiterated in 2013, very few countries have met the goal. In fact there was a drop in the average percentage spent on agriculture during the five years ending in 2013 relative to that spent during the five years ending in 2008 in all sub-regions other than central Africa. Mr Sile cited the example of Rwanda’s public investment in agriculture delivering annual sector growth averaging over 5 percent from 1999 to 2012. During this time, incomes rose 40 percent for the poorest quintile of families in the country and 20 percent for the next two quintiles.
This story is part of a sponsored series on the second SAM, which is being held from June 29 to July 3 by Luxembourgish NGO ADA in partnership with the African Microfinance Network, the African Microfinance Transparency Forum, the African Rural and Agricultural Credit Association and the Microfinance African Institutions Network (MAIN). MicroCapital is reporting on SAM live from Dakar.
Additional Sources and Resources:
African Microfinance Week Website: http://www.microfinance-africa.org
MicroCapital Coverage of African Microfinance Week: https://www.microcapital.org/category/semaine-africaine-de-la-microfinance-sam/
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