Following its success in Uganda, the East African Development Bank (EADB) is extending its loans to other East African Countries with Kenya being the next beneficiary.
It has entered into a financing agreement with KfW, Frankfurt am Main, Germany, for the ‘Agricultural Financing Kenya’ project which is funded by the German Government as part of the wider ‘One World – No Hunger’ special initiative.
In an announcement made at the East African Development Bank Head Offices in Kampala, Uganda, Vivienne Yeda; Director General of EADB made the announcement said EADB and KfW’s ‘Agricultural Financing Kenya’ will cater to the SMEs and farmers along the agricultural value chain in Kenya.
The project which will be funded by EUR 13 million consists of two components.
The first component will provide medium- to long-term loans to small and medium sized farmers and SMEs along the agricultural value chain. This will be done via selected partner financial institutions that boast extensive market knowledge; while the second component will be technical assistance and will involve training and capacity building measures.
Speaking at the event, Yeda noted that agriculture is the key source of income among Kenya’s rural population.
“Most of the farmers from rural Kenya are employed in Small and Medium sizes enterprises (SMEs). This program will go a long way to improve food security for the communities while achieving the greater purpose of poverty eradication,” she said.
“It is our belief that the program will give agricultural SMEs in Kenya the opportunity to invest and therefore expand and grow. This will greatly improve agricultural productivity and efficiency in Kenya. Ultimately, a more efficient Kenyan agricultural sector should boost economic growth, generate employment creation, reduce poverty and increase food security,” Ms. Yeda concluded.
The ‘Agricultural Financing Kenya’ program follows the successful implementation of two similar collaborations between EADB and KfW in Uganda: the ‘Rural Finance Enhancement Program’ and the ‘Agricultural Enhancement Program’.
The two programs follow a similar model and have delivered over EUR20 million (about Shs 77.7Billion) in financing to SMEs in Ugandan rural areas and along Uganda’s agricultural value chain.