23 August. Dar es Salaam. A $100 million (Sh160 billion) catalyst fund will be launched before the end of this year to help attract the private sector to participate in the implementation of the Agricultural Growth Corridor of Tanzania (Sagcot).
The fund will help prepare investment opportunities for local and international investors and it will also complement existing government and donor-backed financing initiatives in the agriculture sector.
The fund will also compliment other funding models including the Tanzania Agricultural Development Bank to be launched this year, the $25 million Danida backed-PASS facility, Agra/Stanbic Bank’s and Agra/NMB’s $25 million guarantee facility to support established and commercially viable agriculture business and the $5 million Africa Enterprise Challenge Fund window for Tanzanian agri-business.
According to the Sagcot blue print, the catalyst fund provides early ‘social venture capital’ to cover the start-up costs of commercially viable agri-businesses and other key investments.
“After the catalyst fund is set regulations will be made clear on how to access the fund and what are the criteria for one to qualify for it,” said Felix Mosha.
Sagcot chairman (and SACAU board member) Mr Salum Shamte said the successful implementation of Sagcot will see an investment inflow of $2.1 billion from the private investment and $1.3 billion from the public sector by 2030. The result will be a tripling of agricultural production in about 350,000 hectares in Southern Tanzania. And at least 420,000 new employment opportunities will be created in the agricultural value chain and more than two million people lifted out of poverty. “We hope the outcomes of Sagcot by 2030 will lead to regional food security and annual revenue from farming of about $1.2 billion,” said Mr Shamte.
Already, there are investment opportunities to be undertaken in the five regions of Mbeya, Rukwa, Ruvuma, Morogoro and Iringa which form the special agricultural corridor of Tanzania. Investment will be in production of rice, sugar, banana, citrus, horticulture and pulses and keeping livestock. In Mbeya for example there will be the Mbozi seed farm of 3,000 hectare nucleus seed estate and irrigated outgrowers scheme for maize, soya, sunflower, sesame and pulses. In Iringa, there are seed potatoes at Mtanga farm for growing seeds and distribution on up to 100 hectare nucleus farm and throughout grower pragramme to provide improved seeds to farmers.