The International Finance Corporation (IFC), a member of the World Bank Group, and the South African bank Absa Group Limited, have agreed to a $50 million facility for the agri-food company Valency International, a key player in the African agricultural commodity market based in Singapore, have agreed to a $50 million facility for the agri-food company Valency International, a key player in the African agricultural commodity market based in Singapore.

The $50 million loan will provide Valency with working capital to purchase agricultural products, including cashews, sesame seeds, sesame seeds, shea nuts, ginger, and soybeans. These products will come from the Valency network, which includes around 150,000 small-scale farmers and local traders in Côte d'Ivoire, Nigeria, Ghana and Tanzania. It is estimated that 80% of African agricultural land is managed by smallholder farmers and that agriculture is an industry they rely on for their jobs and livelihoods. However, many smallholder farmers do not have access to finance.

ABSA and IFC will each invest $25 million in this arrangement, which will allow Valency, through its procurement activities, to provide much-needed working capital financing to cooperatives and local purchasing agents to support procurement from smallholder farmers, which in turn offers them a better access to the market. The IFC investment is part of the $1 billion Africa Trade and Supply Chain Recovery Initiative Global Warehouse Finance Program envelope, which is supported by the IDA Private Sector Window

“As one of the largest global investors in agribusiness in Africa, IFC sees a great opportunity to support economic growth and job creation in this critical sector,” said Sérgio Pimenta, IFC Vice President for Africa. “We are happy to be working with Absa and Valency to help ensure that farmers in the region are better integrated into the market and have the opportunity to grow and thrive.