AfDB Group Commits US$ 1 Billion More to Tackle Food Crisis, Raises Agriculture Portfolio to US$ 4.8 Billion

05/05/2008
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AfDB Group Commits US$ 1 Billion More to Tackle Food Crisis, Raises Agriculture Portfolio to US$ 4.8 Billion

Tunis, 5 May 2008 – The President of the African Development Bank (AfDB) Group, Donald Kaberuka, announced in Tunis that the Bank Group would add US$1 billion to its agriculture portfolio, raised to US$ 4.8 billion, as part of a short-term action to help address the food crisis in its regional member countries.

In a statement to the media, Mr. Kaberuka said the Bank Group would also restructure some of its agriculture portfolio to provide a rapid disbursement facility to the tune of US$ 250 million.

He urged cereals exporting countries not to suspend their exports because the practice would compromise the existence of about 150 million people in a dozen African states, especially the population of fragile countries, the sick and elderly.

Explaining that the Bank had consistently supported the agricultural sector in its Regional Member Countries, with a current portfolio of US$ 3.8 billion, Mr. Kaberuka indicated that the food crisis required urgent and long-term action.

He said that Bank would find a way of assisting countries in difficulty by considering additional measures for budget support to these countries.

The Bank Group's board of governors recentlyapproved the establishment of the African Fertilizer Financing Mechanism Special Fund with a view to mobilizing resources from donors to finance in particular, fertilizer production, distribution, procurement and use in Africa.

Given that delegates at the African Green Revolution Summit in 2006 called on the AfDB Group to host the fertilizer fund and given the strategic importance of fertilizer in achieving the African green revolution aimed at ending hunger, there is a compelling need to increase the level of fertilizer use from the current average of 8kg per hectare to an average of at least 50 kg per hectare in 2015.

In this regard, Mr. Kaberuka reiterated the importance of infrastructure in the resolution of the crisis, considering that current average post-harvest losses stand at a whooping 40% where a reduction of 10% of the losses would result in 5 million additional tones of cereals.

He emphasized the development of rural infrastructure as one of the Bank Group’s priorities to open up landlocked areas to wider markets, attract great revenue for local farmers and drastically reduce post-harvest losses.

Mr. Kaberuka commended the emergency support offered by rich countries saying these efforts would go a long way in mitigating the crisis’ impact on the continent’s vulnerable population and elsewhere. He said the Bank Group was working with partners to respond quickly and effectively, noting however, that the crisis also provided an opportunity for Africa to think long-term regarding the continent's green revolution  agenda.

He recently set up a Bank-wide taskforce to produce a "balance sheet" of the food situation in all regions of the continent to guide the institution’s immediate and long-term actions on the phenomenon.