Kenya Secures US $22 million Loan to Restore Farm Infrastructure and Rural Livelihoods

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Tunis, 29 April 2009 –  The Board of Directors of the African Development Fund (ADF), the concessionary window of the African Development Bank (AfDB) Group, approved on Wednesday in Tunis, a loan of 15 million Units of Account (UA*), equivalent to US$ 22.4 million to finance a Farm Infrastructure Restoration and Rural Livelihoods Project (RFIRLP) in Kenya.

The project’s objective is to restore agricultural production and livelihoods for 19,000 farm households displaced by the Post-Election Conflict (PEV) in the districts of Molo and Uasin Gishu in the Rift Valley Province.

Designed to be implemented over a three-year period (2009-2012), the project comprises three components: Provision of on-farm infrastructure, agricultural input services and coordination of project activities.

This project is a response to the post conflict emergency following the 2008 post-election violence during which many people lost their lives and thousands, including farmers, lost their homes and livelihoods. The Kenyan government’s Kshs 31.47 billion (UA 276 million) National Reconciliation and Emergency Social and Economic Recovery Strategy published in April 2008, identified the revitalization of the agricultural sector, especially in the Rift Valley, Nyanza and Western Provinces, as well as the reconstruction of lost assets, including homesteads, as a key area for action to mitigate the effects of the conflict on the economy and to restart agricultural production.

The RFIRLP is the Bank’s contribution to the appeal, whose design and duration are based on best practices already being used by other donors and the government in the area. It is consistent with the country’s 2008 to 2012 Medium Term Plan (MTP) and its Vision 2030. It also in line with the Country Strategy Paper (2008 – 2012, which focuses on employment generation, as the most urgent challenge facing the country in its bid to address the socioeconomic pressures and reconstruction needs arising from the post-election violence.

The project will benefit about 100,000 people (19,000 households) previously displaced returnee farmers. It will reverse the current food deficit in the targeted area and even increase the volume of agricultural produce marketed by 15%.

The project is estimated at UA16.673 million with the Bank’s share accounting for 90% of the total cost. The Kenyan government and beneficiaries will provide the remaining UA 1.673 million, which represents 10% of the overall costs.

* UA 1 = US$ 1.49507= KES 116.93 as at 29-04-2009