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Ms Eugenia Serova, Director FAO Rural Infrastructure and Agro-Industries
Division, with Adolfo Brizzi, Director of IFAD's Policy and Technical
Advisory Division. |
The UN Food and Agriculture Organization and the International Fund for
Agricultural Development (IFAD) on the 11th of February 2013 have signed an $875 000 agreement aimed
at helping small farmers and rural households in developing countries
gain improved access to agricultural and rural finance, thereby enabling
their investments.
The three-year grant agreement is intended
to generate new policy tools and training materials for public-sector
agencies, donors, financial institutions and NGOs working to enhance
smallholder access to financial services including credit, savings and
insurance.
The knowledge gained will be disseminated world-wide
through the Rural Finance Learning Center (RFLC), a jointly supported
web platform managed by FAO which has been operating since 2004.
The
grant agreement was inaugurated here last Friday during the annual
meeting of the Improving Capacity Building in Rural Finance (CABFIN)
partnership, which groups the German International Cooperation Agency
GIZ, the World Bank, the UN Capital Development Fund (UNCDF) as well as
FAO and IFAD. The grant will support CABFIN's work plan for 2013-15.
"Many
development agencies said finance for agriculture was too risky and
difficult. The CABFIN Partners believed otherwise and 10 years ago
initiated a plan to jointly address learning on polices, products and
models by sharing information on how it can be done, by creating the
RFLC information gateway and by jointly developing technical guidance
documents and working together on strategic initiatives in the sector.
The continued and growing commitment of the partners is testament to the
global success and impact from the collaboration," said FAO Senior
Agribusiness and Finance Officer Calvin Miller.
"This is a real
model of coordination, cooperation, and harmonization in the field of
rural finance and agricultural investment. It not only promotes sharing
information among local public and private partners, it supports an
environment of knowledge sharing and dialogue across regions," said
Michael Hamp, IFAD Senior Technical Adviser, Rural Finance.
Rural Finance Learning Centre.
The
RFLC is a key component of the CABFIN partnership. It ensures lessons
and advice collected from around the world is broadly disseminated among
the relevant stakeholders promoting access to agricultural and rural
finance. It currently offers more than 3,000 selected and abstracted
documents that governments, financial institutions and other
organizations can use to design improved financial services, strategies
and innovations to serve rural communities.
The RFLC is also the
largest source of training courses and capacity building resources on
the topic. The online centre serves visitors in three languages, who
come from an average of 130 countries each month.
Smallholder
agriculture and related businesses currently suffer from
under-investment. The objective of the CABFIN partnership is to turn the
situation around by enabling local institutions to learn, from others,
how to offer improved, specifically-tailored financial products and risk
management strategies that make such investments more attractive,
including investments by rural households themselves. CABFIN also offers
policy tools and advice to governments and public stakeholders.
Smallholder finance
Credit
schemes designed for smallholders must, for example, take account of
the agricultural cycle and provide flexible repayment plans that fit in
with the cash flow of small farmers, who have little income between the
planting and harvest seasons.
As an example of CABFIN
initiatives, the Rabobank Group collaborates with FAO and other CABFIN
members to share its experiences working with producer organizations in
sub-Saharan Africa, in order to jointly develop this appropriate
agricultural credit product as well as complementary products such as
insurance, savings and local institutional development.
FAO has been acting as a facilitator in bringing stakeholders together, drawing and sharing lessons from such experiences.
According to FAO's flagship publication, The
State of Food and Agriculture 2012,
"only by catalyzing investments by farmers and directing public
investment appropriately can we achieve a world in which everyone is
well nourished and natural resources are used sustainably."
SOURCE- http://www.fao.org/news/story/en/item/169727/icode/