EIB, IFAD Seal €350m Deal To Strengthen Food Security, Climate Adaption In Africa

Posted by Eric Ojo African News, Featured, Latest Headlines, News Around Africa Wednesday, May 17th, 2023

(AFRICAN DXAMINER) – The European Investment Bank (EIB) and the United Nations (UN) International Fund for Agricultural Development (IFAD) have signed two agreements to further strengthen their cooperation in low- and middle-income countries worldwide, with a particular focus on Africa.

EIB is the long-term lending institution of the European Union (EU), owned by its Member States. It finances sound investment contributing toward EU policy goals. EIB Global carries out EIB’s operations outside the EU.

IFAD is an international financial institution and a UN specialized agency. Based in Rome, it serves as the UN’s food and agriculture hub. IFAD invests in rural people, empowering them to reduce poverty, increase food security, improve nutrition and strengthen resilience.

Since 1978, the agency has provided more than $24 billion in grants and low-interest loans to fund projects in developing countries.

The agreements were signed on Monday in Rome by EIB Vice-president Ambroise Fayolle and IFAD President Alvario Lario.

As part of the first agreement, the EIB agrees to €350 million loan to IFAD to strengthen food security, reduce poverty and strengthen resilience to climate change in rural areas.

The second agreement establishes a Procedural Framework that will enable a streamlined procurement process for jointly financed projects.

The €350 million facility is the second finance contract under the Framework agreement for the €500 million package announced in November 2022.

This EIB financing, in line with the EU’s Global Gateway strategy, will strengthen IFAD’s response to help small-scale farmers adapt to climate change and cope with the ongoing global food crisis linked to high food, fertiliser, and fuel prices.

In addition to improving food security, the deal will strengthen small-scale farmers’ resilience to climate change and preserve natural resources, safeguarding the environment. The initial tranche of €150 million was disbursed in March 2023.

The signature of the Procedural Framework agreement between the EIB and IFAD will further strengthen synergies by facilitating project implementation and procurement monitoring for jointly financed public sector projects in shared countries of operation.

The framework also supports the growing trend of cooperation and mutual reliance, drawing upon previously established frameworks with other Multilateral Development Banks (MDBs) to provide clear, consistent, and resource-efficient procurement structures.

President of IFAD, Alvaro Lario said: “By joining forces, we can eradicate hunger and poverty, and support millions of small-scale farmers be more resilient to climate change. The partnership with the EIB will make a difference in the lives of millions of rural people and small-scale producers who are on the frontline of the global climate and economic crisis and remain essential to global food security by producing one third of the world’s food”.

Similarly, EIB’s Vice President, Ambroise Fayolle noted that the EIB-IFAD strengthened partnership will allow both organisations to further increase the support to low- and middle-income countries outside Europe, with a specific focus on Africa.

“By sharing synergies and best practices, our organisations aim to improve food security and support small farmers around the globe in their efforts to adapt to the consequences of climate change and turn agriculture into a more resilient and sustainable business”, he stressed,

The signed agreements fall within the EIB’s strategy to increase its cooperation with clients, EU Member States, development finance institutions, civil society, and many other partners under its the EIB Global branch, launched last year and through which the Bank invested €10.8 billion beyond the European Union in 2022.