INVESTING IN AGRICULTURE IN MALAWIUK-Malawi Trade & Investment Forum, 20th March 2013

Chris Isaac, Executive Director, AgDevCo

About AgDevCo

• Social impact investor and project developer operating in SSA with 18 investments in Mozambique, Tanzania, Zambia and Ghana (and soon Malawi)

• AgDevCo’s distinctive approach involves a combination of investment and hands-on, in country management support to early-stage agricultural businesses

• Funded by the Private Infrastructure Development Group (PIDG) and private charitable foundations

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Ability to accept higher risks and lower (risk-adjusted) returns

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Malawi background

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Malawi background

There are also new opportunities for Malawi’s farmers….

i. Rapidly growing regional markets and agricultural growth corridors

ii. Potential to link farmers to large buyers of agricultural commodities

SAGCOT BAGC

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AgDevCo approach

SME agribusiness investments

• Typically these are start-up or early stage farms and agriprocessing businesses. Financing needs can range from $50,000 to $2,000,000

• SME businesses are generally

undercapitalised and need ongoing management support

• To maximise chances of success, AgDevCo makes investments in clusters of SMEs to strengthen value chains

Example of SME cluster in Mozambique

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AgDevCo approach

Irrigation developments

• Medium-sized to large irrigation schemes typically of 1,000 to 3,000ha which combine commercial and smallholder farms

• AgDevCo’s role is to act as the project developer, deploying capital at risk

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Results

• A £10 million AgDevCo-managed Catalytic Fund for agribusiness investment in Malawi could deliver within 10 years:

o £61 million third-party capital leveraged into Malawian agriculture businesses, from development finance and commercial sources

o 161,000 smallholder farmers linked to profitable markets with an annual per capita income benefit of £170 in perpetuity

o at least 500 emergent farmers on irrigated plots of five to 10 hectares using modern farming practices and achieving world-class yields

o an extra 173,00MT of food crops produced by Malawian farmers worth some £35 million

Fund expected to be operational from Q3 2013

INVESTING IN AGRICULTURE IN MALAWIUK-Malawi Trade & Investment Forum, 20th March 2013

Chris Isaac, Executive Director, AgDevCo