Press release No.: IFAD/42/08

IFAD’s Executive Board concludes meeting in Rome

Rome, 15 September 2008 – IFAD’s Executive Board approved more than US$177.41 million in loans and US$60.235 million in grants for twelve programmes and projects that will improve the lives of the rural poor in developing countries.

The 94th session of the Board, which met in Rome from 10-11 September, approved an additional US$5.01 million in grants to support agricultural research and development activities. 

Western and Central Africa: US$28.39 million in loans and US$9.07 million in grants
In the Republic of Cameroon, a loan of US$13.5 million and a grant of US$0.2 million will target smallholder farmers who cannot currently access financial services.

Without access to financial services, most of these smallholders cannot make any meaningful investment to sustain their activities. This project will help increase the income of smallholder farmers, particularly young women and men, by expanding the network of microfinance institutions.

Increased investment will help diversify the range of income-generating activities, providing more rural employment and food security. The status of women will improve through their participation in the management of microfinance institutions. The programme will use modern technologies to make financial services readily available to the poor and will facilitate more medium and long term loans to the target groups.

In the Republic of Congo, 250 villages will be targeted by a project reaching about 20,000 households. The programme will be supported by a US$8.6 million grant. Current yields in the targeted region are very low as a result of poor-quality seed and the effects of mosaic disease on cassava. The project will help farmers’ interest groups to produce, multiply and disseminate improved disease-free cassava planting materials and seeds.

Training will be provided so that smallholders will have the knowhow for improved cultivation practices. It will also finance the rehabilitation of rural roads with the aim of increasing access to production areas. By inserting ex-combatants into agricultural and food production systems, the project will support the first pillar of fostering peace in the region.

In the Republic of Senegal a loan of US$14.89 million and a grant of US$0.27 million to support agricultural value chain development will help tackle rising rural poverty in the country’s “groundnut basin”. An extended slump in world groundnut markets, continued land degradation and climate change have contributed to a steady economic decline in the area. Although new markets are opening up, most smallholders are unable to access them. The project will assist them through the promotion of production/purchase contracting arrangements between their organizations and market operators. Farmers’ organizations will be strengthened to give members a greater say in decision making at regional and national levels. This will increase market access and a more equitable distribution of profits along a given value chain. The project will improve marketing conditions for higher surpluses and terms of trade for small producers as well as a more sustainable use of natural resources.

Eastern and Southern Africa: US$49.8 million in loans and US$20.97 million in grants

In the Republic of Madagascar, the Support to Farmers’ Professional Organizations and Agricultural Services Project (AROPA), supported by a US$18.7 million loan and a US$515,000 grant will help poor rural families including small-scale farmers with little or no land and households with nutritional deficits. 85 per cent of the population live in rural areas and recent reforms have had an impact in cutting poverty.

The project will boost farmers’ production by supporting them in joining farmers’ associations and agri-business centers (CSA) to improve services to farmers. This will improve agricultural production and increase rural families’ income.  Farmers’ organizations will be better integrated into the economy and able to mobilize providers to deliver the services required. The project will improve access by rural poor people to financial services through regional agricultural funds (FRDA).

In the northern provinces of the Republic of Mozambique an estimated 20 000 farmers, 375 small-scale traders and 200 000 individual farmers and non farmers will benefit from a new seven-year programme. Supported by a US$31.1 million loan, and based on the success of previous projects, the programme will improve the livelihoods of poor rural households, enabling smallholders to increase their agricultural income by marketing their surpluses more profitably.

There is an enormous untapped potential to develop commercially-oriented and market-focused agriculture in the region. Farmers’ organizations and small-scale traders will be supported through capacity building, including basic business training and direct counselling.

There will be investment in feeder roads as well as construction of district and provincial markets. Profitable partnerships between smallholders and agribusinesses will be promoted, producing mutually beneficial arrangements. The project will increase access to financial and market services and improve market transparency.

A new project in the Republic of Rwanda will be supported by a grant of US$20.45 million – to be followed by a second grant of US$6.32 million when resources become available - helping poor smallholders in the Kirehe District of south-eastern Rwanda. Poverty reduction depends on intensification in the area since there is little prospect for agricultural expansion. The programme will help farmers overcome their food insecurity and low incomes by promoting market-orientated intensification of agricultural systems. Land degradation will be stopped and soil fertility restored. It will develop irrigation facilities, reducing dependence on erratic rains and allowing farmers to shift to higher value crops. Poor physical access is a major hurdle to increasing trade in this area so feeder roads will be improved and maintained. Local institutions will be developed giving them the tools to support an increase in profitable smallholder agriculture.

Near East and North Africa region and Central and Eastern Europe and Newly Independent States region: US$21.9 million in loans and US$14.43 million in grants

A loan of US$9.2 million and a grant of US$0.40 million will help the poorer and poorest households in the mountainous northern part of Albania, the most disadvantaged part of the country. This investment will support a new programme, the “Mountain to Markets Programme,” that builds upon lessons learned from previously successful poverty reducing strategies in the mountain areas.

The main thrust of the programme is an emphasis on raising cash incomes from farming, improved opportunities for wage employment and self-employment in micro, small and medium enterprises. The programme will enhance access to financial services, support investments in small-scale, commercially justifiable rural infrastructure and introduce innovative technology both at farm and enterprise level.

In Moldova, a loan of US$12.70 million with a complementary grant of US$0.53 million will be invested in the Rural Financial Services and Marketing Programme. The programme will create opportunities for employment and income generation in on and off-farm activities for the rural poor, related to the promotion of the Moldovan horticultural value chain. This will be accomplished through the provision of targeted rural financial services, development of rural commercial infrastructure as well as knowledge and technical expertise required to participate more profitably in national and international markets. Although the programme will have national coverage, its investments will be aimed at areas with the highest concentrations of rural poor people. Women and young people will have equal access to programme benefits.

In Sudan, a programme supported by a grant of US$13.5 million will increase food security and incomes in six counties in the States of Central Equatoria, Eastern Equatoria and Jonglei, through improved agricultural productivity and marketing. Rural poverty in southern Sudan has been linked to the prolonged conflict situation, population displacement, poor service coverage, inaccessibility, low labour availability and low productivity. Agriculture has been identified as the main engine of economic and rural development.

The project will support the following productive activities such as farming, herding and fishing and the support will be directed towards rural households in particular woman-headed households and returnee households. The project will also finance infrastructure rehabilitation such as potable water, repair of rural feeder roads, and rehabilitation of market infrastructure. The project will enhance managerial capacity and accountability at the county level and build county capacity in resolving resource-based conflicts.

Asia and the Pacific: US$68.13 million in loans and US$9.4 million in grants

A national programme to reduce poverty and improve local-level governance in rural Indonesia will be supported by a loan of US$68.13 million and a grant of US$0.4 million. At the request of the government and in partnership with other external development agencies, IFAD will provide its support to the National Programme for Community Empowerment, which will cover all the rural sub-districts in the country during 2009-2015. IFAD will also provide targeted support for agricultural development in Papua and West Papua that are largely populated by indigenous and ethnic populations and have the highest rates of rural poverty in the country.

In the Kyrgyz Republic a country-wide project targeting 475 rural communities will be supported by a US$9.0 million grant. The project aims to improve the institutional and infrastructure environment for farmers and herders, with a strong emphasis on the livestock sector.  It will specifically increase the productivity of farmers, particularly livestock farmers, and reduce animal diseases that have a public health impact (e.g., brucellosis).  During its five-year duration, the project will assist in developing and adopting an adequate legal and institutional framework to govern the management and use of pastures.  It will support the development and operation of a market-oriented rural advisory service system.  The project will also provide technical assistance for the establishment of a suitable legal and regulatory framework for the delivery of veterinary services.  IFAD will finance the project in partnership with the World Bank and the Swiss Development Cooperation.

Latin America and the Caribbean: US$12.0 million in loans and US$0.6 million in grants

A US$9.19 million loan will support a programme in Costa Rica which will target regions characterized by environmental fragility and high rural poverty levels. An estimated 25,400 people will benefit directly including small-scale producers, subsistence fishers, indigenous communities and jobless young people. The income-generating activities of these groups will be improved by broadening their access to competitive markets.

The programme will develop local enterprises and establish sustainable agribusinesses. The Government’s poverty reduction priorities will be supported by the creation of local technical and financial service markets as well as a national rural development institute. Special attention will be paid to vulnerable groups - women, indigenous communities and young people, increasing employment and incomes.

In Honduras and Nicaragua, IFAD will provide additional funds for ongoing projects to increase food security and guarantee the participation of small-scale producers in a sustainable response to the current food crisis. The project for Enhancing the Rural Economic Competitiveness of Yoro in central Honduras will receive US$2.27 million to assist an additional 1700 families to increase their grain production and expand their access to seeds, fertilizers and technical assistance. The Small-scale Producers in Value Chains and Market Access project in Nicaragua will receive a US$0.6 million loan and a US$0.6 million grant. The supplementary financing will allow 1,200 additional smallholders to improve their production capabilities and incomes.

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The Executive Board approved one grant under the global/regional grants window to a CGIAR-supported international centre for a total of US$1.2 million:

• World Agroforestry Centre (ICRAF), for the Programme for Promoting Rural Innovation through Participatory Tree Domestication in West and Central Africa

The Executive Board approved three grants under the global/regional grants window to non-CGIAR-supported international centres and organizations for a total of US$3.13 million:

• Kenya Gatsby Trust (KGT), for the Rural Finance Knowledge Management Partnership – Phase II

• Commission on Family Farming of the Common Market of the South (MERCOSUR), for the Institutional Consolidation of the Commission on Family Farming of the Common Market of the South (MERCOSUR)

• United Nations Economic Commission for Africa (UNECA), for the Support for the Formulation and Implementation of Pan-African Land Policy Guidelines

The Executive Board also approved one grant (under the country-specific grants window) to the Uganda Women’s Effort to Save Orphans (UWESO) for a total of US$680,000:

• Uganda Women’s Effort to Save Orphans (UWESO), for Institutional Capacity Strengthening, Resource Mobilization and Rural Financial Services Expansion

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IFAD was created 30 years ago to tackle rural poverty, a key consequence of the droughts and famines of the early 1970s. Since 1978, IFAD has invested more than US$10 billion in low-interest loans and grants that have helped over approximately 400 million very poor rural women and men increase their incomes and provide for their families. IFAD is an international financial institution and a specialized United Nations agency. It is a global partnership of OECD, OPEC and other developing countries. Today, IFAD supports more than 200 programmes and projects in 85 developing countries and one territory.