The World Bank’s private sector funding arm said it would provide $18 million in debt financing to Singapore-based Robust International, an agricultural company that trades in specialty crops such as cashews, sesame, ginger, and gum arabic.
The company will use the International Finance Corporation (IFC) loan to build modern warehouses and processing facilities in northern Nigeria, in one of the first investments in modern secondary sesame processing in that region.
“The private sector will play a critical role in improving the livelihoods of thousands of smallholder farmers and lowering greenhouse gas (GHG) emissions in Nigeria,” the IFC said.
The project will improve smallholder farmers’ access to modern storage and processing facilities, while allowing Robust to increase direct sourcing volumes with smallholder farmers.
The storage facilities will relieve farmers of the need to store their own crops in often poor conditions, which leads to high post-harvest losses and unnecessary GHG emissions related to spoiled food, which account for around 5% of Nigeria’s GHG emissions.
The financing package consists of a senior secured loan of up to $9 million from IFC’s own account, as well as a concessional loan of up to $9 million from IFC acting for the International Development Association’s Private Sector Window.
“Robust is committed to empowering farmers and enriching local communities and has followed and encouraged sustainable farming practices,” Robust chairman and managing director Naarayan Raaghavan said.
“[The project] will provide employment opportunities to the local community while significantly contributing to Nigeria’s economic growth and value addition in the country’s supply chain,” he said.
The project also involves a deeper engagement with smallholder farmers by supporting them in the adoption of sustainable farming methodologies.
Agribusiness accounts for more than half of Nigeria’s jobs and contributing more than 35% of its gross domestic product.
The sector provides a route out of poverty for many smallholder farmers in the north of the country, which is marred by conflict and where poverty levels are five times higher than in the south.
- George Russell
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