Agricultural enterprises in Malawi will benefit from a new partnership between the European Investment Bank (EIB) and the European Union (EU).
In addition to the new €12.5 million EIB financing to First Capital Bank, the European Union will contribute €5 million to support additional long-term agricultural finance in the form of best practice agricultural investment technical assistance. In turn, this will allow smallholder farmers to make a greater impact on national agricultural output and exports.
“Increasing high impact agricultural investment is crucial for Malawi. This new partnership between First Capital Bank, the European Investment Bank, and the European Union will benefit thousands of small holder farmers across our country and unlock economic opportunities from sustainable agriculture in the years ahead,” said Agness Jazza First Capital Bank, Deputy Chief Executive Officer.
The new financing initiative has been launched to address specific challenges holding back agricultural investment and is part of the broader “Kulima – promoting farming in Malawi” programme developed by the European Union and the Government of Malawi.
“The European Investment Bank recognizes the importance of agriculture for both economic activity and social development. This latest partnership with First Capital Bank will unlock investment by smallholders across Malawi facing challenges of climate change and the COVID-19 pandemic. The EIB is pleased to support this visionary Team Europe Kulima initiative that tackles barriers to agricultural investment,” said Thomas Östros, European Investment Bank Vice President.
First Capital Bank joins ECOBANK Malawi, and together the two leading local institutions will provide a total of €50 million of new financing for agricultural investment. Agriculture value chain companies across Malawi will be able to access loans with maturities of up to 7 years, longer than commonly available in the market to expand, upgrade and modernize their equipment, and unlock new business opportunities.
“Team Europe is working with Malawian partners to transform opportunities in rural communities. Today First Capital Bank, the EU, and the EIB are joining forces to boost agricultural investment in a pioneering initiative that is a model for Africa,” said Aurélie Valtat, Chargé d’affaires of the Delegation of the European Union to Malawi.
The new agriculture access to finance cooperation was confirmed in Brussels by EIB President Werner Hoyer ahead of the EU-Africa Summit.
