€1 million fund to finance Senegalese farm co-ops
Agriculture in Senegal faces a major financing challenge, as farmers' financing needs far outpace the credit available to them – despite the efforts of government and financial institutions. For the 2024-2025 financial year, the government has increased its agriculture budget by 20%, to 120 billion CFA francs (about €183 million). However, enormous challenges remain.
In an attempt to close this financing gap, the International Trade Centre (ITC) has set up a €1 million co-financing and subsidy fund under the PACAO programme, designed to finance Senegalese agricultural cooperatives. The main targets are onion and mango farmers, which are poorly served by the financial sector, despite working in agricultural sectors with high market potential. The fund is being set up with the support of Banque Agricole, with a leverage effect of 100%, bringing the total financing package to FCFA 1.3 billion (about €2 million).
The initiative will grant subsides and loans to cooperatives set up under PACAO-Senegal, with the aim of making selected value chains more competitive.
On 4 September, in the presence of the Secretary General of the Ministry of Industry and Trade, the institutional partner of PACAO-Senegal, the ITC set up the Credit Committee responsible for assessing applications.
The PACAO-Senegal Credit Committee, chaired by the Minister of Industry and Trade, is made up of 10 members, including a representative of the Ministry of Agriculture, the Director General of the Agency for the Support and Development of Small and Medium-sized Enterprises, the Director General of the Market Regulation Agency, the Director General of the Warehouse Receipt System Regulatory Body, the Director General of the National Microfinance Fund, the Director General of the Partner Bank, the PACAO-Senegal National Coordinator and the PACAO-Senegal Programme Administrator at ITC headquarters in Geneva.
The first funds should be allocated in October 2024, so the cooperatives can prepare for the onion planting season in November.
The support provided by the Ministry of Industry and Trade is part of its mission to support initiatives that strengthen small businesses and fulfill Senegal's commercial potential.
In Senegal, the International Trade Centre, through PACAO-Senegal, has helped to structure and formalize 15,616 small producers into 29 agricultural cooperatives. Seventeen work with onions and seven with mangoes. The cooperatives receive significant training in managerial and organizational skills, competitiveness, market access and financing. The goal is to connect them to more profitable and sustainable business opportunities. The project works in Dakar, Thiès, Louga, Saint-Louis, Matam, Fatick, Ziguinchor, Sédhiou and Kolda.
