The Africa Fertilizer Financing Mechanism of the African Development Bank, in collaboration with the African Fertilizer and Agribusiness Partnership, has officially launched a project that will provide a $2 million trade credit guarantee to help Tanzanian fertilizer suppliers deliver 60,000 tons of fertilizers to smallholder farmers on credit. The project will make fertilizers more accessible for farmers.
In Tanzania, banks’ hesitancy to lend to farmers means that only 3% of all commercial loans go to the agriculture sector, according to the African Development Bank. While banks tend to view farming as risky, it is also true that farmers often lack collateral, such as a land title, that banks require for a loan.
Over 100 people attended the event, including representatives from the Tanzanian Ministry of Agriculture, the Tanzania Fertilizer Regulatory Authority, and a diverse group of fertilizer private sector companies and hub agro-dealers. Visitors to the Nanenane Agricultural Exhibition in Dodoma, where the project kick-off, also attended the event.
Speaking at the project launch, Dr. Stephen Nindi, the Deputy Permanent Secretary for Food Security in the Ministry of Agriculture, praised the initiative, which he said aligns with Tanzania’s national development priorities. “We will continue to provide the necessary institutional support, policy coordination, and stakeholder engagement to ensure that such transformative initiatives deliver a lasting impact for our farmers and the broader economy,” he said.
Mrs. Marie Claire Kalihangabo, Coordinator of the Africa Fertilizer Financing Mechanism, highlighted the project’s long-term goals during the project launch. “We are especially excited because this initiative builds on the strong foundation laid by our earlier 2019-2022 partial credit guarantee project,” she said. “Over the next 36 months, we aim to collaborate with at least three major suppliers, support hub agro-dealers, and retail agro-dealers and facilitate access of fertilizer to smallholder farmers in targeted areas in the southern highlands and the lake region,” She added.
The $2 million financial scheme will help Tanzanian farmers prepare for the upcoming planting seasons. Mr. James Mutonyi, East Africa Regional Director for the African Fertilizer Agribusiness Partnership, said, “Most farmers do not apply fertilizers suitable for their crops, climate, or soil because limited supplier capital restricts options, ultimately lowering productivity,” he said. “Under the initiative, farmers will be assured of a consistent supply of quality, affordable fertilizers from suppliers, including agro-dealers and cooperative unions.”
Joel Laurent, the Executive Director of the Tanzania Fertilizer Regulatory Authority, said that the project will help smallholder farmers to increase productivity and enhance food security in the country. “This phase aims not only to reduce risks in the agricultural sector, but also to stimulate private sector investment, and most importantly, empower smallholder farmers who are the backbone of food production in the country,” he opined.
The Africa Fertilizer Financing Mechanism, a special fund administered by the African Development Bank Group, provides innovative financing solutions to improve production, procurement, and distribution of fertilizers and other inputs in Africa.
