World Bank Finances Senegal’s Agribusiness Plans; Will Also Help Wider Sahel Region
15 January 2014 The World Bank is providing $86 million in zero-interest financing to help Senegal transform its commercial agriculture, boost sustainable land management and engage local communities in agribusiness enterprises.
“Senegal’s agricultural sector is marked by increasing private sector interest,” said Vera Songwe, World Bank Country Director for Senegal. “By focusing on the key gaps hampering growth in agriculture, such as too little infrastructure and irrigation and secure access to land, this project will unleash growth, enable smallholder farmers to raise their incomes and yields, better protect the environment by expanding sustainable land management practices, while also creating jobs for young people and raising incomes for women.”
Makhtar Diop, World Bank vice president for Africa, said the new operation, which is called the Sustainable and Inclusive Agribusiness Development Project, falls under the World Bank Group’s new Sahel Initiative and will also help to deliver on a key international commitment to help more than double the amount of irrigated land in The Sahel from 400,000 hectares to 800,000 hectares over the next five years.
The operation is designed to support Senegal’s strategic plan to accelerate diversification of agricultural exports, increase trade revenues and promote domestic and foreign direct investment in the farming sector, a dominant part of the West African nation’s economy, World Bank said.
Agribusiness, particularly in horticulture, has strong potential in Senegal. The new project will focus on two areas – Ngalam Valley and Lac de Guiers – and both have distinct advantages such as strong demand from private sector, fertile soils, access to water, and parcels of land of 15,000 and 40,000 hectares which are suitable for commercial expansion, World Bank stated.
According to the World Bank, the project will provide technical assistance to rural communities and smallholder farmers engaged in commercial agriculture. Because current legal provisions preclude direct allocation of land from rural communities to investors, the project will test a “Lease-Sub-lease Option” land allocation model where the government will convert land identified and selected by the rural community from the national domain (in French Domaine national) to the private domain of the state (Domaine privé de l’État). It will then lease this land (bail emphytéotique) to the rural community, which in turn will sub-lease the land to the investor.
“For too long, commercial agriculture has been held back by a combination of insufficient investment and an overall lack of appreciation for the poverty-fighting punch that a vibrant farm economy can deliver,” Diop said.
The project will directly benefit more than 10,000 people and 100 off-farm enterprises, representing a mix of smallholder and medium-scale farmers, wage workers and small and medium enterprises, World Bank said.
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