CTA Blending4Ag 2nd Newsletter, September 2016
It's time to register for the Blending4Ag conference!
Blending4Ag is the second ever conference on blended finance for agriculture.
The conference will focus on the practicalities of mixing public, philanthropic and private capital in emerging and frontier markets for agriculture:
- Achieving leverage in unlocking private funding for smallholder agriculture through public resources
- Facilities for local currency financing in blended finance for agriculture
- Partnership for effective financing of climate change adaptation and resilience
- Risk management and other support structures in blended finance for agriculture
The conference, from 7 and 8 November 2016 in Brussels, is organised bythe Technical Centre for Agricultural and Rural Cooperation (CTA) in collaboration with other organisations. It is supported by AFRACA, Convergence, the Initiative for Smallholder Finance, the Organisation for Economic Co-operation and Development (OECD), the Climate Bond Initiative and others.
Blending4Ag event is going to be a platform to meet with leading DFIs, impact investors and others who can make blending for agriculture work!
Visit the conference website
Attracting and working with public funders is the biggest challenge
A November 2015 workshop on blended finance for agriculture highlighted attracting and working with public funders as the biggest challenge.
This workshop, organised by Convergence — partner in the 2016 Blending4Ag conference — focused on financing inclusive supply chains, blended funds for agribusiness investment, and results-based financing for sustainable agriculture. The workshop highlighted that deal sponsors must convince public funders that their funding is truly additional to private finance and that their funding is used to attract private capital that would otherwise not be deployed. Given the technical complexity of these funds, substantial time and effort is also required educating public partners on where in the structure their capital sits and what returns they can expect. A key constraint to engaging public-sector funders in blended financing is that they often have difficulty justifying providing financing that will eventually flow to private enterprises. A clear narrative, therefore, is required to detail how public funds will be used to address this market difficulty.
Once public funders are on board, there can be further challenges. Each public funder has unique policy objectives that must be addressed, and expectations around the speed with which funds are deployed must also be managed. Finally, some public funders require governance that is over burdensome which creates inefficiencies.
Click here to learn more about the workshop.
How does Blended Finance fit into ILO’s Social Finance Programme?
In preparation for the Blending4ag event, CTA's Blending4ag team and International Labour Organization (ILO) had a discussion on what a blended finance approach could be with ILO, and how it applies to ILO's agricultural projects. ILO's Social Finance Programme also signals special interest to join CTA in the course of driving 'blended finance for agriculture' towards achieving sustainability in smallholder agricultural financing.
How does blended finance fits into ILO's Social Finance Programme?
Agricultural finance is still perceived as a high risk business. We observe this to be the case in general and in particular in the countries where ILO is implementing agri-related projects. Thus, addressing the perceived and actual risk is our entry point for engaging in the blended finance space...
Click here to read more.