Over 10 000 small-scale farmers from Malawi, Zimbabwe and Mocambique are expected to tap from the African Development Bank (AfDB) $20 million (about K16.6 billion) facility aimed at providing finance to Meridian’s operations to local farmers and soft commodity suppliers to grow their revenues and produce quality crops for export.
Specifically, the facility will be used to provide funding to purchase farm inputs (mainly fertiliser) to be supplied to farmers to ensure consistency and quality of the commodities being supplied to Meridian.
Established in 1970 to assist the small scale farmer, Meridian focuses on production and supply of various agricultural inputs/outputs through a chain of vertically integrated subsidiaries in Malawi, Mocambique, South Africa, Zambia and Zimbabwe.
Thus, as one of the largest commodity aggregators in Southern Africa, the Meridian Group plays a significant role in the promotion of agribusiness in five countries where its operations are in line with four of the bank’s five development priorities: light up and power Africa, Feed Africa, Industrialise Africa, Integrate Africa, and Improve the quality of life for the people of Africa.
In a statement, the bank said this will enable it to reach small-scale farmers indirectly through a regional aggregator (Meridian) that understands the market in which it has accumulated a 40-year track record, understands the operational risks and is able to mitigate and manage them.
“Meridian’s key markets in Africa are Malawi, Mocambique, Zambia and Zimbabwe. Agriculture in these four countries accounts for approximately 32 percent of GDP and provides a livelihood to 81 percent of the population (56 million people) in the form of smallholder subsistence farming.
The group uses its retail outlets to distribute farming inputs to small-scale farmers such as fertiliser, seeds and hardware products,” reads the statement in part.
In March last year, Minister of Finance, Economic Planning and Development, Goodall Gondwe, disclosed government plans to open Agricultural Co-operative Bank (ACB) which will mainly advance agricultural activities by easing difficulties of accessing agricultural loans.
Gondwe revealed that a feasibility study on the same was being conducted saying government will need about $50 million (K34 billion) to open the bank. n