Transforming Agriculture: Insights from the African Agri Investment Indaba

22 November 2023

Africa stands at the forefront of agrifood investment, and the annual African Agri Investment Indaba (AAII) serves as the epicentre for global stakeholders to converge, discuss, and shape the future of agriculture on the continent. This year's gathering, attended by over 900 key players, including representatives from governments, banks, financiers, investors, project owners, project developers, commercial farmers, and the agro and food processing industry, delved deep into the trends that will likely influence food and agribusiness economics over the next decade in Africa.

Strategic Financing and Partnerships: Unlocking South Africa's Agricultural Value

At the heart of the Afri Investment Indaba was the Finance and Investment Keynote panel, a powerhouse of minds exploring the crucial role of strategic financing and partnerships in unlocking South Africa's agricultural value. Themba Rikhotso, the Chief Executive Officer of Land Bank, South Africa, shared the stage with influential figures such as Nhlanhla Nene, Chairman of the Board of Directors at Thebe Investment Corporation, Pascal Siphugu, Managing Director of Land Bank Insurance Company, and? Jannie Strydom, CEO of Agri Western Cape.

Themba Rikhotso's Vision: Beyond Banking

During his insightful presentation, Themba Rikhotso shed light on Land Bank's multifaceted approach to catalyse agricultural development. One standout initiative is the recently launched Agro Energy Fund, designed to assist clients in adopting alternative energy sources, aligning with the global push for sustainable practices.

Land Bank's strategic focus on partnership funding models signifies a commitment to efficiency. The organisation is restructuring to handle partner funds seamlessly. But Land Bank goes beyond traditional banking services – they offer pre and post services, actively supporting clients in packaging their businesses effectively. Market access takes centre stage, with the bank striving to help clients establish crucial linkages with markets essential for their success.

Embracing a comprehensive approach, Land Bank has adopted a partnership and ecosystems model, overseeing the entire agricultural value chain and acting as a coordinator. The overarching goal is clear: to foster sustainable farming practices by serving as a facilitator of opportunities within the agricultural landscape.

Pascal Siphugu's Call to Action: Bridging the Insurance Gap

Pascal Siphugu, the MD of Land Bank Insurance, brought attention to a critical issue during his presentation. Global studies indicate a staggering issuance of 265 million insurance policies in 2022, with only 3% allocated to Africa. More shockingly, 80% of this global support is absent in Africa, leaving a significant gap in coverage.

Siphugu sees a solution in Public and Private partnerships. He believes that collaboration can bridge the insurance gap and aid farmers in mitigating risks. The statistics are sobering – only 27% of farmers in South Africa are insured. In response, Land Bank Insurance Company pledges to introduce innovative solutions tailored to the unique needs of South African farmers.

Siphugu stresses the importance of collaboration between the industry and the government to ensure the success of small-scale farmers. He leaves the audience with a profound question: How can we collectively collaborate to bring substantial value to farmers, serving as funders, policy makers, and essential stakeholders in the agricultural sector?

A Vision for Collaborative Growth

The African Agri Investment Indaba has once again proven to be a melting pot of ideas, innovations, and a catalyst for change in the agricultural landscape. Themba Rikhotso and Pascal Siphugu's insights highlight not only the challenges but also the tremendous opportunities that lie ahead. As Africa strives for agricultural sustainability, the call for collaboration among stakeholders – from financial institutions to government bodies – echoes loudly. The path to transformative change is clear: strategic partnerships, innovative financing models, and a shared commitment to bringing substantial value to farmers and the agricultural sector as a whole.