The concept of Climate Smart Agriculture (CSA) is gaining traction at the international and national levels as an approach to address the challenges of agricultural planning in the face of climate change.
However, adoption has been slow, and diffusion rates are a concern hence the adoption of technological and chain innovations on a large scale remains a challenge in the Sub-Saharan Africa agribusiness sectors. It necessitates a better understanding of the heterogeneous nature of the smallholder farming sector, differences in business strategies and willingness and ability to take risks among smallholder farmers.
Most agribusinesses do not fully understand their exposure to climate change, nor do they recognize the growing business opportunities in climate action. Therefore, changing the perspective of agribusinesses on climate change is critical for shifting food systems to more sustainable practices and working towards climate change adaptation and mitigation in agriculture. It is also essential to ensure CSA service providers are assisted in developing business models and demonstrating the benefits of their technologies.
Access to finance for input suppliers, farmers, and Small and Medium Enterprises (SMEs) involved in trading and processing is among the barriers to CSA adoption. To be successful, a better understanding of financial institutions’ strategies is required, along with effective de-risking activities and potential portfolio financing. It is therefore critical to collaborate with financial institutions to develop relevant and targeted financial products for various value-chain actors.
Investments in productivity enhancement and climate adaptation of inclusive food production and supply systems are required for large-scale adoption and implementation of climate-smart solutions, making this a critical intervention area.
With the CRAFT project’s investment fund, the team facilitates innovation and investments in the bean, green gram, potato and sorghum value chains, as agri-finance is a crucial enabler for sector development. CRAFT is committed to testing and improving climate-smart and inclusive agribusinesses in collaboration with private partners in order to increase the scaling of climate-smart investments.
Investment opportunities for the roll-out of CSA activities are being promoted, backed by solid return on investment scenarios based on business realities. The CRAFT project continues working with key partners from the financial and agro-commodity sectors to de-risk value chains to achieve large-scale climate-smart investments.