British International Investment (BII), the UK’s Development Finance Institution (DFI) and impact investor, today announced a US$ 100 million finance facility with the Eastern and Southern African Trade and Development Bank (TDB).

The investment is designed to strengthen economic resilience in the region by supporting essential trade finance activities, fostering agricultural development and addressing critical challenges such as food insecurity.

The facility will empower TDB to provide financial support to local businesses and financial institutions in several key markets in Africa.

Many African economies are facing various economic challenges, including currency depreciation, rising inflation, debt challenges, and climate-related vulnerabilities, all exacerbated by global economic factors such as the Russia-Ukraine conflict and post-COVID economic turbulence.

TDB will use the financing to fund trade transactions, including importing and exporting goods, commodities, and essential services across the region.

This allocation of capital is crucial for overcoming the barriers to trade in Africa, including the retreat of international correspondent banks from the continent, and addressing the substantial trade financing gap estimated at $80-120 billion.

With improved access to trade finance, businesses can engage more readily in import and export activities, facilitating increased cross-border trade, contributing to food security, and stimulating job creation, economic growth and resilience in Africa.

The financing will enable local companies to procure essential agricultural inputs, such as fertilisers, seeds, and machinery.

By facilitating access to these critical resources, the facility aims to enhance local production capabilities, increase agricultural productivity, support both export sectors stimulating forex generation and elevate the overall quality of food products.

This helps address immediate food security issues and increases the agricultural sector’s capacity, global competitiveness, and economic output.

In recent years, TDB has strengthened its collaboration with financial institutions, recognising them as essential partners to boost trade. This strategic partnership is vital to increasing the flow of goods and services, including through financial institutions.

The transaction builds on BII and TDB’s shared ambition of empowering critical segments of the economy, as well as the private sector including SMEs, which the institutions are committed to supporting to promote inclusive growth across the continent.

Andrew Mitchell, Minister for Development and Africa, said: “This investment underscores the UK government’s commitment to supporting economic and agricultural development across Africa by empowering businesses, stimulating trade, and increasing the flow of essential goods and services.

This funding will also help to lower trade barriers so that companies across the continent are better able to expand into overseas markets, access vital resources and tackle critical challenges such as food security.”

Ndaba Mpofu, Director and Head of Financial Services Debt at British International Investment,said: “Through this investment, BII is focusing its capital on offering strategic support to key financial institutions in countries we have a long-term commitment to.

This facility with TDB aligns with our core mission to address the financing gaps in areas that help empower local businesses to drive inclusive growth, boost trade flows, and strengthen economic resilience.”

Admassu Tadesse, TDB Group President and Managing Director, said: “TDB Group has been playing an important role in the trade finance space, often working countercyclically to contribute to the security of supply of essential commodities in high priority sectors such as agriculture and healthcare.

This is the fourth facility we are signing with BII and its predecessor. We are pleased to continue building this strategic partnership, and through this new facility, enhance efforts to address ongoing supply chains disruptions and forex shortages, and their impact on food security.”

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Bangladesh, one of the most populated countries in the world, is experiencing strong economic and demographic growth demanding expansion of their agri-food industry supported by government projects food security.

Symaga is proud to have participated in Modern Food Security Project (MSP), led by the Bangladesh government, by manufacturing and delivering two silo installations of silos to the Danish company Cimbria.

One plant is located in the town of Naranyanganj reaching up to a number of 12 Silos SBHX1834/15 and the second one in Barisal, a city located in the Ganges delta with 16 silos SBHX1680/13.

The Government of Bangladesh has launched an innovative plan to build grain storage plants at several strategic locations. These plants will be equipped with a “Food Stock and Market Monitoring System”.

The objective is to supervise the food stock, as well as the transport and the overall market in order to reduce inefficiencies.

Bangladesh is a key country for Symaga, with 1.5 M m3 of built storage in 150 silos assembled in “The Lands of Rivers”. The country’s main agribusiness players such as City Group, A R Specialized, Auto Rice Mills, Akij, and Basundhara have relied on our industrial silos.

Symaga has participated in other projects in the Asian country as a port terminal for one of the large business groups in the country, Bashundhara LT and in a few weeks will start the assembly of the Chittagong terminal. Less recently we participated in several feed mills.

Food security projects in Bangladesh are emblematic for Symaga, as they strengthen the company’s corporate mission: helping to feed the world.

We look forward to continuing to contribute to this MFSP (Modern Food Security Project) by supplying silos for the upcoming grain storage plants.

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South African agriculture equipment dealers could be in for a bad year following poor sales in January 2024.

South Africa’s tractor sales were down 26% year-on-year (y/y) in January 2024, with 353 units sold. At the same time, combine harvesters were down 50% y/y, with eight units sold.

December tractor sales of 531 units were significantly (27%) less than the 729 units sold in December 2022.

For the 2023 calendar year, tractor sales were approximately 9% down on the 2022 calendar year. Thirty-one combine harvesters were sold in December, five more than the 26 units sold in December last year.

Calendar year 2023 combine harvester sales were significantly (35%) higher than those in 2022. With most summer crop plantings having been completed, the market is showing caution as to what will happen weather-wise in the next few weeks.

Initial predictions were that the El Niño phenomenon was likely to result in lower than normal rainfall during the critical January and February months.

Potential buyers of tractors therefore delayed their buying decisions until some degree of certainty in terms of rainfall developed.

“Present rainfall conditions are looking favourable, however, but rain will still be required through to the end of February in most areas.

It is still early in the year to be predicting 2024 calendar year tractor sales,” says Tallie Giessing Chairman of South African Agricultural Machinery Association.

Nevertheless, expectations are that, despite the market being very competitive and this driving sales, calendar year 2024 tractor sales will be of the order of 10% down on last year.

“At face value, this could be viewed as a worrying agricultural machinery sales report, indicating difficulties in the sector.

But we have a different reading of it. This is more of a normalisation after a few years of robust sales,” explains Wandile Sihlobo Agbiz chief economist.

“Generally strong agricultural machinery sales over the past few years were primarily on the back of large grain and oilseed harvests.

In 2023, tractor sales were down marginally from the previous year, while the combine harvester sales held the last year’s momentum. Thus, we think the January 2024 sales begin a correction period.”

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