AfDB adds $1 billion in loans for Africa food crisis

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Sat, May 3 04:14 PM

TUNIS (Reuters) - The African Development Bank (AfDB), the only multilateral development body specifically devoted to Africa, will add $1 billion to its portfolio of agricultural loans to help address the food crisis in African countries, the bank said on Saturday.

Bank President Donald Kaberuka said the bank would also restructure some of its agriculture lending to provide a rapid disbursement facility to the tune of $250 million.

The addition of the $1 billion in funding would raise the bank's portfolio of agricultural loans to $4.8 billion, he said in a statement.

The statement gave no indication about the source of the additional funding.

Kaberuka urged cereals exporting countries not to suspend their exports "because the practice will compromise the existence of about 150 million people in a dozen African states, especially the population of fragile countries, the sick and elderly."

Sharp price hikes for essential food and fuel have triggered riots and protests in a number of African countries.

The U.N. World Food Programme appealed to donors in late March to help it offset a $500 million hike in aid costs to maintain deliveries already scheduled for this year.

The AfDB, whose shareholders include Africa's 53 nations and 24 non-African donor countries, lends commercially to Africa's richest nations and at concessionary rates to poor ones from its Development Fund, financed largely by Western donors.

The bank statement said it would also consider providing countries in difficulty with support for state budget spending and would help fund the provision of more fertilisers to boost farm productivity.

Kaberuka added: "There is a compelling need to increase the level of fertilizer use from the current average of 8kg per hectare to an average of at least 50 kg per hectare in 2015."

The bank had recently set up an African Fertilizer Financing Mechanism Special Fund to mobilise resources from donors to finance, in particular, fertilizer production, distribution, procurement and use, the statement said.

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