Africa
"To promote income generation through selected programmes supporting basic agriculture and small scale manufacturing and enterprise in selected African countries on a basis which is environmentally sustainable"
Introduction
The Country Trusts
African Agricultural Capital
The Kilimo Trust
Tanzania Cotton & Textiles Programme
Moving Forward
Grants made during 2007-2008
Links
Introduction
Gatsby has been funding and implementing programmes in Africa since the 1980s with the overall objective of stimulating job creation and improving incomes for the poor. Programmes have focused mostly on two key areas: disseminating agricultural research to small-holder farmers, and providing assistance to small and medium enterprises (SMEs).
Gatsby generally makes grants totalling £6 million per year, principally in East Africa. These grants are managed both from London and through six local institutions that Gatsby helped set-up: the Kilimo Trust African Agricultural Capital, and four country trusts in Cameroun, Kenya, Tanzania and Uganda. Programmes range in scale from grassroots micro-finance initiatives to forestry projects spanning East Africa.
Looking forward, the Trustees have decided to shift their strategic focus toward a small number of large and ambitious sector development programmes across East Africa that have the potential to transform the lives of large numbers of the poor.
The Country Trusts
Gatsby established the country trusts 20 years ago in response to the specific development challenges presented by their respective regions. Their local ownership, staff and networks are characteristic of Gatsby’s overall approach in Africa. While programmes vary from country to country, each trust aims to develop its country’s hitherto untapped economic potential by underpinning grassroots economic activity through financial and business development support.
The trusts focus on micro-finance and small business development, but are also engaged in larger scale initiatives, such as Kenya Gatsby Trust’s involvement in developing a new Nairobi Wholesale Market.
In addition to engaging with the trusts on their programmes, Gatsby is now supporting them to determine their strategic focus and develop as institutions.
Read Muyer Celestina’s StoryAfrican Agricultural Capital
In 2005 Gatsby partnered with the Rockefeller Foundation and Incofin to set up African Agricultural Capital (AAC) in 2005. AAC is a distinctive investment company providing loan, equity and quasi-equity finance to agricultural SMEs across East Africa. AAC focuses on supporting SMEs who buy from, or sell to, large numbers of small-holder farmers, thereby strategically impacting these markets. In addition to financial returns, AAC looks for investments that will deliver broader social and economic benefits.
To date AAC has fully invested its initial capital of $7 million in 15 businesses, ranging from Ugandan honey processers to producers of dehydrated vegetables in Tanzania. In January 2008, Gatsby agreed to provide up to a further $3 million of funding, and AAC is actively raising further funds from other donors.
The Kilimo Trust
The Kilimo Trust was established in 2005, principally as a grant-giving institution managing a portfolio of projects mainly focused on funding or disseminating agricultural research across East Africa. Recently Kilimo has sought to develop a more pro-active approach with a focus on a smaller number of sectors where the Trust adopts a market-driven perspective assessing constraints along entire supply chains.
Kilimo has assessed its existing portfolio for opportunities to scale up some of its most successful interventions, such as its ‘push-pull’ programme designed to eliminate the threat of striga and stemborer moths to cereal crops.
Read about The ‘Push-Pull’ Programme
Tanzania Cotton & Textiles Programme
In September 2007 Gatsby initiated a major long-term programme supporting the transformation of the Tanzanian cotton and textiles sectors. The programme aims to double the yields of Tanzania’s 400,000 cotton farmers and catalyse value-adding industries in the textile and clothing sector.
Following discussions with the Tanzanian Government, Gatsby contracted an expert team to complete a feasibility study that identified the constraints along the whole supply chain which need to be addressed in order for these sectors to develop. Gatsby then worked with stakeholders in the sector to set up a series of interventions addressing these varied constraints.
The programme includes introducing improved cotton seed, assisting farmers adopt minimum tillage conservation agriculture, and setting up contract farming between ginners and farmers.
Further efforts are underway to encourage internal investment, attract foreign direct investment into the sectors, and improve the availability of skilled resource. So far Gatsby have committed approximately £3m over three years to the programme.
Moving Forward
Gatsby is now aiming to develop further ambitious strategic programmes looking to catalyse the growth of economic sectors that have the potential to lift large numbers of people out of poverty.
Gatsby will be targeting sectors or sub-sectors that have the potential to be competitive in their local, regional or international market while benefitting large numbers of people. Opportunities to catalyze change will also be important, whether through private sector momentum, political support or local champions.
The exact focus of interventions within the sector programmes will be determined by the nature of the sector or sub-sector and the specific constraints and opportunities that emerge. Future programmes will all be informed by a comprehensive understanding of the sector or sub-sector, attained through in-depth research and local consultation.
Focusing on sector development is more ambitious and is more dependent on outside players and factors. Such a focus will require greater flexibility in how we work and the partners we work with. The Foundation believes this approach will ultimately have the greatest impact in terms of delivering sustainable economic growth and transforming the lives of millions of the world’s poorest people.