How Agribusiness Financing Can Have Transformational Impact on Asia and the Pacific
Agriculture accounts for more than half the workforce in most ADB developing member countries. In the Greater Mekong Subregion, agriculture forms the backbone of its countries’ economies, directly supporting the livelihoods of nearly 200 million people with over 60% of the subregion’s 340 million inhabitants engaged in small-scale agriculture.
An article on ADB.org highlights the need to scale up agribusiness investment in Asia and the Pacific. According to Mr. Martin Lemoine, Agribusiness Unit Head in ADB's Private Sector Operations Department, agribusiness is critical to the economy, impacting the agriculture, manufacturing, and services sectors. He underlines that the region needs to invest $120 billion every year in agribusiness until 2050 to meet the growing demand for food. Such huge demand have led agribusiness companies to have large and unmet financing needs, both in the long-term and short-term.
Providing agribusiness financing is also crucial to helping countries achieve their Sustainable Development Goals (SDGs), specifically under SDG 1 – No Poverty, SDG 2 – Zero Hunger, SDG 3 – Gender Equality, SDG 8 – Decent Work, SDG 12 – Responsible Consumption and Production, and SDG 13 – Climate Action.
In the 16th Annual Meeting of the GMS Working Group on Agriculture, held in Luang Prabang, Lao PDR on 17-18 June 2019, one of the subprojects proposed is to finance climate-smart agribusinesses to enable GMS stakeholders to
- Analyze barriers and propose measures for improving financial preparedness of agri-food small and medium enterprises (SMEs), with specific focus on job creation for women;
- Build capacity of SMEs and women entrepreneurs on appropriate financing options and measures for climate risk management;
- Support a small competitive grant scheme for SMEs to adopt climate-friendly manufacturing practices to reduce greenhouse gas emissions and vulnerability to impacts of climate change; and
- Implement a pilot on digital agricultural finance service aimed at women farmers and entrepreneurs.
Read on and watch the accompanying video that outlines the challenges and opportunities facing agribusiness, and understand ADB's future plans for the sector.