LAFCO - Lending for African Farming Company (continued)

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The project is the Lending for African Farming Company - LAFCo working capital facility for financing small and medium-sized enterprises in the agricultural sector in Africa. LAFCO primarily offers urgently needed working capital financing in the form of loans for crop purchase finance and input finance, combined with agronomic and financial advice for small farmers. The facility focuses on agricultural value chains in the food sector, whose players mainly supply local and regional markets. The aim of the measure is to improve the integration of small farmers into the value chains by improving local SMEs' access to working capital financing, thereby increasing the productivity and income of small farmers. This will increase food security, growth and employment in rural areas and contribute to the main objectives of SEWoH. The facility was originally designed by AgDevCo, which, together with FZ as anchor investor, is providing the start-up capital. The volume of the facility is currently around USD 23.5 million. In the medium term, the volume of the facility is to be expanded to USD 100 million in partnership with other investors. The FC measure within the framework of SEWoH includes a trust investment by KfW of EUR 17.6 million (in USD). In addition, the Local Currency Support Trust (FX Trust) was established and endowed with SEWOH funds of EUR 2.37 million. The funds can be used to partially cover currency hedging costs incurred by LAFCo when financing SMEs in local value chains. A Technical Assistance Facility is also supporting the expansion of LAFCo's business activities to other SEWOH countries and impact measurement. Funds of EUR 2 million have been made available for this purpose so far.