CASA Webinar 1: Stronger, Greener and Fairer Recovery: The Investment Response
CASA Webinar 1: Stronger, Greener and Fairer Recovery: The Investment Response
This was the first of the webinar series which runs every last Wednesday of the month until 2024. It is also the first of three sessions focused on ‘Stronger, Greener and Fairer Recovery’ and it concentrates on the investment response.
The panel focused on challenging some of the more persistent narratives around investment and agri-finance and global development, exploring how we can build more effective support for these, post-pandemic. The session featured two recent CASA reports.
Here are the four main takeaways from points made by the panelists: (This is not a summary of the research).
- Concessional finance has great potential for developmental impact, but the industry needs to produce and share quality evidence to back this aspiration. The majority of evidence studies are being produced by investors themselves and lack of the necessary rigour to identify key lessons learned, which should inform future investments and contribute to maximizing the impact of concessional finance overall. Consistency across impact evaluations (e.g. using approaches like the ones proposed by the GIIN) would facilitate the task of comparing across studies and identifying impact success factors of concessional finance models. There is also a number of studies that have been produced for private consumption (at the fund level) that should be repackaged for public consumption.
- Most of the investors might be hunting the same gazelles. There is a shortage of ‘investible’ agri-businesses, mainly due to the investment requirements imposed by impact investors, which try to balance impact and returns in their investments. The majority of impact investors hunt investments with ticket sizes that range between $500K and $5M, with an investment timeframe of five to seven years. This is what Professor Jayne refers to as the “gazelles” of agri-SMEs, due to their potential to scale with speed. However, there aren’t that many ‘gazelles’ and investors end up competing with each other for the same deals, which doesn’t mean that there isn’t enough capital ready to hunt the right deals. Longer-term patient capital and smaller ticket sizes would offer an opportunity to increase the number of investible agri-businesses while contributing towards building the critical mass needed to attract more investments to developing countries.
- The enabling environment for investments extends beyond the national level. National investment promotion plans are not being matched or included in clear regional or continental (e.g. pan African) investment plans with explicit commitments of resources and timeframes for implementation. This contributes to increasing the perceived risk of investing in agriculture in Africa, as there is uncertainty about the sustainability of the political commitment towards attracting investments into the continent.
- Now is the time for African governments to help de-risk agricultural investments. Growth in Africa over the last 20 years has been unprecedented, but more needs to be done at the policy level to play a catalytic effect in attracting agricultural investments. African governments should concentrate on promoting access to technology, finance and markets for ‘survival agri-businesses’ which would contribute to their maturation and to increasing the population of ‘gazelle SMEs’. Investment in agriculture support services like technology, digitalization and access to energy should become the cornerstones for building a more investment friendly environment within the continent. Acknowledging where we are in the ‘market life cycle’ also has implications for the way investors think about and are supported with impact assessment approaches.
|Welcome by Nick Ishmael-Perkins CASA||Introduction to CASA and the Agribusiness Breakthrough Webinar Series|
|Michael Shaw Wellspring||Presentation of key findings and recommendations from “The development impact of concessional finance to agri-business: a rapid evidence review”|
|Prof Thomas Jayne Michigan State University||Presentation of key findings and recommendations from “Bridging demand and supply of private investment capital for small and medium agribusinesses”|
|Dr Ousmane Badiane Malabo Montpellier Panel||Presentation of perspective on regional vision for an enabling environment in Africa|
|Nick Ishmael-Perkins CASA||Questions from the audience
Wrap-up of key takeaways
Michael is the lead researcher of ‘The development impact of concessional finance to agri-business: a rapid evidence review’.
Michael leads a 20-person team of staff, consultants and associates who work alongside private, public and third-sector development and impact investment partners to provide project development services, programme design, strategic advice, management consulting, management training and investment advisory.
Since 2009 Michael has led Wellspring in carrying out more than 65 projects with a range of clients in the agricultural sector. These include DFID, the Bill & Melinda Gates Foundation, UN, Gatsby Africa, Wood Family Trust, AgDevCo, CDC Group, Innovate UK, Acumen Fund, AGRA, DAI, ACDI/VOCA, Food Trade East and Southern Africa (FTESA), Msingi Fund and a range of private sector companies and philanthropic organisations investing and supporting agricultural markets. During this time he has lived in Malawi, Kenya, Tanzania and the UK.
Previously, Michael has been executive director of AgDevCo, a social impact investor and project developer working in the African agriculture sector, supporting small and medium-sized enterprises involved in farming, agri-processing and logistics, with the aim of creating jobs and income-earning opportunities for African farmers.
He has also been Interim CEO of CIELivestock, working with 12 of the UK’s leading livestock research institutions and a large network of industry partners spanning the UK food supply chain. During Michael’s tenure, the partnership, together with the UK government’s innovation agency Innovate UK, invested close to £70 million in facilities and equipment to improve the UK’s capacity for livestock-related research.
Prof Thomas Jayne
Thom is the lead researcher of ‘Bridging demand and supply of private investment capital for small and medium agribusinesses’.
Thom Jayne is University foundation professor of agricultural, food, and resource economics at Michigan State University. He is a Fellow of the Agricultural and Applied Economics Association and a distinguished fellow of the African Association of Agricultural Economists.
His works span numerous topics, including food marketing and price policies, changes in land use patterns, sustainable intensification, employment, and rural transformation. He has mentored dozens of young African professionals and played a major role in building MSU’s partnerships with African agricultural policy research institutes.
Thom is adjunct professor at the Indaba Agricultural Policy Research Institute in Lusaka, Zambia, a board member of the Regional Network of Agricultural Policy Research Institutes in Eastern and Southern Africa, and was a founding co-director of the Alliance for African Partnership at Michigan State University.
In 2017, he became the flagship co-Leader of the CGIAR Policies, institutions and markets research program on economy-wide factors affecting agricultural growth and rural transformation. In 2019, Jayne is seconded to the African Development Bank, serving as special advisor to the president.
Over the past decade, he has received six research excellence awards, including the 2009 Outstanding Article Award in Agricultural Economics and the 2017 AAEA Bruce Gardner Memorial Prize for Applied Policy Analysis.
Dr Ousmane Badiane
Dr Ousmane Badiane, distinguished fellow of the African Association of Agricultural Economists, recipient of the Africa Food Prize in 2015 and member of the World Academy of Sciences, is the founder and executive chairperson of AKADEMIYA2063. He is a panel member of the Malabo Montpellier Panel, a sister programme of CASA which aims to guide policy choices that accelerate progress towards food security and improved nutrition in Africa.
Dr Badiane has over 30 years of experience, as academic and a practitioner, in international development. As the director for Africa at the International Food Policy Research Institute, he was instrumental in developing and guiding the implementation of the Comprehensive Africa Agriculture Development Programme.
As lead specialist for food and agricultural policy at the World Bank, he served as advisor to the vice president for Africa and originated projects with funding ranging from US$5 million to US$150 million. Between research and development finance, Dr Badiane taught economics of development in Africa at Johns Hopkins University’s School of Advanced International Studies for many years.
Dr Badiane received PhD in agricultural economics from the University of Kiel in Germany. He is also recipient of a doctorate honoris causa from the University of KwaZulu Natal.
Nick is a journalist with over 20 years of experience in media development and community mobilization across the global South working in French and English. He has delivered award winning results on dozens of projects, managing media networks and leading multi-country, multi-stakeholder teams. In the last ten years his work has been focused on senior management level communication in multinational institutions working at the interface of global development and research.
Nick works as CASA’s communication and learning lead. He is also CABI’s lead technical advisor for development communication and extension – the role supports strategy, learning and capacity development for research uptake amongst stakeholders in farming communities, line ministries and CABI member states.
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