Component 3 – Agriculture Development and Commercialization (US$85 million, including US$36 million IDA equivalent and US$10 million commercial financing, with remaining funds expected from other sources mobilized by GoM (US$39 million)

  • This component will aim to improve productivity and agriculture commercialization for 30 Smallholder Owned Commercial Farm Enterprises cultivating roughly 21,000 ha of land in the Program area.
  • Agriculture blocks are a necessary pre-condition to enable both the physical investment in the land to transform it into irrigated land and for the development of the SOCFEs as viable businesses.
  • SVTP-2 will finance establishment of agriculture clusters to improve market access and coordination of actors.
  • The project will finance the development of public-private stakeholder platforms for the clusters which will convene regularly, develop a vision, map out issues that foster development, set out priorities, and develop strategies for the development of value chains. 
  • SVTP-2 will have diversification to commercially viable crops as a major priority in planning for agriculture block operation. 
  • IFC will support the private sector to encourage greater participation in the SVTP. 
  • SVTP-2 will finance the capacity building of around 30 new (to be established during SVTP-2 implementation) and 14 SVTP-1 SOCFEs through recruitment of service providers, consolidating and registering land into customary estates, preparation of business plans, and coordination of production.
  • SVTP-2 will finance the recruitment of Specialist Service Providers (SP) for each SOCFE to link them to off-takers and agricultural clusters, assist the farmers to produce goods that satisfy market standards and value addition, and strengthen institutional capacity of SOCFEs through preparation of technically and financially viable SOCFE business plans. 
  • The SPs will be responsible for the identification of commercial partners/off-takers to provide technical advice, training and mentoring on the essentials of farm business management such as agronomy, crop husbandry, value chain development services, and marketing to enable SOCFEs to function as viable and profitable commercial farms.
  • The project will provide funds to support SOCFEs with the implementation of business plans. Agricultural Block Capital Investments and Operational Support (US$48 million plus US$10 million private financing). 
  • SVTP will collaborate with the Southern Africa Trade and Transport Facilitation Project and the Southern Africa Trade and Connectivity Project which will ensure that expected increased volume of products can be transported to markets in the country and abroad.
  • The project will finance the recruitment of an expert team of independent evaluators to assess business plans prepared by SOCFEs.
  • The project will finance the development of agricultural farming models that will adopt climate resilient technologies and promote alternate crops to protect farmers from frequent extreme weather (floods and droughts) and market shocks.