An alliance of West African nations seeking to help small farmers cope with climate change are helping them adopt agricultural practices that are also attracting a growing share of investors.
The Economic Community of West African States is raising $80 million through its Investment and Development Bank, according to Afrik21. Helping farmers adjust to climate change is one of the issues raised by African delegates at the COP 25 meeting in Madrid. Africa is especially susceptible to global warming as its agriculture largely depends on rainfall due to the lack of irrigation.
“Africa needs to move towards market-based innovative financing models to achieve a strong, united, resilient and globally influential continent,” said Mohamed Beavogui, the United Nations assistant secretary and general manager of African Risk Capacity, in a press release.
Private investments in West African agtech startups are small and growing steadily. Venture capitalists spent a record $7.65 million this year, 58% higher than last year. A large chunk of the capital comes from companies outside Africa, while local companies typically raise less than $1 million, according to PitchBook data.
New York-based WorldCover, a company provides farmers agriculture insurance, raised $6 million in series A funds in February, the largest fundraising in the space this year. Farmcrowdy, a digital farming platform from Lagos, scored $1.5 million seed funding, the highest for West African agtech startups.
- ECOWAS set goals for its agricultural efforts, including “reduction of food vulnerability and the promotion of sustainable access to food,” and proper governance.
- Y combinator was the most active investor in the space, investing $6.54 million in five deals in the last five years, including WorldCover and Abuja, Nigeria-based Thrive Agric.
- Chinese companies have invested in at least 115 agricultural projects in Africa, according to state media Xinhua. Earlier this month, the China-Africa Cooperation in Agriculture was held in Southern city Sanya to promote cooperation between Africa countries and China’s Hainan province, an island in the tropic zone that shares similar climate with some African countries.