Ghanaian investment firm Databank Financial Services has announced the launch of the Africa Agricultural Fund (AAF), a private equity fund established to finance the agricultural sectors of economies across Africa.
The fund is directed at small and medium scale entrepreneurs in agribusiness who have prospective businesses ideas and the required skill set.
“Agriculture is important and we can do all that we want but if we don’t tackle agric and add value, we stand the chance of losing out,” Ken Ofori-Atta, Databank’s chairman said.
With an initial capital investment of $30 million, the investment firm has now added $6 million to the fund with an average investment of $250,000 and $4 million in each country per time.
Although Databank has invested in a bakery in Nigeria, a fertilizer plant in Magadascar and a beverage company in Zambia, it is yet to channel part of the funds to any venture in its home country, Ghana.
This is a strategic decision by the bank who intends to first invest in countries around the continent before looking inwards to familiar territory.
According to the Chairman, the reason for this is to “make the fund pan-African in character in line with its purpose.” He added that it was important for people to know that the bank was not just indigenous, but pan-African.
With more private-led investments in Africa’s agricultural sector, there will be increased productivity in the agricultural value chain, which will ultimately improve the continent’s revenue from the agribusiness both locally and internationally.