CDC Group has announced a US $100 million debt commitment to ETG, an agricultural conglomerate connecting smallholder farmers to global markets through its operations in 48 countries worldwide.
The debt commitment will support the growth of ETG’s food and agriculture business, and it will help ETG strengthen food value chains by expanding its logistic networks, boosting agriculture yields, and the production of staple foods such as grains, rice, and cocoa.
ETG has long-standing relationships with over 550,000 smallholder farmers across Africa, it helps to significantly improve their livelihoods by providing consistent future demand for their produce through access to regional and global markets; this enables their business to grow and ultimately improve their way of life.
Operating a two-way logistics model, ETG drops fertilizers at the farmgate – improving crop quality – and then picks up the farmers’ produce to sell on the global market.
Furthermore, farmers supplying produce to ETG benefit from training, expert farming support, and mechanization which all lead to significantly improved yields. Its team of agronomists guides farmers on the production of higher-margin cash crops and crop rotation to ensure year-round stability.
As part of the funding facility, CDC will support ETG’s ongoing efforts towards implementation and alignment with international Environmental & Social standards with an enhanced focus on supply chain risk management, safeguarding work, and procedures.
“We are extremely grateful for the support of CDC Group. ETG is excited to expand its existing presence in various markets and further offer support to communities across our extended footprint,” Anish Jain, Chief Treasury Officer of ETG, said.
Given CDC’s focus on ESG frameworks, this facility marks a solid achievement for ETG to further strengthen its world-class supply chain and mitigate risks in its operations. Including this CDC capital commitment, ETG has one-third of the loan book linked with ESG and Sustainability standards.”
“Agriculture and rural developments are vital engines that are accelerating Africa’s economic transformation and meeting global food and health needs,” Tony Morgan, Managing Director & Head of Private Equity and Corporate Debt at CDC Group, said.
The food and agriculture sector is a fundamental part of the development agenda, increasing the availability and accessibility of agricultural goods brings more nutritious food to the market, with the longer-term goal of improved food security and nutritional outcomes in countries where we invest.
Emma Wade Smith OBE, Her Majesty’s Trade Commissioner for Africa at the UK Department for International Trade, said: “Improving access to markets for Africa’s farmers is critical to food security, across the continent and the world. It is also essential to sustain and improve the livelihoods of Africa’s farmers and their families.
The positive impact of this CDC investment goes well beyond the hundreds of thousands of smallholder farmers – many of whom are women – whose lives will be directly and positively affected. It also speaks to the UK Government’s ambition to be Africa’s investment partner of choice, providing support for the long-term that sustains jobs and enables technology-driven improvements to the way we do business together.”
At $100 million, the capital we’ve provided to ETG marks one of the largest corporate debt investments in CDC history.