The SAGCOT Catalytic Trust Fund (CTF) is an innovative financing mechanism for SAGCOT created in response to the challenges of catalysing private sector investment in commercially and financially viable agribusinesses.
It targets smallholder linkages along the value chain and aims at providing the bridging financing for commercially viable agricultural businesses that incorporate and support smallholder farmers.
The CTF will combine both high developmental impacts with commercial viability in order to leverage investment in the agribusinesses value chain. The CTF will have two investment windows:
The Matching Grants Fund (MGF) and the Social Venture Capital Fund (SVCF).
The MGF is a $45M facility designed to catalyze investments in the SAGCOT region through $250K – $1.5M grants in capital expenditure,operational expenditure or technical assistance to improve the productivity and incomes of small-holder farmers leading to incorporation of small-holder farmers into commercial supply chains.
The SVCF is anchored by $20M of initial funding designed to make mezzanine debt and quasi-equity investments in earlier stage companies to facilitate the growth of emergent agribusinesses to commercial scale and develop greater interaction with Smallholders.
Raise the Profile and Image of SAGCOT CTF.
Market Creation for Smallholder Farmers’ Produce:
To create sustainable agricultural and agribusiness enterprises and attract private sector capital to invest in them with the aim of guaranteeing markets for smallholder farmers. In many cases the demand (or markets) lacks even when there is plenty of produce from and farmers struggle to find markets. Early-stage Project Development Capital is necessary to bring opportunities to the point where third party debt and equity can be attracted to invest in them.
CTF Financing Windows:
The primary beneficiaries for the Catalytic Trust Fund are smallholder farmers who engage in agricultural activities including crop farming, livestock keeping, fisheries, beekeeping and forestry.
Scope of CTF Services:
Currently, CTF activities are limited within the southern Agricultural Growth Corridor of Tanzania (SAGCOT) including Mbeya, Ruvuma, Iringa, Njombe, Rukwa, Katavi, Morogoro, Dodoma, Pwani and Dar Es Salaam.
Why SAGCOT CTF?
1. In some places of the SAGCOT, demand lacks and smallholder farmers struggle to find reliable and profitable markets for their produce.
2. At large the supply side is weak and smallholder farmers cannot meet the market requirements.
3.In most cases the cost of doing business prevents business linkages between the markets and the smallholder farmers from happening.
Thanks SAGCOT CTF "I was really impressed by the state-of-the-agricultural equipment available and more so by the staff who operate them and by the well-meshed flow of work. This was an eye-opener for us so kindly keep up the good work"