Over 51,000 households in Benin will benefit from a US$104.4 million project that aims to reduce rural poverty through a value chain approach, which can contribute to reducing food imports and improving the competitiveness of small farmers’ products in national and global markets.
The financing agreement for the Agricultural Development and Market Access Support Project (PADAAM), which was signed in Rome today by Gilbert F. Houngbo, President of IFAD, and Romuald Wadagni, Minister of Economy and Finance of the Republic of Benin, includes a $15.5 million loan and $15.5 million grant from IFAD.
The project will be cofinanced by the OPEC Fund for International Development ($10 million), the private sector ($5.6 million), financial institutions ($1.3 million), the Government of Benin ($9.8 million), and the beneficiaries themselves ($3.3 million). The financing gap of $43.4 million will be covered by other sources of financing or by the next IFAD resource allocation cycle for Benin.
Agriculture is a key sector for the economy of Benin. It accounts for 70 per cent of employment, 32.7 per cent of GDP and 75 per cent of export revenues. The new project will increase production and improve the marketing of rice, maize and cassava to contribute to the Government’s strategy of reducing food imports and fostering value addition for enhanced competitiveness.
PADAAM will be implemented in the departments of Atlantique, Collines, Couffo, Mono, Ouémé, Plateau and Zou. It aims to create jobs and generate income for rural people living in the project areas. At least 40 per cent of the project’s participants will be women and 30 per cent young people. In addition, it will focus on de-risking agriculture through adaptation to climate change and putting in place an insurance scheme that will target primarily smallholder farmers.
Since 1978, IFAD has financed 13 rural development programmes and projects in Benin at a total cost of $467.1 million, with an IFAD investment of $247.2 million. These projects and programmes have directly benefited 469,400 rural households.