The Agricultural Bank of Namibia (Agribank) and the Development Bank of Namibia (DBN) have signed a two-year memorandum of understanding (MoU) to cooperate and co-finance controlled environment agriculture activities in Namibia.
Controlled environment agriculture finance involves the provision of land and facilities that enable consistent productivity with infrastructure that reduces the impact of drought and variable weather, such as hydroponics, vegetable tunnels, green schemes and aquaculture.
“In terms of the MoU, the banks will also identify parallel opportunities of mutual interest. For instance, if DBN receives a request for direct financing for agriculture it will refer the request to Agribank. Agribank may similarly refer requests for financing for agri-processing facilities to DBN. Both banks may collaborate on finance for controlled environment agriculture.”
“The MoU recognises the joint interests of the two banks in promoting agriculture as a route to economic activity and food security. Agribank promotes agriculture through financing the entire agriculture value chain and related activities.
“DBN provides finance for agricultural infrastructure, manufacturing of agricultural inputs and provision of agricultural services, as well as enterprises that process agricultural produce and manufacture food.”
Agribank’s Chief Executive Officer Dr Raphael Karuaihe said “collaboration with other institutions to pool financing resources speaks directly to the Bank’s strategic initiative of targeting high impact projects to transform our economy and the agriculture sector in particular”.
DBN CEO Martin Inkumbi said DBN has identified controlled environment agriculture to focus on, as this industry inherently mitigates many of the risks usually associated with agriculture, and with limited background in agriculture, it greatly reduces the risk DBN has to mitigate and manage in the agricultural space.
This comes as in July Agribank and the Namibia Biomass Industry Group (N-BiG) signed a five-year MoU to cooperate in the development and amendment of financing products aimed at scaling up projects in bush control and biomass utilisation, as well as the sharing of data required to develop loan products that are responsive to market needs.
