USAID in partnership with Incofin, GAIN and the Swiss Agency for Development and Cooperation (SDC), has launch the Nutritious Foods Financing Facility Fund (N3F). The Fund aims to boost the production and distribution of safe and nutritious foods across Sub-Saharan Africa, impacting the lives of millions of people in the region.
The fund has an initial target of Ksh. 3.9 billion (USD 30 million) and first loss capital of approximately Ksh. 1.4 billion (USD 11 million) already secured. The N3F is an open-ended debt fund which will invest in SMEs focused on improving nutrition in Sub-Saharan Africa. Its blended structure combines public and private donor funds to attract capital from private investors.
It will support SMEs along the nutritious food value chain to generate more than half a billion additional servings of nutritious food. This will benefit more than 7 million people in Sub-Saharan Africa, over the next decade.
The N3F’s comprehensive investment strategy is poised to greatly enhance access, affordability, and desirability of nutritious foods for millions of lower-income individuals, with a special emphasis on women and children. Beyond financial investments, N3F is committed to providing technical assistance (TA) for SMEs, with GAIN delivering this under a grant provided by the Netherlands Ministry of Foreign Affairs. GAIN will also lead the dissemination of knowledge and insights from the validation of metrics for targeting nutrition-sensitive investments from the N3F, a first-of-its-kind nutrition fund.
According to data from the World Food Program, malnutrition affects over one in three people in the world. The challenge of accessing nutritious food is most pronounced in Africa, where most food comes from SMEs, especially that which is consumed by the poorest and most vulnerable people. In the current world, 80% of Africans cannot afford a healthy diet.
Speaking on the fund, Patrick Webb, Chief Nutritionist at USAID stated, “Even in Africa, most consumers do not produce the food that they eat. They purchase it from local markets or from small shops that are supplied by Small and Medium-sized Enterprises working across the food system. These are mostly locally-owned businesses that process, transport and transform foods of all kinds. I hope that many more donors will join hands with this exciting and innovative initiative.”
On her part, Roberta Bove, Senior Lead Innovative Finance at GAIN said, “Through N3F we aim to pioneer making nutrition central to food systems. For too long, investment in food and agriculture in Africa has neglected healthy dietary needs, focusing on crops for export or staple foods. We aim to show it is possible to support the entrepreneurs who deliver most of the food to local consumers, and to make diets healthier.”