At 2011 Ibrahim Forum, OPIC Discusses Investments in African Agriculture

The Overseas Private Investment Corporation (OPIC) showed its commitment to food security this past year through support of two private equity funds that target investments in agriculture in Sub-Saharan Africa. These investments aligned closely with concerns discussed at the 2011 Ibrahim Forum in Tunisia this past November. OPIC Executive Vice President Mimi Alemayehou participated as a panelist at the forum.

In mid-2011, OPIC committed $150 million to the Silverlands Fund, which focuses on acquiring large-scale, cash-generating commercial farms in the region. Though still in the fundraising stage, the Silverlands Fund strategy addresses several critical objectives for OPIC, which align closely with Ibrahim Forum concerns:

• Food security: Creating value by improving the operations of existing farms.
• Access to markets: Using the “hub-outgrowers” model to manage farm acquisitions. This model integrates neighboring subsistence farmers with an existing commercial farm. Commercial farms function as hubs where local farmers can receive crop inputs, education, and compensation for harvests. Partnerships with civil society also help provide training and technical support to these small-scale farmers.
• Natural resource governance: Assigning a socially responsible investment officer to focus on analyzing acquisition targets from a sustainability perspective. This officer will also ensure that companies continue to use social and environmental best practices post-investment. 

OPIC also committed $100 million to the African Agriculture Fund, LLC, which focuses on food and agriculture investments across Africa, particularly in food production. Its managers will work closely with local partners to target three sectors—farms and plantations, processing and animal feeds, and services and infrastructure (including inputs such as fertilizers, packaging and storage, among others)—with returns expected to range between 15 to 25 percent annually. 

The fund will target investment in Ghana, Kenya, Zambia, and Tanzania—all Feed the Future focus countries.

The 2011 Ibrahim Forum, an annual event organized by the London-based Mo Ibrahim Foundation, focused on agriculture and food security in Africa. Representatives from African institutions, civil society and the international development community—including OPIC—met to discuss how to meet regional needs as well as create wealth and move Africa from a hungry continent to a global player in agriculture.