The Mozambique Cereals Institute (ICM) and Gapi reinforced, this week, with another 36 million Meticals the capacity of the Credit Line for Agricultural Commercialization (LCCA), increasing to around 310 million Meticals the availability of this instrument to finance the acquisition and resale of surplus agricultural production.
“The reinforcement of this line aims to strengthen the capacity of traders to acquire the surplus production of our peasant population” – said Mohamed Valá, ICM General Director, adding that “considering the growing demand, we are aware that the amount still does not cover the needs, but we continue our efforts to mobilize more resources for the reinforcement of this line, which already impacts life in rural areas, especially on the income of producing families.”
Valá welcomed the support of the Ministry of Industry and Commerce and the partnership with Gapi, emphasizing that “making financial services available in rural areas, prioritizing our potential beneficiaries, who are the actors of agricultural commercialization, will leverage economic inclusion and financial inclusion, and consequently improve the lives of our rural population.”
For Adolfo Muholove, president of the Executive Committee of Gapi, an institution that contributed 31 million in this recent reinforcement of the LCCA, “the main objective remains to ensure the availability of funds for traders to strengthen their technical and financial capacity to boost agricultural marketing, in order not only to benefit families, but also to feed the agri-food industry. Another major impact of this line is its contribution to the development of the agricultural value chain, with emphasis on increasing production and improving food security.”
The two institutions since the inception of the LCCA have linked funding with capacity building activities for stakeholders to improve their management skills. In the capacity building programs for traders, the central theme is that “credit is responsibility and must be repaid.”
“Our message has been getting heeded, hence we have only 1.5% default,” assured Amiro Abdula, Director of Financing at Gapi.
Since its launch, the LCCA has financed, until June of this year, the commercialization of about 75,000 tons of various products, with emphasis on corn, beans, sesame, and soybeans, throughout the country, prioritizing the provinces of Cabo Delgado, Niassa, Tete, and Manica.
The Special Credit Line to Support Agricultural Commercialization (LCCA) is an instrument that aims to strengthen the rural trade network to stimulate the production and valorization of agricultural surpluses, and to integrate the family sector in the food and production factors market.
Gapi is working on the extension of these financial services, supporting the creation of producer organizations that operate as aggregators to achieve greater scale and sustainability of these operations. For greater inclusiveness, Gapi is also involved in projects to create micro-finance entities linked to rural agricultural markets.
