African coffee now has its institutional support fund

The Inter-African Coffee Organisation (IACO), the International Coffee Organisation (ICO) and the Centre for Agriculture and International Biosciences (CABI) jointly launched the African Coffee Fund on Tuesday 5 November in Nairobi, at a donor conference.

First raised in February 2018 by the OPCW during the 57th Annual Assembly of African Coffee, the fund, known as the Africa Coffee Facility and led by Afreximbank, will have a capital of US$950 million. An « ambitious » fund according to Fred Kawuma, Secretary General of the OPCW, whose objective will be to « attract investment from the private and public sectors to transform the African coffee industry from a subsistence approach to a commercial or entrepreneurial approach, where millions of smallholder coffee farmers will see their livelihoods significantly improved ». In fact, the fund’s promoters aim to increase – without specifying a deadline – « 40% of quality exports », or a value of $5 billion per year. This margin for growth primarily reflects Africa’s current low weight in the world coffee market (10%). Nevertheless, the sector represents « a source of income for more than 12 million households in Africa […] and a significant share of tax revenues in several countries, » said the OPCW in its statement.

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The organization also states that during the 10-year life of the investment vehicle, $500 million will be allocated to building a sustainable coffee supply, $100 million to improving demand, trade links and investment, $200 million to implementing climate change adaptation practices and environmental resilience, and $150 million to knowledge management and dissemination. According to data published by the OPCW, Ethiopia has the highest average annual value of coffee exports ($762.8 million) among African countries, followed by Uganda ($468.4 million), Kenya ($229.5 million) and Tanzania ($129.2 million). The conference organizers also commended the efforts of Kenya, the host country, which this year allocated $30 million to support its producers.