Sustainable Investments in African Agriculture

Rural areas are home to 75% of the world’s poor and are characterized by severe decent work challenges: high rates of un- and underemployment, high levels of temporary or casual employment, limited social protection, prevalence of child labour especially in agriculture, and in general, poor working conditions. However, rural areas hold a considerable potential for economic growth, productive jobs and improved livelihoods.

Striving to unleash this potential of agriculture on a sustainable basis, the German government—together with Deutsche Bank and KfW—established the Africa Agriculture and Trade Investment Fund (AATIF) in 2011. The Fund is an innovative public-private partnership dedicated to uplifting Africa's agricultural potential for the benefit of the poor. It aims to improve food security and provide additional employment and income to farmers, entrepreneurs and labourers alike by investing patiently and responsibly in efficient local value chains.

Moving forward

Since July 2012, the ILO and the Fund have been collaborating through a 3-year public-private partnership to improve implementation of the social and development commitment of the Fund (see KfW press release). As part of the partnership activities, the ILO has started developing and testing a methodology for assessing the social compliance of investments. Currently, the ILO and UNEP are finalising an agreement to support and validate the environmental side of the assessments.

Starting in 2013, the ILO together with an external research partner and KfW will establish the developmental impact of the approach: combining social safeguard guidelines with a compliance mechanism and technical assistance for decent work in agricultural investments in Africa.

The experience of this public-private partnership will eventually benefit other financial institutions that want to engage in sustainable investments in African agriculture and build their capacity on how to detect social shortfalls and what alternatives have been successful to bring investments into compliance.