Senegal’s agricultural sector is facing an annual funding shortfall of 364 billion FCFA ($611 million), as revealed in a recent study presented by the International Finance Corporation and APIX SA in Dakar. This gap highlights the disparity between available financing and the needs of producers in the sector, which plays a crucial role in job creation and poverty reduction.
Various constraints, such as production and marketing risks, raw material supply issues, and financial actors’ risk appetite, contribute to limited access to funding. Financial institutions also struggle to adequately fund the sector due to a lack of specialized personnel, adapted procedures, and expertise.
To address these challenges, a concerted effort is needed to provide sustainable financing solutions for agricultural enterprises. Formal agri-food processors alone require 184 billion FCFA ($309 million) in financing, excluding the needs of informal processors.
Improving financial literacy, reducing risk aversion, and enhancing access to long-term resources are crucial in unlocking opportunities for small and medium-sized agricultural enterprises. The Senegalese government is working on new strategies to tackle this funding issue and create investment opportunities in key sectors like agriculture.