Private Sector Investments and Financing Mechanisms for Fisheries and Aquaculture in Africa
Africa accommodates 14% of the world’s population, yet it only produces 5% of total and 2% of farmed fish.
The continent imports three million tonnes of fish annually worth USD 3 billion as it does not produce enough to satisfy its own internal markets. However, the continent could produce significantly more if existing resources were effectively harvested.
The underlying barriers to financing Small and Medium-Sized Enterprises (SMEs) in Africa can be classified into five types related to (i) risks involved; (ii) institutional development; (iii) policy and regulatory frameworks; (iv) technical skills; and (v) management capacity.
Apart from the need to boost SME capacities, there is a need to promote financial instruments in order to help reduce risks stemming from lack of transparency from some SMEs.
A number of financial instruments are recommended, including (i) guarantee funds; (ii) credit associations; (iii) micro-credit institutions; (iv) warehouse-receipt financing; (iv) financial leasing; (vi) institutional funding; (vii) second-tier intermediation; and (viii) expanding the supply of finance through the non-financial private sector.