Financial Landscape Analysis for Senegal
This Financial Landscape Analysis (FLA) explored financial barriers faced by agribusiness in Senegal and avenues to make funding more accessible for investments in services, such as cold chain logistics, as part of a broader effort to improve food safety. The study focused on small- to medium-sized local food businesses, referred to as growing food businesses (GFBs), and ensured the inclusion of women and young entrepreneurs. The study identified the main players and institutions, the current financing modalities and the regulatory environment of financing companies; their constraints in accessing finances; and matched those with the needs, gaps, risks and alternatives of the formal or informal financial system. The study also identified sustainable mechanisms for access to finance and investment throughout the value chains (production, processing, cold chain, transport and storage) and suggested alternative or improved solutions for providing investment, training and capacity building services to GFBs.
Constraints to private sector development in this area include limited access to arable land and irrigation facilities; difficult access to finance, compounded by inadequate agricultural insurance mechanisms; and weak links, especially for processing infrastructure, between smallholder farmers and commercial buyers. Senegal can also improve the quality of basic services offered to exporters. Despite those surmountable constraints and the small size of agribusiness, the sector is growing, and growing food businesses (GFBs) need investment/financing to improve food safety practices.
The Feed the Future Business Drivers for Food Safety (BD4FS) project, funded by USAID and implemented by Food Enterprise Solutions (FES), is a multicountry effort that works with agribusiness players to codesign and implement incentive-based strategies to fast track the adoption of food safety practices in local food systems. One of the missions of BD4FS is to provide technical assistance and capacity building to GFBs for them to become drivers of food safety. Recognizing the financing challenges for GFBs, BD4FS initiated an FLA in Senegal to map its financial landscape in relation to GFBs working in the perishable food value chains, particularly the processing subsector