The project seeks to design and implement a credit guarantee scheme to enable smallholder farmers to gain access to commercial loans necessary to purchase and install improved coffee processing equipment and to enable the cooperative societies to more effectively purchase and export the resulting high quality coffee produced through the improved processing practices. The project addresses the emerging challenges to sustainable production of high quality coffee by promoting good agronomic and processing practices. The accelerated flow of market information to all players in the coffee chain promotes good governance of the cooperatives. Primary beneficiaries are the farmers who benefit from technical and credit support to purchase inputs and farm equipment for coffee production. CABI coordinates grant based activities whilst Rabobank coordinates the loan operations and also provides co-financing. ILLYCafe is also expected to provide co-financing to the project. The local participating banks (Cooperative Bank of Oromia and the Banque Populaire du Rwanda) will benefit from capacity building in credit assessment and management. The cooperatives will also be able to export their coffee directly to the consuming markets.
Key project outputs/results to date are summarized as follows:
1. The process of identifying the cooperatives in both Ethiopia and Rwanda is completed. This exercise was undertaken in a participatory manner based on criteria agreed between the key stakeholders in the project including the participating banks.
2. Capacity building of banks – Training of the bank officers in at the Cooperative Bank of Oromia (CBO) in Ethiopia and the Banque Populaire du Rwanda (BPR) has been completed and an evaluation report prepared. Final hands-on support will be provided by Rabo Development once the banks start processing loan applications by the cooperatives.
3. Capacity building in agronomy -The agronomic training has been initiated in Ethiopia. This involved the Training of Trainers (ToT) in both the Oromia and the SNNP regions of Ethiopia. In total, 105 participants drawn from eight Zones and 11 Woredas of Oromia and SNNP were in attendance. The participants included coffee agronomists, coffee marketing and cooperative promotion experts at zonal and woreda levels, supervisors/development agents and cooperative promotion agents at field level. The trainers were drawn from CABI, MoA, Regional Cooperative Promotion Bureau and Agricultural Development Bureau. Similar training was organised in 2012 for Rwanda in collaboration with NAEB and other NGOs involved in capacity building of coffee cooperatives.
Further information can be obtained from the PEA’s website www.cabi.org
Common Fund loan: USD 2,000,000 (Loan Guarantee)