A new study reveals the willingness of the Malian diaspora to invest more in agricultural SMEs if given the right support: IFAD can harness technical expertise and generous EU funding
Paris, October 28, 2022 – The Malian diaspora is willing to invest in the development of small and medium-sized enterprises (SMEs), especially to develop the agricultural sector, if they can access the right training, information and financial products, according to a new report funded by the European Union . Commissioned by the United Nations International Fund for Agricultural Development (IFAD) and developed by Red Mangrove Development Advisors and Adept, the Africa-Europe Diaspora Development Platform.
The study was presented today at an event held in Paris, organized by CEFOM, one of the most important players in France-Mali cooperation, to raise awareness of such investments among French development aid actors and diaspora leaders, and highlight new forms of diaspora. commitment to the maintenance of peace and development in these difficult times.
“Both collectively and individually, the Malian diaspora is increasingly investing in search of sustainable social development impacts and strong financial returns, but they need support in terms of financial education and credible investment opportunities,” said Frédéric Ponsot, IFAD’s expert on remittances and investments from the diaspora. .
As food systems are shaken to the core by the global food crisis, low-income countries like Mali are realizing that years of underinvestment in developing their agricultural sector and rural areas are not only endangering food security but their entire national security. The high dependence on food imports is pushing people into hunger and poverty, while causing serious social unrest, displacement and political instability.
Investments in agriculture can prevent these effects, since the primary sector is a proven engine for economic growth and development. In sub-Saharan Africa, growth in agriculture reduces poverty up to 11 times faster than growth in other sectors, according to IFAD.
“The EU remains Mali’s main partner on migration-related issues. Supporting the efforts of the Malian diaspora towards the socio-economic development of the country remains our priority, as these people living abroad make a significant contribution to the Mali’s economy and overall development,” said Sarah. Mokri, Program Manager for employment, the diaspora and technical and professional education and training of the European Delegation in Mali.
With the support of the European Union, through a grant of €1 million, IFAD is implementing the creation of pilot investment vehicles that provide a safe ground and information to harness the potential and appetite of the Malian diaspora to invest in the agricultural sector. from your country of origin.
“Everyone thinks of their own garden. But if you don’t have a certain level of education, you can’t think why investing in another business would make sense,” said a member of the Malian diaspora.
Dedicated products and specific IFAD-supported information will help harness overall diaspora investment potential, estimated at €9 million per year, with support from Investisseurs et Partenaires (I&P) and FADEV. Both companies practice private capital in the country and own minority shares in companies with high potential for social and environmental impact.
Through a grant from the European Union implemented by IFAD, FADEV is supporting yirimali, an investment solution product that offers the Malian diaspora the possibility of financing micro-enterprises that family members are running at home. In parallel, I&P is supporting a group of Malian diaspora investors who have established Capital Ciwara, a company to invest and provide technical support to high potential SMEs in Mali. Both activities are expected to generate not only investment but also 90 stable jobs.
The study: the potential and role of the diaspora
There are four million Malians living abroad; Europe is home to 250,000 Malians, more than half of whom live in France. The diaspora is a vital source of income for the country: last year, Malians living abroad transferred USD 973 million to the country, equivalent to five percent of Mali’s GDP.
In addition to sending remittances to relatives, most of which are meant to make ends meet, members of the Malian diaspora have historically been involved in social and economic development through various diaspora organizations.
IFAD study Investment practices and preferences of the Malian diaspora in their country of origin, funded by the European Union, revealed the investment practices and preferences of the Malian diaspora based in Europe, as well as their impact on Mali’s economic development. The research included 90 organizations and 210 individuals based in France, Spain and Italy, the European countries with the largest Malian communities.
The study findings recommend providing the diaspora with information on promising investment sectors and solutions, as well as specific training on investment and business creation, and developing attractive investment solutions and supervising and insuring their investments from a regulatory point of view.
IFAD builds on its experience gained from the successful implementation of other projects to encourage diaspora investment. In Somalia, a similar venture helped accelerate Somali diaspora investment in SMEs in their home country and sparked interest from the domestic financial sector to develop activities aimed at diaspora investment in the local economy. The project financed 14 companies, leveraged USD 2.3 million and diaspora members invested USD 1 million, generating indirect benefits along the value chain and creating jobs.
Note to editors:
**The Coordination of French Elected Officials of Malian Origin (CEFOM). Founded in 2006, CEFOM works **in socio-economic development, cultural promotion and peace between France and Mali. It is an association made up of about 70 French elected officials of Malian origin, coming from more than 62 local authorities at all levels, which seeks to strengthen ties between these two countries.
**I&P **has raised more than 210 million euros and has supported more than 170 companies on the continent. With its local funds, it finances and supports SMEs and start-ups with high growth potential and needs that range between 30,000 and 300,000 euros and an average of 100,000 euros.
**FADEV **is a cooperative investment company headquartered in Montreuil, France. For over 10 years, he has been involved in solidarity finance – investing in and supporting the development impact of Very Small Enterprises (VSEs) in West and Central Africa. Since its creation, the company has raised and invested €1.5 million in 27 African companies. FADEV targets VSEs and certain small and medium-sized enterprises (SMEs) in the meso-finance segment, ranging from EUR 15,000 to EUR 125,000. FADEV operates in Cameroon, Côte d’Ivoire, Senegal and Mali. Mali is now his first country portfolio.
Press release No.: FIDA/54/2022
*IFAD is an international financial institution and a specialized agency of the United Nations based in Rome, the center for food and agriculture of the United Nations. IFAD invests in rural people, empowering them to reduce poverty, increase food security, improve nutrition and build resilience. Since 1978, we have provided $23.2 billion in grants and low-interest loans for projects that have reached approximately 518 million people. *
*A wide range of broadcast-quality photography and video content of IFAD’s work in rural communities is available for download from our *Image Bank.
Media contact
Alberto Trillo Barca
Communications Officer, Global Media
a.trillobarca@ifad.org
Bakary Coulibaly
Communication Analyst, West and Central Africa Division
ba.coulibaly@ifad.org
