By Nanai Laveitiga Tuiletufuga

A new “AgriBusiness Support Project�? providing business support services and financing to agribusinesses in Samoa was launched this week.

The project, an Asian Development Bank (ADB) initiative, aims to boost Samoa’s economic performance by addressing constraints that hinder increased trade and export.

The project will assist selected commercial agribusinesses to grow sustainably and will work with participating commercial banks to provide suitable financing services to partner agribusinesses.
In launching the seven year project funded with an ADB US$5 million dollar ($12 million tala) grant, Prime Minister Tuilaepa Lupesoliai Sailele Malielegaoi said that the target is for “agriculture to regain its importance as the backbone of the Samoan economy.�?

“Most agribusinesses in Samoa are small-scale, family owned with a total of 400 employees and mostly in agro industrial production,�? noted the Prime Minister.

“Despite being small in size and number, they provide employment and income earning opportunities for many small-holder families in Samoa as supplies for raw materials with stronger linkages with other sectors.

“Therefore, agribusiness development is essential for achieving the national strategic goals.�?

Tuilaepa also recalled that government had also invested in a similar undertaking some years back.

“These initiatives are not new,�? noted the government leader.

“We have tried similar funds before such as the Kula Fund supported by a number of development partners.

“Sadly there was hardly any success story as a result.

“This project has taken lessons from those previous experiences and therefore an appropriate project design has been put in place to ensure this will make difference.�?

The Prime Minister is also pleased to note that there are already qualified proposals under the facility.

“I’m sure there are many more in the pipeline,�? he continued. “The challenge now is for those qualified projects to work closely with the Project Management and the commercial bank involved ensuring the anticipated goals are achieved.

“On that note, I challenge our agricultural business community to take advantage of this facility and take on board whatever new idea it brings to make your venture perform better.�?

In August 2013, the agribusiness survey was conducted in August 2013 and it identified the need for a range of business support services.

And according to the Prime Minister there are several examples where businesses producing for local or export markets fail to achieve the standards to compete and satisfy market entry requirements.

The Common Weaknesses include;

I.    Lack of technical skills for equipment commissioning, production management, establish and manage supply chains, achieving food safety standards and accreditation;

II.    Inadequate export planning and marketing;

III.    Weak business and financial management;

And to address these constraints, the Samoa Agribusiness Support Project will support developing the agribusiness sector in three complementary areas;

I.    Cash Collateral facility – The project will provide a cash collateral facility to secure up to 50% of the amount lent to eligible agribusinesses for a first-time secured loan and up to 30% for a second-time secured loan.

II.    Repayable Supplemental Seed Capital – An eligible business may be able to receive a repayable supplemental seed capital up to a maximum of $100,000, if it qualifies for Bank finance.

III.    Business Support Services – Provided on a cost sharing basis with the Samoa Agribusiness Support Project, the project is designed to help business build their capacity in a broad range of areas which are critical to business success.

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