Building a robust engine for agrifinancing

Over the course of the week, we examined credit policy, risk appetite, value chain structures, and sustainability frameworks. By the final day, our initial curiosity had sharpened into a more pointed critique of the structural divide in our systems.

The question was no longer what our visitors could learn from Kenya’s vibrant private markets, but whether their own examples had finally exposed the true cost of Kenya going it alone.

The answer begins with the numbers.

Kenya is home to roughly 56 million people. Morocco has 38 million, Egypt exceeds 116 million, and Turkey nears 86 million. Scale matters—it shapes how governments design policy and how deeply financial systems can reach into rural economies.

Agriculture accounts for 22 percent of Kenya’s gross domestic product (GDP). In Morocco, it is 10 percent; in Egypt, 14 percent; and in Turkey, just six percent. Kenya is the most agriculturally dependent of the four countries.

Employment data tells a sharper story: 45 percent of Kenya’s workforce depends directly on farming, compared with 30 percent in Morocco, 20 percent in Egypt, and under 15 percent in Turkey. For Kenya, agriculture is the most reliable shock absorber.

Yet dependency does not equal efficiency. Agricultural value added per worker in Kenya sits at roughly $800–$900 per year. In Morocco and Egypt, it is nearly $3,000, and in Turkey, it exceeds $7,000. The gap is stark. Kenya employs the largest share of its population in agriculture, but generates the lowest returns. This is not just a story of soil quality or rainfall alone; it is a story of capital.

This is where the conversation became most revealing. Egypt, Morocco, and Turkey operate with large government-owned agricultural banks. The institutions are not peripheral lenders.

They are the central infrastructure. They carry state backing. They deploy subsidised funding. They operate deep rural branch networks.

They anchor entire value chains.

Kenya’s Agricultural Finance Corporation plays a role. However, it does not function at comparable scale. It lacks deposit-taking capacity. Its balance sheet is limited. It cannot shape national credit conditions. It cannot drive system-wide transformation.

In North Africa and Turkey, agricultural finance is treated as strategic infrastructure. Credit is extended through permanent public channels. Interest rate subsidies reduce borrowing costs. Risk is partially socialised. Long investment cycles are supported. Structural change becomes financeable.

Kenyan farmers operate under different conditions. They borrow at market rates. They carry climate risk largely alone. They finance productivity upgrades within thin margins. The system relies heavily on private lenders whose capital has commercial return expectations and risk limits.

The result is a financing environment that asks the most vulnerable producers to carry the greatest volatility. Three structural functions are missing.

In our sessions, it became evident that without a government-led mechanism to lower the cost of capital, the Kenyan farmer effectively competes on an uneven playing field. We identified three critical areas where this institutional absence is felt most:

The absence of a robustly funded state vehicle in Kenya creates a “risk vacuum.” We identified three critical missing pieces:

Infrastructure over intervention: State banks in Egypt and Morocco anchor the entire value chain, from seed procurement to export.
Risk mitigation:

Subsidised rates act as a buffer against climate volatility—a luxury the Kenyan farmer, who pays market rates for risk, simply does not have.

Long-term transformation: While private capital seeks quarterly returns, state banks can fund the decade-long transition to climate adaptation and “green” farming.

In early 2025, the African Union adopted the Kampala Declaration, a successor to the Malabo and Maputo agreements. It isn't just a renewal of the pledge to allocate 10 percent of national budgets to agriculture; it is a “bold reimagining” of agrifood systems that aims to boost productivity by 45 percent by 2035.

We need an urgent, clear-eyed debate on the structural reforms required to transform Kenyan agriculture from a ‘backbone’ of survival into a world-class, competitive sector.

For Kenya, this is no longer a theoretical target. If the government is truly serious about meeting this 10 percent threshold, a significant jump from the current allocation of roughly three percent, we cannot simply pour more money into the existing pipes.

We need an urgent, clear-eyed debate on the structural reforms required to transform Kenyan agriculture from a "backbone" of survival into a world-class, competitive sector.

Whether that means recapitalising our own state vehicles or creating a "financial revolution" that de-risks private capital, the Kampala Declaration provides the deadline.

The question is whether we have the collective will to build the engine.

The writer is the Co-Chair of Financing Agri-Food Systems Sustainably Dialogues and Summit and the founder of Moving Frontiers, a consultancy specialising in green finance and bank advisory in East Africa