Recent studies have shown that investing in agriculture is one of the most cost-effective strategies to reduce poverty and hunger. The proposed Climate-friendly Agribusiness Value Chains Sector Project (the project) will invest in pro-poor and inclusive agricultural value chains in Cambodia. The project will enhance rural household incomes and agricultural competitiveness by (i) providing improved critical production and post-harvest infrastructure, (ii) reducing energy costs by promoting bio-energy use and sustainable biomass management, and (iii) offering targeted agribusiness policy and capacity support services. Sector lending is proposed, as it will enable improving agribusiness policies and supporting reforms while financing investments in multiple subprojects. Cambodia has experience in sector modality in terms of identifying and carrying out subprojects during project implementation period and meets criteria for sector lending, as it has (i) agricultural sector development plan, (ii) reasonable institutional capacity to implement the plan, and (iii) suitable policies applicable to the sector. Furthermore, capacity building will be integral to the investment.
The impact will be increased productivity, quality, value addition and rural household income in the project areas. The outcome will be development of climate friendly agribusiness value chains. The project will have three outputs. Output 1 (Critical agribusiness value chain infrastructure improved) will include rehabilitating and modernizing critical infrastructure (e.g. farm roads, water storage and small scale irrigation systems, drying, storage, milling and packaging facilities, by the public and private sectors. These activities will reduce post-harvest losses and improve efficiency. Output 2 (Bio-energy use and sustainable biomass management expanded) will include installation of agricultural waste to energy infrastructure (hard and soft) such as bio-digesters, bio-fertilizer facilities, and improved cook stoves for effective biomass management. These activities will increase price competitiveness by lowering production costs. Output 3 (Agribusiness policy and capacity support services strengthened) will include agribusiness policy/regulatory development, identification of opportunities for linking private sector companies to farmers or farmers' groups, provision of information on climate-friendly agriculture and resource efficient practices, harmonization of standards, and capacity building for productivity and quality improvement and reduction of post-harvest losses, marketing, potential PPPs, and financing options. It will also include consultant's support and institutional strengthening for subproject preparation, procurement, financial management and safeguards, and diffusion of knowledge and technologies for agribusiness value chains.
Green Climate Fund US$ 30.00 million (Grant)
Green Climate Fund US$ 10.00 million (Loan)
Ministry of Agriculture, Forestry & Fisheries
# 40 Norodom Blvd.
Phnom Penh, Cambodia
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