Together, the Dutch government and co-operative bank Rabobank are committing $80 million to kickstart the AGRI3 Fund to support the development of sustainable agriculture and forestry.
The contributions, which see both parties commit $40 million apiece, will mobilise commercial finance, which can be used to finance sustainable agriculture and accelerate forest protection.
The AGRI3 Fund was created by UN Environment Programme and Rabobank, together with partner IDH and supported by FMO, the Dutch entrepreneurial development bank, to mitigate climate change.
“The AGRI3 Fund provides a unique opportunity to contribute to forest protection and sustainable agriculture at scale, while also helping to transform the financial sector’s attitude towards sustainable investments,” said HE Sigrid Kaag, Minister for Dutch Foreign Trade and Development Cooperation.
The fund acts as a blended finance vehicle aimed at unlocking at least $1 billion in finance. It provides additional de-risking financial instruments and grants for technical assistance for food value chain actors, and, particularly, farmers.
“As a cooperative bank, we see it as our role to help our clients accomplish the required shift in the agricultural value chains,” says Wiebe Draijer, Chairman of the Managing Board of Rabobank.
“The Dutch government supporting our partnership is a more than welcome complement. Together with our contribution, I’m utterly convinced these combined contributions will spur this shift.”
Now that the Dutch government has approved the $40 million grant, the AGRI3 Fund will be up and running in the first half of 2020. Mirova Natural Capital, FOUNT and Cardano Development will act as investment advisors.
The fund will be open to participation by commercial banks aiming at sustainable agriculture and forest conservation.