JICA and ECOM support smallholder coffee farmers and sustainable coffee supply chains

The Japan International Cooperation Agency (JICA) has signed a US$75 million loan agreement with ECOM Agroindustrial Corp. Limited (ECOM), a global agribusiness and processing group, and its subsidiary ECOM Agroindustrial Asia Pte Limited (EAA). Co-financed by the Asian Development Bank (ADB), this partnership marks a milestone as JICA implements its first-ever special working capital financing loan, marking a new step in strengthening cooperation with the world’s leading agribusiness groups to support the agricultural and food supply chain in Asia.

JICA’s loan aims to strengthen the supply chain, improve livelihoods and create more employment opportunities for smallholder farmers in the Asia- Pacific region. Specifically, the loan will support stable coffee procurement from more than 60,000 smallholder farmers in Vietnam, Indonesia, India and Papua New Guinea (PNG). In addition to supporting capital for coffee procurement from smallholders, the project also supports advisory services such as coffee certification support, piloting climate change adaptation models, and technical support for female farmers. These services contribute to enhancing climate resilience and promoting gender equality in the regional coffee value chain.

Vietnam is currently the second largest coffee producer in the world, with coffee bean exports accounting for 12.2% of total agricultural exports. However, increasing added value and improving farmers' incomes remains a challenge for Vietnam's agricultural sector. This loan is in line with the orientation of the "Agricultural restructuring project towards increasing added value and sustainable development" and the "5-year socio -economic development plan 2021 - 2025" of Vietnam, aiming to increase the added value of agricultural products through improving productivity, quality and production efficiency. At the same time, the loan is also in line with Japan's global development agenda. Specifically, the joint statement of the G7 Leaders in Apulia (Italy) in June 2024 set a goal of promoting public-private partnership initiatives to support the global coffee value chain and smallholder farmers in coffee-producing countries.

In addition, the loan also reflects the commitment of former Japanese Prime Minister Fumio Kishida, announced at the 2023 G7 Hiroshima Summit, to promote sustainable development through the "Agricultural Supply Chain Support and Food Security Enhancement Facility" (SAFE). With a capital of 1 billion USD, this program aims to address global food security challenges.

Mr. Yasui Takehiro, Director General, JICA Finance and Private Sector Cooperation Department, said: "We are honored to implement JICA's first working capital financing loan with ECOM Corporation, one of the world's leading agribusiness companies, which has built transparent, sustainable, and disaster-resilient coffee supply chains globally. We look forward to further expanding our financing programs to support similar supply chain business models in the future. This project is a testament to the close cooperation that JICA has built with ECOM and ADB. The project will contribute to strengthening the coffee supply chain and addressing challenges such as rural poverty, gender inequality, vulnerability to climate change, and the need for sustainable economic development opportunities in the region."

JICA continues to affirm its commitment to supporting inclusive and sustainable development initiatives in the Asia-Pacific region through promoting strategic partnerships and providing innovative financial solutions.

Source: https://htv.com.vn/jica-va-ecom-ho-tro-nong-ho-nho-trong-ca-phe-va-chuoi-cung-ung-ca-phe-ben-vung-222251001154122513.htm