Agricultural producer based organizations and companies in East Africa could find it easier to prove their credit worthiness in the near future, once a pioneer rating assessment in the region has been implemented.
EADD has entered into a partnership with SCOPEInsight a rating organization in Agriculture, Aquaculture, Dairy/livestock and Forestry. Through the partnership, SCOPEInsight will conduct an independent assessment of the dairy cooperatives and companies, currently working with EADD. EADD, has been supporting selected (68) dairy producer companies and cooperatives in Rwanda, Uganda and Kenya.
The assessment will determine whether the organizations will be in a position to sustain their operations beyond EADD, based on an objective rating score. Using a well tested Rating tool, the assessment will rate the organizations in terms of sustainability and their creditworthiness. The producer companies can then use the results to demonstrate to financial institutions, investors, and other stakeholders their credit worthiness as they negotiate financing.
The objective is to expand access to markets and scaling the productivity and efficiency of the beneficiary dairy cooperatives. “The philosophy within EADD is that you only support to a certain point” says Mr. Moses Nyabila, Regional Director EADD. “Once the producer organisations organisations are profitable, can pay their members regularly and provide quality and quantity guarantees, they are considered to be mature enough to exit the EADD nest”, explains Mr. Nyabila.
The SCOPEinsight profile offers insight into the maturity of the dairy producer organizations. The partnership will start with profiling 28 dairy producer organizations in Kenya and Uganda before the end of May 2012. Later on this year, the remaining 40 producer companies will be profiled as well.
Mr. Lucas Simons, CEO of SCOPEinsight, is delighted about the partnership with EADD. “It is vital that we make our food production systems more productive and sustainable. For this producers need access to market and access to finance. We see that rating is a very effective tool to link producer organizations to business partners and banks while lowering the risks. We believe that EADD takes a leadership position in this respect and we are eager to support them in their mission”
EADD will use the results of the on-going assessment to inform the project’s activities for a planned extension in Ethiopia and Tanzania.