Tanzania, through the National Food Reserve Agency plans to introduce special food security bonds.
The initiative aims at raising around USD 490 million for refurbishing and upgrading the NFRA’s food storing capacity.
Apparently, the National Food Reserve Agency (NFRA) future plans is to purchase and store large quantities of grain to guarantee food security in the country.
The proposed food security bonds are set to be officially launched in May, 2025.
Money raised from the bonds will help the NFRA refurbish its current silos and build new granaries for harboring more than 3 million tons of food by 2030.
Dr Andrew Komba, is the NFRA chief executive officer who explained that the Authority has sought into selling bonds instead of applying for bank loans to fund the planned developments.
The NFRA Board Members, according to Komba, have unanimously voted for the food security bond idea, which gets to be implemented as soon as possible.
But the documents to that effect, comprising information memorandum (IM), and project information memorandum (PIM), are being processed through professional guidance from the National Bank of Commerce (NBC) which is the leading transaction advisor.
The papers will then be sent to the Capital markets and securities authority (CMSA) and the ministry of finance, as well as the planning commission for getting approval before official launching of the vital bonds.
“The plan is to empower the National Food Reserve Agency (NFRA) boost its grain and cereal storing capacity to be able to intake 3 million tons by 2030 and therefore ensuring ample food security for the country,” Komba maintained.
At the present, the National Food Reserve Agency (NFRA) has the capacity to harbor an average of 776,000 tons of grains and cereals procured through a total of 72 purchasing centers across eight regions.
The NFRA has branched in Arusha, Dodoma, Dar es Salaam (Kipawa), Njombe (Makambako), Songwe, Rukwa (Sumbawanga), Manyara, Shinyanga and Songea.
The authority also works to start purchasing over 2,000 tons of grains from large-scale farmers and traders, while the third tier includes buying from cooperative societies through which farmers aggregate their produce.