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

The Japan International Cooperation Agency (JICA) has signed a $75 million loan agreement with ECOM Agroindustrial Corp. Limited (ECOM), a global agroindustrial trading and processing corporation, and ECOM Agroindustrial Asia Pte Limited (EAA), a subsidiary of the corporation. Co-financed by the Asian Development Bank (ADB), this partnership marks a significant milestone as JICA implements its first special working capital loan, paving the way for enhanced collaboration with leading global agroindustrial corporations to support agricultural and food supply chains in Asia.

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

Vietnam is currently the world's second-largest coffee producer, with coffee bean exports accounting for 12.2% of its total agricultural export value. However, increasing added value and improving farmers' incomes remains a challenge for Vietnam's agricultural sector. This loan aligns with the direction of Vietnam's "Agricultural Sector Restructuring Plan towards Increasing Added Value and Sustainable Development" and the "5-Year Socio -Economic Development Plan 2021-2025," aiming to increase the added value of agricultural products through improved productivity, quality, and production efficiency. Simultaneously, the loan is also consistent with Japan's global development agenda. Specifically, the joint statement of G7 leaders in Apulia (Italy) in June 2024 aimed to promote public-private partnership initiatives to support the global coffee value chain and smallholder farmers in coffee-producing countries.

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

Mr. Yasui Takehiro, Director of the Finance and Private Sector Cooperation Division of JICA, stated: "We are honored to launch JICA's first working capital loan with ECOM, one of the world's leading agricultural businesses, which has built transparent, sustainable, and disaster-resilient coffee supply chains globally. We expect to further expand 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 by fostering strategic partnerships and providing innovative financing 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