Senegal is an IDA country in Sub-Saharan Africa with a population of 15.5 million that has experienced steady economic progress in recent years. In both 2015 and 2016, the country’s GDP grew at 6.5%, its strongest performance since 2003. But much more can be done to encourage public and private investment across Senegal, particularly in the agricultural sector, where mango horticulture remains a key area of competitiveness.
Despite current growth opportunities in Senegalese mango farming, the sector remains stymied by a lack of storage, transport infrastructure and local processing, causing more than half of the mango production to go to waste. Some Senegalese private sector companies such as Kirene—the country’s leading still beverage company—has taken an innovative approach to these challenges: using mangoes unsuitable for export or sale as raw material for its pulp, offering a second market for Senegal’s mango producers and ensuring the economic stability of their business.
In 2017, IFC and the Private Sector Window of GAFSP provided €5.6 million in financing to Kirene to help the company undertake a modernization project to upgrade its environmental and social infrastructure, debottleneck its processing and warehousing capacity, and increase its sourcing from the local smallholder mango supply chain.
The combined GAFSP/IFC funding aims to strengthen the mango and dairy value chains through Kirene’s expansion. Technical assistance provided by IFC will support Senegal’s farmers, smallholders, collectors, transporters and farmer organizations in these value chains through job creation and increased income. This blended finance solution will further Kirene’s vertical integration for mango pulp and locally sourced dairy, which will partly reduce dependence on imports over time, offering import substitution in Senegal. Kirene’s expansion also has the potential to boost the mango value chain by sourcing mangoes from Burkina Faso and Mali, and selling to Nigeria and Ghana.
Over 500 smallholder mango farmers are expected to be reached by Kirene by 2019 through Agrofruits, the fully owned subsidiary of Kirene that sources local mangoes and processes them into mango pulp that is supplied to both Kirene for its juice production, and to third parties abroad. As the majority of the mangoes sourced by Agrofruits are not suitable for sale in the export or local market, the company is tapping a supply that would otherwise go to waste. Agrofruits’ sourcing of local mangoes supports the work of collectors, transporters, suppliers of inputs and others, representing a total of over 1,200 indirect jobs.
Improved livelihoods, income and food security for Senegalese smallholder farmers
Total direct employment generated by this project is projected to reach over 4,000 by 2021, generating additional income for those smallholder farmers, distributers and retailers. Through increased productivity and reduced losses in the agribusiness value chain, the project is expected to enhance food security in rural areas.
Strengthening the Senegalese Dairy Supply Chain
Kirene is the largest UHT milk factory in Senegal, yet only sources 10 percent of its needed input. Through technical assistance provided by this project, Kirene is confident it can increase its milk sourcing with both medium-sized farms and smallholders by working with new farms and smallholders; providing support to farmers and smallholders to increase the number of farmers’ cattle by providing a secure market, allowing them to borrow to buy new cows; and by helping raise cows’ milk output through technical assistance.
Increased quality and affordability of beverage products
This investment in Kirene will increase the availability of good quality, clean and affordable beverage products for consumers across West Africa.