Empowering Africa through Agriculture

WE SEEK EMPOWERING AFRICA THROUGH AGRICULTURE FROM THE GRASSROOTS UP!No Charity and No Foreignaid!

 

Come let us change Africa into the breadbasket to Africa and a major contributor to the food security of the world!

 

We like to share with you our longstanding involvement and advocacy for the utilization of sugarcane farming for the commercial production of ethanol in Africa. Because planting and harvesting of sugarcane is an agricultural process requiring the participation of local farming communities, is in our judgment most suited for the rural environment of Africa where the majority of Africans prefer to live.

Our involvement with the promotion of Africa wide commercial sugarcane farming for the production of ethanol as the sustainable alternative fuel of the future started in London in 2001 with the participation of major banks and leading Brazilian ethanol industry leaders.

It is evident that the choice of sugarcane farming is an agricultural process requiring the participation of local farming communities. It is our opinion that the strategic use of ethanol production from sugarcane in Africa as the most effective tool to encourage commercial agro-developments, empowers small farmers and outgrowers, helps establish suitable, realistic, sustainable macroeconomic base for the alleviation of poverty and the creation of new jobs. If structured with knowledge and dedication, implemented upon tried and tested industry precedents, this agricultural empowerment business model will become, in very short time, the engine for inspiring the development of agro-related downstream business opportunities involved in cash crops and a number of diversified services and local cottage industries.

We submit that Africa urgently needs fresh, imaginative and daring development vision and strategies based on its immense agricultural assets. It is clear by now, that the present one hundred year colonial dependency on mining and foreign aid cannot realistically deal with the immense development challenges of Africa. It is also clear that western foreign aid is consistently failing to deal objectively with the colossal economic potential of Africa and ignoring the immense untapped agricultural, animal husbandry, fisheries, forestry and many, other than (oil, gas, gold and diamonds) natural resources. It is a fact that Africa is a giant virgin agricultural potential ready to be developed on commercial basis, can be profitable and can become the breadbasket to Africa and a significant contributor towards the realization of sustainable food security at home and to the rest of the world.

It must however be recognized and acknowledge first by Africans, that Africa’s time has arrived, that the old colonial mining development model is at the heart of the continued enslavement and corruption of Africa and a major detrimental factor that is holding Africa’s development back. The present state of affairs must be an all Africa empowerment economic model spearheaded by Africans starting at the very grassroots level and up.

Our Daring Agro-Business Model for Africa

Africa’s business and financing model based upon new dynamic and smart business strategies targeting the empowerment of Africans at all levels starting by addressing the contribution the smallest African farmer’s posses and can make. The preferred grassroots business models will require the proactive participation of African governments, local counties/states. It must include various tribes and clans, tribal chiefs, individuals and local business leaders. Collectively they are the invested shareholders, in the special purpose vehicles (SPV). The ideal corporate structures must be, governed by reliable commercial laws such as Delaware USA, having enlightened articles of associations and bylaws, predicated on transparent democratic principles of one share one vote.

The Act and Methods to Empower Africa

We stress that the empowerment of Africa by way of the proposed SPV must obligingly address and satisfy international investors and capital markets risks concerns. Our capital raising strategy is to seek the placement of the SPV capital shares/securities on the international stock exchanges including AIM- London and Frankfurt. This is no simple task.

The SPV through professional deliberate financial structuring techniques prepared and groomed in accordance with world capital markets investment criteria. A number of assets-backed credit enhancement instruments supported by high caliber management team, responsible public relations (Roadshow) and adequate budgets to meet costs and expenses needed for the successful launching of the SPV.

Africa’s agriculture has immense collateral values – land, water, forests, oceans, lakes, rivers, weather, location and people. These are extremely valuable assets. We plan to monetize these assets utilizing our long established structured financing expertise. We are following our long held premise is that ” any project, regardless of location, can be made financeable if:(a) In a given project quality assets exists, and (b) Assurance can establish that adequate cash-flow streams can be generated from the efficient economic use of the asset(s) based on proper and efficient management of the assets”.

We are certain that the world knows that Africa possesses immense agricultural collateral positioned to become, in a very short time, a reliable excellent agricultural producer and food security provider. Further, the potential for ethanol production from sugarcane in a very short time Africa can exceed that of Brazil and the USA combined.

Implementation of Our Empowerment of Africa Dream

Moving to the implementation stages of our plans and vision for Africa, we are proposing to locate the first major commercial ethanol from sugarcane Pilot Project in Tanzania. It is for this purpose that we lined up several major European capital raising intermediaries and a number of influential legal firms and securities brokers in London and Frankfurt.

We also arranged the tentative approval of major A3 credit commodities traders to join our financing teams to perform forward longterm sales of substantial quantities of the off take (ethanol) to A3 credit buyers. These are medium term “take or pay” purchase contracts.

Ethanol prices quoted daily on most of the international commodities stock exchanges. These are real project building blocks and essential tools for the financial structuring of credit enhancement instruments including the monetization of the ethanol offtake needed to ascertain the velocity of cash streams generated by the SPV and the demonstrable (earning) revenues and profits of the SPV.

You may ask why ethanol is the linchpin for the empowerment of Africa and for the development of its agricultural resources. The answer is rather simple. First, production of ethanol from sugarcane is a sustainable agro-product. Second ethanol is increasingly considered as valuable as crude oil, used as an additive and as alternative fuel enjoying daily world price indexation denominated in USD.

We emphasize that exporting ethanol is the most reliable hard currency earner for the SPV and to the host country. Revenues generated in hard currency will propel the credit rating of the SPV and that of the African host country to the desired investment grade level expected by retail and institutional global investors.

The First Agro-empowerment Pilot Project in Africa Financed by World Capital Markets

The first Africa agro-empowerment through agriculture using sugarcane for the production of ethanol in commercial quantities is now taking place in Tanzania on a 152,000 hectares of farmland. The development is grassroots based involving the active cooperation of the Mtibwa Sugar Cane Outgrowers Association (MOA) and all officials of the Districts of Mvomero and Morogoro region involving the cultivation of 70,000 hectares of suitable farmland and the proactive participation of all 7328 farmers of the following 18 villages: Madizini, Lukenge, Dihinda, Lungo, Kisala, Kunke, Kilimanjaro, Kwadoli, Kanga, Kiwandani, Mlumbiro, Kichangani, Kidudwe, Lusanga, Mbogo, Manyinga, Digoma and Komtonga.

Recently, neighboring farmers of Kasulu and Kibondo districts of the Region of Kigoma numbering more than 9,000 farmers owners of 82,000 hectares joined the First Empowerment Pilot Project. This project is of direct benefit and source of employment to more than 313,000 local inhabitants.

The empowered shareholders of the proposed SPV are the 16,328 farmers. They agreed to lease their farmland holdings to the SPV on 99 years lease agreement and to remain actively involved in farming and the production and supply of sugarcane to their SPV. They will own not less than 90% of the authorized and issued share capital of the SPV.

The ethanol production capacity of the Tanzanian project is estimated at not less than 120 million gallon/year of high octane ethanol. The first modular distillery plant would have a 200 million/year gallon production capacity expandable by additional modules for future expansions. The strategic location of the distillery plant will allow sufficient margins for expansion of sugarcane farming to other farming communities located within 75-100 kilometer radiuses within the holistic transportation and logistical plan of the project.

The estimated cost of the Tanzanian project is conservatively estimated to be in the range of $490-$570 million. Aside from adequate budgets for first modular distillery plant the development plans Included: $40 million budget for infrastructure development, logistics and housing, $35 million for 30 MW biomass fired power generation plant, $28 million mobilization fund of small local farmers and $20 million fund to kickstart local agro-cottage industries.

Africa’s Empowerment Dream Through Agricultural Development Has Arrived

We believe the timing of our agro-development empowerment plans for Africa cannot be more agreeable. Two unprecedented historical economic factors are present, strongly favoring the empowerment of Africa through the development of its immense agricultural assets and resources from the grassroots level and up:

  • China introduced, albeit not the perfect development model for Africa but a very welcomed departure from the colonial exploitation practices of western multinational companies and set in motion new foreign investment yardstick, and
  • the prevailing fear and concern on the part of most of the developed countries including China and India to seek to secure sustainable Food Security alternatives, which African can provide.
We Are the Proud Sponsors, Investors and Promoters of the Empowerment of Africa

Now, I like to add a word about ourselves. We are merchant bankers having spent the last 44 years (Who We Are) providing complex structured financing solution to difficult financing in Africa and other emerging countries. We know Africa very well. We are very familiar with Africa’s reality, causes of retardation and its continued shameful exploitation. We know firsthand the struggle of the African people and have faith in their ability to rise above the threshold barriers of their colonial past and present dependency on charity and foreign aid. We all know the old proverb: “Give a man a fish and you will feed him for a day; teach him how fish and you feed him for a lifetime”.

We invite expression of interest from true friends of Africa, from farmers and people involved in all kinds of farming operations and management, food processors packagers specialists, small and cottage industry specialist, farming logistics, sugarcane farmers and ethanol refiners and distillers, ethanol traders, credit union specialists, farm financing, investors and goodwill ambassadors and supports.

Please address your inquiries to Mr Fred Farha by email at fred@fundmore.com.

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