The USAID Hub is working with the Eastern Africa Grain Council (EAGC) to develop a Trade Facilitation Fund that will address gaps in access to trade finance for grain traders and millers across the East African Community (EAC). This fund will accumulate a capital base, which will provide a new financing option for EAGC members and facilitate regional grain trade.
Through consecutive engagements with the EAGC, the Hub has identified the lack of access to trade finance as a major barrier to increased regional grain trade. Grain traders and millers struggle to access working capital from traditional channels due to onerous application requirements and the need for collateral. The lack of financing confines their capital bases, thereby inhibiting the volumes that traders and millers are able to purchase. This fund will enable traders to access credit to significantly increase their trade volumes, contributing to the USAID Hub’s objective of doubling intra-regional trade of food staples within the EAC. It will also support the G-Soko system, EAGC’s online grain trading platform, by availing financing to facilitate deals created in the system.
Previously, the USAID Hub has worked with the EAGC to support the EAC Secretariat in the revision of nine staple grain standards and development of two new standards for sampling and testing methods. The revised standards will reduce inefficiencies in region grain trade such as quality disputes and double-testing of grain at borders. Read more about the revised standards here.