IsDB, IFAD launch US$750M push to transform rural food systems
The plan paves the way for expanded private-sector operations to support agribusinesses and rural small- and medium-sized enterprises.
GLOBAL – The Islamic Development Bank (IsDB) and the International Fund for Agricultural Development (IFAD) have signed a new cooperation and co-financing agreement to mobilize up to US$750 million for food systems and rural transformation, according to the two institutions.
The expanded partnership combines the financing power, specialized expertise and global reach of both institutions to scale up investments in rural economies, poverty eradication and food security.
“This renewed partnership between IsDB and IFAD builds on nearly five decades of successful cooperation,” said Dr Muhammad Al Jasser, Chairman of the IsDB Group.
“Together, we will leverage our collective expertise and resources to strengthen resilience, expand opportunities, and improve the lives of rural communities across our member countries.”
Alvaro Lario, President of IFAD, highlighted the initiative’s economic ripple effect. “Through this agreement, we are scaling up investment in the first mile of food systems to create jobs, increase incomes and build more prosperous and resilient rural economies,” Lario said.
“When rural people have the opportunity to build businesses, connect to markets, and earn a decent living, the benefits extend far beyond rural areas.”
Under the agreement, the two institutions are developing a joint action plan covering agribusiness value chains, market access, rural finance and financial inclusion, climate adaptation, sustainable natural resource management, and water access.
In addition, the plan paves the way for expanded private-sector operations to support agribusinesses and rural small- and medium-sized enterprises.
The agreement draws on the wider IsDB Group, including the Islamic Corporation for the Development of the Private Sector (ICD), the International Islamic Trade Finance Corporation (ITFC) and the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC).
Together, these institutions create avenues to integrate development finance, trade finance, investment, and risk mitigation, tools that address the financing gaps that typically constrain smallholder-linked enterprises and Agri-SMEs in member countries.
The agreement also marks a new chapter in a partnership dating back to 1980. Since then, IsDB and IFAD have co-financed 29 projects worth approximately US$1.45 billion, according to both institutions.
Finally, the new US$750 million target marks a significant increase in funding, reflecting both the scale of the challenge and the recognition that rural transformation requires coordinated investment rather than isolated project interventions.
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