Bridging the Capital Gap: Strategic Public-Private Partnerships Invest in Young Agri-entrepreneurs

Women make up more than half of IFAD’s project participants, while over 60 percent of its active project portfolio is youth-sensitive, reaching more than 12 million young people globally. Photo: Joyce Chimbi/IPS

By Joyce Chimbi
NAIROBI, Feb 11 2026 (IPS)

The global aid system is crumbling amidst chronic underinvestment in rural areas, posing a systemic threat to food systems everywhere.

With 1.3 billion young people in the world today – the largest generation in history, and nearly half of them living in rural areas – investing in their entrepreneurial potential is key.

Speaking during a press briefing on February 10, 2026, at the International Fund for Agricultural Development‘s (IFAD) 49th Governing Council, the president, Alvaro Lario, said investing in young entrepreneurs and women farmers unlocks new pathways for employment and ensures that rural areas become thriving engines of stability, prosperity and sustainable growth.

The overarching theme of the ongoing session of the Governing Council is “From Farm to Market: Investing with Young Entrepreneurs” and is being held at a pivotal moment when the global aid system is in urgent need of reinvention.

“We are at a very complex time of geopolitical fragmentation and constrained budgets for many countries. Food systems are going through various regular shocks that include climate shocks. So, rural transformation means economic growth, creating jobs and building stability,” Lario stated.

Lario advocated for public-private partnerships that connect farmers with private companies, which invest directly in Small and Medium-sized Enterprises (SMEs) through blended finance, guarantees, and various forms of debt or equity, ultimately increasing access to rural finance. Public finance alone cannot deliver the transformation of food systems, raise rural incomes, or create decent jobs.

SME-driven value chains are critical to rural development. IFAD’s assessments show that SME-focused value chain projects are more likely to deliver transformational impacts – in other words, where incomes increase by more than 50 per cent because of the project. The Project for Rural Income through Exports in Rwanda (PRICE) increased returns to farmers through the development of export-driven value chains for coffee, tea, silk farming and horticulture.

In brief, he said the private sector accounts for more than 90 per cent of global food systems’ activity and that it complements public sector financing in a critical way by providing technology, market access, and logistics. Emphasising that these are the elements that allow small farms, pastoralists, fishers, rural entrepreneurs and other agri-food enterprises to grow and prosper.

Overall, at the Governing Council, Lario underscored the immense strategic and business value of investing in rural economies, presented new impact data and priorities for 2028-2030 and outlined the most effective models for scaling up productive investments. He was joined by Tony Elumelu, Chair of United Bank for Africa and Heirs Holdings, and founder of the Tony Elumelu Foundation, in outlining a new deal for rural economies.

They spoke at length about how to accelerate the shift to channel more private investments to rural economies. On young African entrepreneurs and facilitating their access to financing, he said as currently constituted, a bank cannot lend without collateral and consideration of social repayment.

“Since the regulatory environment does not permit banks to lend without taking these issues into consideration, countries create development financing institutions that can take some of the risks. And, also, having development financing institutions and global financing that help to de-risk transactions so that banks can come in and provide the capital,” Elumelu said.

“One of the reasons my wife and I established the Tony Elumelu Foundation is to support young African entrepreneurs. Access to capital is critical for entrepreneurship development. But oftentimes, people lack what it takes to access it. The Foundation has provided USD100 million. And every year, we identify young African entrepreneurs who have business ideas and train them on how to actualise these ideas.”

Further emphasising that access to capital, “while important, is not the only condition that will make you succeed. Business education is important. So we train them, appoint mentors for them, create a networking platform for them, and then provide them with the knowledge they need to receive capital. To date, in Africa, we have funded over 24,000 young African entrepreneurs. And the good news is that about half of these people are females.”

Elumelu said youth-centred interventions significantly boost agro-entrepreneurship as a key driver for economic growth, job creation, and stability while addressing the youth opportunity deficit.

“Nearly 21 percent of those who are funded in Africa are in agriculture and agribusinesses.  And out of these 21 percent, which is about 5,600 beneficiaries, 55 percent of them are females. So in a way, we are trying to help bridge that capital gap, finance gap. But that is not enough. It’s just a tiny drop of water in the ocean. So we need even more partnerships.”

Elumelu further drew on his Africapitalism philosophy, which is a call to action for businesses to move beyond short-term profit-seeking and instead make investments that generate socio-economic benefits for the communities in which they operate. And his foundation’s decade-long experience building Africa’s largest entrepreneurship ecosystem speaks to how entrepreneurship, private capital, and market-driven solutions can transform rural economies, expand food systems, and close the youth opportunity gap.

IFAD is an international financial institution and a United Nations-specific agency that invests in rural communities, empowering them to reduce poverty, increase food security, improve nutrition, and strengthen resilience. It has thus far provided more than USD 25 billion in grants and low-interest loans to fund projects in developing countries.

The Governing Council is IFAD’s highest decision-making body that, among other things, provides a forum for Governors to share their insights on priority areas for strategic action to lift the livelihoods of rural people.

This session also takes place at the beginning of the International Year of the Woman Farmer, declared in recognition of the key role that women farmers around the world play in agrifood systems and their contributions to food security, nutrition and poverty eradication.

Empowering youth and women entrepreneurs to initiate and expand agribusinesses serves as a vital catalyst for economic development and creates lasting positive impacts. Women make up more than half of IFAD’s project participants, while over 60 per cent of the active project portfolio is youth-sensitive, reaching more than 12 million young people globally.

IPS UN Bureau Report