Launch of a $600 million Food and Agribusiness Fund was announced on Tuesday by Farid Masood, Director of Asset Management Division of the Islamic Corporation for the Development of the Private Sector (ICD).
The fund is a strategic partnership between ICD and a qualified management team, advised by Robeco – a subsidiary of Dutch Rabobank. With an objective to promote strategic investment flows and expertise into the food and agricultural sector in Islamic countries, the ICD Fund will address growing food security concerns by capitalizing on the region’s largely under-exploited potential for increased food production and supply.
Investing in a wide range of strategic and commercially sustainable initiatives across the entire food & agriculture value chain, ICD’s launch of the fund comes at an opportune time. Recent unprecedented food shortages and price increases have forced food security to the forefront of matters meriting international concern. The issue is more pronounced for various Islamic countries characterized by arid climates and/or underdeveloped food and agricultural sector. Under ICD’s sponsorship, the fund is set to raise USD 600 million from governmental, multilateral and institutional investors in Islamic countries and beyond. The fund’s concept and capabilities are widely recognized and the fund is receiving strong interest from several target investors already. The ICD Food and Agribusiness Fund will make private equity investments in partnership with the private sector, generating a multiplier effect on the fund’s capital and will be operational once it has raised $350 million, anticipated by year-end.
“The fund is the first public private partnership of this nature and size to address the inefficiencies and wastage facing the food and agricultural sector throughout our member countries. Boosting regional food production, supply and trade, the fund’s investments will also lead to creation of jobs, transfer of technology, promotion of sustainable practices and poverty alleviation. The fund will significantly benefit from ICD’s standing and resources in the Islamic countries,” Khalid Al-Aboodi, the Chief Executive of ICD, said.
Robeco’s commitment to sustainable investing in a range of sectors such as water, energy, climate and agriculture, is part of the company’s philosophy.
“We are delighted to be appointed advisor to the ICD Food and Agribusiness Fund, and through Robeco’s experience, network and Rabobank’s research and global footprint, support the sustainable development of the food and agricultural sector in the Islamic world. We see great investment opportunities in this area going forward,” Graham Elliot, CEO Middle East for Robeco said.
The fund will be managed by a specialized asset management company that will house a team of seasoned professionals, including secondments from ICD and Robeco, who bring together extensive investment experience and track record in the Islamic countries and international food and agricultural sector. Dr Abdullah El-Kuwaiz, a renowned economist and former statesman, will act as Chairman of the fund manager.
“The fund will promote value-accretive investments in inputs, technology, infrastructure, farming, logistics and trade whilst generating attractive returns for its investors. The fund will be a catalyst for attracting foreign investment and private sector expertise to capitalize on the Islamic countries’ untapped potential for producing more food for domestic markets, as well as exports, thereby promoting food security and economic growth on a regional basis,” Dr El-Kuwaiz, said.