ZAMBIA has the potential to become a major regional supplier of key agricultural commodities such as maize, wheat and soya, but sustained investment across the value chain will be required to unlock that growth, according to head of the European Investment Bank (EIB) office in South Africa, Jim Hodges.
Currently, the EIB is supporting agricultural financing in Zambia through the Zambia Agriculture Value Chain Facility (ZAVCF), which channels funding to local banks to then lend to farmers and agricultural enterprises.
So far, over 50 million euros has been channeled to three banks which include Zanaco, First Capital Bank and Zambia Industrial Commercial Bank since 2021, which has seen a number of farmers and agribusinesses expand their business.
Speaking in an interview with #Kalemba, Hodges said the country’s favourable climate, available arable land and established production of staple crops position it well to serve neighbouring markets, particularly within Southern and Eastern Africa.
“I think there is enormous potential for Zambia to grow in this space. There are very stable crops like wheat, soya and maize which do have a regional perspective,” Hodges said.
Hodges said the main constraint preventing Zambia from fully capitalising on its agricultural potential is limited access to long-term and affordable financing for farmers and agribusinesses.
This affects their ability to invest in irrigation, storage, processing and modern equipment which are critical factors for increasing productivity and meeting export standards.
Hodges said taking the sector to the next level will require a lot more investment into the market which needs more capital.
Hodges described the EIB’s role as catalytic, with the facility structured to encourage additional lending from local financial institutions through risk-sharing mechanisms and matching funds.
“Whatever we invest, we require matching funding from the banks,” he said.
“The aim is to motivate more money to flow into agriculture and demonstrate that lending in this sector can be both viable and profitable.”
He said that as banks become more comfortable lending to agricultural businesses and farmers strengthen their operations, the sector could expand its output and begin to serve a broader regional market.
Zambia’s central location and membership in regional trading provides ready access to markets where demand for agricultural products continues to rise.
However, inconsistent production levels caused by droughts, power shortages and limited irrigation infrastructure have historically constrained the country’s export capacity.
By supporting investments in climate-resilient farming and strengthening the agricultural value chain, the EIB could help Zambia stabilise output and build the reliability needed to compete in regional supply chains.
“If we can show that with the right financing and risk mitigation the sector works, then there is a real opportunity for Zambia to supply not just its own population but neighbouring countries as well,” Hodges said.
The broader objective of the EIB’s involvement is to help build a financial ecosystem where local banks continue to fund agricultural expansion even after external support phases out.
“The EU recognises that the private sector has a lot more potential to create sustainable jobs. So that’s why this facility, the Zambia Agricultural Value Chain, aims to help the agriculture sector through private sector support. And that’s why we are working now with the local banks,” added EIB Kanya Regional Hub media officer, Harriet Ongaki.
Kalemba March 26, 2026
