Food and Agriculture Sector

About the Private Enterprise Programme Zambia (PEPZ):

Funded by UKaid, PEPZ supports the development of a thriving Zambian private sector in order to create job and income opportunities, increased investment and value addition in the local economy.

The core of the PEPZ value offer to potential partners is formulated under four headings:

  • Capital: Our cost-sharing financial intervention mechanisms designed to incentivise business innovation that will benefit Zambian Micro, Small and Medium Enterprises (MSMEs);
  • Capacity: Our internal expertise and our network of external specialist consultants who can help intervention partners design and implement solutions;
  • Connections: Our networks and contacts that allow us to facilitate business connections and transactions; and
  • Compliance: Our understanding of the formal and informal rules of focus sector markets means that we can help businesses to meet legal/regulatory requirements and client/consumer needs.

PEPZ works across four focus sectors. Each sector has its own overall strategic goal that shapes our work in that sector:

  • Food and Agriculture: To increase productivity at the farm level, promote value addition through processing and get more Zambian products into consumer markets
  • Mining and Mining Services: To increase the positive, sustainable and inclusive economic impact of the mining industry in Zambia
  • Tourism and Hospitality: To increase tourist numbers and spend in Zambia and increase the proportion of tourist revenues captured by local businesses
  • Business Services for Investment and Growth: To increase access to financial and non-financial business services and sources of finance that support growth-oriented Zambian businesses

The core PEPZ mandate is to promote inclusive economic growth and poverty reduction through the distribution as well as the growth of wealth in Zambia. Each of our initiatives and intervention partnerships supports investment in business innovation – new products, services or business models – designed to address the systemic constraints that limit market access and market participation for many Zambian MSMEs. We want to see more Zambian MSMEs participating – and participating more fully – in their relevant sectors so as to secure a greater proportion of the profits in the sector.

Our target beneficiaries are working-age Zambians who live in poverty or near poverty, and we make strenuous efforts to ensure that the most economically disadvantaged and marginalised groups – women and youth, rural communities and people with disabilities – also share in the benefits of economic growth.

The structure of PEPZ’s Food & Agriculture Sector is shown below:

Context of this Call for Investment Project Concepts:

As part of our 2019 strategy, we aim for larger, more complex and diversified initiatives that take on substantial challenges and opportunities in the Zambian food production and agriculture sectors. In line with this goal, PEPZ is soliciting Project Concepts under several initiatives, which we will consider for support through 1) grants for technical assistance, 2) grants to incentivise/de-risk investment, 3) support for market linkages facilitation and 4) general business support.

The approximate budget allocations available for the following Activity Streams are listed below; please contact PEPZ prior to submission for concepts outside of the indicative ranges.

Activity Stream Approximate budget allocationIndicative grant range
Agro-dealer credit registry £50,000 £10,000 up to£40,000
Horticulture sector scale-up £80,000 £10,000 up to £40,000
Legume sector development £75,000 £15,000 up to £40,000
Agri-processing and value addition £230,000 £25,000 up to £100,000
Strengthening inclusive small livestock sector
£50,000 £10,000 up to £15,000
Inclusive commercial agriculture £40,000 £10,000 up to £40,000
Rural Enterprise Hub scale-up £40,000 £5,000 up to £10,000

We have listed below a number of types of benefits that we are looking for under each Activity Stream, but the lists are not exhaustive. Of primary importance is that concepts are focused on commercially viable business innovations – new products, new services or new business models – that address constraints to Zambian MSMEs fully participating in, and benefitting from, their target food/agriculture sector market.

Inputs Financing

Under the Agro-dealer Credit Registry Activity Stream, we are looking for investment projects to deliver these types of benefits:

  • Improved commercial relationships between inputs suppliers (both material inputs such as seed and fertiliser and mechanical inputs such as farming implements/machinery) that reduce the need for subsidies
  • Improved opportunities for agro-dealers to access financing or consignment models
  • Improved systems to ensure that financers/consigners are fully paid back
  • Improved availability of a wider range of quality goods and services that agro-dealers can access as inventory/stock
  • Credible systems (though on a pilot scale) for agro-dealers to develop credit and trading history with inputs suppliers or formal finance institutions

Value Chain Strengthening Initiative

Under the Horticulture Sector Scale-up Activity Stream, we are looking for investment projects to deliver these types of benefits:

  • Improved, sustainable linkages between and among networks of small-scale fruit/vegetable growers and relevant service providers (inputs, extension, bulking, transportation, logistics, cold-chain, certification, etc.) to improve market functions at all areas of the value chain;
  • Improved market access for large numbers of small-scale growers through better commercial linkages to aggregators and/or end off-takers;
  • Improved diversification, variety, quality and volumes of fresh produce;
  • Processing, value addition and distribution improvements;
  • Innovative, commercial ways to increase horticultural exports where possible;
  • Innovative and commercial ways to increase inclusive economic growth and environmental/climatic benefits.

Under the Legume Sector Development Activity Stream, we are looking for projects to deliver these types of benefits:

  • Improved production (i.e. volumes) and diversification of commercially competitive legume/pulse crops;
  • Better production models that lead to inclusive economic growth and environmental/climatic benefits;
  • Improved market linkages all along the value chain;
  • Processing, value addition and distribution;
  • Improved quality standards of production, processing and end-product certification;
  • Development of new markets for Zambian legumes/pulses.

Under the Agri-processing and Value Addition Activity Stream, we are looking for investment projects to deliver these types of benefits:

  • Development or scale-up of large-scale commercial processing capacity;
  • Improved post-harvest handling, storage and transport;
  • Improved market linkages with direct benefits to large numbers of smallholder farmers;
  • Strengthened market linkages with off-takers for large volumes of product;
  • Overall expansion of Zambia’s agri-processing and value addition capacity;
  • Development of new, commercially viable products and new markets;
  • Increased service provision to increase local value addition (e.g. local packaging facilities).

Inclusive Commercial Livestock and Agriculture

Under the Strengthening Inclusive Small Livestock Activity Stream, we are looking for investment projects that can diversify smallholder farmer/herder’s income opportunities through:

  • Improved, commercially sustainable access to better genetics of small livestock (sheep, goats, poultry);
  • Improved capacity for rural animal husbandry;
  • Established linkages for smallholder farmers/herders to markets;
  • Innovative fodder production to improve animal nutrition;
  • Development of small livestock inputs markets and services (aggregation, logistics, etc.);
  • Growth in rural, local meat markets through improved practice of commercial approaches to small livestock rearing in Zambia.

Under the Inclusive Commercial Agriculture Activity Stream, we are looking for investment projects that can leverage the local economic generation power and large workforce numbers of large commercial farms in Zambia to deliver:  

  • Improved, commercially sustainable provision of goods and services to farm workers and surrounding communities;
  • Diversified income opportunities for farm workers and surrounding communities;
  • Commercially viable agricultural production support to communities on/surrounding commercial farms;
  • Encourage commercially viable crop diversification within and surrounding commercial farms through smallholder growers;
  • Improved skills development for farm workers and surrounding communities.

Rural Enterprise Linkages

Under the Rural Enterprise Hub Scale-up Activity Stream, we are looking for partners with concepts that align with PEPZ’s scale-up of developing small commercial hubs in rural areas. We have traditionally engaged high-performing rural cooperatives as an operating platform, but are open to looking at other platforms that combine high capacity and business-minded groups/individuals with basic infrastructure where small businesses can leverage off of each other, expand and create entrepreneurial opportunities that boost rural economic activity and create jobs. Example benefits of these concepts are:

  • Improved access to green energy sources and associated technology, and ways to commercialise distribution in rural areas
  • Increased rural value addition of agricultural products (ie, aggregation, logistics, micro-cold chain, etc.)
  • Increased distribution of goods/services available in local communities
  • Rural job creation and entrepreneurship opportunities
  • Improved data, mobile phone and computer access in rural areas

Criteria for Competitive Concepts:

Project Concepts must meet the following criteria:

  • Proposals must be shown to be commercially viable to ensure sustainability.
  • Applicants need to display sufficient capacity (technical, management and financial) to implement the project successfully in partnership with PEPZ.
  • Proposals must address sector constraints in a systematic, targeted way. This does not mean they must address all constraints in a given sector, but they need to be focused on addressing clear market challenges faced by large numbers of MSMEs within the value chain.
  • Proposals must introduce some level of innovation in terms of an innovative business model, a new product or service, or a new way of addressing sector constraints that keep Zambian MSMEs from fully and profitably engaging in markets.
  • There must be a substantial cost-sharing element to each proposal concept. For private sector intervention partners, we target a 50/50 cost share between the partner and PEPZ. Non-private sector entities’ investments will be reviewed on individual bases to ensure adequate level of financial contribution and commitment to project delivery.
  • All other considerations being equal, concepts likely to deliver greater outcomes and in which the partner contributes a larger proportion of the total project budget will be more competitive for funding.
  • Projects must be completed by 31 December 2019.

Eligibility and Submission Guidelines:

Who may apply?

  • For-profit and non-profit companies are eligible to apply.
  • For-profit companies should target cost-share of 50% of the overall investment project cost. Non-profits will be assessed on a case-by-case basis. In general, the higher cost-share percentage borne by the investor, the more attractive the proposal will be to PEPZ.

Investment Project Concept development guidance:

  • Applicants should complete the PEPZ Concept Note in as much detail as possible. After PEPZ’s review, feedback will be given to all applicants. Selected projects will then be requested to complete a fully detailed Investment Project Proposal template.
  • PEPZ has a limited budget, so we are looking for high-impact investment projects that meaningfully benefit relatively large numbers of Zambian MSMEs. Competition for support is likely to be high, so be advised that only the most convincing, value-for-money and high-impact projects will be requested to develop full proposals for funding consideration, and funding is not guaranteed.
  • As above, concepts in which the investing partner intends to contribute a higher proportion of the total budget, the more competitive the concept will be.
  • Investment projects need to be completed by 31 December 2019.

Concept Submission Guidance:

  • Please submit a fully completed concept note template – and any related backup documentation – to [email protected] and [email protected]
  • Please also submit fully completed Information Form and Banking Details templates with the concept note.
  • Applications will be accepted on a rolling basis through June 2019, and may be extended beyond that pending funding considerations. Applications will be reviewed on a first-come, first reviewed basis.
  • PEPZ’s decisions on applicants requested to provide full proposals are final.

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