An impactful new alliance is forming between Africa’s leading public development financier and a foremost international agri-development agency, signaling a robust commitment to expanding rural economic opportunity across the continent. In a ceremonial signing at the Finance in Common Summit 2025 in Cape Town, the Development Bank of Southern Africa (DBSA) and the International Fund for Agricultural Development (IFAD) formalized a Memorandum of Understanding that sets a collaborative framework for leveraging each institution’s strengths. The agreement aims to invest in people-centered projects that can uplift rural communities and drive wider economic development across Africa’s member states. By aligning DBSA’s infrastructure-led development approach with IFAD’s near-five-decade track record in agriculture-based poverty alleviation, the MoU creates a catalyst for scalable, sustainable impact in rural areas, where the benefits can ripple into livelihoods, markets, and regional resilience. The partnership represents a strategic commitment to harness expertise, resources, and networks to design, fund, and implement projects that prioritize people, place, and long-term economic vitality.
MoU framework and strategic intent
The MoU between DBSA and IFAD is more than a formal handshake; it establishes a concrete, actionable framework for intensified collaboration and co-financing. The document codifies a shared vision: to enhance rural economic development through investment vehicles and project designs that maximize development impact while maintaining fiscal responsibility and risk management. The framework is designed to be adaptable, allowing both institutions to respond to evolving rural development needs across Africa’s diverse landscapes—from agricultural heartlands to remote rural districts where infrastructure gaps hinder opportunity. The collaboration is anchored in a belief that sustainable rural growth requires a people-centered approach, blending capital investment with knowledge transfer, capacity building, and inclusive governance. The MoU also emphasizes the importance of combining public sector strength with the targeted expertise of international development finance, enabling more predictable funding flows, longer-term planning horizons, and better alignment with national development strategies. Together, DBSA and IFAD intend to design and implement projects that not only boost productivity and incomes but also foster resilience to climate change, enhance food security, and promote inclusive economic participation by women, youth, and marginalized groups. This alignment is expected to improve the design quality of rural development initiatives, accelerate implementation timelines, and strengthen the overall effectiveness of interventions across a wide range of geographies and sectoral focuses.
The agreement explicitly outlines a co-financing partnership as a core mechanism, aimed at expanding the pool of resources available for IFAD-led rural development initiatives. By coordinating funding strategies, blended finance arrangements, and risk-sharing arrangements, the MoU envisions a more robust pipeline of credible, bankable projects that deliver tangible developmental outcomes. This synergistic approach is intended to accelerate project readiness—from conceptualization and feasibility to design, procurement, and execution—while also improving the monitoring and evaluation framework so progress can be tracked, lessons can be captured, and best practices scaled. The MoU thus serves a dual purpose: it provides a clear path for joint funding and implementation, and it creates a governance and oversight structure that ensures accountability, transparency, and alignment with both institutions’ mandates and ethical standards. The overarching goal is to maximize the developmental return on investment, ensuring that funds reach rural communities in ways that yield durable improvements in living standards, economic opportunity, and long-term regional growth prospects.
In addition to financial coordination, the MoU emphasizes knowledge exchange and capacity development as foundational pillars. Staff from both organizations will participate in knowledge-sharing activities, technical exchanges, and joint capacity-building programs designed to strengthen local institutions, public administrations, and grassroots organizations. This emphasis on knowledge transfer ensures that people at the community level—not just the financiers—benefit from the partnership. It also supports the broader objective of creating locally owned, sustainable development models that communities can maintain and scale over time. By embedding knowledge-sharing into the partnership, the DBSA and IFAD aim to cultivate a culture of continuous improvement, where lessons learned from one project inform the design and execution of subsequent endeavors, leading to cumulative, compounding improvements in rural development outcomes across Africa.
The MoU further identifies six key areas for collaboration, each designed to reinforce a comprehensive approach to rural development. These areas include integrated sustainable development, environmental conservation, empowerment, knowledge sharing, regional collaboration, and governance and policy support. Within this framework, the partnership seeks to address a broad spectrum of rural development needs—from physical infrastructure and economic diversification to social empowerment and climate resilience. The integrated sustainable development pillar underscores the need for holistic planning that harmonizes infrastructure with productive activities, social services, and environmental stewardship. Environmental conservation emphasizes safeguarding ecosystems while pursuing sustainable agricultural intensification and climate-smart practices. The empowerment pillar centers on inclusive participation, especially for women and youth, to ensure that benefits are widely shared. Knowledge sharing is designed to diffuse expertise across borders and sectors, while regional collaboration aims to leverage cross-border opportunities, markets, and shared water resources. Governance and policy support focus on strengthening institutions, improving policy environments, and aligning regulatory frameworks with development objectives. Collectively, these six pillars form a multi-dimensional strategy intended to maximize impact and deliver durable improvements in rural livelihoods.
The players: DBSA and IFAD—roles, strengths, and leadership perspectives
The partnership unites two institutions with complementary strengths and a shared mission to promote inclusive development. The Development Bank of Southern Africa (DBSA) brings a distinctive public development banking perspective, with a focus on infrastructure-led growth that connects rural economies to broader market opportunities. DBSA’s leadership has consistently highlighted the centrality of infrastructure as a catalyst for development. The organization positions itself as a mobilizer of capital and a facilitator of transformative projects that improve access to essential services, strengthen logistic networks, and unlock export and value-chain opportunities for rural producers. In this framework, the DBSA is expected to play a pivotal role in financing and de-risking major rural development initiatives, ensuring that infrastructure investments are not isolated endeavors but integrated within broader productive activities that yield measurable social and economic returns. The CEO’s remarks emphasize that infrastructure is at the heart of the bank’s work and that partnerships magnify impact, enabling more innovative solutions and lasting community change through collaborative action.
IFAD, as a United Nations specialized agency and an international financial institution with decades of experience in agri-development and poverty alleviation, contributes a deep technical expertise in agricultural development, rural livelihoods, and climate resilience. IFAD’s leadership has stressed the importance of leveraging additional resources and expertise to amplify the reach and effectiveness of rural development projects. The agency’s objective is to enhance the design and delivery of programs in ways that maximize developmental outcomes, including reducing poverty, boosting resilience to climate shocks, and promoting inclusive growth across Africa. IFAD’s perspective emphasizes the critical role of smallholder farmers, rural entrepreneurs, and community organizations in driving durable development, as well as the need for climate-smart and market-oriented approaches that can withstand external shocks and support long-term economic diversification.
Together, the partnership aligns DBSA’s infrastructure and public-sector finance strengths with IFAD’s agricultural development expertise. The collaboration is designed to produce a synergy where infrastructure investments are effectively integrated with agricultural value chains, rural credit markets, and social protection measures, all aimed at expanding opportunities for rural people. The joint efforts seek to create more predictable, scalable, and sustainable development outcomes by combining capital, technical know-how, and local partnerships across a wider geographic canvas. The leadership of both institutions underscores a shared belief that rural development is a civilizational project—one that requires coordinated action, long-term commitments, and a willingness to test and scale innovative approaches that can deliver tangible benefits to communities.
FiCS 2025 ceremony: a milestone moment in Cape Town
The signing of the MoU occurred during a high-profile ceremony at the Finance in Common Summit 2025 in Cape Town, a gathering that brings together policymakers, development practitioners, financial institutions, and international organizations to discuss innovative financing solutions for sustainable development. The Cape Town event provided a strategic platform for DBSA and IFAD to announce their collaboration publicly, signaling a mutual commitment to accelerating rural development across Africa. The ceremony highlighted a broader global context in which public development banks and international financial institutions are increasingly coordinating efforts to mobilize capital for projects that deliver social and economic benefits in rural areas, while also addressing climate resilience and environmental stewardship. In the African context, the partnership is particularly timely given the continent’s ongoing efforts to diversify economies, strengthen rural value chains, and expand access to essential services such as energy, water, education, and healthcare in rural districts. The FiCS 2025 backdrop underscores the potential for cross-border learning, shared technologies, and regional cooperation to amplify impact, and it elevates the profile of rural development as a strategic priority on the development finance agenda.
For DBSA, the Cape Town signing reinforces the bank’s identity as a catalytic public institution focused on mobilizing resources for infrastructure-driven growth that benefits rural communities. It also positions DBSA to strengthen its collaboration with international partners, to align with global best practices, and to expand its reach within the wider Africa region. For IFAD, the ceremony signals a reaffirmation of its mandate to fund and support agricultural development and poverty reduction with a pragmatic, people-centered approach. It brings IFAD closer to a major regional development partner and potential co-financier, enabling more ambitious rural development programs that can integrate climate-smart agriculture with infrastructure and market access improvements. The joint appearance at FiCS 2025 reflects a shared willingness to address complex rural development challenges through strategic financing and collaborative implementation, and it sets the stage for a broader, more ambitious pipeline of projects that will be designed, financed, and implemented cooperatively.
Co-financing, project design, and implementation
The MoU’s co-financing framework is designed to unlock additional resources for IFAD-led rural development initiatives, enabling more ambitious project design and broader geographic reach. The co-financing arrangement is intended to create a pipeline of projects that demonstrate strong development impact, with careful attention to financial structuring, risk management, and sustainability. By pooling resources, DBSA and IFAD aim to reduce financing gaps, improve project bankability, and provide more stable funding streams that can support multi-year implementation cycles essential for rural development initiatives. The co-financing approach is also expected to improve the quality of project design by enabling joint technical assessments, shared risk assessments, and harmonized monitoring frameworks. This, in turn, should lead to more effective execution, better alignment with national development strategies, and stronger outcomes for rural populations.
Crucially, the MoU commits to strengthening project design and delivery through enhanced collaboration in planning, implementation, and monitoring. By aligning technical capabilities, sectoral expertise, and financial resources, the partnership intends to improve the design and execution of projects, ensuring they deliver improved developmental outcomes and empower communities. A core objective is to translate funding into tangible benefits—improved livelihoods, diversified incomes, and stronger resilience—through well-structured interventions that connect farmers and rural entrepreneurs with markets, finance, and essential services. The enhanced collaboration is expected to help identify high-impact opportunities, promote value-addition in rural economies, and facilitate the scaling of successful pilots into larger, more sustainable programs. The joint efforts are also anticipated to strengthen governance and oversight mechanisms, improve procurement and implementation practices, and ensure that the most at-risk communities receive targeted support in a timely manner.
In operational terms, the partnership will emphasize a coordinated approach to project appraisal, risk sharing, and performance monitoring. A central aim is to ensure that co-financed projects adhere to agreed standards for environmental sustainability, social inclusion, and gender equity, while delivering measurable development outcomes. The collaboration will also prioritize knowledge transfer and capacity-building activities, so that local institutions can manage, adapt, and sustain programs beyond the immediate funding period. By combining the financing strength of a public development bank with the field-proven technical expertise of IFAD, the MoU envisions a more efficient, effective, and inclusive rural development ecosystem across Africa that can adapt to diverse local conditions and evolving development needs.
Six pillars of collaboration: areas of focus and expected impact
The MoU identifies six key areas for collaboration, each designed to address critical dimensions of rural development and to reinforce a holistic, cross-cutting approach. These areas are integrated to ensure coherence and synergy across projects, programs, and geographic regions. The six pillars are: integrated sustainable development, environmental conservation, empowerment, knowledge sharing, regional collaboration, and governance and policy support. Each pillar is explored below, with a view to explaining how they interlock to create a comprehensive rural development agenda.
Integrated sustainable development
Integrated sustainable development represents the overarching framework that weaves together infrastructure, agribusiness, social services, and local governance. Projects under this pillar aim to harmonize the construction of roads, energy systems, water supply, and waste management with the growth of agricultural value chains, agro-processing facilities, and market linkages. The emphasis is on creating synergies between hard infrastructure and productive activities so that investments do not operate in silos but reinforce each other. In practical terms, this means coordinating feasibility studies, environmental impact assessments, and social risk analyses so that investments in transport corridors, irrigation schemes, and energy access are accompanied by workforce development, access to finance, and supportive policy environments. The goal is to generate more resilient rural economies that can withstand shocks, diversify income sources, and provide sustainable services to communities over the long term. This pillar is inherently multidisciplinary, requiring collaboration among engineers, agronomists, economists, sociologists, and local government officials to design solutions that are technically sound, financially viable, and socially acceptable.
Environmental conservation
Environmental conservation focuses on safeguarding natural resources while pursuing agricultural development and infrastructure expansion. Projects designed within this pillar must balance development needs with ecosystem protection, biodiversity preservation, soil health, water stewardship, and climate resilience. This requires integrating climate-smart agricultural practices, sustainable water management, and nature-based solutions into project designs. It also involves assessing and mitigating potential environmental risks, incorporating conservation measures into land-use planning, and promoting agroforestry, soil conservation, and watershed restoration where appropriate. The aim is to ensure that rural development does not come at the expense of environmental integrity, but rather strengthens ecosystem services that rural communities depend on for farming, drinking water, and livelihoods. Implementing this pillar entails rigorous environmental governance, transparent reporting of environmental outcomes, and the adoption of best practices that minimize negative externalities while maximizing positive social and economic benefits for rural populations.
Empowerment
Empowerment places people at the center of development decisions, with particular attention to women, youth, and marginalized groups. Programs under this pillar seek to expand access to productive resources, leadership opportunities, and decision-making processes at the local level. This includes supporting women farmers with access to land rights, finance, training, and technologies that enhance productivity. Youth-focused components might involve entrepreneurship training, job placement initiatives, and inclusive apprenticeships in agro-processing and related sectors. Empowerment also entails strengthening community organizations, improving participation in governance, and ensuring that local voices shape project design, implementation, and evaluation. By fostering inclusive participation, this pillar aims to create more equitable development outcomes and catalyze broader social and economic empowerment that can sustain rural progress across generations.
Knowledge sharing
Knowledge sharing is a critical mechanism for spreading best practices, technical know-how, and innovative approaches across borders and sectors. It encompasses the exchange of data, research findings, and practical lessons learned from implemented projects, pilots, and demonstrations. The objective is to build a learning ecosystem where practitioners—from government agencies to community groups—can access, adapt, and apply successful methodologies in diverse contexts. Knowledge sharing can include joint training programs, technical workshops, open data platforms (where appropriate and compliant with privacy and security standards), and collaborative research on climate-resilient agriculture, value-chain development, and rural finance. By promoting continuous learning, the partnership seeks to accelerate the diffusion of effective solutions, reduce duplication of effort, and enable faster replication and scale-up of successful interventions across different countries and regions.
Regional collaboration
Regional collaboration leverages cross-border opportunities and shared resources to bolster rural development at a continental scale. This pillar focuses on harmonizing policies, standards, and regulatory frameworks that facilitate regional trade in agricultural goods, shared infrastructure networks, and transboundary water management. It also emphasizes the importance of regional knowledge corridors, joint market development programs, and collective procurement mechanisms that can lower costs and improve efficiency for rural producers. Regional collaboration seeks to unlock economies of scale by pooling procurement, financing, and technical assistance resources, while encouraging mutual learning across countries with similar agro-ecologies, value chains, and development needs. By aligning efforts across borders, the partnership aims to reduce fragmentation, maximize impact, and expedite the diffusion of successful rural development strategies across the region.
Governance and policy support
Governance and policy support address the institutional and regulatory environments that enable successful rural development. This pillar focuses on strengthening public sector capacity, improving policy coherence, and fostering transparent, accountable governance structures. It includes activities such as policy advisory services, regulatory reform support for land tenure and credit access, anti-corruption safeguards, and the modernization of public procurement practices. Effective governance and policy work ensures that investments are well-governed, that regulatory barriers are reduced, and that national and regional policies align with the long-term development objectives of rural communities. This pillar also encompasses the development of monitoring, reporting, and accountability mechanisms to ensure that projects deliver on their stated outcomes and maintain public trust. A robust governance and policy framework is essential for sustaining momentum, encouraging private sector participation, and strengthening confidence among communities and stakeholders.
Overall, these six pillars are designed to operate interdependently, with the aim of delivering a cohesive, durable rural development program. By combining infrastructure development, environmental stewardship, inclusive empowerment, knowledge proliferation, cross-border collaboration, and strong governance, the DBSA-IFAD partnership seeks to transform rural Africa in a comprehensive and scalable manner. The integrated approach is intended to produce a pipeline of high-impact projects capable of generating lasting value for rural populations, economies, and ecosystems alike, while aligning with broader national and regional development priorities.
Anticipated impact on rural livelihoods and regional economies
The collaboration between DBSA and IFAD is expected to generate substantial benefits for rural populations across Africa by improving livelihoods, increasing productivity, expanding access to markets, and strengthening resilience to climate change. By integrating infrastructure investments with agricultural development and value-chain enhancements, the partnership can create more reliable and efficient routes for goods and people, facilitating better market access for smallholders and rural entrepreneurs. Improved connectivity can reduce transport costs, shorten supply chains, and enable farmers to reach urban and regional markets more effectively, potentially increasing income opportunities and reducing post-harvest losses. When paired with climate-resilient agricultural practices and improved water management, projects under this partnership have the potential to stabilize yields, reduce vulnerability to extreme weather events, and support risk management for farmers and rural communities.
The emphasis on empowerment, particularly for women and youth, is likely to broaden participation in agricultural and rural non-farm activities. Access to finance, land tenure reforms, and targeted training can empower more people to start or grow businesses, adopt new technologies, and participate in value chains that add value locally. This inclusive approach can help address gender disparities and unlock untapped talent, contributing to more diverse and resilient rural economies. Knowledge sharing and capacity-building activities are also expected to accelerate the diffusion of best practices and innovations, enabling communities to adopt efficient farming methods, climate-smart practices, and productive business models. As regional collaboration gains traction, cross-border value chains may develop, offering new opportunities for regional markets, shared infrastructure, and joint ventures that can promote economic diversification and resilience across multiple countries.
In addition to economic metrics, the partnership is anticipated to yield measurable social and environmental benefits. Improved access to reliable infrastructure—such as electricity, water, and roads—can enhance health, education, and safety outcomes in rural areas. Environmental conservation efforts can protect natural resources that rural communities rely on for livelihoods, ensuring long-term sustainability and reducing the ecological footprint of development activities. The alignment with governance and policy improvements has the potential to foster more accountable institutions, clearer land and resource rights, and more predictable investment environments, which in turn attract private sector participation and enhance the overall attractiveness of rural regions for investment. The cumulative effect of these outcomes is expected to be more resilient rural economies, more sustainable livelihoods, and a stronger, more inclusive development trajectory for Africa’s rural populations.
Implementation, monitoring, and accountability
Effective implementation and rigorous monitoring are central to translating the MoU’s intentions into tangible outcomes. The two institutions plan to establish joint governance arrangements, including decision-making processes, oversight mechanisms, and performance indicators that reflect both developmental impact and financial soundness. The monitoring framework will track progress across the six collaboration pillars, enabling timely course corrections and evidence-based decision-making. Regular reporting, transparent auditing, and independent evaluations are expected to accompany project execution to ensure accountability to beneficiaries, funders, and partner governments. The emphasis on governance is designed to foster integrity, minimize risk, and safeguard public resources while maximizing impact.
Risk management will play a critical role in project design and execution. Potential risks—ranging from macroeconomic volatility and climate-related shocks to governance weaknesses and implementation bottlenecks—will be systematically identified, assessed, and mitigated through the MoU’s formal processes. This includes risk-sharing mechanisms, collateral considerations, and refinancing strategies that can keep projects on track even when faced with adverse circumstances. The collaboration also prioritizes social safeguards to protect beneficiaries, ensure equitable access, and prevent unintended negative consequences. By embedding risk management and accountability at every stage of the project lifecycle, the partnership aims to sustain momentum, protect public interests, and maintain public trust in development financing.
Coordination with national and local authorities is a core component of the implementation strategy. Aligning with country development plans, sector strategies, and regulatory environments strengthens ownership and ensures that projects reflect local needs and priorities. The partnership will also seek to leverage existing programs and platforms where possible to avoid duplication and maximize synergies. Local communities, civil society organizations, and private sector partners are expected to participate in planning, implementation, and monitoring, ensuring that projects are grounded in real-world conditions and responsive to community preferences. The combination of rigorous governance, transparent accountability, and inclusive participation is intended to produce a robust implementation pipeline with high potential for success and durable impact.
Practical roadmap: next steps and milestones
Looking ahead, the DBSA-IFAD partnership will advance through a structured implementation roadmap designed to translate strategic intent into concrete actions. The initial phase will focus on finalizing project pipelines, aligning financing instruments, and establishing joint operating procedures that govern project appraisal, risk-sharing, procurement, and disbursement. This phase will also include capacity-building activities for partner institutions, government agencies, and local partners to ensure readiness for project execution. A second phase will concentrate on the on-the-ground rollout of pilot programs in select rural areas, chosen for their potential to demonstrate scalable impact, robust value chains, and strong partnerships with local stakeholders. These pilots will serve as a learning laboratory, informing refinements to project design, financial arrangements, and implementation approaches.
Subsequent phases will scale up successful pilots into larger programs, expand geographic coverage, and broaden sectoral reach to include additional agricultural value chains, rural infrastructure projects, and complementary social services. The implementation plan will emphasize phased financing, with clear milestones and performance targets designed to ensure steady progress and accountability. Throughout all phases, continuous knowledge sharing and capacity-building activities will accompany technical implementation to strengthen local institutions and support sustainability after the initial funding period concludes. The roadmap will also include stakeholder engagement milestones to ensure ongoing dialogue with communities, government partners, and the private sector, ensuring that the partnership remains responsive to evolving needs and opportunities across Africa’s rural landscapes.
Stakeholder engagement, capacity building, and community outcomes
The collaboration recognizes that true development hinges on robust stakeholder engagement and meaningful community participation. Local communities are central to the design, execution, and success of rural development projects, and the partnership seeks to create inclusive platforms for dialogue, feedback, and co-creation. By engaging farmers, women’s groups, youth associations, and community organizations early in the project cycle, the partnership aims to ensure that interventions reflect local realities, cultural contexts, and priorities. Capacity-building initiatives will equip community actors with practical skills in farming technologies, business management, financial literacy, and governance-related competencies, enabling them to manage and sustain programs beyond the initial funding horizon.
The private sector has a role to play in this collaborative effort, contributing to value-chain development, investment, technology transfer, and market access. Public-private collaboration can help unlock the resources and expertise required to scale successful interventions, especially in areas such as agro-processing, storage, and logistics. The partnership emphasizes a balanced approach that harmonizes public development finance with private sector participation in a manner that safeguards public interests and promotes inclusive growth. Through these multi-stakeholder engagements, rural communities can benefit from improved services, greater income opportunities, more reliable markets, and a stronger sense of ownership over development outcomes.
A notable objective across all activities is the equitable distribution of benefits, ensuring that women, youth, smallholders, and marginalized groups gain access to opportunities and resources. This includes measures to reduce gender gaps in productivity, ownership, and leadership, as well as targeted programs to empower younger generations to contribute to rural innovation and enterprise development. The emphasis on equity, accessibility, and social inclusion is designed to create more resilient communities where benefits are broadly shared and sustainable over time. In sum, the stakeholder engagement and capacity-building aspects of the partnership are indispensable to achieving durable, inclusive, and locally rooted rural development outcomes across Africa.
Conclusion
The memorandum of understanding between the Development Bank of Southern Africa and IFAD represents a significant inflection point in Africa’s rural development landscape. By combining DBSA’s public development financing and infrastructure expertise with IFAD’s proven track record in agricultural development and poverty reduction, the partnership is positioned to unlock new opportunities for millions of rural residents. The six-pillar framework—integrated sustainable development, environmental conservation, empowerment, knowledge sharing, regional collaboration, and governance and policy support—provides a comprehensive, multi-dimensional blueprint for transforming rural economies. The co-financing mechanism, designed to mobilize additional resources and strengthen project design, is complemented by a robust implementation, monitoring, and governance framework intended to deliver measurable outcomes with accountability and transparency.
At the core of this collaboration is a shared commitment to people-centered development: investing in farmers, rural entrepreneurs, and communities to create sustainable livelihoods, resilient infrastructure, and inclusive growth. The partnership signals a new era of strategic cooperation between regional development finance and international agricultural development, with the potential to accelerate progress toward food security, climate resilience, and economic diversification across Africa. If effectively implemented, the MoU can catalyze a pipeline of high-impact rural development projects, help bridge critical gaps in connectivity and services, and strengthen regional economies through more vibrant value chains and improved market access. As both institutions move to operationalize this partnership, the world will be watching how their combined expertise, resources, and commitments translate into lasting improvements in the lives of rural Africans and the communities that depend on their land, water, and labor for a better future.
