Morocco in Africa's top 5 for agri-food startup financing

Morocco is among the five largest markets on the continent, according to the first global report on agri-food startup financing in Africa by the American company AgFunder
Agricultores marroquíes cosechan uvas en el viñedo "Val d'Argan" en el pueblo de Ounara, en la región occidental de Essaouira

AFP/FADEL SENNA  -   Moroccan farmers harvest grapes in the "Val d'Argan" vineyard in the village of Ounara, in the western region of Essaouira

The report developed by AgFunder in collaboration with the British International Investment Fund and the Dutch Development Bank, estimates that, in terms of investment volumes, Morocco is among the top five countries on the continent. With an estimated turnover of $15.4 million, this increased by 3.2% compared to 2020. Over the past five years, investors have injected more than $1.1 billion into 119 innovative companies in the agri-food sector, of which $482 million was invested in 2021 alone. These figures represent an increase of 250% compared to 2020 and account for 1% of global investments while occupying 17% of the global population.

At the top of the ranking we find Egypt with an annual collection of $186 million, while Nigeria and Kenya raised $147 million and $88.5 million respectively. They are followed by South Africa with 22.1 million. In terms of agreements with agri-food companies, Morocco is also in fifth place with seven agreements, well behind Nigeria (38), Egypt (36), Kenya (32) and South Africa with 14 agreements.

AFP/FADEL SENNA - A Moroccan woman sorts buds of Damask roses (Rosa Damascena), which are used to make cosmetic products

This comes at a time when Morocco dropped three points on the food security index, from 57th to 113th place, and comes at a time of war in Ukraine, which has intensified conflict over grain resources around the world. Morocco's proliferation in this sector is recognised in turn by a study by the National Institute for Agronomic Research (INRA), which states that Morocco is committed to the production of grain through nano-irrigation and the minimisation of water use to optimise its productivity.

Business Insider, a US digital newspaper specialising in economics and financial and business news, has compiled a list in which it ranks Morocco as the fifth best country in Africa for investment. In addition, it is also the continent's fifth largest economy with a GDP of $124 billion in 2021 that is expected to grow by 3.2% by the end of this year. 

Countries such as Saudi Arabia, since 2016 under the "Vision 2030" project for the enlargement and expansion of the Gulf economy, presented a proposal for agri-food investment in the Moroccan country. According to official sources quoted by Asharq Al-Sawat, the Federation of Saudi Chambers approved the investment project, which will affect ten more countries, related to the cultivation of fruits and vegetables in the country, as well as specialising the production of hybrid seeds. 

REUTERS/ABDELHAK BALHAKI - Amazigh women sit together while crushing argan nuts to extract the kernels at the Taitmatine Women's Agricultural Cooperative in Tiout, near Taroudant, Morocco

"The report highlights innovations within African agriculture to address current challenges in food production and distribution while helping the sector respond and adapt to the impacts of the climate emergency," says Chirantan Patnaik, head of venture capital at British International Investment. Investor interest in Africa differs from global trends according to the report. 

Among the companies that invested the most in the country, Midstream Technologies topped the list with $293 million between investment and movement of assets, representing 61% of the total. They are followed by Cloud Retail solutions, E-Grocery, retail technologies for physical shops and agri-food fintechs. In addition, Morocco has one of the best In-store Retail offerings aimed at digitising the existing offline market on the African continent, which represents around 80% of the market.  

The market for venture capital in agribusiness start-ups is getting bigger and stronger year after year. In fact, this year is on track to break the 2021 record, with agribusiness start-ups raising around $400 million in the first half of 2022.