BRIEF

Southern Agricultural Growth Corridor of Tanzania (SAGCOT): Fact Sheet

March 7, 2017

Overview

The Southern Agricultural Growth Corridor of Tanzania (SAGCOT) Programme (SP) is a pioneering initiative of the Government of Tanzania (GoT) to mobilize $2.1 billion in new private sector agribusiness investments, backed by $1.3 billion in public sector facilitating investments in infrastructure and related public goods, to achieve rapid and sustainable growth in smallholder agriculture in the southern corridor of Tanzania.

The SAGCOT Programme has been established as an international public-private partnership to implement the GoT’s 2009 resolution, ‘Kilimo Kwanza’ (Agriculture First) which calls for greater investment in agriculture and a stronger emphasis on delivering development benefits to smallholders and farming communities through inclusive commercialization.

SAGCOT Investment Project (SIP)

On March 10, 2016, the World Bank Board of Executive Directors approved the $70 million SAGCOT Investment Project to support Tanzania’s agriculture sector and strengthen it by linking smallholder farmers to agribusinesses for boosting incomes and job-led growth.

The SIP will boost income opportunities for 100,000 smallholder farming households by expanding partnerships with agribusinesses in the Southern Corridor of Tanzania.  Upon implementation completion, the SIP would directly benefit over half a million people and engage up to 40 agribusiness operators, with emphasis on including women in successful commercial value chains.

The SAGCOT Investment Project is separate, distinct and catalytic; it supports select aspects of the overall SAGCOT Programme. The SIP is working to benefit smallholders through investments that are financially, socially and environmentally sustainable, in line with its development strategy for Tanzania and Tanzania’s own National Strategy for Growth and Reduction of Poverty (Mkukuta II), specifically Cluster I, which calls for the “modernization and commercialization of private sector-based agricultural activities through accelerating productivity growth and removing bottlenecks along agribusiness value chains.”  The SIP contributes to achieving the World Bank’s twin goals of ending poverty and boosting shared prosperity by enhancing the participation of smallholder farmers in sustainable agribusinesses. More information on SIP is available online.

The SIP and Land Issues

The World Bank-financed SAGCOT Investment Project is structured to increase commercial benefit flows to smallholder farmers derived from the growth of existing agribusinesses that have clear, undisputed land titles and land rights; only such agribusinesses are eligible for World Bank financing.  SIP does rnot support investments that involve the reallocation of land from smallholders to agribusinesses or that involve the acquisition of new land by private investors.

In supporting the SIP, the World Bank recognizes that Tanzania has one of the strongest land law  frameworks in Sub-Saharan Africa for the protection of rural land rights.  Under the 1999 Village Land Act, most rural land (70 percent of total land available in the country) has been placed under the control of villages and the Act includes robust procedures governing the reallocation of land to private investors.

In response to concerns that increasing commercial investment under the SAGCOT Programme could have impacts on local land rights if proper procedures are not followed, the Government of Tanzania has provided a “Letter of Sector Policy on Land” confirming its commitment to protecting the land rights of rural households and village communities, and to ensuring that any land allocation to agribusinesses within the wider Progamme will be based on community consent, with appropriate compensation and well-defined sharing of benefits and commitment to partnership between the community and the investor.  The GoT has also committed to ensuring that land allocations are transparent and publicly-documented.

The SIP and Indigenous Peoples Policy

As part of the discussions during preparation of the SIP, the GoT requested a waiver to the application of the World Bank Indigenous Peoples Policy (OP 4.10) stating that the policy was inconsistent with the Tanzanian Constitution which emphasizes unity and calls for equal treatment of all ethnic groups by not giving special preference to individual ethnicities.

The waiver requested was approved by the Bank’s Board of Executive Directors. A Vulnerable Groups Planning Framework (VGPF) has been prepared to guide project implementation and includes measures to ensure that such groups would be involved in a process of free, prior and informed consultation; any adverse impacts on such groups are mitigated; that the groups benefit from the project in a socially appropriate manner; and a process for grievance redress is available to them. The VGPF includes monitoring and evaluation to assess the project’s impacts on and b enefits for vulnerable groups.

The World Bank’s standard accountability mechanisms remain unchanged, including access to the Inspection Panel, the independent complaints mechanism for people and communities who believe they have been, or are likely to be, adversely affected by a World Bank-funded project.