An Exploratory Overview of Agriculture Finance in Indonesia
The Government of Indonesia is aiming to diversify the country’s food system by developing and strengthening high-value-added and more nutrient-rich value chains. In this regard, the government is focusing on diversifying into horticulture and smal...
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| Format: | Report |
| Language: | English |
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World Bank, Washington, DC
2020
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| Online Access: | http://documents.worldbank.org/curated/en/414561593422207170/An-Exploratory-Overview-of-Agriculture-Finance-in-Indonesia-Background-Paper-1-Agro-Value-Chain-Assessment http://hdl.handle.net/10986/34100 |
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okr-10986-341002021-05-25T09:57:06Z An Exploratory Overview of Agriculture Finance in Indonesia World Bank HORTICULTURE AGRICULTURE VALUE CHAIN AGRICULTURAL FINANCE FINANCIAL TECHNOLOGY CROP INSURANCE BLENDED FINANCE The Government of Indonesia is aiming to diversify the country’s food system by developing and strengthening high-value-added and more nutrient-rich value chains. In this regard, the government is focusing on diversifying into horticulture and small ruminant livestock. Undertaking Value Chain Analysis (VCA) is a critical part of this process as it helps in the identification of constraints and opportunities in relevant sectors. Agriculture funding and finance are vital components of this analytical process. This report presents a preliminary overview of opportunities and constraints as well as areas for future interventions. The analysis is based on a World Bank and FAO scoping mission to Indonesia that took place between March 2 - March 13, 2020. This report focuses on the supply-side of capital. The key findings suggest that supply-side constraints are minimal. The liquidity in Indonesia’s banking system is enough and there already exist extensive physical banking networks within the country. The Indonesian banking networks include a selection of commercial and specialized banks, membership-based groups, and fintech organizations. Also, there exist several large food manufacturers that could potentially aid in the process of financing and the creation of linkages through vertical integration of value chains. The Small and Medium Size Enterprises (SMEs) in the food and agriculture sectors have been growing strongly, and they can act as accelerators and facilitate the process. The Indonesian government is supporting the development of value chains and has been actively promoting the creation of farmer organizations to aid the process. Lastly, there exists a demand for the creation of a blended finance facility that could help amplify the effects of the value chain projects, and the Tropical Landscapes Finance Facility (TLFF) is a proof of such a concept that is working well in Indonesia. 2020-07-14T19:30:40Z 2020-07-14T19:30:40Z 2020-06-19 Report http://documents.worldbank.org/curated/en/414561593422207170/An-Exploratory-Overview-of-Agriculture-Finance-in-Indonesia-Background-Paper-1-Agro-Value-Chain-Assessment http://hdl.handle.net/10986/34100 English CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Economic & Sector Work Economic & Sector Work :: Other Agricultural Study East Asia and Pacific Indonesia |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
HORTICULTURE AGRICULTURE VALUE CHAIN AGRICULTURAL FINANCE FINANCIAL TECHNOLOGY CROP INSURANCE BLENDED FINANCE |
| spellingShingle |
HORTICULTURE AGRICULTURE VALUE CHAIN AGRICULTURAL FINANCE FINANCIAL TECHNOLOGY CROP INSURANCE BLENDED FINANCE World Bank An Exploratory Overview of Agriculture Finance in Indonesia |
| geographic_facet |
East Asia and Pacific Indonesia |
| description |
The Government of Indonesia is aiming to
diversify the country’s food system by developing and
strengthening high-value-added and more nutrient-rich value
chains. In this regard, the government is focusing on
diversifying into horticulture and small ruminant livestock.
Undertaking Value Chain Analysis (VCA) is a critical part of
this process as it helps in the identification of
constraints and opportunities in relevant sectors.
Agriculture funding and finance are vital components of this
analytical process. This report presents a preliminary
overview of opportunities and constraints as well as areas
for future interventions. The analysis is based on a World
Bank and FAO scoping mission to Indonesia that took place
between March 2 - March 13, 2020. This report focuses on the
supply-side of capital. The key findings suggest that
supply-side constraints are minimal. The liquidity in
Indonesia’s banking system is enough and there already exist
extensive physical banking networks within the country. The
Indonesian banking networks include a selection of
commercial and specialized banks, membership-based groups,
and fintech organizations. Also, there exist several large
food manufacturers that could potentially aid in the process
of financing and the creation of linkages through vertical
integration of value chains. The Small and Medium Size
Enterprises (SMEs) in the food and agriculture sectors have
been growing strongly, and they can act as accelerators and
facilitate the process. The Indonesian government is
supporting the development of value chains and has been
actively promoting the creation of farmer organizations to
aid the process. Lastly, there exists a demand for the
creation of a blended finance facility that could help
amplify the effects of the value chain projects, and the
Tropical Landscapes Finance Facility (TLFF) is a proof of
such a concept that is working well in Indonesia. |
| format |
Report |
| author |
World Bank |
| author_facet |
World Bank |
| author_sort |
World Bank |
| title |
An Exploratory Overview of Agriculture Finance in Indonesia |
| title_short |
An Exploratory Overview of Agriculture Finance in Indonesia |
| title_full |
An Exploratory Overview of Agriculture Finance in Indonesia |
| title_fullStr |
An Exploratory Overview of Agriculture Finance in Indonesia |
| title_full_unstemmed |
An Exploratory Overview of Agriculture Finance in Indonesia |
| title_sort |
exploratory overview of agriculture finance in indonesia |
| publisher |
World Bank, Washington, DC |
| publishDate |
2020 |
| url |
http://documents.worldbank.org/curated/en/414561593422207170/An-Exploratory-Overview-of-Agriculture-Finance-in-Indonesia-Background-Paper-1-Agro-Value-Chain-Assessment http://hdl.handle.net/10986/34100 |
| _version_ |
1764480096249315328 |