JICA, ECOM boost sustainable coffee farming

JICA, ECOM boost sustainable coffee farming

The Japan International Cooperation Agency (JICA) has expanded its role in global food security with its first exclusive working capital loan.

On October 2, JICA signed a loan agreement worth up to $75 million with ECOM Agroindustrial Corporation Limited (ECOM) and its affiliate ECOM Agroindustrial Asia Pte Limited (EAA). Co-financed by the Asian Development Bank (ADB), the deal strengthens ties with one of the world’s leading agricultural trading groups and aims to reinforce Asia’s agricultural and food supply chain.

The loan is aimed at strengthening supply chains, improving livelihoods, and creating jobs for small-scale farmers across the Asia-Pacific. A key focus is the stable procurement of coffee from more than 60,000 smallholder farmers in Vietnam, Indonesia, India, and Papua New Guinea.

Alongside purchase financing, the initiative also provides consulting services, including coffee certification support, pilot projects on climate change adaptation, and tailored farming assistance for women. These measures are designed to boost climate resilience and advance gender equality in the region’s coffee value chain.

Vietnam is the world’s second-largest coffee producer, with coffee beans accounting for 12.2 per cent of the country’s total agricultural exports. Yet, raising value-added output and improving rural incomes remain major challenges for the sector.

The JICA loan aligns with Vietnam’s Agricultural Sector Reform for Value-Added and Sustainable Development and the 2021–2025 Socioeconomic Development Plan, both of which aim to enhance efficiency, quality, and productivity. It also supports Japan’s broader development agenda, echoing the Apulia G7 Leaders’ Communiqué of June 2024, which called for public-private partnerships to strengthen the global coffee value chain and support smallholder farmers in producing countries.

It also reflects former Prime Minister Kishida Fumio’s pledge at the 2023 G7 Hiroshima Summit to advance sustainable development through the $1 billion Facility for Supporting Agricultural Supply Chains and Food Security Enhancement, a programme designed to tackle global food security challenges.

"We are honoured to launch JICA’s first exclusive working capital loan with ECOM, a global leader in sustainable coffee trading," said Yasui Takehiro, director general of JICA Private Sector Partnership and Finance Department.

"This initiative, built on strong partnerships with ECOM and ADB, will strengthen the coffee supply chain and help tackle rural poverty, gender inequality, climate vulnerability, and the need for sustainable livelihoods. We also hope to expand this financing model to support more supply chain businesses in the future," he added.

JICA remains committed to supporting inclusive and sustainable development initiatives in the region through strategic partnerships and providing innovative financing solutions.

VIR