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Swedfund, Sweden’s development finance institution (DFI), announced on Monday a $12 million investment in the Acumen Resilient Agriculture Fund II (ARAF II) to strengthen climate resilience and productivity across African food systems. The commitment, disclosed today, will support fast-growing agribusinesses that help smallholder farmers access markets, finance, technology and essential agricultural services.

More than 30 million smallholder farmers operate across Sub-Saharan Africa, accounting for 80% of all farms and producing 70% of the region’s food, according to IFAD. Yet these farmers face persistent barriers, including limited financing, poor access to quality inputs, unreliable buyers, and inadequate market information. They are also among the most vulnerable to climate change and weather-related shocks.

“Climate change is already affecting the livelihoods of millions of smallholder farmers across Africa. Investing in businesses that improve access to markets, finance and agricultural services helps farmers strengthen their resilience, increase productivity and build more stable incomes. That is essential for more resilient food systems,” said Helen Hagos, Investment Director, Food Systems & Strategic Investments at Swedfund.

ARAF II targets businesses that close critical gaps across agricultural value chains, from improving market access and reducing post-harvest losses to expanding digital and financial services for farmers. By scaling these companies, the fund aims to boost productivity, deepen local value chains and enhance the resilience of food systems across the continent.

Swedfund’s investment is expected to help ARAF II reach approximately four million smallholder farmers through its portfolio companies. The fund also aims to meet the criteria of the 2X Challenge, an initiative that promotes investments advancing women’s economic empowerment.

Swedfund is investing alongside other development finance institutions and private investors to mobilise long-term capital for agribusinesses that often struggle to access finance, despite their potential to strengthen food security, climate resilience and economic development.

ARAF II is managed by Acumen Capital Partners, a subsidiary of Acumen, and focuses on agribusinesses whose models help farmers adapt to climate change and build more stable livelihoods.

The Swedish DFI says it is committed to reducing poverty through sustainable investments in developing countries. Its work supports the implementation of the 2030 Agenda and the Paris Agreement by creating decent jobs and expanding access to essential services, including electricity and food.

Swedfund operates through two instruments, namely Sustainable private-sector investments and Technical feasibility studies, via its Project Accelerator, which supports public-sector infrastructure development and trade opportunities for Swedish solutions.

The institution positions itself as a long-term, catalytic investor, mobilising private capital and measuring impact across all its interventions. Swedfund is state-owned, managed by Sweden’s Ministry of Finance, and financed through portfolio reflows and annual capital injections overseen by the Ministry for Foreign Affairs.