The Danish government, the Investment Fund for Developing Countries (IFU), PensionDanmark and PKA, have jointly invested $102.28m (DKK 700m) in the Danish Agribusiness Fund, which will back agri projects in developing countries.

The $102.28m (DKK 700m) consists of $12.86m (DKK 88m) from development aid, $30.98m (DKK 212m) from IFU and $29.22m (DKK 200m) from two pension funds, PensionDanmark and PKA respectively.

The Fund is expected to raise additional capital of $14.61m (DKK 100m) in a second closing.

The Danish Agribusiness Fund will invest capital in projects in Africa, Asia, Latin America and parts of Europe.

The funds are expected to generate investments of close to $876.7m (DKK 6bn) in improved production, distribution and food sales in developing countries.

The Danish Agribusiness Fund will be managed by IFU, which has experience from 1,200 investments in more than 100 developing and emerging countries in Africa, Asia, Latin America and parts of Europe.

Tommy Thomsen, CEO of IFU, said: “We are very pleased that we have managed to bring private investors and public capital together in a fund that has such an important purpose. Because the Danish Agribusiness Fund only contributes with part of the investment in each project, we expect that the total investments will amount to around DKK 6bn.”

Peter Damgaard Jensen, Managing Director of PKA, added that PKA has good experience with collaborating with IFU on investments in developing countries: “Because of this we expect to achieve good results with the partners in the new fund. By becoming part of the Danish Agribusiness Fund, we can make a positive difference in developing countries, strengthen the Danish economy and ensure a good return for our members.”

The Fund will invest in projects throughout the entire value chain from farm to fork, where a Danish commercial interest is included – thereby increasing the export of Danish technology and know-how.

Danish Foreign Minister Kristian Jensen, said: “Danish agricultural and food companies are among the most efficient in the world. Consequently, these companies can help to increase the production of much-needed food in developing countries.”

“However, there is a need for risk capital if the potential is to be realised. That is exactly what the new fund will contribute to. Accordingly, this initiative is in line with the global UN goal to increase private investment in the agricultural and food sector in developing countries,” he said.