The West Africa Development Bank (BOAD) is raising XOF115bn (approximately US$200mn) in support of Benin’s 2014/15 cotton season.

Local banks, including Ecobank (agent bank), BOA, Banque Atlantique, BGFI, Diamond Bank, BSIC and UBA, contributed 79% of the total. BOAD was mandated by the government of Benin to arrange the deal, and contributed US$43mn to the operation.

The agreement was signed by BOAD president Christian Adovelande, managing director of the National Office for Farm Income Support Adrien Delidji, the borrowing organisation, and the managers of the banks involved in the transaction.

The financing has now been in place for three years. For the 2013/14 season the BOAD also raised US$200mn, to which the local banking system made the same percentage contribution as this year. These figures saw an increase from the 2012/13 deal, which amounted to US$140mn, of which the local banks covered 76%.

“The funds will be used to cover financial needs, including cotton purchase from producers, ginning as well as storage, evacuation and marketing of cotton fibre and by-products,” says the BOAD in a statement. Projections for the cotton season show a cottonseed production of 360,000 tonnes over an area sown of nearly 400,000 hectares, a 17% increase from the 2013/14 season.

Cotton accounts for 40% of total exports in Benin, mostly directed to China, India and Nigeria. The country recovered from a cotton production crisis in 2011/12 by raising the fixed price paid to producers in an effort to motivate the farmers to increase the area dedicated to cotton production. Along with the BOAD deal in 2012/13, this contributed to an increase in exports by over 90% from the previous season.