During a public ceremony in Mbabane a EUR 36.4 loan agreement was signed between the EIB and the Ministry of Finance of Eswatini, in support of phase two of the Lower Usuthu Smallholder Irrigation Project (LUSIP II) being developed by the Swaziland Water and Agricultural Development Enterprise (SWADE). 

• EUR 36.4 million loan from the European Investment Bank (EIB) for the second phase of the Lower Usuthu Smallholder Irrigation Project
• After successful first phase, new financing to equip over 5,200 ha of dry land with irrigation infrastructure and replace inefficient pumping systems for a further 533 ha.

During a public ceremony in Mbabane a EUR 36.4 loan agreement was signed between the European Investment Bank and the Ministry of Finance of Eswatini, in support of phase two of the Lower Usuthu Smallholder Irrigation Project (LUSIP II) being developed by the Swaziland Water and Agricultural Development Enterprise (SWADE). Following on the LUSIP I project, which had the objective of storing water to enable year-round agricultural production, LUSIP II will enlarge the available irrigated farmland for local smallholders. The design of the bulk storage facility (Lubovane Dam), constructed under LUSIP I, envisaged a command area of 11,500ha, this includes LUSIP II.

LUSIP is a climate adaptation initiative to alleviate poverty and improve food security through sustainable agriculture in Lowveld, one of the driest and poorest areas of land-locked Eswatini, where over 70% of the population relies on subsistence farming and one in three people are undernourished. The project is based on an integrated bottom-up approach of social and economic empowerment throughout project identification, preparation and implementation, supporting the introduction of commercial farming in the area.

The final beneficiaries are predominantly smallholder homesteads that will be grouped into Farmer Companies (FCs) to operate the irrigation systems and adopt modern farming technologies, with efficient use of water and energy resources. LUSIP II will directly benefit about 2,300 smallholder households and 10,000 people, with a further 10,000 indirectly benefiting through connected activities.

Through the provision of irrigation services, LUSIP II will provide a strong boost to the agricultural economy and is expected to have considerable spillovers on job creation, private sector development, health conditions, as well as on environmental protection through decreased land degradation. Sugarcane cultivation will cover a maximum of 70% of the irrigated area, while at least 30% of the irrigated area shall be allocated to other food and cash crops.

“I think I don’t have to stress the importance of water for agriculture, so its efficient management really is crucial.” commented EIB Vice-President Ambroise Fayolle. ”LUSIP II is a flagship project in many respects, especially as it will strongly support as many as seven sustainable development goals. The first phase of the Lower Usuthu project was a great success, adding over 6,000 ha of irrigated land to Eswatini’s agricultural basin. Now, with new canals right up to the farmers’ land, as well as new pumping systems to replace the old ones, local farmers may have really fruitful times ahead.”

The Ambassador of the European Union to Eswatini, H.E. Esmeralda Hernandez Aragones, added that: "LUSIP II is fully aligned with the EU National Indicative Programme (NIP) for 2014 – 2020 which singles out agriculture as one of the two key focal areas of intervention, with a view to addressing existing challenges and promoting sound agricultural practices, eradicate food insecurity, and contributing to sustainable economic growth. By supporting such projects the EU aims to contribute meaningfully to Eswatini's development initiatives thus helping the country to achieve economic growth and prosperity."

Samson Sithole, the CEO of SWADE, added: “In LUSIP II EIB has provided substantial non-financial value added in terms of project preparation since 2012. Thanks to its early involvement, it helped SWADE design a bankable and sustainable project - especially with respect to scoping, structuring, technical solutions, as well as social and environmental standards - incorporating lessons learnt from LUSIP I and EU's best practice”