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The International Fund for Agricultural Development (IFAD) and the French Development Agency (AFD) have signed an agreement to work towards the development of rural areas in developing countries. AFD agreed to provide a €200 million loan to IFAD to support rural finance, adaptation to climate change, gender equality, and stem migration, according to a statement released this week.

“At a time when governments face constraints on development funding, and with the demand for IFAD’s services higher than ever, this loan gives us the opportunity to increase investment in rural areas of developing countries and help achieve the Sustainable Development Goals of ending hunger and poverty by 2030,” said Kanayo Nwanze, the outgoing President of IFAD, whose tenure ends on March 31, 2017 after eight years at the helm.

Gilbert Fossoun Houngbo, a former Togolese prime minister, has been elected to succeed Nwanze, a Nigerian, from April 1.

Prior to the latest agreement, IFAD and AFD had collaborated on a number of initiatives including the development of weather insurance products and support to farmers’ organizations in Africa. Both organizations share a similar approach to agricultural and rural development, they prioritize investments in small-scale farming and share the goals of achieving food security and sustainable rural development.

“Through AFD, France wanted be the first member of state to support, under IFAD's sovereign borrowing framework, its 2016-2018 programme,” said Rémy Rioux, AFD’s Director General. “This sovereign loan of €200 million marks, I am convinced, a new step in the partnership relations between our institutions. We both share a common dedication to achieving the Sustainable Development Goals. Joining our forces for agricultural, rural and local development is a key step in this direction.”

IFAD is an international financial institution and a specialized United Nations agency based in Rome, Italy’s capital city. Since 1978, IFAD has provided over $18.4 billion in grants and low-interest loans to projects that have reached about 464 million people in rural areas, helping to reduce poverty, increase food security, improve nutrition, and strengthen resilience.