Vice President Dr. Mahamudu Bawumia, has called on financial institutions to reconsider the notion that investing in Agriculture is risky and play their integral role to promote agriculture, export and socio-economic development.
He made the call on Thursday when he launched the USAID supported “Feed the Future Ghana Mobilizing Finance in Agriculture” (MFA) program via a virtual platform.
The theme for the program was, “Financing Ghana’s Agriculture: A Critical Pathway towards Sustainable Growth, Self-Reliance, and Shared Property.”
MFA is a $19 million, four-year project from 2020 to 2024, focused on 7+1 target agriculture value chains, to mobilize new sources of capital, expanding the supply of Agricultural finance, and creating partnerships to expand access to finance.
It also seeks to increase the commercial financing available for Agriculture that enables capital investment and trade.
Dr. Bawumia said though commercial banks provided loans to farmers, they complained of high interest rates and constant demand for high value collateral.
“If we would not grow out of the traditional lending schemes, then, it will be difficult to promote the agricultural sector. We need innovative schemes and instruments to support Agriculture,” he noted.
He said it was imperative to create enabling environment to create convenience for farmers to grow, and that government, was, therefore, acting as a catalyst to create a stable and sound economy to promote agricultural investments.
The Vice President gave an assurance that government would, therefore, do its part to reduce inflation rates, and lower lending and exchange rates.
Agriculture, he said remained a key contributor to socio-economic development, adding that in Ghana, it contributed to 18.5 per cent of the Gross Domestic Product, provided raw materials for finished goods, nearly contributed 38 per cent to the active labor force and 60 per cent to the rural population’s work.
Dr. Bawumia said the government was reviving and encouraging Agricultural research at the Council for Scientific and Industrial Research and other public institutions.
It had also secured 37 million dollars to promote farming activities in Northern Ghana and was upgrading road infrastructure connecting farms to markets, he stated.
Mr. Plato Hieronimus, Private Sector Engagement, USAID, emphasized the importance of financing to agriculture, explaining that without it, farmers could not supply food, traders could not sell, people would go hungry and the economy would suffer.
He encouraged actors in the agricultural value chain to take advantage of government’s flagship program to promote their operations.
Miss Stephanie Sullivan, US Ambassador to Ghana, said the US was working to enhance Ghana’s export and help her businesses with technical assistance to fit into the current world affected by the outbreak of COVID-19.
“The US will push the country that climbs a good tree. That means we will support businesses committed to expand and contribute to export,” she said