Ghana government to guarantee credit facilities to farmers
The Government, with the Bank of Ghana, would launch an initiative that would allow banks to give credit facilities to farmers to expand production and increase productivity.
The initiative, “Ghana Incentive-based Risk Sharing Agricultural Lending”, is a Ghc100-million-project, budgeted by Bank of Ghana to support farmers from September to December to boost agriculture and enhance food security.
Alhaji Mohammed Muniru Limuna, the Minister of Food and Agriculture, announced this over the weekend when he paid a working visit to the Ghana Commercial Agriculture Projects (GCAP) in the Accra plains to interact with farmers on their operations.
The Minister visited VEGPRO Ghana Limited in Torgorme, Sugarland at Kotoko, GADCO in Sogakope and Eden Tree, all in the Volta Region.
He also visited the Abians Company Limited and Golden Exotic Limited in the Eastern Region.
GCAP is a $145 million project, funded by the World Bank and the United States Aid for International Development, under the Ministry of Food and Agriculture, for the development and expansion of commercial agriculture.
The GCAP operates in Accra plains, comprising parts of the Greater Accra , Eastern and Volta regions, the Savannah Ecological Zone comprising the three Northern regions and the Northern part of the Brong Ahafo Region.
The Minister said banks were unwilling to lend money to farmers because of the high risk involved in farming, explaining the initiative would enable the Central Bank to insure those high risk to leverage the market for the financial institutions to feel free and give loans to farmer.
He explained that under the programme, if a farmer was given money to expand his farm and circumstances beyond his control made that impossible, a team would be sent to investigate the issue.
Alhaji Limuna said should it emerge that the limitation was the result of, for instance a bush fire or flood, the Bank of Ghana would take up the cost so that the banks would not suffer that risk.
Mr Charles Nornoo, the Project Coordinator of GCAP, said the project aimed at improving the investment climate for agri-business and develop Private-Public Partnerships and smallholder linkages towards increasing on-farm productivity and value addition in selected value chains.
He said the objective of the project was to increase access to land, private sector finance, input and output markets for small holder farmers from public, private partnership in commercial agriculture in the Accra Plains and the Northern Ecological Zone.
Other areas to be tackled under the project, he said, were nucleus out-grower or contract arrangements, he said, adding that the project would benefit both Ghanaian and international investors who would invest in new or expanded opportunities in the appropriate value chains.
Mr Jagdish Patel, General Manager of Vegpro Ghana Limited, said the soil and the temperature in the area were good, adding that the Company was planting “ baby-corn”, vegetables and flowers.
He said the Company was currently irrigating on 64,000 hectares land and envisaged to irrigate another 30,000 hectares of land.
Source: GNA