Ghana: President Akuffo-Addo Urges Ghanaian Banks to Increase Levels of Support to Farmers

17 October 2023

President Nana Addo Dankwa Akuffo-Addo has called on banks to offer relatively cheaper and long-term loans to Ghana's agricultural sector to propel the country's economic growth.

"> The President said even though Ghana is the second largest economy in the West Africa region, banks in the country offer the lowest support to the private sector and in particular, the agricultural sector.

Speaking at the Presidential breakfast meeting on Agriculture and Agribusiness financing in Accra on Monday, President Akufo-Addo said a more focused and deliberate financing to the agricultural sector could increase the country's GDP significantly.

"For instance, the President expressed worry that Agriculture Development Bank (ADB) provided 20.4% of its loan portfolio to the agriculture sector, while Fidelity Bank, 10% and the GCB Bank 25%.

"...This is a matter that we have come here to resolve, how we can get more money into agriculture. To hear the statement that the level of credit that has come true our financial system to the private sector is one of the lowest in West Africa is also a very disturbing phenomenon," President Akufo-Addo said.

President Akuffo-Addo said it was disappointing that Ghanaian bank's support to the agriculture sector was lower than Senegal, Cote D-Ivoire and yet the country's GDP was the second largest in the region.

He said if the financial support to these sectors were to be raised a little higher, it would transform the country's GDP growth. "So, we need to look at that and you are the right people to look at it."

The Minister for Food and Agriculture, Dr Bryan Acheampong, said the challenges impeding the growth and development of agriculture were partly and mostly the availability of credit to players in the sector.

He said access to credit for the procurement of seeds and fertilizers, agriculture machinery and working capital as well as the cost of the credit was a bane to farmers.

Also, the Minister indicated that the other challenge had to do with the timing of disbursements for the fortunate few who can go past the bank's rigidities.

He said the solution to these major challenges identified lay with the people who make the decision to finance agriculture and that sticking to the same strategies to address the problems in the sector was a no-brainer.

"On the part of the government, we have changed course by reviewing the Planting for Food and Jobs (PFJ) programme and transforming it into an input credit system.

"We, therefore, expect a similar course correction on the part of you," the Minister told the bankers.

Dr Acheampong said as partners who are not only driven by profit but also by collective national development agenda, "We cannot continue to do the same thing and expect different results."

To prove his commitment to the PFJ and to convince the banking sector to support the initiatives, Dr Bryan Acheampong gave three examples of the interventions that MOFA is putting in place to make this happen.

In the poultry industry, Dr Acheampong said "While we (Ghana) consume a total of 324,000 MT, we are only able to produce just about 15,000 MT, implying a woeful self-sufficiency of under 5%".

"In our five-year plan, we will move our self-sufficiency from 5% to 7% by the end of 2023 and to 13% in 2024 and progressively attain full self-sufficiency of 110.6% by 2028. Specific steps that we have taken in this regard are as follows.

"In the immediate term (October to December 2023), we are supplying 4.5-million-day-old chicks, vaccines and starter-pack feed to anchor farmers and their out growers."

This intervention will result in the production of an additional 13,200 MT of poultry meat by the end of this year, which will increase our self-sufficiency to 7%, Dr Acheampong said.

"In 2024, the government will ramp up this support to 18-million-day-old chicks, vaccines and starter-pack feed, which will lead to the production of 42,600 MT of meat and increase our self-sufficiency to 13%. This trajectory will continue until we reach full self-sufficiency."

The Minister said the government was reviving the poultry industry through the rehabilitation of 300 outgrower poultry farms across the country over the next 12 months. Each of these farms can be scaled to produce 200,000 birds within each poultry cycle of 4 months.

Similarly, he said for rice, his ministry was rolling out specific interventions to increase local production and reduce import levels and the national target, he indicated, was to attain self-sufficiency in 2028 with a total paddy production of 3.31 million MT (equivalent to 1.82 million MT of milled rice).

That, Dr Acheampong said, would require putting 690,059 hectares of land under cultivation and with just 381,663 hectares currently under cultivation,

"We have to put an additional 308,396 hectares into cultivation over the next 5 years. In this regard, and over the next 12 months, we will be investing in the development of 50,000 hectares of land under an agro-economic enclave project.

"We are also undertaking the rehabilitation and expansion of several irrigation schemes that would see the construction of 50,000 hectares of irrigated land in the inland and lowland valleys, which give the highest yields for rice (average of 6.5 MT per hectare)" the food and agriculture minister disclosed.

On the manpower front, Dr Acheampong said the ministry would engage 70,000 young people to go into rice farming out of the 200,000 people the YEA intends to employ under their Youth in Agriculture module.

All these specific interventions, the agriculture minister said will result in increased production levels from the current 684,761 MT to 907,790 MT in 2024 and push our self-sufficiency level from 47.5% to 59.4%.

"Sustaining these interventions will ramp up subsequent years' production levels to reach 1,823,577 MT by 2028 with self-sufficiency of 106%, with attendant savings in our import bill.

"This is just a summary for you to appreciate the agricultural reconstruction that we have set in motion. Phase 2 of the PFJ will be the single biggest agricultural revolution in this country, and we believe that Ghana will achieve food security" Dr Acheampong indicated.

"Our mission here today is to invite financial institutions into this national development conversation. We need to establish a nexus for greater collaboration in pursuit of our collective objective of transforming Ghana's agriculture," he further remarked.

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