Agric sector deserves credit, not risk prone than others – AFT Fund Chief

Coordinator of the AFT Fund at the AFDB, Dr Jonas Chianu has observed that while commercial banks are weary of offering credit to farmers citing high-risk concerns, he believes the agricultural sector is not volatile nor risk-prone than competing sectors such as mining, manufacturing or the services sector.

He said it was passive fear the banks have which is unfounded yet aided in the agric sector only being availed 4 percent credit in 2018 for farming, fishing and related activities as against vast sums other sectors got as credit.

To cure the anomaly, the African Development Bank (AFDB) is confident a newly secured US$23 million grant under the Agriculture Fast Track Fund, will go a long way to improve some aspects of the agriculture value chain in Ghana from production to the market spanning rural feeder roads to irrigation, agro-processing and marketing facilities as well as out-grower schemes.

The funds, which will benefit 17 new projects in 8 countries, is expected to be used for feasibility studies, market analysis, environmental and social impact assessments among others, to aid in the development of a strong pipeline of bankable agriculture infrastructure projects.

The Agriculture Fast Track Fund (AFT Fund) custodians of the US$23 million grant which was provided by the governments of Denmark (through DANIDA), the US government (through USAID) and Sweden (through Sida), is managed by the Agriculture and Agro-Industry Department of the African Development Bank.

Of the 17 Small- and Medium-sized Agribusinesses to benefit from the grant, Ghana and Tanzania had the highest number of four beneficiaries each, Burkina Faso, Malawi and Mozambique all had two beneficiaries each, while Ethiopia, Nigeria and Senegal all had single beneficiaries.

The 17 beneficiaries Small- and Medium-sized Agribusinesses are expected to receive between US$100,000 and US$1.5 million for their feasibility studies.

Tamanaa Company Limited received US$220,000 to be invested in rice production and processing, while Farmline Limited Ghana was granted US$165,000 for warehouse and industrial food processing.

Philafrica Foods Limited received US$195,000 for a maize mill plant and integrated poultry production, while Techiman Processing Complex Limited had US$160,000 for a tomato supply chain processing.