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Government to introduce legislation to compel commercial banks to give loans to farmers – Agric Minister

Dr Owusu Afriyie Akoto Inset Agric Minister Dr. Owusu Afriyie Akoto

Tue, 21 Jun 2022 Source: gbcghanaonline.com

The Minister of Food and Agriculture, Dr. Owusu Afriyie Akoto has revealed that the government will soon introduce a Bill to be presented to Parliament for approval that will compel commercial banks in Ghana to give loans to farmers.

The Minister of Food and Agriculture, claimed that the government has done its part in supporting Ghanaian farmers by subsiding inputs therefore, the banks will have to also play their role in ensuring sustainable food production in the country by giving out loans to the farmers and other players in the agriculture sector.

According to Dr. Afriyie Akoto, Ghana is not the first country to introduce such a law, citing India as an example which he said has done it for over 30 years.

The Food and Agriculture Minister, announced this when he toured some selected commercial farms in the Eastern Region over the weekend.

He further explained that the cost of farming has shot up due to factors beyond his government’s control.

“When we met the poultry farmers, it is very obvious that prices of poultry feeds which make up 70 percent of the cost of production have gone up. If you compare prices this year in January, February, March, April, and May, and compare to the same period in 2021, 2020, and 2019, the prices have shot up.

"They have shot up for the very simple reason that the chemicals have gone up two or three times and that means the cost of production has gone up on the farm.

“At the same time, fuel prices have trebled and it means that haulage from the farm gate to the centres of consumption has also gone up.

"So, these we don’t have control over, these are external factors that are impacting seriously the price formation.

“The thing is that because of that the cost of doing business in the Agriculture space has gone up and that is why poultry farmers, for instance, those who were doing 150,000 birds, have now reduced to 50,000 because their working capital cannot support the new higher prices.

"That is where the banks have failed us in agriculture because the banks which are doing business with these poultry farmers should be able to give them credit to sustain their production at those levels or even increase it.

“Unfortunately, the banks have stayed away and therefore they are having to reduce the level of production.

"Their interpretation had been that the government, in spite of all that is happening, had done nothing.

"But we took the trouble, more than one and half hours, to explain to them what the government is doing in trying to rectify the situation. After the explanation, it was obvious that they were very satisfied with the efforts we have made.

“We are making a whole lot of efforts to ensure that we bring in the commercial banks including the possibility of introducing legislation so that commercial banks would have to lend a portion of their portfolio to farmers and those in the value chain, the processors, and others.

"We wouldn’t be the first country in the world to do that, India has been practicing that for 30 years.

“So definitely you are going to hear something in Parliament about this issue, as a way of making sure the commercial banks play their role because the government is playing its role by subsiding inputs and fertilizer, the banks should be able to lend to agriculture.”

Source: gbcghanaonline.com
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