Mr Patrick Mawusi Morttey, the Head of Domestic Corporates at GCB Bank, has said statistics from the Bank of Ghana indicates Agribusiness’s share of credit by banks has seen a reduction from 5.2 per cent in 2020 to 3.4 per cent as of June 2021.
He attributed the shortfall by banks not advancing loans to farmers, to some factors such as, high risk perception, high service delivery, monitoring cost, low levels of education or financial illiteracy, inability to provide documentation required for loans, lack of capacity in agribusiness financing, lack of adequate risk management tools, rain -fed agriculture, and others.
Mr Morttey disclosed this to participants during a seminar which focuses on “Agri-business financing” held at the residency of the Volta regional Minister on Monday, November 22 as part of the ongoing fifth Volta Trade and Investment Fair.
Mr Morttey in his lecture, stated, agriculture is the main stay of the Ghanaian economy “since agriculture was contributing to Gross Domestic Product (GDP), about 35 per cent from 2010 to 2015, but there was a decline to 18.24 per cent at the end of 2020 to GDP, whilst agriculture provides about 80 per cent of the food requirements in Ghana.”
The situation, he said, called for embracing a focus on the agricultural value chain which referred to a set of actors such as farmers, transporters, processors, input providers, sales and distribution, and activities that bring a basic agricultural product from production to final consumption where each stage value is added to the product.
He revealed that the GCB Bank financed many agricultural businesses in Volta and Ghana at large and that their outfit was ready to support farmers in an organised manner with capital for enhancing their activities without any collateral.
Mr Morttey appealed to business owners in the agriculture industry to implore prudent measures to meet the expectations of banks for good business partnerships between them and their financiers in order to make agriculture attractive.
He said there were a combination of agri-business financing options depending on the need of the applicant.
It includes, long term and medium term loans for long life assets, medium term loans for development, bank guarantees, short term loans, and overdraft facilities for working capital finance.
On some government interventions, Mr Morttey mentioned, the introduction of food and jobs, rearing for food and jobs, the presence of the Agricultural Development Bank, Eximbank, Export Development Investment Fund (EDIF), Export Development and Agricultural Development Fund, among many others were assisting in controlling the agricultural sector.
On recommendations, Mr. Morttey said there was the need of forming co-operatives to enhance the capacity to source credit facilities, readiness to embrace more scientific approaches to production, and the adoption of the value chain financing method.
Mr William Dzamefe, the Volta Regional Director of Agriculture, disclosed that Volta Region is the leading producer of rice in the country and there was the need to improve on all agriculture activities in the region.
He said his outfit has embarked on several activities such as bridging the gap between other neighbouring countries for agriculture extension projects.
He highlighted vegetable farming with focus on Keta and Anloga area where over 2500 farmers were engaged in that aspect as well as other areas with different crops across the region.
Mr Felix Kamasah, the Chief Executive Officer (CEO) of Maphlix Trust Ghana Limited, players in the food production and processing industry, who is also the President of vegetable producers and Exporters Association, has urged the youth to venture into agribusiness, saying “farmers are the most intelligent people in the world.”
Mr Gorden Akurugu, Volta and Oti Regional Director of the Food and Drugs Authority (FDA), said the Authority decentralised its offices to enable all product owners to register.
He said without the permit from the FDA, it would be difficult to do business.
Me Chris Amponsah Sackey, Volta Regional Director of the Ghana Export Promotion Authority (GEPA), on his part, disclosed to participants, they have introduced several programmes such as Youth in Export Programme (YIEP), Volta Oti Vegetable Export Expansion Programme, and others to get the youth interested in farming.
Mr Dela Gadzanku, the Volta, Oti, and Eastern Regional Chairman of the Association of Ghana Industries (AGI), expressed appreciation to the facilitators and partners of the event.
He was optimistic, participants would improve on their businesses for the growth and sustainability of the economy.
Students, agriculture oriented business men and women took part in the event.