GHANA – Following the presentation of the 2023 budget, the Agricultural Development Bank (ADB) Plc, has welcomed the Ghana government’s pledge to establish a GH¢ 500million (US$38.02m) special credit program to focus on the agriculture sector and some other sectors.
This initiative by the government, according to the newly appointed Managing Director of ADB, Ahaji Alhassan Yakubu-Tali, will tremendously de-risk financing to the sector with the government pledged to introduce an agricultural insurance product through the Ghana Agricultural Insurance pool with an additional investment of around US$400million.
Set up to develop the agricultural sector and with 87 network branches nationwide, ADB remains the only bank in the country with branch locations in mainly agricultural-prone areas like Sefwi-Wiawso, Juaboso, Dormaa Ahenkro, Enchi, Savelugu, Nkoranza, Goaso, Denu, Juapong, Sefwi Essam, Sogakope, Bonsu Nkwanta, Apemenim.
Overall investment into the Ghanaian agricultural sector over the past six years has seen steady growth, reaching GH¢993.50 million (US$75.54m) as of September 2020, from GH¢453.20 million (34.46m) in December 2016.
The amount excluded the huge volumes of non-funded facilities such as letters of credit and guarantees granted for the purchase of agricultural inputs, machinery, equipment, and raw materials.
Alhassan Yakubu-Tali noted:” The over 119% increase in agri-finance has come on the back of our strategy to focus the bank onto its original mandate of providing financial intermediation to the sector and to do more in the coming years.”
The Bank has been an active partner for the implementation of the novel One District One Factory (1D1F) initiative and so far about 20 companies had received financial support of over GH¢100 million.
They include Ekumfi Fruits and Juices Limited, Kumasi Jute Factory, Weedi Africa Tomato Processing Factory, and Kaad Integrated Limited.
In supporting the Fisheries sector, the bank imported 1,300 outboard motors made up of 1200 (40HP) and 100 (15HP) Yamaha products at a cost of GH¢19.8million (1.51m) for the Ministry of Fisheries and Aquaculture Development and the Coastal Development Authority.
The bank undertook the importation to absorb all incidental and related costs amounting to about GH¢7.0 million, which will have been a cost to the fishers.
To also further contribute to the government’s effort at reducing the importation of poultry into the country, ADB this year announced the implementation of the Broiler Revitalisation Programme with poultry farmers in the Bono Region being the first beneficiaries.
Explaining the need for increased funding to the sector amid the current economic conditions, Mr. Yakubu-Tali said additional investments will improve food security and engender a shift from the traditional production of raw materials to value addition for both local and export.