Ghana needs approximately US $40m in order to fill the financial gap in the agricultural sector. The African Regional Programme Leader of Food and Agricultural Organisation (FAO), Dr. Ade Freeman, has pointed out that there will continue to be a deficit in the sector and until that amount is acquired.
Dr. Freeman was speaking at a stakeholders’ engagement on agriculture financing under the Ghana Agriculture Investment Plan (GhAIP). He emphasized on the need for donors to invest in the area and figure out how to leverage financing resources to power the sector.
Participants at the engagement were brought together to help come up with innovative ways of addressing the financial gap in the agricultural sector.
He further added that the engagement is also expected to find out how links would be facilitated to drive the sector, trade and growth.
This, he said, would go a long way towards ensuring that all stakeholders are part of the solution to create more employment, reduce poverty and address hunger among others.
There was also a panel discussion to find out how agriculture can be financed, expected enablers or reforms needed to harness the full inherent and opportunities in the sector.
Panel members called on the authority to educate financial institutions on agriculture since they did not understand the sector and lent money to farmers like they do with commercial interests. They also appealed for a bank risk mitigation tool, adding that farmers did not have collateral for loans apart from the lands.
The panel noted that in addition to farmers being structured to reduce transaction costs in accessing agricultural credit, there is also the need to support banks to set up agriculture desks and make practical the implementation of financing to the agriculture sector though GhAIP.