Banks and other financial institutions in the country are been blamed for the poor performance of Ghana’s agriculture sector, compare to other sectors because most of these financial institutions have failed to support the agric sector.
The Deputy Minister of Food and Agriculture, Mr. George Boahene Oduro pointed out that financial institutions in general have create problems for agribusiness industry, because they believes there are huge risks associated to sector.
“Yes, I know there are some forms of risks within the agribusiness sector. But it is not a situation where financial institutions especially the banks should make the sector looks bad, and because of that they will make things difficult for those players they come in contact with,” he added.
According to him, because the financial institution believes there are risks in the sector, they make it difficult for the industry players to access credit facility by pegging the interest rate higher and also frustrate those who are able to access the credit.
Mr. Oduro said this when he gave address at the launch of the Business Advisory Service Providers Association of Ghana (BASPAG) in Accra on Tuesday May 29, 2018, with support from the U.S. Government’s Feed the Future Financing Ghanaian Agriculture Project (USAID FinGAP).
The BASPAG is an initiative of USAID FinGAP’s Business Advisory Service (BAS) providers’ network, which link agribusinesses and other Small and Medium Enterprises (SME’s) to finance and expand their business operations.
The Daily Express gathered that USAID FinGAP provides financial capital to agribusiness and smallholder farmer through BASPAG. BASPAG is made up of institutions that provide several supports to agribusinesses in the country.
The Deputy Minister of Food and Agriculture said the financial institutions in the country do not do their works very well that’s why they see the agric sector as the most risk area. “I disagree with them,” he added, noting he doesn’t see why financial institutions prefer coming to the aide of farmers when the season is about to end.
“Sometimes it’s the fault of the financial institutions when the farmers are unable to service or pay their loans back. They make things difficult for the farmers,” said the Deputy Minister of Food and Agriculture.
The Chief Executive Officer (CEO) of BASPAG, Mr. Samuel Zeph Atiemo said BASPAG is coming at a time that business opportunities for Micro, Small, Medium and Large-Enterprises (MSMLs) abound in every sector of Ghana’s economy, yet there are no innovative ways of identifying and maximising these opportunities for clients and shareholders.
“For instance, there are many financial sector institutions looking for projects to finance or entrepreneurial ventures that require financial support, we need to synergise to satisfy our mutual needs. It is this convergence of synergy that BASPAG aims to broker large deals for mutual benefits and success,” said Mr. Atiemo.
The BASPAG established to improve access to good quality BAS; improving access to appropriate enterprise finance; better coordinated and well-targeted advocacy for BAS provision and private sector development; and promoting the emergence of an entrepreneurial ecosystem in which BAS providers are able to increase their contribution to inclusive and sustainable development in Ghana.
The Daily Express understands that BASPAG objective is to provide a platform for linking enterprises to BAS providers; provide a platform for linking financial institutions, enterprises and BAS providers; and advocate for BASPAG members around issues affecting BAS provision and enterprise development.
BASPAG services include investment and credit facilitation, organizational development, market linkages, financial and investment management, strategic planning, business planning, and mentorship and coaching.
For the last four years, BAS providers (43 including six female-led BAS firms) have partnered with USAID FinGAP to facilitate approximately US$45 million in financing from 28 financial intermediaries for 260 agribusiness enterprises in the maize, rice and soy value chains to increase production and enhance food security.
The financing accessed by these agribusinesses has benefited a total of 61,834 smallholder farmers in Northern Ghana. To date USAID FinGAP has unlocked approximately US$168 million in private capital for 2,995 agribusinesses, 40% being female-led agribusiness enterprises. These development efforts have reached over 169,698 smallholder farmers in the maize, rice and soy value chains.
