The Agricultural Development Bank has extended a GH¢50million credit facility at a concessionary rate to the National Food Buffer Stock Company (NAFCO) to purchase grains under government’s Planting for Food and Jobs (PFJ) initiative, for onward delivery to schools under the Free SHS programme.
Dr. John Kofi Mensah, Managing Director of the bank, during the cheque presentation ceremony at the bank’s head office in Accra, pointed out that a readily available market and guaranteed prices are prerequisites for enhanced agricultural productivity.
He lauded the Buffer Stock Company for its creditable performance last year when the bank loaned it GH¢20million. “The bank in 2018 provided a facility of GH¢20million for NAFCO to purchase grains held by farmers who produced under the PFJ campaign. I wish to state that NAFCO performed creditably and liquidated the facility on schedule.
“The increased amount of GH¢50million is underpinned by the fact that the cultivated area under the Planting for Food and Jobs campaign has increased, and again because the third stream of students under the Free SHS programme will be going to school in September with the attendant increase in food requirement,” he said,
Dr. Mensah said in addition to supporting NAFCO to undertake purchases of grains, the bank will also continue to provide support to aggregators licenced by NAFCO to purchase grains and other foodstuffs for supply to secondary schools.
“ADB has done this due to our conviction that the agricultural sector has responded to the clarion call from the president of the nation, and we have changed our strategy by accelerating our input in terms of finance into agriculture. We have moved it up, and we believe that we have to encourage the farmers to produce more,” he added.
He stressed that the current situation – wherein the country annually loses between 20 to 50 percent of all vegetables and 20 to 30 percent of grains produced through post-harvest losses – has led to the support from NAFCO to provide reliable marketing outlets for farmers.
“We are looking forward to partnering NAFCO in setting up appropriate post-harvest and processing technologies to deal with the many perishables, such as plantain and tomatoes. ADB continues to support government’s agricultural initiatives and interventions,” he said.
He pointed out that as a bank with a developmental focus and a mandate to provide financial intermediation for the development and modernisation of Ghana’s agricultural sector, ADB is aware of its strategic role in providing financing to accelerate growth of the agricultural and allied sectors.
“It is in light of this that the board and management of the bank have tasked the Agribusiness Division to increase the agricultural loan portfolio to a minimum of 50 percent of the total loan book by 2022. ADB will continue to roll out innovative products, programmes, schemes and services that will reduce bottlenecks associated with agricultural lending, as well as increase the bank’s outreach,” he said.
He urged more people, especially the youth, to venture into agriculture because they can count on support from the ADB.
Alhaji Hanan Abdul-Wahab, CEO of NAFCO, noted that with the credit facility, the company will be able to purchase grains from farmers for onward supply to selected state institutions -especially the public boarding second cycle institutions under the Free Secondary Education Programme, one of government’s flagship programmes.
He noted that introduction of the PFJ programme has significantly changed the landscape of agriculture in Ghana, leading to an increase in food productivity. “The availability of ready markets for our farmers will further enhance the successes chalked up in the PFJ,” he noted.
Emmanuel Asante Krobea, a Technical Advisor to the Minister of Food and Agriculture, noted the presentation is a significant milestone in the ministry’s PFJ programme. “This is a game changer for the programme. The minister appreciates the bank for its continuous support over the years,” he said. He also lauded NAFCO for positioning itself credibly for the bank to lend such a significant amount to it.