Honorable Fifi Kwetey, Minister of Food and Agriculture, distinguished Ladies and Gentlemen,
It is a great delight for me to be speaking today at the second annual Ghana Agribusiness Investment Summit.
I am happy to note that since last year’s summit, USAID through the Financing Ghanaian Agriculture Project has facilitated over $15 million in investments into agribusinesses in the rice, maize and soy value chains.
One of the key constraints of developing commercial agriculture in Ghana is limited access to finance. Financial institutions are reluctant to provide financing to the agricultural sector due to perceived and actual risks.
Meanwhile more than 3 million Ghanaians, mostly living in rural agricultural communities in northern Ghana, struggle against the threat of food insecurity on a daily basis.
I think that the theme for today’s event – Overcoming Obstacles to Unlocking Agricultural Investments in Ghana – presents us with an exciting challenge, on behalf of the American people, we are proud to join you in meeting it.
The dialogue we have here today will bring into focus this Credit Constraint. President Obama’s Feed the Future Initiative has a special focus on transforming the agriculture sector. The U.S. Government has also committed support to improve access to credit under the Partnership for Growth initiative.
This event is about you, meeting your needs as agribusinesses, and needs as financial institutions to maximize good investment opportunities with minimal risk. It is about expanding levels of food security in Ghana.
USAID, through its Financing Ghanaian Agriculture Project (or what we call FinGAP), provides technical assistance and incentives to drive financing for agribusiness through partnerships, and specifically, a Business Advisory Service providers’ network.
Access to credit has been a major challenge for businesses in Ghana, especially Small and Medium Enterprises. However, the situation is even more severe for the agricultural sector. Only about 4% of lending in Ghana goes to the Agricultural sector.
The number of Ghanaians involved in agriculture implies that private sector investment into the agriculture value chains is critical to reducing poverty and spurring economic growth in Ghana.
Steps must be taken to address the issue of high cost of credit, which is holding back investments into the agricultural sector.
We aim to help Ghana take those steps through programs like FinGAP, which is an important part of USAID’s overall goal of fostering broad-based, sustained and inclusive economic growth in Ghana.
Since last year’s summit, we’ve seen great progress and we are looking forward to even bigger successes this coming year. The U.S. Government is committed to supporting Ghana as you improve financial sector infrastructure and access to finance. We look forward to working with you towards a goal of Overcoming Obstacles to Unlocking Agricultural Investments in Ghana.