Problems over farm funds
At least $320 million allocated to farmers and agricultural and medium-scale enterprises in northern Ghana is sitting idle because many of the intended beneficiaries are from districts without any community or rural bank.
According to the Monitoring and Evaluation Officer of the Rural and Agricultural Finance Programme (RAFIP), Mr Raymond Mensah, as at 2011, a total of US$320 million credit for agriculture and medium scale enterprises had not been utilised.
The unutilised funds, he noted, was probably higher because the figure mentioned did not include funds from the Export Development and Investment Fund (EDIF), Venture Capital Fund and other funding sources.
Mr Mensah made this known Thursday at a meeting organised by the Northern Rural Growth Programme (NRGP) and the Northern Regional Coordinating Council (RCC) to strategise how to establish rural banks in various districts in the Northern Region.
Participants at the meeting included the Bank of Ghana, ARB Apex Bank, Association of Rural and Community Banks, District Chief Executives (DCEs), other local government staff and some opinion leaders.
Addressing the meeting, the National Co-ordinator of the NRGP, Mr Roy Ayariga, said the NRGP was a $104 million agricultural support project being co-funded by the International Fund for Agricultural Development (IFAD), African Development Bank (AfDB) and the Government of Ghana over an eight-year period, 2008 – 2015.
He said part of those funds was to be extended to support low income farmers in the Northern, Upper East and Upper West regions and parts of the Brong Ahafo region, but the funds were not reaching the target group due to the absence of rural banks.
He said already the project was in its fifth year and, therefore, it would be unfortunate if it should elapse without some of its target farmers benefiting from it.
The co-ordinator noted that NRGP was taking a lead role in facilitating the establishment of rural and community banks because the programme sought to increase farmers’ access to credits, because many of the big banks shied away from giving credits to farmers.
The Head of Research, Marketing and Corporate Affairs of ARB Apex Bank, Mr Richard Mettle Addo, said it was not only farmers who were losing out, but other people, including those involved in small scale businesses.
He said huge sums of monies meant for the implementation of pro-poor programmes and other development initiatives were being channelled through rural banks and, therefore, people living in districts without those banks were at a disadvantage.
The Deputy Northern Regional Minister, Mr San Nasamu Asabigi, underscored the need for leaders in the various districts to acquire information on how to start rural banks in the areas and work towards establishing them.
He said agriculture was very important and that the establishment of rural banks should be a matter of priority because it would help leverage resources to poor farmers and that would increase production and help reduce poverty.
In an interview, the Rural Financial Services Specialist of the NRGP, Mr Emmanuel Antwi, said that the Upper East, Upper West and Northern regions, combined, could boast of only 15 rural banks out of the about 136 rural and community banks nationwide.
“So obviously, pro-poor packages that are channelled through rural and community financial institutions to the target population would not reach people in the north,” he said.
Mr Antwi said the NRGP was trying to challenge district assemblies in the north to take a lead role in establishing rural banks in their respective areas in the spirit of public-private partnership.
“The assemblies can help sensitise their people to the importance of rural banks and also help to mobilise the required initial capital for starting a rural bank,” he stated.
Source: Argentine Beef Packers S.A.