Targeted financing critical for agric value chain — Deputy Trade Minister
GHANA can harness the full potential of its agricultural sector by adopting a value-chain approach to financing, the Deputy Minister for Trade, Agribusiness and Industry, Sampson Ahi, has said.
That, he said, can be done by providing targeted financial support to all actors along the chain, reducing risks, enhancing productivity and ensuring inclusive growth that reaches every corner of the agricultural ecosystem.
He said such an approach will integrate farmers, processors, marketers and exporters into a seamless ecosystem, where finance flows efficiently to meet their diverse needs, breaking down the traditional silos that have long hindered the sector’s growth.
Mr Ahi said this in his address on the topic “Value-Chain Agricultural Financing and the Role of Ghana’s Ministry of Trade, Agribusiness and Industry” at a high-profile stakeholder event in Accra on Thursday.
The event, on the theme: “Enhancing Value chain investments to improve food systems”, was organised by GBHUB Africa. It brought together key players across the agricultural ecosystem, including policymakers, academics and private sector leaders, all united in their commitment to enhance value chain investments to build stronger, more sustainable food systems in Ghana and beyond.
Sustainable growth
He said that as the country strives for sustainable growth, food security and industrialisation in an increasingly competitive global market, the agricultural value chain, which covers input supply, production, processing, marketing and distribution, remains essential for Ghana’s economic growth and development.
The comprehensive value chain approach, he explained, recognises that agriculture is not just about farming but encompasses the entire journey from farm gate to consumer plate, creating opportunities for value addition at every stage.
“In 2023, agriculture contributed 21.1 per cent to Ghana’s Gross Domestic Product (GDP), making it one of the largest contributors to national income, and the sector also employs about 34 per cent of the workforce, representing millions of Ghanaians whose livelihoods depend directly or indirectly on agricultural activities,” Mr Ahi stated.
However, he said despite the significant contribution of the sector to the country’s development and its critical role in ensuring food security, smallholder farmers and agribusinesses continue to face persistent challenges, including limited access to finance, inadequate infrastructure, fragmented value chains and insufficient technical support that hamper their ability to reach their full potential.
These challenges, he said, have created a paradox where one of Ghana’s most important economic sectors remains one of the most underfinanced and underperforming, despite its enormous potential for transformation and growth.
Risk perception
The Deputy Minister of Food and Agriculture, John Dumelo, highlighted the persistent deficits in storage, processing and post-harvest infrastructure, as well as the continued struggle of actors across the value chain to access affordable financing.
He explained that many financial institutions still consider agriculture a high-risk venture, often attaching steep interest rates that can reach as high as 25-30 per cent and difficult collateral requirements to agribusiness loans, making it nearly impossible for small and medium-scale farmers to access the capital they desperately need.
According to him, this risk perception, often based on outdated assumptions rather than current realities, discourages lending and significantly slows down the sector’s growth, creating a vicious cycle where lack of investment leads to poor performance, which in turn reinforces negative perceptions.
“Yet, without sufficient capital injection, our food systems suffer reduced productivity, increased dependence on food imports that drain our foreign exchange reserves, rising consumer prices that burden ordinary Ghanaians, and missed opportunities for job creation, especially among the youth who represent the future of our agricultural sector,” he stated.
He highlighted the critical importance of public-private partnerships in addressing these challenges, commending GBHUB Africa for its unwavering commitment to agricultural development in Ghana and its innovative approach to addressing systemic issues in the sector.
Investment
For his part, the Executive Director for GBHUB Africa, Nelson Madiba Amo, said GBHUB Africa exists to improve African livelihoods by strategically investing in its food systems, recognising that sustainable development must start with ensuring food security and creating opportunities within the agricultural value chain.
Mr Amo disclosed that the GBHUB has received over $10 million in dedicated funding from GB Foods Africa to support strategic investments in Africa’s agricultural value chains, representing one of the largest commitments to agricultural transformation in the region.
He said the initiative aims to foster startups and support existing enterprises across various stages of the food value chain, from farming inputs and seeds to processing, packaging, marketing, and logistics, creating a comprehensive ecosystem of support.
He said the investments are carefully designed to ensure that all players in the value chain, including young entrepreneurs with innovative ideas, smallholder farmers with potential for growth and established processors seeking to expand, have access to the necessary financial resources, technical support and market linkages they need to succeed.