Banks have failed farmers; the government will create legislation to compel them to lend to them - Agriculture Minister

Ghana's Minister of Food and Agriculture, Dr. Owusu Afriyie Akoto, has stated that the government will shortly propose legislation requiring commercial banks to lend to farmers. 

He pointed out that, just as the government has aided farmers by subsidizing inputs, banks must also assist farmers and other sector participants by financing to them. 

Ghana, according to Dr. Afriyie Akoto, would not be the first country to introduce such legislation, citing India as an example. 

When he was touring commercial farms in the Eastern Region with TV3's Yvonne Neequaye over the weekend, he said this. 

He claimed that the government is powerless to stop the rising cost of farming. 

"It was evident when we visited chicken farms that feed prices, which account for 70% of production expenses, had increased. Prices have risen in comparison to January, February, March, April, and May 2021, 2020, and 2019. They've risen as the cost of chemicals has doubled or quadrupled, increasing the cost of agricultural output. 

Fuel costs have risen, resulting in greater haulage from the farm gate to consumption centers. These are uncontrollable external forces that influence price formation. 

"Since then, the cost of doing business in agriculture has skyrocketed, and poultry producers who once raised 150,000 birds have reduced their flock to 50,000 since their operating capital can no longer support the higher prices." Poultry producers should be able to obtain loans from banks that do business with them in order to sustain or increase output. 

"Banks are decreasing output since they haven't been able to help. Despite everything, they believed the administration had done something. We spent an hour and a half discussing what the government is doing to address the issue. They were pleased with our efforts after hearing the explanation. 

"We're attempting to pull in commercial banks in a variety of ways, including the possibility of passing laws compelling them to lend a portion of their portfolio to farmers and others in the value chain." We wouldn't be the first to do it; India has been doing it for 30 years. 

"You'll probably hear something in Parliament about this subject, because the government is subsidizing inputs like fertilizer, and banks should be permitted to lend to farmers."

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