Africa-Press – Ghana. The Delegation of the European Union (EU) in Ghana and representatives from the European Development Financial Institution (EDFI) Management Company have launched the Agriculture Financing Initiative known as “AgriFI”.
The tailor-made farmer support project (AgriFI) is an impact investment facility funded by the EU with a mandate to provide medium to long-term financing to private sector enterprises active in the agri-food value chain with a focus on smallholder farmers.
AgriFI is managed by the EDFI Management Company and offers investment capital and technical assistance to agribusiness Micro, Small and Medium-sized Enterprises (MSMEs).
The initiative which was launched in Wa, in the Upper West Region has a country window of EUR 10 million for Ghana, is a financing mechanism aimed at supporting the development of sustainable and inclusive agricultural value chains, with a focus on improving the livelihoods of smallholder farmers in the cashew, groundnut, mango, rice, sorghum, soybean and vegetables value chain, and will span the five Northern regions: Upper West, Upper East, North East, Northern and Savannah.
Deputy Ambassador of the European Union delegation to Ghana, Jonas Claes, at the launch, said the EU has realised the challenges Ghanaian farmers face, particularly in terms of access to finance. This stumbling block too often hinders the ability to make investments in modern farming techniques.
“The EU is committed to supporting a more sustainable approach to agricultural financing. These are not just hollow words,” he strongly stated.
Adding grants play a vital role in addressing financing challenges, but they are not always sufficient or sustainable.
“This is where the AgriFI Ghana Country Window enters in the picture. AgriFI is a unique loan system for farmers. These loans help to develop the activities of key agriculture stakeholders, such as microfinance institutions or aggregators. By complementing grants with loans, we create a more holistic and sustainable approach to agricultural development and financing,” Jonas Claes mentioned.
Chief Director of the Upper West Regional Coordinating Council, Peter Maala, added, “The Northern Belt, including Upper West, is one of Ghana’s major food baskets. EU and EDFI Management Company’s financial support for its smallholder farmers ensures improved livelihoods for farmers by decreased production cost, resulting in food security, which is a priority for government.”
The Fund Manager of AgriFI, Lionel Dieu, is hopeful that the launch of the AgriFI Ghana Country Window will support smallholder farmers in Northern Ghana.
“This event is an important step in bringing together key stakeholders to discuss the challenges and opportunities in the region.”
The launch of the AgriFI Ghana Country Window marks the first investment of the EU to Ghanaian smallholder farmers and agribusinesses with the event bringing together key intermediaries to discuss the opportunities and challenges in reaching smallholder farmers in Northern Ghana.
AgriFI Ghana Country Window is funded by the European Union–Ghana Agriculture Programme (EUGAP) implemented together with the Ministry of Food and Agriculture which contributes to higher annual incomes for smallholder farmers’ households by increasing agricultural productivity, protecting natural resources, and improving access to markets for smallholder farmers.
The Chief Executive Officer of Sinapi Aba Savings and Loans, Tony Fosu, applauded the collaboration with the EU, “With over 40 branches across Ghana, Sinapi Aba has garnered experience across the country, and we are equipped to facilitate access to financing for smallholder farmers.”
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