Venture Capital to support agric investors under President’s initiative
The Venture Capital Trust Fund is to commit part of its $50 million budgetary allocation to support companies that will be willing to take advantage of the government’s One-District, One-Factory (1D1F) initiative.
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The fund said it would direct its attention more to companies in the agriculture sector and in particular, those in agro-processing and the entire agriculture value chain as a whole.
The Chief Executive Officer (CEO) of the fund, Mr Yaw Owusu-Brempong, made this known in an interview with the Graphic Business in Washington last month. This was shortly after an investment tour to the United States of America (USA) under the auspices of the Ghana Investment Promotion Centre (GIPC).
“With the kind of business we do, we are going to actually assist private enterprises, especially those in the agriculture sector that are ready to set up industries within the districts of the country”, he said.
Mr Brempong said there were many opportunities within the agricultural value chain, particularly for those who would want to process the raw produce which are mostly exported without any value addition.
“Our problem is that we don’t add value so if we get companies that are going to process the agriculture raw material, we will support them with enough working capital to enable them to run their businesses effectively to provide jobs,” he said.
Evidence
Mr Brempong said there was evidence to the fact that, farmers who were supported under the Special Purpose Vehicle (SPV) where moneywere given to them against the norm of operations under the fund, were doing well and same will be done with strict supervision.
“Techon Serve found some farmers for us and they were successful. They grew sorghum and sold to Guinness. We assisted 4,500 farmers in the north and they were able to sell sorghum that would have been imported,” he said.
He said there had been abuses in the implementation of the SPV, adding “it was messed up and we will revisit it but with caution to ensure its success.”
“We want to have farmers to mechanise and we will support that effort. Farming should be seen as a business and once we see that, we will support. Some have come with very good proposals and we are ready to support. It is risky but we will work to support and recover what we give out through a well-structured system and approach so that we recover the money for others to also benefit”, Mr Brempong said.
Growing the fund
On how the VCTF intended to grow the funds allocated to it to benefit more people and businesses, he said the moniey was managed by special fund managers who were also expected to raise an additional one and half times the amount given them.
“So I’m saying that with the $50 million given us, they are also expected to raise an additional $75 million to bring the total money under the fund to $125 million,” he said.
According to him, this would be enough for this year, while efforts are being made to attract additional funds from elsewhere to support the fund.
For instance, he said there had been preliminary discussions between himself and the president of African Development Bank and there would be a follow up to see how much the bank would be prepared to offer to support the Fund.