USAID introduces risk management tool for agribusinesses
The United States Agency for International Development (USAID) has developed an investment mapping software for the northern part of Ghana to help players in the agricultural value chain to gather the required information and minimise risk in their businesses.
The resource, which can be accessed online, has mapped the location of farms; infrastructure; support service providers such as input dealers, and business advisory service providers. It has information on the availability of roads and irrigation facilities, processing facilities and warehousing etc. to help the agribusinesses in the value chain to choose where to locate their investments.
The software, FinGAP Nautilytics, is part of the Financing Ghana Agriculture Project (FinGAP) being implemented by the USAID under the United States government’s $250 million Feed the Future initiative.
Mr Fidelis Paa Kwesi Dadzie of USAID-FinGAP, who presented the software at the second Ghana Agribusiness Investment Summit in Accra last Wednesday, explained that the software could help financiers to mitigate risk as it allowed them to make quick assessments of the environment.
Investors could also make informed choices as to which part of the value chains to invest in as well as assess whether there were complementary or duplicated services available.
Resources such as Nautilytics, which gives a clear picture of the investment environment within the SADA Zone (northern sector of the country), has enabled USAID-FinGAP to facilitate the disbursement of huge investment financing into the production of maize, soya and rice in the SADA zone.
FinGAP, the five-year USAID project to facilitate finance and investment in the soya, rice and maize supply chains in northern Ghana (SADA zone), has since its maiden summit last year facilitated the investment of US$13.5 million into agribusiness, the Chief of Party, USAID-FinGAP, Mr Rick Dvorin, said.
He added that the project had also facilitated about US$60 million investments in the pipeline, with an anticipation to move the funding forward to about US$75 million by the end of 2018.
The US Ambassador to Ghana, Mr Gene Cretz, called for steps to be taken to address “the issue of high cost of credit, which is holding back investments into the agricultural sector.”
Access to credit has been a major challenge for businesses in Ghana, especially small and medium enterprises, with an even dire consequence on the agricultural sector, which attracts only about four per cent of lending in the country.
“The number of Ghanaians involved in agriculture implies that private sector investment into the agriculture value chain is critical to reducing poverty and spurring economic growth in Ghana,” Ambassador Cretz noted.
He, therefore, expressed satisfaction about the disbursement of over $15 million into agribusinesses in the rice, maize and soya value chain since last year’s summit, adding “I think the theme for today’s event – Overcoming Obstacles to Unlocking Agricultural Investments in Ghana – presents us with an exciting challenge.”
The one-day summit brought together agribusinesses, including farmers, input dealers, tractor and support service operators, business advisory service providers, processors and irrigation companies.
USAID, through the FinGAP project, supports both the supply side of finance as well as the demand side, through a Business Advisory Service providers’ network, focused on helping the players to identify these opportunities.