Agric falters, oil to the rescue
Not only does the country’s budget move oil funds to finance agriculture every year, but oil producers themselves understand the need to support the sector given its potential. And not only was it the first to discover oil in Ghana, but Kosmos Energy Ghana has again become the first oil company to set money aside to help increase productivity in agriculture.
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Having supported various communities with water, fishery and educational facilities, Kosmos has launched a revolutionary social investment project which aims to transform different sectors of the economy, starting with agriculture.
The Kosmos Innovation Centre (KIC) is an initiative born from innovation and the power of technology. It is designed to promote tangible impacts on the sector it focuses on through ambitious interventions.
The Kosmos Innovation Centre will take a sector-by-sector approach to problem solving, using analysis and expertise to identify the barriers to growth, while designing support activities based on innovation.
“We want to help innovative enterprises succeed and, in the process, transform the Ghanaian economy by investing in one entrepreneur at a time,” said Mr Joe Mensah, Kosmos Energy’s Vice President and Country Manager, in an interview with the Daily Graphic.
The first area of focus for the Kosmos Innovation Centre is agriculture because it holds enormous potential to address poverty, increase the incomes of most Ghanaians, and enhance economic growth for the whole country.
“Agriculture has been the country’s economic foundation for many years and offers the greatest potential to transform people’s lives. Based on the success of the KIC’s interventions in agriculture – and the learnings that come from it – we expect to eventually invest in other sectors such as education, health and others to replicate the impact,” said Mr Mensah.
Why agric initiative
Despite its continued importance, the agricultural sector had fallen from its place as the leading contributor to the country’s Gross Domestic Product (GDP) to third place.
The sector, which contributed more than half of the country’s productivity since the 1980s, gradually reduced to 19 per cent of GDP last year, with the services sector leading the pack with 54.1 per cent, followed by industry with 26.9 per cent.
The agric sector grew by a provisional 0.04 per cent in 2015, according to the 2016 budget statement.
The population involved in agriculture in 2010 was 13,366,340 and accounted for 54.2 per cent of the total population, according to the 2010 Population and Housing Census. The report indicated that out of a total of 5,467,136 households in the country, 2,503,006 households were found to have individuals involved in agriculture, translating to 45.8 per cent of the total households in the country.
Rural areas accounted for 73.5 per cent of the agricultural households, demonstrating that agriculture is a concentrated sector. Since poverty is endemic in rural areas, the focus on commercially viable agriculture is a promising way to eradicate poverty.
Selecting for the pilot incubation
Mr Mensah indicated that the KIC, which moved into operation immediately upon its launch on March 16, 2016, would start with a two-day agricultural technology forum where thought leaders will brainstorm on the challenges of the sector and how to deal with them using innovation and technology.
The discussions will feed into proposals to be pitched to an evaluation and selection panel. Selected individuals or groups will then do about two months of field work and research to perfect their proposals, after which they will compete to receive funding from Kosmos to study at the Meltwater Entrepreneurial School of Technology (MEST) for 12 months. After finishing incubation at MEST, it is expected that new businesses will be launched.
The initiative is a significant deviation from traditional corporate social responsibility by most companies. The KIC initiative consists of three pillars – collaboration, incubation and acceleration – with which it hopes to drive change and get tangible results.
Collaboration
Under this philosophy, the KIC will bring together people from a range of fields that have bearing on the sector under focus. In the case of agriculture, the KIC will assemble the “best and brightest minds” from agribusiness, farming, technology, finance and academia to discuss challenges in the sector – and how to use technology to solve them.
Incubation
After proposals have been evaluated, the winner – a promising start-up – will be given technology and entrepreneurial training at MEST.
“We will use formal competitions to challenge young entrepreneurs to use technology to develop commercially viable solutions to challenges within the chosen sector,” Mr Mensah said at the launch of the initiative in Accra.
At the end of the competition, the selected entrepreneurs will receive the seed funding, technical assistance and mentorship required to help them turn their ideas into reality.
Acceleration
There are already thriving businesses and agricultural solutions, many of them using technology interventions. In partnership with a mobile telephony provider, there are financial technology (Fintech) solutions providing credit facilities to farmers and input providers and other players in the agriculture industry’s value chain.
“Acceleration is the third component of the programme. Through capital investment and technical assistance, the KIC will help to accelerate the development of a promising small business. We expect to partner with a social investment fund company to help us identify potential candidates,” Mr Mensah said.
Export focus
Kosmos has a long-term view of the project and a big vision. For instance, in agriculture, the company would like to see its intervention lead not only to local food security, but increases in the portfolio of Ghana’s export products. “Beyond food security, we want to see the country export more because there are so many opportunities that can be created,” said Mr Mensah.
The company believes in the youth as the future of the country and is, therefore, ready to invest in them, even if the initiative calls for more investments as it progresses.
“We are anticipating that this is for the long haul. We don’t want to overstretch ourselves so we want to ensure that whatever we are doing is done well. This is why we are putting funds in agriculture to do a pilot the first year and based on the success of it, we will decide how to increase our involvement,” said Mr Mensah.
