A Ghana Warehouse Receipt System has been launched to increase farmers’ access to credit, storage and market facilities.
The system allows farmers to deposit their agricultural products in a public or private warehouse where operators will evaluate and grade the commodity, and agree to maintain and insure it.
A detailed receipt reflecting the quantity and quality of the deposited commodity is then issued to the farmer.
It can be used by the farmers as a negotiable item—they can trade it, swap it and use it as collateral to access credit facilities.
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The Warehouse Receipt System is being implemented by the International Finance Corporation of the World Bank Group in collaboration with the Ministries of Trade and Industry and Food and Agriculture, as well as the Ghana Exchange Commodity.
It is being financed by the Embassy of Switzerland in Ghana.
The system is expected to address major challenges facing farmers such as access to credit facilities, markets and storage facilities and make the sector attractive for more people, particularly the youth, to venture into.
In a statement read on his behalf to launch the initiative in Accra on Wednesday, the Minister of Trade and Industry, Mr Kwadwo Alan Kyerematen, said agriculture remained one of the key sectors the government intended to use to increase exports and to promote a sustained approach to poverty reduction.
“Ensuring agricultural commodity produced are stored properly and traded in a structured manner to avoid chaos in the market is very key to the successful implementation of these policies,” he said.
Mr Kyerematen was of the opinion that without an adequate warehousing system, there would be a disjoint between agricultural production and the needs of industry.
He described the warehouse receipt system as an integral part of agricultural trade and financing and said the system would improve storage, promote structured trade and enhance financing for farmers.
In his remarks, a senior Country Officer of the IFC, Mr Joseph Akwasi Kuma, reiterated that the initiative was designed to improve access to credit and market for the agricultural sector.
“Some of the constraints facing farmers in Ghana are low collateral value of inventories, post-harvest losses and quality deterioration due to lack of storage facilities, sub-optimal prices of goods due to early selling, non-availability of quality assurance and access to credit,” he said.
He was optimistic that a well-regulated warehouse receipt system and collateral management would help improve these issues and improve the business environment for the small-scale business sector for Ghana.
For his part, the Swiss Ambassador to Ghana, Mr Markus Dutly, said the project was expected to greatly contribute to improving the competitiveness and diversification of the economy.