Ghana’s economy has been largely supported by the agriculture sector, but this has not been exploited to the maximum. Commodities, such as avocado, pineapple, coconut, sweet potato, cashew among other have huge value on the international market but has not been exploited due to lack of funds to support the sector.
The Alliance for Development and Industrialization (ADI), a think tank group, is proposing a US$2 billion Transformational Commodity Fund, (TCF) for the agriculture sector. The US$2 billion fund is expected to support the complete value chain and adjourning structures such as roads infrastructure at community levels, farmer support and contracting, storage, processing, packaging and marketing.
The US$2 billion which can be raised through the issuance of bonds on the international market could be used to support the country’s five key commodities such as avocado, pineapple, coconut, sweet potato, and sweet potato, which have huge potentials offshore.
In a press statement issued in Accra, the ADI is optimistic that this should not be the burden of the government but rather the responsibility of the private sector which should be based on monitoring and structural system that could pay back the debt. It would also support the grass root development and expansion of the agricultural industry making sure that the value chain establishment for these industries are well establish to pay for the facility.
According to the statement, “ this is just a replica of the Syno Hydro batter deal with the Ghana’s bauxite…what we need is the government guarantee to raise the money, since the cultivation of these crops would automatically pay for itself”.
The export of these commodities would bring in the much needed green back to slow down the speed depreciation of the Ghana Cedi, support the country’s balance of payment and also improve on the reserves.
According to the ADI, the bonds should have a 15 year tenor, which would be paid back to potential investors through the export of these commodities.
The cultivations of these five commodities on a large scale would also serves as an import substitution and also feed the factories that the government is creating through the 1D1F program.
According to ADI arithmetics, the cultivation of coconut for export over 130 thousand acres is expected to generate US$250 million per annum over a 10 year period with expected 61000 jobs, the cultivation of avocado on a 120 thousand acres over a six year period is expected to generate US$700 million per annum with expected 24000 jobs, and sweet potato on a 35 thousand acres could generate US$200million annually with expected 14000 jobs.
Citrus can generate US$180 million annually on a 95 thousand acres of land with expected 36000, cashew could generate US$40million annually in the next six years , mangoes could generate US$160 million annually with expected 3100 jobs , pineapple could generate US$150 million per annum and also essential oils could generate US135 million per annum with over 25000 jobs.
The ADI has called on the Finance Minister to work assiduously to raise this bonds for the agriculture sector, since it is consider as the backbone of the country’s economy.