By Yunus S Saliu
The Ministry of Agriculture and relevant stakeholders has Tuesday validated the Gambia Incentive-Based Risk Sharing System for Agricultural Lending (GAMIRSAL) business plan.
The validated GAMIRSAL business plan is expected to increase the appetite of banks and other financial institutions to lend to agriculture as the most sustainable approach to increase production and productivity of both crops and livestock and also expand agribusiness activities.
Delivering a statement at the forum, Mr Hassan Jallow, permanent secretary at Ministry of Agriculture expressed delight on the validation of the incentive-based risk sharing system for the agricultural lending in The Gambia.
He said one of the biggest challenges to development of agriculture in The Gambia has recognized by the Ministry of Agriculture is the lack of access to finance.
“Availability of funds to finance agricultural production has been the main hindrance to the development of reliable agricultural services and mechanization; land preparation and tillage, harvesting, threshing and other post-harvest operations,” he pointed out.
Over the years, he said, government has implemented several initiative and interventions to increase access to finance to agriculture which include the defunct Agricultural Development Bank, the Gambia Cooperative Union, VISACAs, among others.
Mr Jallow stated that the Ministry of Agriculture, recently, through donor funded projects adopted the Matching Grant approach to stimulate private sector investments into agriculture this with the aim of helping Farmer Based Organisations (FBOs) and individual Agro Enterprises realize their productive capacities.
He noted that the establishment of GAMIRSAL aligns with the second generation Gambia National Agriculture Investment Plan, Food and Nutrition Security (GNAIP-FNS) and the National Development Plan (2018 – 2021) committed to modernizing agriculture to stimulate inclusive growth of the Gambian economy through employment opportunities for the teeming active and youthful population.
PS Jallow thanked AfDB for its continuous support to the agriculture sector and also the Central Bank of The Gambia for all the support rendered to make the initiative a reality.
Madam Juldeh Ceesay, deputy permanent secretary at Ministry of Finance and Economic Affairs said MoFEA attaches high priority to the advancement of agriculture as it continue to be a major pillar for the development of the Gambia’s economy and a means to reduce poverty.
“Most especially in the rural areas where over 80 percent households depend on agriculture for their livelihood,” she said.
According to her agricultural sector contributes around 20 percent to the country’s GDP and generates 30 percent of its total foreign exchange earnings while the high importation of agriculture and related products poses a threat to the stability of the Dalasi.
Adding, “An increase in the production of import substitutes such as rice will surely lower pressure on the balance of payment as well as the export of high value crops.”
She however encouraged private sector to take advantage of the opportunities created through the Risk sharing Facility to venture into expand or diversify their agriculture and agro-enterprises.
Dr Seeku AK Jaabi, first deputy governor Central Bank of The Gambia described agriculture as an important sector in many SSA countries, to The Gambia “forming 20% of GDP, provide employment and income for majority of the population, foreign exchange through earnings through exports.”
He highlighted on the major constrain which is attributed to lack of formal financial access along the value chain and as well the challenges which included long gestation of commodities, informality, collateral value, markets, micro-insurance to mitigate risks, experts in agricultural lending that are normally not in banks.
Dr Olusegun Ogidan, a representative NIRSAL Nigeria congratulated The Gambia and people of the Gambia for the bold step taken in initiating discussions and studies of the validated GAMIRSAL business plan.
He noted that Africa is blessed with natural agricultural opportunities – the land, water, ecology, labour and the market “but despite all these opportunities and potentials we have in Africa, enabling governments’ policies and environments there are still many challenges agriculture in in Africa is still facing.”
He noted that there are four major capitals that are required to earnest the opportunities in agricultural sector this are finance, technology, equipment, and Human.
“But from experience the moment you can access finance capital you can buy the technology, the equipments, and you can even train people to acquire human capital. Public finance cannot do it alone, therefore we need private finance to be able to move and make agriculture gain its potential,” he pointed out.