CENTRAL BANKS IN AFRICA URGED TO FINANCE AGRICULTURE

Nairobi — THE conference on revolutionising finance for agriculture value chains held recently in Nairobi has come to an end. Providing finance in agriculture was described as "putting the flesh on the skeleton."

Speaking during the closing ceremony, Technical Centre for Agricultural and Rural Cooperation ACP-EU Director, Mr Michael Hailu said the resolutions made by participants is a clear indicator that the conference was a huge success.

"The time for pilot and demonstration farms is over, it is time to replicate the success stories that we heard and scale up," he said. Mr Hailu said apart from the ideas that had overflooded the conference, had a whopping 731 participants hailing from 81 countries, over 50 news articles, 52 blogs covered the event with a readership of over 5,000 people.

Over 11,000 tweets were generated with a readership of 1.68 million people. Mr Hailu said the one thing that had come out very clearly from the meeting was that small holder farmers are business persons who need skills to understand how the financial sector works.

"The conference made it very clear that these two sectors namely agriculture and finance can work together and through this cooperation will revolutionise the industry," he said.

Deputy Governor, Bank of Ghana, Mr Millison Narh said that the conference made it clear that Central Banks needed to promote agriculture and increase institutional development.

Mr Narh said that other suggestions that were directed to the Central Banks and governments is the establishment of collateral registries, credit bureaus and commodity exchanges.

"In order to accrue this desired revolution, there is a need for robust farmer organisations but these need capacity building such that they operate as businesses and therefore can sue and be sued," he cited.

The Deputy Governor stressed that the issue of interest rate regimes which are very contentious to smallholder farmers particularly needs serious consideration. He said that the revolution being sought is within reach, as long as the networks established during the meeting and the lessons learnt from different countries' experiences are utilised effectively.

Kenya's Cabinet Secretary for Agriculture, Livestock and Fisheries, Mr Felix Koskei, said that with the global demand for food poised to increase by 5 per cent in the next five years, it was vital to set priorities right to keep the commitment for action.

"At country level, we are in the process of transforming the agriculture and finance corporation and streamline our cooperatives such that they play a greater role of ensuring access to finance opportunities are broadened," he said.

Mr Koskei said that as long as efforts to address interest rates, formulation of tailor made financial products to farmers, the reduction of default risk to farmers, climate change challenges are mitigated and the collateral issue is handled, there is every reason for the revolution to take off.