THE Ministry of Agriculture yesterday launched its Agricultural Diversification Fund and made the first set of disbursements of low- interest loans and grants to cluster members and farmers from the Aquaculture, Livestock and Fruit and Vegetable subsectors. The initiative is being funded by the Inter-American Development Bank (IDB) to the tune of US$1.7 million and it is expected to provide a mix of grants and loans aimed at reducing the cost of financing and at improving profitability. The Agricultural Development Fund is a part of the Agricultural Export and Diversification Programme of the Ministry of Agriculture.
Speaking at the event, Minister of Agriculture Robert Persaud said that financing for agriculture is key for transforming the sector. He said that the Government has been making attempts outside of budgetary allocations to reach out to the financing needs of small and other farmers. But he said that the time for talk about Guyana’s potential in agriculture is over. “It is about getting it done…making possibility into reality,” he said.
“We have looked at creative ways of making money accessible to farmers,” he said, noting the bad experience of a development bank in which the Government of the day had its hands and which had to be closed if the country were to have received help from the financial institutions.
“We are very comfortable with working with financial institutions to help farmers access credit,” he said. But he noted that Government wanted to ensure that there is uptake of the financing to ensure the success of the revolving fund.
Persaud voiced Government’s continued support for the agriculture sector even though there is a focus on many other sectors. “This sector will not be neglected. Agriculture will continue to be a significant player in Guyana’s national economy,” he said.
Speaking at the handing over and launch, CEO of GBTI John Tracy said that his bank has had an affinity with the agriculture sector for over three decades. He said that for 2010, 10 percent of GBTI’s loans were for agriculture while in 2011 it is 12 percent. He said that his bank has the highest percentage of loans to the agriculture sector than any other bank in the country.
Speaking of the programme itself, he said that the fund – which has a 12- year duration including repayment – is meant to contribute to the growth in exports and the reduction of vulnerability and increased chances of profitability for the various sub-sectors.
He said that the loans will be concessionary in nature and will have rates of interest of between 5 and 8 percent and will be between $3 million and $9 million. He said that emphasis will be placed on viable projects with a focus on employment creation.
Tracy said that so far GBTI has received 44 applications for loans and grants. He said that 24 of those are from the fruit and vegetables cluster, 9 in aquaculture and 11 in livestock.
Speaking on behalf of the aquaculture cluster of farmers, Beni Sankar commended Minister Persaud for the good work in the agriculture sector. He spoke of the importance of food production in relation to the world’s population which has hit seven billion people. He noted that food production is lagging behind population growth and he said that aquaculture can be a large income earner for the country.
Pierce Ifill spoke on behalf of the fruit and vegetable farmers who are to benefit from the initiative. He said that they were happy to finally be able to access the financing at a low cost to them. He noted that it will help to improve their drainage and irrigation and finance the construction of shade houses.
Representing the livestock farmers, Mortimer Livan said that the financing should allow for the re-exportation of beef to places such as Trinidad and Barbados. He said that those countries should not have to be importing beef from New Zealand when Guyana is “right here.”