Overall context and objectives of the German Development Cooperation

Agriculture is one of the three focal sectors of the German Development Cooperation. The overall objective of the German involvement in the agricultural sector is to improve the income of the rural population by supporting value chain approaches and to strengthen small-scale commercial farmers. As a consequence, agricultural producers and other actors in the agricultural sector (processors, traders and service providers) will develop their ability to compete in national, regional and international markets.

Key issues

• Improve productivity along agricultural value chains to increase competitiveness
• Increase compliance with international quality and standard demands
• Recognize the role of the private sector as a main driver of development
• Adapt capacities of the civil service to the changing role of government
• Improve the access to finance of the actors in the value chain

GDC Strategic areas of focus

The German Government support to the agriculture sector has two components: Financial Cooperation (FC) and Technical Cooperation (TC).

The FC component provides innovative agricultural financing under the Programme for the Promotion of Perennial Crops and the Outgrower and Value Chain Fund (OVCF). The objectives of OVCF are to:

• Improve access to medium to long-term finance using market mechanisms in cooperation with the banking sector.
• Promote outgrowers, outgrowers’ schemes and integration of smallholders into commercial agriculture.

The TC component, under the Market Oriented Agricultural Programme (MOAP), provides support in three key areas:

• Support to specific value chains development and value addition.
• Institutional and policy support to government.
• Support to private sector organisation and development.

Institutions of the German Development Cooperation in Ghana are Kreditanstallt für Wiederaufbau (KfW) for Financial Cooperation, the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) for Technical Cooperation and the German Institute of Metrology (PTB).

The delivery mode of the German Development Cooperation is based on value chain development, looking at the market opportunities and following through from farmer to consumer. Linking stakeholders of the value chains and distributing value added equally are central to the GDC approach. Quality assurance along the value chain and adequate volumes to satisfy consumers’ needs are also crucial.

To date, nine value chains have been supported (rubber, mango, pineapple, citrus, chili pepper, maize, guinea fowl, grass cutter and fish) in five regions (Western, Central, Brong Ahafo, Volta and Northern). 5800 farmers have been directly supported in addition to processing companies; key achievements being increased income and gender participation, improved access to finance/markets and job creation.

Other programmes (like the Programme for Sustainable Economic Development) are complementary and are contributing to improve agricultural financing through agricultural insurance or financial literacy. The planned roll out of e-zwich will also enhance access to electronic banking services by farmers and rural communities.

Specific activities supported

FC: KfW access to finance (2004-2013) - Promotion of Perennial Crops Programme (6 million €, co-financed with AFD) and Outgrower and Value Chain Fund (11 million €)

TC: GIZ Market Oriented Agriculture Programme (25 million € for 9 years 2004 – 2013)

PTB Support to Ghana Standards Board (900 000 €)

Future support areas

24 more million € are committed to the Outgrower and Value Chain Fund, 3 million € for supporting climate adaptation of agricultural ecosystems (will be attached to MOAP) and 1,4 million for a new phase of the support of PTB

You may visit the links below for more on our programmes and activities

http://www.kfw-entwicklungsbank.de/ebank_EN_home/index.jsp

http://www.giz.de/en/home.html

http://www.ptb.de/index_en.html