WASHINGTON, August 3, 2000 - The World Bank has approved a credit of US$67 million to assist the government of Ghana in completing its decentralization program in the agricultural sector. The Agricultural Services Subsector Investment Project is the first phase of an Adaptable Program Loan which will mainly benefit Ghana's rural population, particularly women farmers, traders and food processors.
The project will support the Ghanaian government's efforts to increase growth in agricultural productivity and incomes as the driving force for reducing rural poverty. It will also help improve food security and provide the basis for accelerated growth in the overall economy in an environmentally sustainable manner.
The main objectives of the project will be to:
- Initiate and/or accelerate policy and institutional reforms for the strengthening of the government's capacity to carry out its core functions;
- Promote the decentralization of the planning and implementation of agricultural development programs to the regions and districts by strengthening the capacities of (i) regional and district governments, and (ii) central ministries and agencies to focus on policy-making, planning, monitoring, evaluation, technical back-stopping and regulatory services;
- Promote cost-effective demand-driven agricultural research and extension systems that would generate and disseminate technologies on a contracting and/or cost sharing basis;
- Strengthen the capacity of farmer-based organizations to play an enhanced role in priority setting and decision making in agricultural and community development programs and facilitate input distribution, credit, processing and output marketing services.
Ghana's rural population represents 63 percent of its total, and agriculture represents 38 percent of the country's gross domestic product. Poverty in rural areas stands at 52 percent compared to 23 percent in urban areas, with rural poverty contributing a very high share of 84 percent to total poverty.
The Agricultural Services Subsector Investment Project will be financed by a US$67 million equivalent credit from the International Development Association (IDA), the World Bank's lending arm for the poorest countries. The IDA credit is on standard terms of 40 years maturity, including 10 years grace. The government and other donors will finance the project with an additional US$56.73 million.