ADB and AFD sign EUR 14.0 million Rubber Outgrower Project financing agreement
ACCRA'The Agricultural Development Bank (ADB) and Agence Francaise de Developpement (AFD) today signed a EUR 14 million financing agreement for the 4th Phase of the Rubber Outgrower Project in the Western and Central Regions. Under the agreement, ADB will on-lend the amount to 2,750 small-scale farmers under the Project to cultivate 10,500 hectares of new rubber plantations.
In a statement, Mr. Ibrahim Adam, Chairman of the Board of Directors of ADB said France has been very supportive of the development of cotton, oil palm, rubber, among other forms of agricultural development. He said the beneficiary farmers on the Rubber Outgrower Project should use the opportunity of the new round of French assistance to use improved technology.
Mr. Ibrahim Adam advised the staff of ADB in charge of the Project to reciprocate the gesture of the AFD by providing efficient management of the Project.
Mr. Dov Zerah, Chief Executive Officer of the Agence Francaise de Developpement, said the Rubber Outgrower Project has so far planted more than 11,000 hectares and that the successful development of rubber plantations in Ghana has convinced AFD to continue the financing of the Project.
Mr. Zerah thanked ADB for contributing to the success of the development of rubber outgrower plantations. He said the French agency is willing to pursue a very fruitful collaboration with Ghana in the coming years in order to support the national economic development strategy.
The Rubber Outgrower Project has been co-financed by the Agence Francaise de Developpement (AFD) since 1988. So far, more than 11,000 hectares of rubber plantations have been planted under the Project.
Whereas the three previous phases involved loans to the Government for on-lending to the Agricultural Development Bank, the financing agreement for the fourth phase, as signed with ADB, is a non-sovereign loan in that it is a loan directly to ADB without government's guarantee. Indeed, this is the first non-sovereign loan in the history of AFD directly to a local bank for a project dedicated to small-scale farmers.
The 4th Phase of the Project is therefore based on a tripartite agreement between ADB as the financial operator, Ghana Rubber Estate Limited (GREL) as the technical operator, and the Rubber Outgrowers and Agents Association (ROAA) representing the interest of farmers. The EUR 14.0 million financing granted by AFD to ADB will cover the investment cost of planting, including the maintenance cost during the immature period, with the exception of a part of the labour requirements, assumed to be provided by the families of the farmers as their contribution to the investment.
The Project is designed to finance 2,750 beneficiary farmers cultivating 10,500 hectares of new rubber planting, with each of the beneficiary farmers planting a maximum of 4 hectares in the Western and Central Regions. The financing will be for a period of 15 years with a 7-year grace period.
The signing ceremony as witnessed by His Excellency, Mr. Francis Hurtut, the French Ambassador to Ghana, Mr. Jean-Marc Gravellini, Head of Africa Department at the French Embassy, and Mr. Benoit Lebeurre, Resident Manager of AFD.
The Communications Dept. of ADB