Minister stresses importance of finance in bringing about structural change in agriculture

Addis Ababa, May 1, 2024 (FBC) – Ethiopia’s Agriculture Minister Girma Amente emphasized today the importance of access to finance in agriculture to bring about structural transformation in the sector.

A workshop designed to provide a platform for all stakeholders to come together and jointly chart the way for the next height and formulate relevant framework and legal instrument for agricultural finance was held today.

The minister said on the occasion that “financial service for agriculture and rural Ethiopia is one of the critical enablers in transforming Ethiopian food system. Together, we embark on a journey to transform the landscape of agricultural financing and risk management.”

According to him, finance is important in bringing about structural change in agriculture sector.

Girma underlined the need to build resilient farmers and pastoralists by enhancing synergy between financial institutions, insurance providers, and agricultural community to help farmers access fertilizers, improved seeds and other agricultural inputs.

At the workshop, the importance of addressing the lack of agricultural insurance and managing risks associated with agriculture was emphasized along with the need to update agricultural practices and embrace agribusiness principles that require adequate financing.

Lessons were also shared on establishing the link between agricultural transformation and financial services as well as revamping agricultural and rural financial services to transform Ethiopian food systems.

The workshop comes on the heels of the just approved Agriculture and Rural Development Policy.

The policy aims to improve the provision of credit and facilitate income transfer to commercial farming that ultimately improve the lives of farmers and pastoralists.

As part of this initiative, the National Bank has introduced a credit guarantee scheme to enable farmers to access loans for essentials such as fertilizer and machinery.

The policy also aims to drive economic growth in rural areas and improve the living standards of rural communities, ENA reported.

Partners, policymakers, and representatives of financial institutions took part in the one-day workshop that focused on assessing the current state and future potential of access to finance in agriculture.