Cedi depreciation causes NAFCO to explore a new financing option
Posted on: 12-Sep-2012
The recent decline in the cedi’s value has compelled the National Food Buffer Stock Company, NAFCO to explore a new financing option for some key initiatives to boost rice and maize production.
These include plans to establish a rice mill and a maize hub with 2 giant warehouses around maize production belts.
The projects were estimated at about 8 million Ghana cedis in the 2012 budget. NAFCO’s Chief Executive, Eric Osei-Wusu however explains to JOY BUSINESS, the cedi depreciation has somewhat affected the implementation of the projects.
“At the time when we asked for money to build the warehouses and the rice mill, we were allocated 8 million Ghana cedis equivalent to 6 million dollars at that time. And because of the depreciation of the cedi, its now in the region of about 6 million. So if we take the cost of the rice mill which is about 4-5 million, it leaves every little for us to work with on the warehouses” he said.
This, according to him has triggered a new 45 million dollar financing arrangement of enhanced benefits.
“This facility is from the Overseas Private Investment Corporation, a US private agency under which we would be getting about 15 new warehouses and 3 more rice mills. One each of the rice mills would be located in the Upper East Region, Ashanti Region and the Volta region in the bid to expand the rice industry in Ghana” he said.