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Germany gives Ghana €107.5m financial support

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The German government has increased its financial support to Ghana, a press release from the German Embassy in Ghana copied to ghanabusinessnews.com has said.

The amount totals €107.5 million (equivalent to GH₵196 million) and it is for a two-year period 2010 to 2012.

According to the release an agreement for the financial cooperation was signed Thursday October 28, 2010. Dr Kwabena Duffuor, Minister for Finance and Economic Planning signed for Ghana and H.E. Eberhard Schanze, Ambassador of the Federal Republic of Germany to Ghana, signed for Germany.

The financial support the release said, is the German government’s continuous support for the government of Ghana’s policies and strategies aimed at the reduction of poverty and the achievement of the Millennium Development Goals.

It also indicated that the financial contributions are for three specific priority areas of German cooperation with Ghana; and these are agriculture, sustainable economic development and decentralization as well as a contribution to the Multi Donor Budget Support (MDBS).

The German government had made a commitment to Ghana of €130 million in total for the period 2010-2012, a pledge that represents an increase of more than 60 % thus showing its acknowledgement of Ghana’s success in practising good governance, the release said.

It also said, out of the total amount €85 million will be provided as concessional loans out of which €55 million will be provided as general budget support (MDBS) to the government.  €23 million it said will be for the establishment of an Outgrower and Value Chain Fund and €7 million will be used to support the roll-out of e-zwich to rural areas (Rural Branchless Banking).

In addition €22.5 million will be provided as grant: €21 million will be used to support the decentralization policy of the government of Ghana by financing the District Development Facility, €1.5 million will go into accompanying measures to support the Ministry of Agriculture to establish the Outgrower and Value Fund (€1 million) and to strengthen domestic accountability in supporting the Ghana Audit Service (€0.5 million).

The funds will be made available to the Government of Ghana through KfW, the German Development Bank, which acts on behalf of the German government in the area of financial cooperation, the release said.

By Emmanuel K. Dogbevi

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