The project attempts to highlight the role of Development Banks in financing for development in Ghana, The target audience are the politicians and policy makers. It also tries to propose a few thing to be done to salvage the already deteriorating standards of these banks. Enjoy

1. FINANCING FOR DEVELOPMENT – FINAL
PROJECT

2. Ghana currently has two state owned development
banks:
 THE NATIONAL INVESTMENT BANK:
Set up by the state with the mandate of financing
infrastructure and industry
 THE AGRICULTURAL DEVELOPMENT BANK:
Set up by the state with the mandate of financing
Agriculture

3. The National investment bank for example
undertakes the financing of road projects, school
projects, irrigation infrastructure etc.
These projects should ideally be financed after 2
critical considerations that is
 The economic impact of a proposed project
 The high risk or last lender resort principle for
lending

4. Before a development bank agrees to finance
projects, the bank should have conducted a
thorough economic impact assessment to ensure
that the proposed project has the potential of
improving the economic livelihood of the society
An example is the ‘Silbele Irrigation Project’ :
financed by the National Investment Bank.

5. The irrigation dam provides water for several hectares of rice farms in the area. This
in turn, provides employment for the people of the community (farmers) and provides
income as well.

6. This other principle employed by development banks
is to ensure that projects undertaken by such banks
are completely necessary and of high risk and as
such no other commercial bank can extend financing
for the project.

7. Over the years, political interference from successive
government have ensured that these banks are saddled
with huge debt due to poor investment decisions which
are influenced by decision.
The Agricultural Development Bank (mentioned earlier)
for instance is on the brink of being privatised, and the
implication of such an action shall have dire
consequences on the Agricultural Sector of the country’s
economy. It is unlikely that the private entity that takes
over shall focus on the same mandate of financing
agriculture

8. It is imperative that considering the critical roles
these banks play in the country, that the following
measures are put in place to protect the activities of
these banks from corrupt political activities and
interference
19 january 2012

9.  Development of a policy framework that insures
these banks against change in government
 Development of a policy framework to ensure that
the operations of these banks are independent
upon the government of the day
 Building the capacity of the Banks to properly
access the economic impact and viability of project
before financing is approved
 These banks should be given the authority to
mobilize funds from pension funds, mortgage
banks etc
19 january 2012