TO PROMOTE AGRIBUSINESS IN WEST TIMOR
A case study of Mungbean Industry1
By: Fred Benu2
Banks and the Commitment to Agricultural Development in NTT
The main issue faced by small and medium enterprises in agricultural sector is empowering the poor. This is the main issue that has to be dealt by banks in NTT in order to maintain a good and prospective farming business. Without dealing with this issue, it is impossible for banks in NTT to have a good credit schemes have been allocated for small and medium enterprises in rural area, these schemes have been delivered without any empowering programmes to cover all the risks associated with the poor, especially technical risk. As we know, agricultural sector is the main source of rural economic growth in NTT. At the same time, the main problem faced by small and medium actors in rural area are lack of skill, lack of business orientation, lack of capital access, and limited market accesses.
Although we know that banks have to maintain the principle of prudential banking in dealing with all credit schemes, it does not mean that banks have to avoid risks at all, especially risks associated with working with small-scale farmers. Since agricultural sector in NTT is dominated by a small-scale farming systems, bank also have to deal with risks of credit scheme associated with small-scale farming, including technical risks,