Cashew processors have called on the government to impose taxes and levies on the exportation of raw cashew nuts to protect the local cashew processing industry.
Aside from the fact that the country did not earn much revenue from the exportation of the raw nuts, the processors said foreigners rather benefited more from the export while they collapsed the local industry.
The President of the Association of Cashew Processors, Mr Ed-Malvin Nii Ayi Bontey Smith, made the call on behalf of the processors at the inauguration of the association and swearing-in of new executive members in Accra yesterday.
“Foreigners buy the raw cashew at any price given them because they do not pay for any levies or taxes for exports, a situation which creates high price competition for the local processing industry,” he said.
The association is made up of cashew nut processors, cashew apple processors and other value-added processors of cashew.
The objective of the association is to formalise the cooperation of cashew processors in Ghana in the quest to revamp and transform the cashew processing industry.
According to Mr Smith, the non-payment of taxes allowed foreigners to invade the country even with student visas to buy the raw cashew, a situation which is collapsing the processing industry.
Of the 14 cashew nut processing factories in Ghana as of 2014, he said, only two were operating but under very severe conditions and at very low capacity while the rest had collapsed.
“Processors are unable to obtain adequate supplies of raw materials for processing due to intensive competition with purchases from traders, especially foreigners at the farm gates,” he stated.
By considering the tax imposition on exportation, Mr Smith noted that the government would be protecting the local industries, as well as generate more revenue which could be used to reinvest in the sector.
He asked farmers to consider the local processing industry as their first market option by offering them fair and reasonable price and also urged the government to set up the necessary regulatory framework aimed at encouraging local processors to achieve full benefits from the crop.
Mr Smith said the association would work hard to change the status of the industry to ensure that it achieved its full potential.
Critical economic transformation
In a speech read on his behalf, the acting Chief Director of the Ministry of Trade and Industry, Mr Ebenezer Adjirackor, said cashew was the leading non-traditional export product with export earnings of about $197 million for the 2016 fiscal year.
Although it has been identified as critical to the economic transformation of the country, he indicated that the cashew processing industry was facing some challenges.
He mentioned high cost of raw cashew nuts, inability of the processors to obtain adequate raw materials due to competition, high cost of credit and utilities and obsolete technology as some of the challenges facing the industry.
“Ghanaian processors have become less competitive with foreign traders and this does not in any way make the business competitive in relation to the global market expectations,” he stated.
Mr Adjirackor noted that the survival of the industry was dependent on the availability of cashew nuts, diversification in the value chain and policy interventions.
On the part of the government, he said it had launched the 10-year development plan that sought to increase Ghana’s production beyond 300,000 metric tonnes within the next 10 years.
Additionally, he said the government together with the other partners in the industry would establish a multi-stakeholder regulatory body to help in streamlining the activities within the cashew value chain.
Mr Adjirackor urged the association to work together with other bodies to promote the industry.