Business News of Tuesday, 4 December 2018
The Managing Director of RMG Ghana Limited, an agro-input company, Mr William Kotey, has urged the government to review the national fertiliser subsidy programme to reduce its cost burden on the government.
He said although the fertiliser subsidy programme was rolled out to support farmers to produce more, its implementation had not yielded the desired impact on productivity and income of small-holder farmers due to unresolved challenges along the agriculture value chain.
As a result, he said part of the funds invested in the programme must be diverted into the needed capital projects such as roads and storages facilities.
“The government must be pressurised to shed off some of the subsidies on fertiliser and some of the money must be invested in infrastructure which is needed in the agric sector.
“It is unproductive to increase yields when there are no storages facilities or good roads to transport them from the farm,” he said.
Get it right
Mr Kotey was speaking to the GRAPHIC BUSINESS after a Chartered Institute of Marketing- Ghana (CIMG) evening encounter on the theme: “Getting it right with Agribusiness: The supply chain management factor,” held at the Golden Tulip Hotel in Accra last Thursday.
The evening encounter brought together stakeholders in the supply chain of agribusiness to discuss the challenges and opportunities in the sector.
Leading the discussions, Mr Kotey said the country could harness the full potential of agriculture, if the government made strategic interventions targeted at improving agric based infrastructure rather than focusing on subsidies.
For instance, he explained that due to unreliable road networks, it was more expensive to transport maize from Tumu, in the Upper East Region to Tema than to import from Argentina to Tema.
“While it cost US$ 60 per metric ton to transport maize to Tema, it cost only US$25 per metric ton to transport maize from Argentina to Tema.
“Poor roads and lack of storage facilities are affecting productivity in the agric supply chain,” he said.
Private sector partnership
Shedding light on collaborations between the government and the private sector in improving productivity and agriculture’s contribution to the growth of the economy, he said the government must focus on infrastructure projects while the private sector commit to provide inputs to support farmers.
He explained that RMG Ghana Limited had over the years invested in the development of private sector initiatives aimed at improving yields and revenues among small-holder farmers.
The initiatives, he said, included the Cocoa Abrabopa scheme, which supports farmers through the supply of fertiliser and agro-chemicals on credit and provide training in input application methods.
“The government must focus on infrastructure development so that the private sector can do their part to improve the sector,” he said.
Mr Kotey also said the country could improve its gains from the Agric sector by focusing on creating larger farms.
He said the country must scale up and build the capacity of small and medium scale farmers to venture into large-scale farming, which has the potential of transforming the agric sector to make it more profitable.