Less than one per cent of the 2016 budget of the Ministry of Trade and Industry will be used to support trade and industry initiatives this year.
This is because out of the GH¢259.61 million allocated to the Ministry of Trade and Industry (MoTI) for spending this year, GH¢258.61 million, representing 99 per cent, is to be disbursed to subverted institutions under the ministry.
Part of that amount would be used to pay the salaries and remuneration of staff of the ministry, leaving only GH¢750,000 for goods and services.
“This amount (GH¢750,000) is less than one million cedis, it is less than the price of a two-bedroom house, yet that is the amount we will work with after taking out salaries and allocations to the agencies,” the Sector Minister, Dr Ekwow Spio-Gabrah, said at the National Cashew Dialogue in Accra.
He explained that the meager nature of the ministry’s goods and services budget normally constrained efforts aimed at developing the industrial and trade base of the economy.
The ministry currently has about 16 institutions under its care, out of which all, including the Ghana Export Promotion Authority (GEPA), the Export Development and Agricultural Investment Fund (EDAIF), the Komenda Sugar Factory and the Ghana Standards Authority (GSA), are subvented.
He said a chunk of the ministry’s budget could be saved if majority of the institutions were weaned off the subventions.
“Some of them are ready to be weaned off. The GSA has actually proposed to be an independent agency but they say they can do so only if, in their view, the Ghana Conformity Assessment Programme (GCAP), is brought back. They think it is one of the sources of revenues that has been denied them,” he said in an interview with GRAPHIC BUSINESS after the dialogue.
“So, it is either the government can keep them under subvention without the GCAP or they are given the GCAP and taken out of subvention,” he said.
Asked what he would advise under the current situation, Dr Spio-Gabrah said the issue of the GCAP was part of a range of policy initiatives being discussed with stakeholders and the presidency.
The national dialogue, which was on the theme: “Revitalising the Cashew Sector, an Opportunity Neglected by the Nation,” aimed at outlining measures to raise output of the crop to 150,000 metric tonnes by 2025.
Currently, annual output of cashew is reported at 50,000 tonnes, majority of which is exported, leaving the local manufacturing sector to fend for itself.
As a result, the low production figures has combined with increasing cost of production, lack of funds and stringent cashew nut import measures to make the processing of the crop unattractive, leading to the collapse of the processors.
Only nine of the 12 processors in the country are in active business.
“If we put the right structures in place, we can even move from the 50,000 tonnes to 200,000 tonnes within the next 10 years. The good thing is that we have good land suitable for cultivation,” the President of the Ghana Cashew Industry Association (GCIA), Mr Winfred Osei Owusu, said at the dialogue graced by the Trade and Industry minister.
“Currently, the land that is suitable for cashew production is three million hectares. Out of that, we are farming on just 100,000 hectares. So, if we get the support, then we can increase production,” Mr Owusu added.
While admitting the need to support the sector with funds to grow, Dr Spio-Gabrah said his outfit was only in charge of the trade and industry bit of the economy, as the Ministry of Food and Agriculture oversees the agriculture sector.
That notwithstanding, he said the limited nature of budgetary allocations to the MoTI meant that any attempt to support the cashew processors with funds would be constrained.
He, however, pledged to work with them to unearth the potential of the crop, which he said he had been cultivating for 17 years.