VALUE CHAINS AND GAINS. Ghana the Gateway to Africa

Transcription

1 VALUE CHAINS AND GAINS Ghana the Gateway to Africa Joint presentation by MOFA, MOTI, GIPC, GEPA 17 th September,

2 presentation outline Ghana - Overview Ghana s Competitive Advantages Cashew Industry in Ghana (Historical and current status) Why is Ghana investing so much in the cashew industry? Key Opportunities in the cashew industry Investment Procedures (GIPC & GFZB) Investment Incentives and Guarantees A Success Story Conclusion 2

3 Lower middle income economy GHANA - OVERVIEW 2012 GDP of $40.68 billion & West Africa s second-largest economy and market. GDP growth rate of 7.9% (2012) Income per capita US$ 1,570 (2012) Population 25 million (2010 census) million labour force Over 60% employed million mobile voice subscribership Strong and sustained economic growth over the last 10yrs GDP annual growth rate of 6.5%; this includes the temporary slowdown to 4% in 2009 and the quick rebound to 14.4% in

4 GHANA - OVERVIEW Economic Indicators GDP (GSS) GHC56.28 billion (US$31.45 billion) GHC73.1 billion (US$40.86 billion) GDP per capita(gss) US$1,380 US$1,570 Real GDP Growth 14.4% 7.9 % GDP sector contribution Agriculture Industry Service 15.7% 36.2% 48.1% 22.7% 27.3% 50.0% Inflation 8.73%(average for 2011) 8.8 %(Average for 2012) Reserves (Months of Imports Cover) 3.6 months (US$5,474.6 million) Source: 2013 Budget Statement, MOFEP & Ghana Statistical Service 3.0 months (US$ 5,348.9 million) 4

5 Ghana s Competitive Advantages Ranked the most business-friendly environment in West Africa -World Bank. Sound Macro-economic and Political stability one of the best in the sub-region. IMF Average Forecasted Growth Rates, % economic growth in 2011, and forecasted 6-7% growth for next five years - IMF 3.9% 4.8% 5.8% 6.4% 7.9% Generous investment incentives including tax holidays and customs exemptions. Ghana s unique geographically position as the closest country to the centre of the earth provides the capacity to develop a good hub for intra-african market. Cote d' Ivoire Senegal Burkina Faso Nigeria Ghana 5

6 MAP OF GHANA SHOWING CASHEW PRODUCTION AREAS 6

7 Cashew Industry in Ghana (Historical Perspective) Cashew cultivation in Ghana started in the 1960 s from Central and Greater Accra Regions and spread into Brong-Ahafo, Northern, Upper East and Upper West Regions. Production decreased in the 1970s due to lack of governmental support and market. In 1983, the Economic Recovery Programme identified cashew as one of the major non-traditional commodities for export. Ghana recorded its first RCN export of 50 MT in In 1994, cashew Export Production Villages (EPVs) were established by GEPA and through the assistance of USAID, the first processing units were set up in the EPVs in Brong Ahafo Region 7

8 Support to The Cashew Industry (1980 to date) The Govt of Ghana together with its Development Partners, NGOs and the Private Sector contributed in diverse ways to the development of the cashew value chain. These are: Govt Agencies MoFA (Ministry of Food & Agric) GEPA (Ghana Export Promotion Authority) CRIG (Cocoa Research Institute of Ghana) GSA (Ghana Standards Authority) MLF (Ministry of Lands & Forestry Development Partners, NGOs USAID (Technoserv, TIPCEE, AMEX, ADRA, WATH) AfDB GIZ UNDP World Bank R&C ACi ACA 8

9 Government s Major Intervention ( ) Implementation of Cashew Development Project with the objective of increasing production and processing of cashews and generating foreign exchange. Some of the achievements were: Over 30,000 farmers mobilized for cashew development activities Area under cultivation expanded by 34,000 ha 60 ha germplasm plots established to broaden cashew gene pool Scion banks created to provide sources of scions for canopy substitution of poor yielding trees and production of clones Improved cashew production and protection packages developed by CRIG to strengthen extension delivery to farmers Credit provided to support production District farmer associations formed and registered with Department of Cooperatives to encourage group marketing of RCN Average cashew yield levels increased from 200kg/ha to 550kg/ha 6,704 full time jobs and 229,253 seasonal jobs were created

10 Cashew Industry in Ghana (current status of 50 Area under cultivation and RCN production volumes Area ('000, Ha) RCN Production ('000,mt) Volume of RCN Exported ('000 mt) Production) Farms 88% are by small holders (0.8-3 ha) 12% by large plantations (4 40 ha) Seasonality: Harvesting is done between March and June. 95% of production is exported as RCN 90% of RCN are exported to India

11 Cashew Industry in Ghana: Current Status of Processing 2012) Processing capacity in country (mt/year) Processing Only 5% of RCN is processed in Ghana Total installed processing capacity : 27,000mt Number of major primary processing units currently in operation: 12 Major secondary processors (Roasters): over

12 Why is Ghana investing so much in the cashew industry? Contribution to economic development Export earnings from RCN Social impact contribution to pro-poor economic growth by improving incomes of the roughly 70,000 smallholder farmers who are currently involved in cashew cultivation Generation of more than 200,000 permanent and seasonal jobs, particularly for farm laborers and intermediaries. RCN harvesting and marketing activities occur during the four-month lean season and therefore provide buffer cash flows to smallholder farmers who intercrop cashews with staples such as maize. Positive contribution to the environment (play an important role in reducing greenhouse gas emissions) Northern linkage: Cashew production occurs primarily in Ghana s savannah region, creating a direct linkage to economic development in this region. 12

13 Investment opportunities Production: 75,000 ha is under cultivation. 5.5 million ha identified for devt Input supplying (seedlings, fertilizers, agrochemicals dealers) warehouses Haulage services aggregators & field agents Processing of RCN

14 INCENTIVES & Guarantees Gfzb 100% exemption from payment of direct and indirect duties and levies on all imports for production and exports from free zones; 100% exemption from payment of income tax for 10 years After 10 years Agro Processing companies outside regional capitals - 0% Agro Processing companies in regional capitals 4% Commercial & service companies, enclave developers 8% Manufacturing companies outside regional capitals 5% Other manufacturing companies 6% 100% exemption from payment of withholding taxes 100% ownership of shares by foreign or local investors No restriction on repatriation of dividends Up to 30% of products can be authorized for sale on local market Unimpeded issuance of expatriate work and residence permits; Free zone investments are guaranteed against nationalization and expropriation.

15 Incentives & Guarantees - GIPC Custom duties exemptions for plant, machinery, equipments and parts thereof Graduated and reasonable corporate taxes Location incentives of between 25%-50% tax rebates for processing companies Other attractive tax concessions such as accelerated depreciation for plants and buildings, five-year loss carry-over and R&D expenditure deductibility Transfer of funds in respect of servicing of foreign loans Tax holidays ranging from 5-10 years depending on sectors Automatic immigrant quotas Relief from double taxation for foreign investors and employees where applicable Full repatriation of dividends and net profit attributed to investment Guarantee against expropriation (also enshrined in the Constitution of Ghana) Remittance of proceeds in the sale or liquidation of investment

16 Free Zone Registration Eligibility Should be a limited liability company registered with the Registrar Generals Department Should be export oriented. Should add some value to products/services to be exported Should be environmentally friendly Requirements Business Plan Copy of Certificate of Incorporation Copy of Certificate to Commence Business Copy of Companies Code Evidence of possession or lease of real property or intent to acquire such property Memorandum of Understanding (MOU) with prospective clients Environmental Protection Agency Permit (where necessary) Evidence of Funding/Capital Transfer Any other relevant document 16

17 GIPC registration Step 1 - Registration with Registrar General's Department Incorporate your company at the Registrar General's Department and obtain the following : 1. Certificate of Incorporation 2. Certificate to Commence Business 3. Company s Regulations Step 2 - Minimum Equity Contribution for foreigners Compliance with GIPC Act 478 regarding minimum equity requirements either in Cash or in Kind as follows: Joint Venture US$ 10, % Foreign-Owned US$ 50, Trading Enterprises US$ 300, In the passed new GIPC law, the thresholds would be; US$ 50,000 Joint Venture US$ 200, % Foreign owned in specified sectors US$ 1,000,000 Trading Enterprise Step 3 - Registration with GIPC This process takes up to five statutory working days to complete, provided all documents are in order. Registration with the GIPC entitles Investor to the Incentives and Guarantees under the GIPC Act

18 Mim Cashew and Agricultural Products Ltd A leader in cashew processing Established in Ghana in 2008 Head office in Mim, Brong Ahafo, Ghana $20 million in cashew processing plant with 5,000 ton capacity 1,000 Direct employment and additional 200 on seasonal bases 560 Acres organic cashew plantation and 155 Acres of New Plantation Current production level at 3,500 m/tons and expected to increase to 5,000 m/tons in farmers engaged supplying them with inputs GHC2 million small loans to farmers in the form of advance payments GHC 0.5 million Community development projects 18

19 conclusion The Government of Ghana would welcome the opportunity to partner businesses for mutual commercial and development benefits for all. 19

20 Contact us The Chief Director Ministry of Food and Agriculture (MoFA) Postal Address: P. O. Box M37, Ministries, Accra Ghana Tel: Fax: Website: 20

21 THANK YOU FOR YOUR KIND ATTENTION