Tax raw cashew exports - GEPA

The Ghana Export Promotion Authority (GEPA) is advocating the imposition of taxes on the export of raw cashew to encourage more local processing.

Ms. Gifty Klenam, CEO of the authority told the B&FT that: “We believe that exporting the cashew raw doesn’t earn us more revenue. Besides, the foreign exchange that is earned from the export is also not always returned to the country to support the cedi.

As part of our strategy to implement the National Export Strategy of the government, we are considering having a conversation with the appropriate Ministry to surcharge the export of raw cashew that is done in the country.”

Available data from the GEPA shows that cashew has, over the years, become the leading non-traditional export earner in the agriculture sub-sector, contributing US$196.7 million in 2016.

Approximately 75,000 farmers in the country are engaged in cashew cultivation, with most farmers located in the Brong Ahafo, Northern, Ashanti and Volta Regions.

The price of raw cashew nuts has also soared. A kilogramme of raw cashew nut, which sold on the market for GH¢1.5 in 2013 is now trading for GHC4, representing an increase of 166 percent.

Currently, about 90 per cent of cashew is exported raw, much to the chagrin of local producers who struggle to get the raw materials for processing.

The proposal, when fully considered and adopted, will help revamp the local cashew industry and prevent the further collapse of processing plants in the country, Ms. Klenam said.

Ms. Klenam added that: “It was in this context that GEPA is having a conversation that a certain percentage of the cashew grown here be allowed for export, while a larger proportion is processed in the country. The domestic processing of the nuts will create jobs for the youth.”

Mr. William Agyepong Quaitoo, Deputy Minister of Food and Agriculture affirming the proposal confirmed that: “I fully support imposing taxes on the raw cashew export.”

Mr. Quaitoo noted that the Ministry of Food and Agriculture (MOFA) is fully aware of the situation and is therefore developing plantations of cashew. “When we do that and production goes up, of course the Indians will come and buy and some will still remain in Ghana and local processors can also buy.”

Ghana is one of the few English-speaking countries that have signed onto the consultative International Cashew Council.

The Council is an international organisation, steered by the Ministries responsible for cashew in the member states and meet annually as the decision-making body for the development of the sector. The association aims to create a consultation framework and synergies between member states for a sustainable cashew sector.

Mr. Quaitoo explained that Ghana’s membership of the Council would help contribute to the harmonisation of policies in the region and profit from the exchange in the technical bodies for private sector promotion, cashew research along the value chain and production.

He added that over the last decade, cashew had emerged as an integral part of Africa’s economy, and its production had grown impressively in the past years from 1.2 million tons in 2014 to 1.8 million tons in 2016.

Dr.Adama Coulibaly, Director in charge of Cashew Regulatory Body in Cote d’ Ivoire commended the country for signing onto the convention and expressed the hope that it would support member states to develop policies and strategies for the development of Cashew sector.

Representatives from the Ministry of Trade and Industry, Ministry of Local Government and Rural Development, African Cashew Alliance, Competitive Cashew Initiative, Ghana Export Promotion Authority, Mennonite Economic Development Association and Cashew Industry Association of Ghana witnessed the ceremony.

Fast Facts

12 processing factories

42,000mt installed processing capacity, representing 60% of national production levels of 70,000mt

2,000 jobs in factories, 75% women

Accumulated wage: US$1.5million with a maximum wage of US$720 per year

Potential of 10,000 direct quality jobs in processing