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Business News of Thursday, 5 February 2004

Source: GNA

Govt to commit money to commercial production of cocoa by products

Accra, Feb 5, GNA - Government would commit 25 billion cedis on soft financing terms to support the commercial production of cocoa by products - animal feed, fertilizer, soap, pomade and alcoholic beverages.

This is not only to link research findings to industry and to generate employment avenues but also to maximise the benefits of the cocoa industry.

Mr Yaw Osafo-Maafo, Minister of Finance and Economic Planning, presenting this year's Budget to Parliament on Thursday, said, "to maximize the benefits of the cocoa industry, Government will continue pursuing the policy of encouraging local value addition to raw cocoa beans".

"This initiative is expected to generate employment, reduce poverty and put to commercial use some of the waste products of the cocoa industry.

Mr Osafo-Maafo recalled that in 2003 the Cocoa Research Institute of Ghana (CRIG) outdoored a number of industrial cocoa by-products derived from using sub-standard beans, cocoa husk and other cocoa waste.

These industrial products include: animal feed, fertilizer, soap, pomade, and alcoholic beverages needed to be produced on large scale. He said "this year the portion of cocoa production processed locally is expected to increase from the current 25 per cent to 35 per cent with the coming on stream of additional processing capacity.

"As part of Government's support for the private sector, it is proposed that companies which invest in producing these products commercially using cocoa waste as their main or principal raw materials will enjoy a 5-year tax holiday, after which period the same tax regime" would be extended to them as those companies engaged in agro-processing.

He said the administration of the financial support would be handled by a sub-committee of Cabinet consisting of the Ministers of Finance and Economic Planning, Food and Agriculture, Women and Children's Affairs, Private Sector Development and Trade, Industry and President's Special Initiatives in partnership with designated financial institutions to ensure professionalism, effectiveness and transparency in implementation.

The Minister expressed regret that Ghana's smooth cayenne pineapple variety had lost out in the international market to the newly developed MD2 variety from South America.

He said: "Government is worried about this development because of the significant contribution of the pineapple sector to Ghana's non-traditional exports"

Mr Osafo-Maafo said accordingly Government intended to import, as a start, two million MD2 suckers for the Horticultural Association of Ghana for distribution to its members through on-lending arrangements. Government has voted 18 billion cedis for the purchase of the suckers.

In the long term, however, Government would support the propagation of the suckers locally using the tissue culture technology.

Government would support the Biotechnology Nuclear Research Institute (BNARI) to complete its tissue culture laboratory located at the premises of the Ghana Atomic Energy Commission (GAEC), Mr Osafo-Maafo said.