‘Oil Palm Sector Needs Financial Support’

Palm oil workers
Samuel Awonnea Avaala, President of the Oil Palm Development Association of Ghana (OPDAG), says long-term tailor-made financing for oil palm development is required to attract investment into the sector.

According to him, government's master plan for the oil palm industry, which was developed in 2012, has not been implemented.

Mr. Awonnea Avaala, who made this known in an interview with the media, called on government to begin the implementation of its master plan for the oil palm sector to ensure effective development.

He said the oil palm sector was faced with numerous challenges and called on all stakeholders in the sector to hold board consultations to find solutions to them.

'One of the major issues is the Import Adjustment Tax (IAT) on Crude Palm Oil (CPO). Some actors in the palm oil value chain are calling for the introduction of Import Adjustment Tax (IAT) on imported Crude Palm Oil (CPO). Will that be in the best interest of the entire industry and the economy in the near term and long term? This is a nagging issue that cannot be decided on unadvisedly,' he said.

Touching on the position of the Association, Mr. Avaala said, 'In the interest of the industry as a whole, the tax regime for imported palm oil in the immediate term should remain same.

Key Issues
Commenting on issues affecting the sector, the president of the association said the refiners and Fast Moving Consumer Goods (FMCG) manufacturers have more than enough capacity to produce for domestic consumption and for export to the sub-region.

He added that they do not get enough crude palm oil from local sources to produce and therefore unavoidably import the commodity.

'If they could source 100 percent of the raw material locally to lower production cost and prices of the product, it would be favorable for the ordinary Ghanaian consumer and the export market,' Mr. Avaala said.

Oil Palm Industry
Oil Palm industry constituted two percent of total agricultural production value in Ghana in 2010.

According to recent MOFA statistics, there is a little over 300,000 hectares of palm oil plantation in the country.

There is a corresponding palm oil production of about 240,000 metric tones, with an unmet demand of between 35,000 and 50,000 metric tones, making the country a net importer of the commodity.

Samuel Awonnea Avaala
By Cephas Larbi
[email protected]