25.05.2005 Business & Finance

Ministry Halts Yam Exports By Sea

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THE Ministry of Trade and Industry has suspended the export of yams by sea indefinitely to ensure compliance with the directive for exporting by air.

The ministry explained that there was the need for its directive for yam exporters to freight solely by air to the United States of America (USA) and Canada to be fully tested and monitored to ascertain the degree of success before any contrary steps were taken.

It said recent reports of high rates of spoilage of yam arriving on the US market by sea was creating a bad image for the Ghanaian yam brand.

In an interview in Accra, the acting Chief Director of the Ministry, Mr Seth Evans Addo, said the ministry had begun an exercise of monitoring the exercise, vis-a-vis the world trend of yam trade to enable the ministry to institute the right measures to bring maximum benefit to Ghanaian yam exporters.

The ministry's intervention follows recent outcry by a section of yam exporters in the country, who called themselves the Association of Sea Freight Yam Exporters, calling on the ministry to grant them waivers to freight by sea.

The Ministry of Trade, in June last year, issued a directive which stated, among other things, that all yam exports to both destinations were to be air freighted. The measure was to reduce waste and create a uniform price for the commodity, which is seen as having the potential to do better than the country's main traditional commodities, if well regulated.

However, the minister can grant waivers to exporters to freight by sea to those destinations for purposes other than sale.

Mr Addo explained that the directive was issued at the instance of the yam exporters themselves requesting for the system to forestall the collapse of prices of the commodity on the international market.

Dilating on the rationale behind the directive, Mr Addo said yam exporters in the country had suffered for a long time from certain constraints and peculiarities such as non-payment for yams exported to buyers in Europe and the United States, which consequently resulted in the exporters refusal to pay local yam farmers and traders.

Non-payment by the buyers also resulted from high spoilage of the commodity on arrival at the buyer countries.

Consequently, Mr Addo said, the five different yam exporters association and the Federation of Associations of Ghanaian Exporters (FAGE) engaged the ministry in a continuous dialogue to bring sanity into the trade.

“As a result of persistent pleas by the exporters for government intervention, the ministry responded by first passing the legislation that made yam a traditional export product on June 24, 2002,” thus bringing the commodity to the status of cocoa beans, lumber and logs, electricity, unprocessed gold and other minerals, Mr Addo pointed out.

He said another appeal last year for a single corridor for the yam export trade since the earlier measure was inadequate, made “the ministry accept the challenge and draft new policy guidelines for the yam trade, which were discussed extensively with the yam exporters”.

Mr Addo said after several consultations, all yam exporters agreed to comply with the new policy directive that exports to the US and Canadian markets should be by air only.

Mr Addo said concerns were raised at an exporters' forum by a section of exporters who doubled as importers since they had some shops in the US and Canada and in consultation with FAGE, a waiver system was created to be issued only in exceptional circumstances.

The ministry, he said, found out recently that the system was being abused and that the waivers were being used to undermine the directive which had been put in place at the request of the stakeholders.

“Following these reports, the ministry conferred with the associations and the stakeholders and decided to suspend the waivers and allow for the full implementation of the guidelines as issued before for a trial period,” Mr Addo stated.

Mr Addo said the ministry found it strange and disingenuous on the part of few individuals to be attacking policy guidelines which have been introduced at the specific request of an overwhelming majority of yam exporters in the country.

“The ministry wishes to strongly advise individuals who have genuine cases to present their positions to the ministry as a unified group,” a statement signed by Mr Addo said.

It would be recalled that the ministry's directive has come under threat, following the abuse of waivers issued to a section of yam exporters.

These exporters, numbering about 17 and mostly resident in the United States, are alleged to have taken advantage of the waivers to send consignments for sale in those countries, enabling them to undercut the market price.

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