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25.02.2006 General News

The Chilling Effect of Frozen Poultry Imports

The Chilling Effect of Frozen Poultry Imports

ACCRA, Feb 25 (IPS) - It is only mid-morning in Ghana's capital, Accra, but the day is already hot -- and business brisk at the Beyeeman Freezing Company Limited, which imports frozen poultry products.

Workers in thick winter jackets emerge from the interior of the cold storage facility, carrying cartons into the sweltering heat. Poultry importers have set up shop in scores of small wooden stalls along the inner perimeter of the company complex; outside, customers are waiting to buy their goods wholesale or in smaller quantities.

"We store products for an average of 50 clients at a time. Though we stock meat products from local livestock farmers, the bulk of our business is with the importers," says Nana Frema Agyemang Ofori-Atta, managing director of the Beyeeman complex.

"This poultry import business is big: the products are cheap, people are buying and some importers are bringing in as many as about 12.containers a month. That is why cold stores are springing up everywhere."

These developments do not auger well for the local poultry industry, however.

Ghana imported 26,000 tonnes of chicken in 2002, mostly from the European Union, where farmers receive generous subsidies. Two years later this figure had almost doubled, to about 40,000 tonnes. The annual import bill currently hovers around 30 million dollars.

In contrast, the domestic market -- which supplied 95 percent of Ghana's poultry requirements in 1992 -- only provided a dismal 11 percent by 2002. Unconfirmed estimates currently put the domestic poultry supply at single-digit figures.

"Why should a chicken, which sells for between four pounds and five pounds in the UK (United Kingdom), sell at one-pound-50 in Ghana, despite freight and handling charges?" asks Ernest Owusu-Afari, managing director of Afariwaa Farms, one of the few local poultry operations still in existence.

"This will only happen because of a policy that allows UK farmers to export surplus produce cheaply."

Once prosperous Afariwaa Farms, where sheds stand empty in fields overgrown with weeds, now operates at 10 percent of its overall capacity. Increasing production costs have resulted in huge job cuts and the owners are thinking of shutting down the slaughterhouse.

For hundreds of small-scale producers, the influx of poultry imports has also proved devastating.

"It is hell out there.Now, you can only breed poultry for the home, but definitely not for the market," says Joyce Armah, a poultry farmer in one of Accra's outer suburbs.

"The foreign birds sell faster, and it is understandable because somehow they have become bigger and cheaper."

The havoc caused by cheap imports is not limited to the poultry sector, however. Ghana's textile industry, weighed down by high production costs, has also taken a hit -- from cheaper Chinese goods, imported legally or smuggled into the country.

In addition, the local rice industry is almost extinct. According to the United Nations Food and Agriculture Organisation, Ghana spends more than 1.2 billion dollars annually on rice imports, which rose from 121,000 metric tonnes in 1993 to 507,600 in 2002.

The gradual collapse of the textile, poultry and rice industries has seen more than 5,000 employees lose their jobs.

"We cannot open up our infant industries and expect them to compete with the giants from the Americas, Asia and Europe, as is the case at the moment. Our government needs to act now," says Kofi Davoh, general secretary of the Union of Industry, Commerce and Finance Workers.

But authorities have been reluctant to impose protectionist measures, saying local industries cannot meet the demands of the domestic market. A 40 percent tariff on imported poultry products that was set to take effect in 2003, for instance, was never implemented.

The question asked by some is whether Ghana should emulate neighbouring Nigeria, which limits the import of products such as textiles, poultry, plastics and rice, even from its West African neighbours.

"Certainly, the Nigerian way is valid to a certain level. We can use a range of options, such as giving out subsidies or lowering bank interest rates, raising tariffs, setting quotas or placing outright bans," says Tetteh Homeku, programmes manager of Third World Network-Africa, a non-governmental organisation that lobbies for free and equal trade for developing countries.

"We should determine what is right to support our local industries," Homeku adds.

According to the Third World Network, African countries can only meet the targets of the United Nations Millennium Development Goals (MDGs) if their local industries are protected, to bolster economic growth.

"Otherwise, how will people -- who continue to lose their jobs and their earning capacities -- be expected to pay for the much-needed social amenities, like health (and) education?" Homeku asks.

"If Ghana's economic policy process continues to be driven by the interests of importers rather than that of domestic producers," concludes Homeku, "then we are in trouble."

Eight MDGs were adopted by global leaders during the U.N. Millennium Summit in New York, in 2000. The goals include halving extreme hunger and poverty, achieving universal primary education, promoting gender equality -- and reducing child and maternal mortality.

There are also goals for combating disease, and achieving environmental sustainability and a fairer international trading system. The MDGs are meant to be achieved by 2015.