EU pumps €7.2 million in Ghana’s banana export Industry

EU pumps €7.2 million in Ghana’s banana export Industry
Source: Ghana|Myjoyonline.com | JoyBusiness
Date: 04-12-2017 Time: 05:12:29:pm

Over €7.2 million has been invested into two banana farms by the European Union (EU) to improve the competitiveness of the banana export industry in the face of some tariff preference erosion on the EU.

Global Banana Export Market

Banana exports by country totaled $11.8 billion in 2016, up from an average 30.9% for all banana shippers over the five-year period starting in 2012 when bananas shipments were valued at $9 billion.

From a continent perspective, Latin American (excluding Mexico) and Caribbean countries accounted for the highest dollar value worth of banana exports with shipments amounting to $7.1 billion or 60.5% of global banana sales.

European exporters accounted for 20.3% of total exported bananas, followed by African shippers at 7%. Asian countries generated 6.8% of global bananas exports with North American exporters at 5.3%.

Economic Partnership Agreements with African, Caribbean and Pacific (ACP) banana suppliers

Since January 1, 2008, African, Caribbean and Pacific (ACP) banana suppliers who have initialled an EPA (Economic Partnership Agreement) benefit from duty and quota-free access to the European Union market.

Members of the ACP include Belize, Cameroon, Ivory Coast, Dominica, Dominican Republic, Ghana, Grenada, Jamaica, St. Lucia, St. Vincent and the Grenadines, and Suriname.

The effect of this deal has been to protect banana farmers in these regions from competition from Latin America, whose bananas are cheaper because they are grown on large-scale, mechanised plantations run by giant US-based corporations.

Geneva Agreement on Trade in Bananas

On December 15, 2009, the European Commission initialled an agreement on bananas with Latin American suppliers. This deal has brought to an end the longstanding banana dispute, which soured EU external trade relations for many years.

According to this agreement, the EU will cut the Most Favoured Nation import tariff on bananas from non-ACP countries in eight steps, from the rate of €176 per tonne to €114 per tonne in 2017 at the earliest (or 2019 at the latest).

The effect of which will be an erosion of the competitiveness of members of the ACP.

How does Ghana Feature in all this?

Currently, Ghana exports about 65,000 tonnes of banana which accounts for barely 1 percent of the global banana export market and with the gradual cut in tariffs on exports from non-ACP members, Ghana is losing competitiveness.

What is the Banana Accompanying Measures for Ghana?

The project investment is a joint partnership between the European Union and the Ministry of Finance. Under this intervention or Aid scheme by the EU, a total amount of €7,240,000 has been invested in two companies, Golden Exotic Limited and Volta River Estate Limited with the aim of boosting the competitiveness of two companies.

Over €6 million has been invested in the construction of 224 houses and social Infrastructure at Kasuna for Golden Exotic limited to provide housing for banana workers and their families.

According to the chief Architect on sight architect Amorien, the project is underway and expected to be completed on August 22, 2018.

Another €700,000 euros plus invested into the organic composting Project for Volta River Estate Limited. Under this project, weeds are harvest from the Volta River and converted into compost.

Results

Boost competitiveness of Banana exports by improving the efficiency of banana workers

Encourage the production and sale of organic banana which is crucial for the future of banana exporters. 

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