Business News of Sunday, 19 February 2017
The government intends to offload its 60 percent shares in the struggling Aveyime rice project at Battor in the Volta Region.
Consequently, it has initiated moves to look for investors to take over the management of the project.
The Minister of Food and Agriculture, Dr Owusu Afriyie Akoto, who disclosed this to the Daily Graphic in Accra, said the government had no funds to invest in the farm currently being operated by Volta Prairie Limited (VPL).
Following the ministry’s objective to increase the production of cereals, including rice, the minister recommended that the government sold its stake in the project because of its poor showing over the years.
“The Aveyime project is just sitting there idle with its entire asset, is that what we want? That is not what we want. The government has no business growing rice. Our 60 per cent now equals to zero.
“If we sell the 60 per cent share and we are taking taxes and they are productive, a lot of people would be employed there. That is better,” he said.
The government is anticipating 48 percent increase in cereals, including rice production, as it plans to inject GH¢560 million in a programme modelled on the ‘Operation Feed Yourself,’ which was highly successful in the 1970s.
The current version, to be known as ‘Planting for Food and Jobs,’ is expected to create 750,000 jobs with a GH¢1.3 billion food income.
At the moment, Ghana spends more than $600 million on imported rice.
Maize silos with a capacity of 10,000 tonnes bought under a Quality Grain project had to be retrofitted for rice processing. However, because the conveyors were not meant for rice but maize processing, it affected the quality of rice produced. Large drying silos are also sitting idle and going rusty.
Other big silos and equipment for de-husking, cleaning, polishing and bagging of the rice are all rusting away. An agriculture aircraft (Agcat) with 450 horsepower has also been abandoned at the project site.
The main challenge is the lack of capital injection into the operations of the project.
PVL is a joint venture company between a USA-registered company, Prairie Texas Incorporated (PTI), and the Government of Ghana, which was agreed in a memorandum of understanding (MoU) signed by the two parties on May 16, 2007.
Per the agreement, PVL, the managing partner, owns 40 per cent shares in the company, while the government is the majority shareholder.
The company owns 1,250 hectares in the Central Tongu District in the Volta Region, of which 750 hectares has been cleared and 710 fully irrigated. PVL also holds lease rights from the government and the local community to a further 6,000 hectares.
With its current 770 hectares, PVL can produce a maximum of 7,000 tonnes of paddy a year, which is about 12 percent of the installed capacity of its 1997 mill.