Norwegian Industrial Adventure in Ghana

They invested about USD 58,6 million to become biodiesel kings in Ghana. Instead, the Norwegian investors ended up as maize farmers. To Ghana they came, Norwegian investors, to plant the hardy shrub called jatropha and reap the benefits.

For everything looked so bright in the beginning. Early in 2007, biofuel was represented as the solution to the climate crisis. The plant grows rapidly, could be harvested four times a year and produced fruits packed with oil, according to the brokerage giant Goldman Sachs. Jatropha could even grow on the most barren plains, and therefore do not occupy arable land for food production. Moreover, it was inedible, and was thus not affected by the growing criticism against the use of other biofuel products such as corn and soya, which, it was thought, could send food prices sky high.

For everything looked so bright in the beginning. Early in 2007, biofuel was presented to the world as the solution to the climate crisis.

Already in the first season, the Norwegians saw that harvest was much lower than they had hoped. Growth disappointed enormously, as did the return on the fruit, which turned out to be far less oily than expected.

Out on the world market, the price of the first generation of biofuels was driven to the bottom by cheap and subsidized biodiesel from the United States. Hard money flowed out of the company coffers and something drastic needed to be done to save the huge investment.

Now, they had to go for food production. The company previously known as Scanfuel was now baptised Scanfarm. These days, jatropha has been replaced with soya, maize and rice; with a company headquarters in Agogo, Asante Akim. The company has 36 employees on the payroll, and hire nearly 500 workers during the harvest. And so it came to pass that Scanfarm became the largest maize producer in the whole of Ghana. It has contributed to making the country almost self-sufficient in the popular grain.

Scanfarm acknowledges that it still has a long way to go. Ghana's agriculture is very little mechanized, and is still based more on survival than industry. There is a lack of irrigation system, and should one rely on the rain in this country, it is often either too wet or too dry. Scanfarm has so far planted 6,700 acres of maize and soya.

According to Scanfarm, the company needs to increase production to 15-20 000 of cultivated acres to achieve profitability in this project. The company believes Ghana's agriculture can be increased tenfold from the current level with fertilizer application and proper irrigation system.

Quite recently, Ghana was rated "moderately unsatisfactory" in the International Fund for Agricultural Development (IFAD) country programme evaluation due to project design problems and delays in start- up and implementation of programmes.

This abysmal rating notwithstanding, Mr Kwesi Ahwoi, Ghana`s Minister of Food and Agriculture said his government was more than determined to transform agriculture from rudimentary characteristics to a modernized one. According to the minister, transforming the agricultural sector "cannot happen without deliberate and intensified prioritization of Agriculture in resource allocation and investment. We cannot continue to pay lip service to the transformation agenda despite the challenges of infrastructure, finance, lack of market and frail private sector among other things."

When the NDC government assumed power in January 2009, they promised to revolutionize the agricultural sector to make it the engine of national growth. Almost three years into their administration, they are still struggling to fulfill this promise.

About a year ago, the National Propaganda Secretary of the ruling NDC government, Mr Richard Quashigah shamefully mentioned, among others, agriculture as government`s success story when he was tabulating government`s achievements. What you just read above does not support that assertion, does it?

Desmond Frimpong, Norway