![Experts are calling on countries to change their policies to protect locally produced products. For example, Nigeria is an exporter of rubber but imports tires; Ghana exports cocoa, but Switzerland is known for chocolate. Here, a worker at a factory in Abidjan holds a block of rubber intended for export and processing into finished products abroad.](https://static.globalissues.org/ips/2023/09/A-worker-in-a-factory-in-Abidjan-holds-a-block-of-rubber-meant-for-export-for-processing-into-finished-products-abroad-1-629x419.jpg)
DAR ES SALAAM, Sep 15 (IPS) – Experts from the Africa Food Systems Forum (AGRF) in Dar es Salaam, Tanzania, have called on African governments to create and review existing policies to facilitate the processing and agro-industrialization of locally produced agricultural products to protect. Products.
Speaking at the launch of the Deal Room, Mohammed Dewji, President of the MeTL Group of Companies in Tanzania, noted that farming will remain meaningless without agro-processing. https://www.ipsnews.net/2021/05/kenyas-dryland-farmers-embrace-regenerative-farming-to-brave-tough-climate/
“Tanzania produces cotton and is perhaps the third largest producer. How come there are only three textile companies? We grow the cotton, gin it and export it to China, where the final product is produced, dyed and printed, and then shipped back to us. Because of the taxes at the local production level, we cannot compete,” he said.
“Unless we implement correct policies that promote local production, we will continue to talk about cocoa from Ghana and chocolate from Switzerland,” he told delegates in the Deal Room.
The Deal Room is a matchmaking platform hosted at the AGRF, with the aim of driving new business deals and commitments, where companies in the agriculture and agribusiness sector can access financing, mentorship and market access solutions to support their growth objectives.
According to Wanjohi Ndagu, partner and investment director at Pearl Capital Partners Ltd in Uganda, many African governments have policies that promote imports, even when farmers in those countries have bumper harvests of the same product.
“We need policies that can protect farmers and local production,” he said.
In addition to cocoa in Ghana and chocolate from Switzerland, countries such as Ivory Coast and Nigeria are net exporters of natural rubber, which is processed and brought back to them in the form of car tires, shoes and rubber-based industrial goods.
Tanzania, Mozambique and Ivory Coast are net exporters of cashew nuts, but importers of roasted and processed cashew nuts, cashew butter and other value-added cashew products.
Kenya is currently delving into raw avocado exports, but the country has always mainly imported avocado cosmetic products.
However, all is not lost.
Rwanda was presented as one of the success stories in Africa, where the country, through favorable policies, has created an enabling environment that attracts investments in the agro-processing sector.
“Our country’s Strategic Plan for Agricultural Transformation has enabled us to evolve the sector from a subsistence sector to a knowledge-based, value-creating sector,” said Nelly Mukazayire, Deputy CEO of the Rwanda Development Board (RDB).
To make work more accessible and attractive to investors, the country has created a one-stop center where investors in a particular sector, including agro-processing, get services from searching for a company name, company registration, generating unique identification of the registered company, opening the business bank account and issuing relevant permits and licenses, and the entire process takes up to eight hours before the company becomes a legal entity.
In many other African countries, such processes can take more than four months and in some cases even a year for a company to receive proper registration, and this slows down the pace of investment, according to AGRF delegates.
“Investors in the agricultural sector in Rwanda also have the opportunity to obtain tax exemptions for up to seven years and reduce corporate taxes on exports,” Mukazayire said.
Following the COVID-19 pandemic, the country launched what is now known as the Manufacture and Build to Recover Program (MBRP), aiming to boost economic recovery efforts with specific incentives for the manufacturing, agro-processing, construction and real estate development sectors.
Through MBRP, manufacturers with capital of USD 1 million and above are granted import duty exemption and value added tax (VAT) exemption for imported construction materials not available in East Africa, VAT exemption for machinery and raw materials produced domestically are purchased and VAT exemption for building materials purchased in your own country.
However, capital for agricultural processing was limited to $100,000 to support the growth of the sector.
Speaking at the AGRF Deal Room event, Brent Malahay, the Chief Strategy Officer at Equity Group, called on investors to take advantage of the bank’s ‘Africa Recovery and Resilience Plan’, which aims to strengthen the East African Community’s value chains to strengthen, finance and connect. for global supply chains.
“Through this plan, Equity Group will benefit from a region that provides access to critical raw materials, supports industrial capacity needs and an entrepreneurial and innovative local workforce, and a region that offers a sizeable market that is becoming increasingly integrated,” said Malahay. .
During the event, Isobel Coleman, Deputy Administrator at the United States Agency for International Development (USAID), announced a $4 million investment in VALUE4HER, AGRA’s Deal Room product, a continental initiative aimed at empowering women’s agricultural businesses and expanding voice and advocacy across Africa.
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© Inter Press Service (2023) — All rights reservedOriginal source: Inter Press Service