Saturday, May 30, 2009

Ghana's Jatropha conundrum - begging for more answers

By Emmanuel K. Dogbevi


Ghana is already making history as it leads in Africa’s Jatropha investment story

Indeed, Ghana is a remarkable country for making history in Africa south of the Sahara. The country often stands out for the best and worst in both what is imaginable and unimaginable. The country is the first south of the Sahara to attain independence and end colonial rule by the British.

Not long ago, the country made history again in Africa for conducting a free and fair election which it proudly followed up with a peaceful transfer of political power to a new government.

And too soon, the country is in the news again. Ghana is becoming the Jatropha centre in Africa south of the Sahara. The attraction which the country has as a welcoming place for investors interested in the wonder plant, Jatropha which hopefully, would be the world’s answer to alternative energy sources is resonating across the globe even in such difficult times when the entire globe is being buffeted by an economic crisis. Despite the economic crisis, the investors in Jatropha and other biofuel crops are trooping into Ghana pledging investments in tens of millions of dollars.

The attraction is such that a global conference claiming to assemble giants in the area of knowledge and expertise in cultivating Jatropha and turning it into biodiesel worth millions of dollars for export has been held in Ghana.

But as one digs deeper into the Jatropha story, one appears to be dogged by more questions than answers.

Ghana Jatropha report

In 2005, the government of Ghana set up a Biofuel Committee (BFC) with the objective to develop a National Biofuel Policy (NBP).

The BFC conducted a study and submitted the following recommendations:

The BFC recommended that National Biofuel Policy should accelerate the development of the biofuel industry in Ghana with special emphasis on the production of biodiesel from Jatropha.

It recommended that the country should substitute 20% of national gasoil consumption and 30% of national kerosene consumption with Jatropha oil by 2015; remove institutional barriers in order to promote private sector investments and management of the biodiesel industry.

Another recommendation was to create favourable regulatory climate to ensure development of; competitive market; favourable pricing regime and high quality product.

It also called for Research and Development to improve the efficiency of biodiesel production technologies, reduce production costs, to raise quality and efficacy of product and suggested that in the medium to long term, Ghana should become a net-exporter of biofuels.

It has been four years now and there is yet to be a clearly defined policy on the biofuel sector to give the industry some structure. And so it appears, as it stands now, it is a free-for-all situation.

Claims about Jatropha

Jatropha, obviously has a valuable use, as its seed contains oil that can be used for biodiesel to power machines and cars. But it appears we don’t have all the facts and as a result there are several claims being made about Jatropha’s economic value to the globe.

One biofuels company Gold Star Farms claims on its website that the company plants a “specific strain of Jatropha that takes one year before they bear fruit and two years before they are producing a full yield.”

One of the company’s executives, Mr. Jack Holden has said that it has commitments from farmers to grow the crop on approximately five million acres of land in Ghana.

The company, he added, plans to begin producing biodiesel at its facility in Nkawkaw, in the Eastern region of Ghana, in 2009.

He said these sometime last year after Gold Star Biofuels, a subsidiary of Ghana based Gold Star Farms Ltd, had formed a joint venture with Aiken, S.C.-based USFuelTech LLC, a provider of turnkey modular biodiesel production facilities, to design and build small biodiesel plants in Chile that will use locally cultivated Jatropha as a feedstock.

The claim that the company is planting a strain which produces yields in two years is doubtful as the experience in India has shown. In the India experiment 22 agribusiness colleges were involved, and their reports were unanimous – it takes about four to five years for Jatropha plants to yield.

And D1 Oils a British company, which was involved in a large scale Jatropha project in India believes that it will be at least an eight-year wait before varieties with good yields on wastelands are developed. Even D1’s E1 variety is not yet available in sufficient quantities, a report in the Naional, an Adu Dhabi publication has said. D1 Oils is one of the companies operating in Ghana.

The claim that Jatropha grows on marginal or wastelands is also questionable. It has been asserted by researchers in India that if planted on marginal land, the plant would only yield marginally. In other words, Jatropha would yield efficiently when planted on arable land, making it compete with land for food crops which is the contention of opponents of the Jatropha promoters.

Professor RR Shah of Navsari Agricultural University was quoted by the National as saying that “the literature said that with dry land, after four years’ growth, you can get a yield of 1kg per plant. For us, it is hardly 200g per plant.”

Someone who said he is an agronomist said in a comment on an earlier article on Jatropha on ghanabusinessnews.com that he had told proponents of large scale Jatropha on marginal land that every plant needs irrigation and fertile soil to grow well and produce high yields, and so is Jatropha. He further argues that the claim that Jatropha can give high yields on waste lands has not yet fully been investigated.

He further made an interesting observation; he said, “moreover, from an agriculture point of view, adding mineral fertilizers in a soil containing less organic matter induces a loss of fertility!”

The cost of cultivation

The cost of cultivating Jatropha from all indications is high. As one investor has said, the
cost of cultivating 10,000 hectares of Jatropha is US$14 million, and that excludes irrigation and does not include processing for the extraction of the oil.

And according to the UN, harvesting Jatropha requires one worker for every one acre of land.

The cost of fossil fuel as against biofuel

The cost of producing biofuels, would make much reason in as much as the cost of fossil fuels remain high. But when prices come down, it makes little economic sense to continue to invest in biofuels, even though, it is also being argued that biofuels are more useful to the environment, or is it not?

NGOs, such as FoodSPAN, Action Aid and lately Friends of the Earth have been making calls for rationalization of the biofuels sector in Ghana and other African countries. But these NGOs have been accused of raising false alarm. It is being argued that NGOs need donor money to survive and the only way they get sponsorship for their activities is to make noise about a situation and make it look bad, even though, the case might not be so.

FoodSPAN and Action Aid are claiming that arable land is being taken away from poor farmers in the northern part of Ghana for the cultivation of Jatropha for the production of biofuels. These activities they claim is further pushing these poor farmers into deeper poverty and hunger and leading to further deforestation which also has consequences for the environment.

But the biofuels companies, mostly multinationals from wealthy nations claim otherwise.

Their alibi is that they are providing jobs for local farmers and building local communities with their investments. They insist their activities are not in anyway harmful to local farming activities, but rather a blessing.

But as events stand now, Ghana certainly is in a Jatropha conundrum, which only more clearer, convincing answers can resolve.

Source: ghanabusinessnews.com

Saturday, May 23, 2009

What lessons for Ghana in India's jatropha failure?

By Emmanuel K. Dogbevi


Would a jatropha crisis hit the world just as the current global economic crisis hit most nations unprepared?

Some analysts are arguing that, the level of the impact of the crisis is so because early warning signals were ignored, and lessons in economic failures of the past were never learned.

Is the investor community learning all they could about the jatropha or biofuel business?

Ghana has become the jatropha centre in Africa south of the Sahara.

There is literally a scramble for land in Ghana by multinationals and local companies in partnership with foreigners vigorously pursuing plans in cultivation of the jatropha plant for its prized oil seed to produce biodiesel for export.

Over twenty companies from various countries are in Ghana acquiring land to cultivate non-food crops and other crops for the production of ethanol and biodiesel, mostly for export.

These companies come from Brazil, Italy, Norway, Israel, China, Germany, The Netherlands, Belgium and India.

They are cultivating fields in the Volta, Brong Ahafo, Ashanti, Eastern and the Northern regions of Ghana. The main non-food crop that these companies are planting is jatropha.

One of the companies, Agroils of Italy is cultivating 10,000 hectares of jatropha in Yeji in the Brong Ahafo region.

Israeli company, Galten has acquired 100,000 hectares of land and an Indian company is requesting for 50,000 hectares of land from the Ghana Investment Promotion Council (GIPC), to cultivate jatropha.

A company from the Netherlands has started a pilot project on 10 acres in the northern region and the Chinese are also doing a pilot project.

Gold Star Farms Ltd., is cultivating five million acres of land to plant jatropha for the production of biofuels for export.

A Norwegian company ScanFuel Ltd., has started operations outside Kumasi in the Ashanti region to produce biofuel. The company aims to start initial cultivation of jatropha seeds on 10,000 hectares of land.

The company which has a Ghanaian subsidiary, ScanFuel Ghana Ltd., says its Ghanaian unit has contracted about 400,000 hectares of land, with up to 60 percent reserved for biofuel production, “not less” than 30 percent for food production and the remainder for biodiversity buffer zones.

Another Norwegian company, Biofuels Africa Ltd., the only one among the about 20 biofuels companies cultivating jatropha to receive an Environmental Impact Assessment (EIA) permit from Ghana’s Environmental Protection Agency (EPA) which covers 23,762.45 hectares of its project area is operating in two locations.

Even though, Ghana has no policy, regulations nor structures in place for the biofuels industry, cultivating any company cultivating anything more than 10 hectares is required to conduct an EIA for approval by the EPA.

All together, these companies are cultivating the jatropha plant on millions of hectares of land with the hope of producing biofuels for export.

The cost involved in cultivating 10,000 hectares of jatropha, one investor has said is approximately US$14 million – and that is when it is not irrigated. And this raises some questions about the commitment of some of these companies to follow through with their projects successfully.

The cost of an extraction plant if bought from India costs about US$3 million but could cost about US$9 million when bought from the West and an additional US$2 million would be required for storage and logistics.

As these companies pursue their dreams, it would be worthwhile to consider India’s failure in attempting to produce biodiesel from jatropha and learn some lessons.

The jatropha tree takes four to five years to mature fully. According to Satish Lele of the Indian Biofuels Awareness Centre, during the cultivation period if the plantation is rain fed, these plants can yield 0.35 to 0.375 gallon of oil per tree or 375 gallons per hectare or 150 gallons per acre. If it is irrigated (3 to 5 liters per plant every 15 days) it can be double this amount.

Planting jatropha alone is not economically attractive, he argues further, as there is little income from it for the first two to three years. The jatropha plant is initially small in height, and he, therefore, suggests that, castor should be intercropped with it in fallow land, to get income and oil.

The Indian experience

The National, a newspaper published in Abu Dhabi in its May 11, 2009 issue, published an article titled; ‘Jatropha seeds yield little hope for India’s oil dream.’

The article referred to a project that was embarked upon by Professor R. R. Shah in 2005, when he sent a team to Navsari Agricultural University’s most parched and desolate strip of land, a farm in the Vyasa district of India’s northern state of Gujarat.

The team was instructed to set up a model farm for jatropha, the hardy shrub with oil-rich seeds that were then emerging as one of the most promising alternatives to crude oil. At the time, jatropha’s promise seemed boundless. A. P. J. Abdul Kalam, the president of the University, even used his presidential address that year to extol the virtues of jatropha.

“Jatropha can survive in the most arid wastelands”, the story went. And so vast barren swathes of India could be put to productive use. It is inedible so it would not cause a backlash by competing with food crops, it said.

The government, according to the publication announced a scheme to plant 13 million hectares, enough to generate nearly 500,000 barrels of jatropha oil per day.

But as Prof Shah’s project in Vyasa nears its end this month, the dean of agribusiness at Navsari is sceptical. “There is no yield,” he says. “The literature said that with dry land, after four years’ growth, you can get a yield of 1kg per plant. For us, it is hardly 200g per plant.”

The consensus of the team of experts after evaluating India’s jatropa projects from 22 agribusiness colleges across the country was that, indeed, jatropha would grow on wasteland, but would give no appreciable yield.

“This is not a wasteland crop. It needs fertiliser, water and good management. Yes, it grows on wasteland, but it doesn’t give you any yield,” the publication quotes Dr Suman Jha a researcher on Prof. Shah’s team as saying.

If this observation is anything to go by, then the persistent argument that jatropha could grow on unproductive agriculture land should be looked at again. This argument also challenges the assertion that investors are not a threat to smallholder farmers,whose productive agriculture land stands to be annexed by powerful multinationals for the cultivation of biofuel crops.

Non of the projects cited in The National story, including D1 Oils’, a London-listed biofuels company, which has planted about 257,000 hectares of jatropha, mainly in India was successful. The company moved far too early.

The report indicated that D1 is also having some nasty surprises on yield. It said in 2006 that it aimed to produce 2.7 tonnes of oil per hectare from areas planted with its new E1 variety, and 1.7 tonnes of oil from normal seed. That is equivalent to about 8 tonnes and 5 tonnes of seed per hectare respectively, or 3.5kg and 2kg a plant.

According to the report, Pradip Bhar, who runs the company’s D1 Williamson Magor Bio Fuel joint venture in India’s north east, admits he has yet to achieve a fraction of that.

“Hitting 500g is the challenge,” he says. “Mortality is quite high. But if we can reach 500g in two years’ time, after that the bush will continue to grow. Our expectation is that after the fourth year we will hit 1kg. The 1.5kg mark we haven’t touched as yet.”

Those are the results from the fertile state of Assam, According to the report. The yields in other, dryer states such as Jharkand and Orissa, he says, are much worse.

Mr Bhar intends to hold the area under cultivation steady at about 132,000 hectares this year. As his plantations account for more than half of D1 Oils’ Jatropha crop, the company’s goal of planting 1 million hectares by 2011 looks like a tough one. He is concentrating instead on ensuring his small contract farmers continue tending it for the two or three years needed before it becomes profitable.

This challenge is one of the reasons why Prof Shah doubts the 500,000 hectares of jatropha the Indian government estimates has been planted so far. Only last month, he unsettled an annual meeting of the universities researching jatropha and India’s National Oilseeds and Vegetable Oil Development Board by reporting that only 5,000 hectares was actually under plantation in Gujarat, half the official estimate, the report added.

The Indian experience can provide sufficient evidence for a careful, and thorough, cost-benefit analysis of Ghana’s jatropha dream, before the bubble most probably bursts.

From May 27 to 28, an international conference on jatropha in Ghana would be considering the benefits of the crop to the global economy.

Hopefully, the conference would not hype the benefits of jatropha and neglect the possible pitfalls. An objective consideration of all the possibilities, including that of possible failure, as the Indian experience has shown so as to minimize any collateral damage in the long term is necessary for the move forward.

The companies investing in jatropha and other non-food crops for the production of biofuels including the ones from India, have lots of lessons to learn from India’s example, so as not to repeat the mistake.

Source: www.ghanabusinessnews.com

Thursday, May 21, 2009

Africa not attractive investment centre for American businesses - Report

By Emmanuel K. Dogbevi



American businesses are not investing in Africa as they should due to a number of reasons including corruption, lawlessness unstable governments and inadequate infrastructure.

They are also hesitant to put their money in African countries because of the apparent lack of political will by African governments to curb corruption, a report released Wednesday May 20, 2009 by Baird’s CMC, a communications marketing consultancy together with the US Chamber of Commerce.

The report a copy of which was made available to ghanabusinessnews.com indicates that, overall, US businesses do not view Africa as an attractive place to invest.

The businesses take into consideration, the image of lawlessness, corruption, unstable governments, an inadequate infrastructure, uneducated or untrained people, and an unwelcoming government attitude toward business.

The businesses believe that these practices handicap those who will not or cannot “play the game” by these rules.

In addition, returns are not reasonably ensured or sustainable because costs can often escalate for reasons unrelated to business operations and the rules can change unexpectedly. This means that the time and resources already invested could be lost, the report said.

The report which is titled ‘The conversation behind closed doors: Inside the Boardroom: How Coporate America Really views Africa’ is in two parts, the study for the second part is ongoing.

The US Chamber of Commerce which is the world’s largest business federation has a membership of more than three million businesses and organizations of every size, sector and region as well as 112 affiliates in 99 countries around the world.

One of the objectives of the qualitative survey was to examine why US companies hesitate to invest in Africa. It also looked at what American businesses and African countries can do to increase US investments across the continent.

Ten industries were looked at in the survey and these are,aerospace/defense, agribusiness, consumer goods, health care and information and communications technology.

The others are, infrastructure, media, petrochemical/extractive, pharmaceutical and transportation.

The Executives who were interviewed, the report indicated, do not yet believe that they are at a competitive disadvantage because they are not investing in African countries.

According to the report, with no competitive traction, there is no sense of an opportunity being missed. Furthermore, since Africa is not selling itself overtly by asking for investment, the continent does not attract enough attention amidst competition for investment from other developing countries or regions. The only exceptions to this are China and India.

While the report recognized the fact that African countries are marketing themselves and creating the environment to attract investments, the lack of the following is a disincentive:

The fact that the rule of law does not prevail to the degree required to make Africa an attractive investment destination. This applies to corporate, societal, and criminal law.

Africa, the businesses observed, does not offer a sufficiently large middle class of consumers or show consistent economic growth that could promise a future market. Most African countries are small and have poor markets, and there are barriers to regional markets—such as taxes and the freedom of movement of people and goods.

According to the report however, if African countries want to position themselves, to attract a lot more foreign direct investment (FDI), from America, then they should do several things including the following:

• Invest in the health and education of the African people to create a large pool of skilled and productive human resources.

• Invest in and maintain infrastructure—transportation, communications, electricity, and security—so that there will be a reliable society in which to operate.

• Build a functioning legal system to ensure the rule of law, transparency, and fair play.

• Create a positive climate for foreign investments by reducing bureaucratic processes, eliminating corruption, and reforming tax systems, irrespective of country of origin.

• Ensure stable political environments—that may or may not be based on western democratic principles—that work toward the common good of all stakeholders in society.

Monday, May 18, 2009

How ghanabusinessnews.com saved eTranzact, US man from cyber crimes

The increasing spate of cyber crimes emanating from Ghana have become a canker that is leaving in its trail victims – both big and small. But through the high standards of journalism that focuses on the real issues that ghanabusinessnews.com is pursuing, we have recently saved eTranzact an electronic money transfer company in Ghana and an American citizen, Ralph Buglione from criminals using the internet to steal money from them.

eTranzact was launched only March 27, 2009 and barely a month after that some cyber criminals had cloned the company’s server and created an email address through which they sent emails to as many people as possible, including even those who are not customers of eTranzact asking them to verify their accounts. The criminals would then access customers’ accounts details and siphone money from their accounts.

When ghanabusinessnews.com got hold of a copy of the email, we immediately called an official of e-Tranzact to alert him and to get his comments. That call and the story that followed, pushed the company to spring into action – eTranzact immediately sent text messages to its customers to disclaim the email.

This saved e-Tranzact’s participating banks and customers from further bigger loses, as a source said the criminals made some successes before the message got to customers.

According to the source some customers’ accounts were broken into and monies siphoned from them. The source told ghanabusinessnews.com that about five banks in Ghana were hit by the criminals. The source would however not reveal the banks choosing to respect the banks’ right not to disclose thefts that occur in them, in order to maintain their credibility in the public eye.

The source said millions of cedis were involved, but for ghanabusinessnews.com’s quick act, it could have been worse.

Last Friday, 55-year-old Florida, US resident Ralph Buglione specifically wrote to us to clarify some issues regarding a message he received from one Anita Brown, who claims to be a Jamaican citizen in Accra, Ghana.

According to Buglione, he met this lady through a dating site called Tagged.com. The lady asked to chat with him on Yahoo Messenger and he obliged. Following the development in their conversations he wrote to us:

I am a Florida USA resident who this week was talking with a young lady named Anita Brown in Accra Ghana both by Yahoo Messenger text & video.

I see where you wrote an article on the subject of Internet service in Ghana. The young lady (and I suspect it was actually a number of people who were sharing the keyboard when the video wasn’t on) wanted US $100 claiming her Internet service was about to be turned off. I just read another article about Internet service in Ghana costing the typical user about $35.

Can you tell me if you think this was a scam? I did a Google search of Ghana & scams and found out that gangs of individuals in Accra play these games with foreigners stealing money from them through promised matchmaking schemes I don’t think girl was geniunely interested in me unless you prove me wrong by telling me that $200 monthly for Internet costs in apartment in Ghana are not unusual.

I ended the conversation when she asked for the money.

The article which was on the cost of the internet in Ghana obviously saved him from this possible scam and he wrote to thank us.

There is no doubt that ghanabusinessnews.com has become the news portal of choice for many around the globe for the fact that we engage in good and high quality journalism.

We do so, because, we are motivated by the principles of good professional journalism that serves the public good by informing and educating individuals with relevant and useful news and information. You can always count on us.

Thursday, May 14, 2009

Tullow Oil, Ghana EPA in permit tango - Who is saying the truth?

By Emmanuel K. Dogbevi

Tullow Oil, the British oil and gas exploration company operating in Ghana has responded to accusations by Ghana’s Environmental Protection Agency (EPA), that it presented inaccurate Environmental Impact Assessment (EIA) reports to the International Finance Corporation (IFC) of the World Bank to acquire a loan of $115 million.

The EPA on April 7, 2009 accused Tullow Oil and its partner, Texas based Kosmos Energy of presenting inaccurate EIA reports to the IFC to secure loans to the tune of $215 million to finance their activities in Ghana.

According to the EPA the two companies are at the second stage of completing comprehensive EIA reports.

On a Joy News bulletin monitored by ghanabusinessnews.com Tuesday April 7, 2009, Mr. Ebenezer Acquah Sampong, who is Head of Environmental Assessment at the EPA said the two companies would be compelled to complete the EIA before they are allowed to start operations.

He said the Environmental Assessment Regulation of 1999 requires that before any company embarks on any project of that nature, it goes through the full EIA procedure and is given a permit.

He said the procedure requires that companies register, and then they do a scoping exercise and submit a scoping report with a terms of reference for the study. He said however, before a ‘scoping report’ is submitted “extensive consultations ought to be done with all major stakeholders to know their concerns about the project.”

He said the companies have done that and submitted a report, but they were told to go back and do wider consultations at all levels at the national, regional, and district levels.

Seeking to clarify this matter, ghanabusinessnews.com wrote to Tullow Oil and Kosmos Energy to get their side of the story, and after over a month, it is only Tullow Oil that has responded to our request, Kosmos Energy has not even acknowledged receipt of our email.

In an email response to ghanabusinessnews.com, signed by Tony Djokoto, Senior Legal Counsel for Tullow Ghana Limited, Tullow Oil said, “regarding the EPA accusations, as you know, we have a valid permit from the EPA that governs our current activities and regard ourselves as being compliant with the terms of the permit. We are still in discussions with the relevant Governmental stakeholders and will revert to you once we have an outcome.”

But the EPA says, “as far as we are concerned, no Environmental Impact Assessment report has been submitted to us and they know that and we have made our position known to them.”

Mr. Sampong said, emphatically that the only report the EPA has received from the oil companies is a scoping report.

Meanwhile, civil society orgnisations are also insisting that Tullow Oil and Kosmos Energy have not done comprehensive environmental impact assessments on the projects.

Ghana discovered oil in commercial quantities in 2007 leading to high hopes of economic boom for the country. Concerns were immediately raised by various interest groups about the dangers inherent in the discovery of oil to the country’s social and economic health.

Nigeria and some other African countries who have oil were cited as examples and calls were made for Ghana to get it right from the word go so that the country can avoid the canker associated with oil-rich African countries.

There have been perpetual violent conflicts particularly in the Niger Delta of Nigeria, where the bulk of the country’s oil is drilled.

With these developments, it is hard to tell, if Ghana is not already missing the point before commercial production begins in 2010.

Wednesday, May 13, 2009

Ghanaian man poses as Iraq soldier, defrauds US woman of $10,000

By Emmanuel K. Dogbevi


A Ghanaian man posing as a US soldier in Iraq has defrauded an American woman of $10,000 by false pretences, the Gateway News has reported.

The publication quoting an April 20, 2009 police report, said the woman a resident of Streetsboro in Ohio gave the money to the scammer believing she was helping a US soldier in Iraq.

According to the report the woman, who was not named, began an online relationship with the man in January. The man claimed he is in the army stationed in Iraq.

The woman told police that in the next four months, after they met, she gave the man $10,000.

The woman, according to the report told police that the man told her that he had been discharged from the army and was trying to leave Iraq with a “large sum” of money.

The man, she said, kept reporting “problems along the way” as he tried to return to America and needed more money from her.

According to the police report, the man requested that the money was to be sent to his “associate” in Ghana.

After she gave him the $10,000 he kept asking her for more money, but the woman said she could not afford to send him any more money.

Soon after that, the man started calling her saying “his life was in danger” and he needed more money, according to the police report. At this point, co-workers advised her to go to the police, and that was when she made a report to the police.

Meanwhile, a U.S. Army agent, who helped police with the investigation told police that he had found that a soldier with the same picture given to the woman had been in Iraq.

The report indicated that Police contacted the soldier, who said the photos were from a social networking Web site, but he had never visited the Web site the woman said she met the man on.

However, the soldier said he had been contacted by a different woman asking him “personal questions”, but thought it was a scam and did not reply to her. The solider said in the report that the woman may have been lured into a similar fraud using his likeness.

The incident was filed with the Internet Crime Complaint Center for further investigation, the report stated.

Internet scams known in Ghana as ‘sakawa’ have reached what authorities call “alarming proportions”. About 82 cyber crimes are said to occur in Ghana every month, and Ghana and Nigeria have been blacklisted by some retail shops in the US and Canada.

Today, May 13, 2009, the Daily Graphic carried a story about the Ghana Education Service calling for an “emergency national response” to salvage the future of hundreds of school children who are increasingly being lured into the phenomenon of ‘sakawa’. The report indicated that internet fraud has gained notoriety in the country lately.

According to the report, it is not clear when ’sakawa’ began in Ghana but the cyber fraud, which is akin to the notorious Nigerian ‘419′ scam, is believed to have taken deep roots in Agona Swedru in the Central region, from where, like an epidemic, it spread to other parts of the country in no time.

Enquiries made indicate that mainly in the ghettos of some of the major towns in the country such as Kumasi, Koforidua, Sunyani and Accra, ’sakawa’ is becoming a major cause of pupil truancy involving many schoolchildren aged between 12 and 18 as they abandon the classrooms for Internet cafes, it said.

The Daily Graphic also indicated that cyber crime is linked to occultism and the modus operandi of those who engage in it includes the use of their victims’ credit cards to purchase items including expensive vehicles and household items on the Internet which are subsequently shipped to Ghana.

Sometimes the operators pose as females, manage to secure relationships on the Internet with male foreigners and subsequently discuss the possibility of marriage with them. But after convincing their victims to send them money for visa and other travelling documents to join them abroad, they hit a jackpot and abscond.

Monday, May 11, 2009

Why Ghana is popular for investments in biofuels


By Emmanuel K. Dogbevi



Ghana has become a major centre of attraction for the cultivation of biofuels in Africa for a number of reasons, even though some of these reasons are hard to tell.

Currently, the country features prominently on the radar of alternative energy interests, especially in the cultivation of the non-food plant jatropha for the production of biofuels.

Ghana, Thailand and Uruguay have been identified by a study conducted by the University of Wisconsin-Madison Nelson Institute for Environmental Studies in 2007, as becoming the leading producer countries of the emerging renewable fuel known as biodiesel.

One of the factors that put Ghana among the leading league of nations with a high potential for biodiesel production is the fact that large volumes of the product can be produced at low cost.

Overall, the study ranked Malaysia, Thailand, Colombia, Uruguay and Ghana as the developing nations most likely to attract biodiesel investment, not only because of their strong agricultural industries, but also due to their relative safety and stability, lack of debt, among other economic factors.

Ghana is ranked high in Africa as a politically stable country, with a growing culture of democracy. Labour is also believed to be cheaper in Ghana than in most African countries, even though some investors disagree on that score.

One investor in the biofuels sector in Ghana argues that the cost of labour in Ghana is not cheap after all, because in his view, “the Ghanaian worker is not efficient as compared to the Chinese worker.”

While an employer might be paying a Ghanaian worker what is estimated to be low wages, the Ghanaian worker is proverbially known “to pretend to be working, while the employer pretends to be paying him.”

Indeed, this is not only a notion but a fact, because most employers in Ghana pay very low wages, irrespective of qualifications, experience or job description. Most Ghanaian workers are therefore, not motivated to give off their best. Substandard work performance has become a norm in Ghana.

Ironically, however, this belief that wages are low in Ghana also makes the country a choice destination for industries, especially the biofuels businesses.

There are companies from Brazil, Italy, Norway, Israel, China, Germany, The Netherlands, Belgium and India investing in the area in Ghana.

They are cultivating fields in the Volta, Brong Ahafo, Ashanti, Eastern and the Northern regions of Ghana. The main non-food crop that these companies are planting is jatropha.

Jatropha has oil-rich seeds that can be used to produce biodiesel.

While its supporters argue that it can be grown on semi-arid land and so poses less of a threat to food output than other biofuel feedstocks such as grains and vegetable oils, its opponents argue that investors are taking away productive agriculture land from poor local farmers for the purpose.

Currently, there is an ongoing debate, accusations and counter-accusations of land grabbing between NGOs, Action Aid and FoodSPAN on one hand and Rural Consult, a consultancy firm on biofuels on the other.

One of the companies, Agroils of Italy is currently cultivating jatropha on 10,000 hectares of land in Yeji in the Brong Ahafo region of Ghana for biofuels.

Israeli company, Galten has acquired 100,000 hectares of land and an Indian company is requesting for 50,000 hectares of land from the Ghana Investment Promotion Council (GIPC), to cultivate jatropha.

A company from the Netherlands has started a pilot project on 10 acres in the northern region and the Chinese are also doing a pilot project.

Gold Star Farms Ltd., is cultivating five million acres of land to plant jatropha for the production of biofuels for export.

A Norwegian company ScanFuel Ltd., has started operations outside Kumasi in the Ashanti region to produce biofuel. The company aims to start initial cultivation of jatropha seeds on 10,000 hectares of land.

The company which has a Ghanaian subsidiary, ScanFuel Ghana Ltd., says its Ghanaian unit has contracted about 400,000 hectares of land, with up to 60 percent reserved for biofuel production, “not less” than 30 percent for food production and the remainder for biodiversity buffer zones.

Another Norwegian company, Biofuels Africa Ltd., the only one among the about 20 biofuels companies cultivating jatropha to receive an Environmental Impact Assessment (EIA) permit from Ghana’s Environmental Protection Agency (EPA) which covers 23,762.45 hectares of its project area is operating in two locations.

Steinar Kolnes, CEO, Co-founder and director of BioFuel Africa Limited has told ghanabusinessnews.com by email that the company is currently operating in two locations in Ghana. The company has a 300 hectare test farm in Sogakope in the Volta region and a 10,696.32 hectares in Yendi in the Northern region.

According to him, the company has planted a total of 660 hectares of jatropha on its projects.

One of the complexities that might confront the growing biofuels industry in Ghana is the challenge of land acquisitions. There is a plurality of land tenure and management prevailing in Ghana.

There is the state/public system and the customary system. These systems have been poorly articulated over the years leading to increasing conflicts associated with land.

Public lands in Ghana fall into two main categories: land which has been compulsorily for a public purpose or in the public interest under the state lands Act 1962 (Act 125) or other relevant statute; and land which has been vested in the President, in trust for a landholding community under the Administration of Stool Lands Act, 1962 (Act 123.)

While government is working to streamline the land tenure system in the country, there are some advocating for a land bank system to make land acquisition smoother and beneficial to all.

Ghana is certainly attractive for investments, especially in the biofuels sector.

But the question some observers of the biofuel sector are asking is why is the country so enthusiastic about biofuels when it has found oil in commercial quantities?

Others are also asking why an agriculture country where only 16 per cent of arable land is used for food production would not rather concentrate on developing the food crop sector, but is diverting resources and labour in agric for the cultivation of non-food crops for biofuels.

Friday, May 8, 2009

Italian company plants jatropha on 10,000 hectares of land in Ghana for biofuel

By Emmanuel K. Dogbevi


An Italian bioenergy consultancy company, Agroils is cultivating 10,000 hectares of jatropha in Ghana for the production of biofuels.

According to a report by Reuters, sited by ghanabusinessnews.com, Agroils is also investing in the cultivation of jatropha in three other African countries - Morocco, Senegal and Cameroon, and Latin American country Brazil.

Agroils’ Business Development Manager, Giovanni Venturini Del Greco, who is also a co-founder was quoted in the report as saying at an energy conference Thursday May 7, 2009 that the company aims at producing 100,000 tonnes of biofuel from the jatropha plant in 2018 in these countries where it works with local farmers.

The company started the cultivation in 2008, the report said.

He said, “our goal is a 100,000 tonne output in 2018.”

He told the conference that the projects include a 200-hectare field in a desert in Morocco and 10,000 hectares in Ghana. He said if the projects were successful the crop would grow in these areas.

Agroils is one of the about 20 companies cultivating jatropha and other crops to produce biofuels in Ghana. There are companies from Brazil, Norway, Israel, China, Germany, The Netherlands, Belgium and India investing in the area in Ghana.

Jatropha has oil-rich seeds that can be used to produce biodiesel. While its supporters argue it can be grown on semi-arid land and so poses less of a threat to food output than other biofuel feedstocks such as grains and vegetable oils, its opponents argue that investors are taking away productive agriculture land from poor local farmers for the purpose.

As the debate rages on between investors and civil society organizations that see the growing number of investors as a threat to poor farmers, particularly in Ghana, the country has no policy on the cultivation of crops for biofuels – leaving the field further open for more intense debates.

The need for investments in alternative energy sources and growing more food are realities confronting the world, especially in the face of the current energy and food crises, coupled with the global economic downturn. But the debate would continue as regards best practices and lawful acquisitions of and use of land for biofuel crops as against food crops.