USDA co-op development efforts support commercial farming in Ghana

Since 2000, the Cooperatives Program of USDA Rural Development has been working in Ghana to build western-style cooperatives that help Ghanaian farmers successfully market their farm products. The vital work in this poor, West African nation is carried out under the banner of the Consultative Committee on Agriculture and Rural Development (CCARD). CCARD is a formal, government-to-government relationship between USDA and the Ghana Ministry of Food and Agriculture (MOFA).

The purpose of the Ghana Cooperative project is to extend western cooperative models into a Ghanaian setting to help farmers there transition to a more commercial level of food production. The project operates with a two-pronged strategy of direct advisory assistance and training which targets existing cooperatives and intervenes with Ghanaian institutions that can help sustain the adoption of western cooperative models over the long haul.

CCARD conducts a series of joint activities that serve the agricultural and trade interests of both nations. USDA agencies with active involvement in CCARD include: Rural Development; Cooperative Research, Education and Extension Service, Foreign Agricultural Service; Natural Resources Conservation Service; and the Agricultural Marketing Service. Activities conducted by CCARD are funded primarily by the U.S. Agency for International Development (USAID).

The Ghana Cooperative Assistance project, managed by the Cooperatives Program of USDA Rural Development, was initially funded under USAID's African Trade and Investment Program (ATRIP), but has since been adopted by USAID's mission in Ghana. The ATRIP-funded project covered work both in Senegal (in partnership with the Federation of Southern Cooperatives) and in Ghana (in partnership with OIC International). Current efforts focus exclusively in Ghana and parallel Rural Development's Nigeria cooperative development project (see Rural Cooperatives, Jan./Feb. 2004 issue).

Capacity building at Ghana Cooperative College

The Ghana Cooperative College is a small institution in Kumasi, the Ashanti region capital. It is charged with training managers and directors of Ghana's cooperative system in basic cooperative principles and business skills. This college is extremely lacking in resources and was sliding into decline, a result of diminishing public funding and, more significantly, of reliance on the teaching of outdated and ineffective top-down models of cooperative enterprise. Reform and rejuvenation of the Cooperative College became one of the centerpiece projects under CCARD.

As a first step, former USDA Cooperatives Program staff member Rosemary Mahoney was contracted to conduct a curriculum review and assessment for the college. This resulted in a series of recommendations and strategies for improving the overall conditions of the college.

In February, one of the centerpiece recommendations was implemented with the opening of a new computer-training facility at the college. The new computer lab will provide students with basic training in business software and IT methods essential to contemporary business operations. The opening of the center represents a true public-private partnership. Partially funded by USAID, with computer donations from the National Cooperative Bank, National Rural Telecommunications Association and the Cooperative Development Foundation, the center is managed by volunteers of the U.S Peace Corps.

Future activity will include staff development, planning, and cooperative course designs, to be done in partnership with the Cooperative Center at the University of Wisconsin.

Cooperatives provide technical assistance

Rural Development's Cooperatives Program contracted with OIC International, a Philadelphia-based nonprofit organization, to provide the in-country presence for the project, which worked directly with a set of selected cooperative associations. Project coordinator Ferdinand Nyantakyi-Dapaah worked with cooperative organizations identified as "high potential" organizations. He provided training and advisory assistance. The focus was on structural or operating issues that were constraining the organizations from taking the next necessary step toward business success.

Farmapine Ghana Limited at Nsawam, eastern region is a 'farmer-owned' limited liability company owned by five pineapple cooperative societies (with an 80 percent share) and two limited liability companies (with a 20 percent share) that received its original capitalization through a World Bank loan. The cooperative's goal was to build an export- based marketing program for Ghanaian pineapples. Farmapine's major challenges included restructuring its finances to replace the expiring World Bank loan, improving product handling practices, and resolving significant schisms within the membership base.

The Cooperative Development project coordinator provided formal training to 320 members of the five pineapple cooperatives to help in the development and implementation of workable business plans, cooperative basic principles and governance, and pineapple crown reduction to meet export requirements. In addition, there is ongoing mediation to help the cooperative work through these issues and move to a more sustainable footing. Within two years of operation, Farmapine Ghana Ltd. became the second largest exporter of fresh pineapples in Ghana.

Dawhenya Irrigation Cooperative Rice Growers Society is an irrigated-rice cooperative composed of about 120 farmers, each farming 1-2 hectares of rice. This cooperative, formed around a Ghanaian government irrigation plan, enabled farmers to produce high-quality rice, but they lacked capacity to mill more than about 10 percent of the members' production, meaning they had to sell lower value, in-hull rice.

The development project worked with the cooperative to establish a more formal business plan that provided the foundation for the co-op to arrange milling services for all of its members' crop. This basic, value-added improvement produced a product farmers could sell for nearly twice the value of their unprocessed rice. Through the cooperative development project, the members have also been linked to a large-scale buyer, Continental Commodity Trading Co. This company provides inputs for farmers on credit and buys the majority of the rice produced by these farmers, processes and packages it, then markets the rice under the Ghana Pride brand.

Cassava-starch project has major potential

A major poverty reduction initiative under Ghana President J. A. Kufour involves the creation of a starch-manufacturing industry to help Ghanaian farmers increase income from their cassava crop. Cassava, a root crop that is a staple of Ghanaian diet, has historically been subject to considerable losses. President Kufour's program is intended to build 10 cassava-starch production plants over a five-year period. They will sell commercial-grade starch, primarily to European markets. The first of these plants, the Ayensu Starch Company (ASCo), established at Bawjiase in the central region, was formally commissioned by President Kufour on Feb. 24.

The cooperative development project is working with the Ghanaian Ministry of Trade and Industry to develop farmer cooperatives to supply cassava root to the plants and, eventually, to take an ownership position. Some 10,000 small farmers have been organized into cooperative units to support the initial plant of this nationwide program. The grassroots, democratic structures established for these co-ops have facilitated production planning, input supply and technical assistance. Additionally, two new farmer cooperatives are being organized for two new cassava-processing plants for Eastern and Ashanti regions this year.

Many challenges remain

Business success is never guaranteed for cooperatives, even in the most advanced economies. The vulnerabilities and fragilities present within economies of developing nations make the cooperative development process even more daunting. For example, in spite of its significant gains, the survival of Dawhenya Irrigation Cooperative Rice Society Ltd., is very much in doubt. The situation is the same for another cooperative targeted for assistance, Weiji Irrigation Cooperative Vegetable Growers Society Ltd.

Significant changes in electric-price policies of the Ghanaian government have jeopardized the viability of all agribusinesses tied to public irrigation projects. Many other challenges will continue to face Ghanaian cooperatives.

Other needs include: better transportation systems, more reliable utilities and communications systems, better post-harvest handling practices, adoption of meaningful grades and standards and modern processing and packaging capacities. These are just some of the needs against which Ghanaian farmers must struggle to realize a degree of the success of their counterparts in the developed world. Yet by addressing their problems together, in cooperative businesses that they own and in which they actively participate, Ghanaian farmers are learning the power of cooperation.

Why help Ghana's cooperatives?

Often, when hearing of USDA's efforts to help cooperatives in developing nations, people ask "why?" This is understandable. The answer is based on both pragmatism--it helps us--and a humanitarian philosophy of helping others learn to support themselves.

Successful cooperatives will generate income for farmers and directly contribute to economic growth. Increased income will, eventually, lead to increased demand for U.S. products. Stronger cooperative businesses in developing nations will also facilitate trade between those cooperatives and U.S. trading partners.

Activities of this sort--which improve the economic and social conditions in developing nations--build permanent reservoirs of goodwill toward the United States. The benefits of this can be far reaching.

Finally, participatory democracy is a fundamental principle of the cooperative form of business. In a time of challenge such as this, what better "product" can the United States export than democracy?

John R. Dunn, Director

Co-op Resources Management Division

USDA Rural Development

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