rubber [PDF]

PUBLIC COMMUNICATION BRIEF ON OPERATIONS

REPUBLIC OF GHANA

CGH6008 Promotion of village plantations for perennial crops (rubber, oil palm, coconut palm) TABLE OF CONTENTS I – SECTOR AND ISSUES ..................................................................................................... 3 1.1. PRESENTATION AND DIAGNOSTIC OF THE SECTOR............................................................. 3 1.2. IMPORTANCE FOR THE COUNTRY ...................................................................................... 4 1.3. GOVERNMENT POLICY ...................................................................................................... 5 1.4. CONTRIBUTION TO THE STRATEGIC AREAS OF AFD .......................................................... 5 II - THE PROGRAMME ........................................................................................................ 5 2.1. OBJECTIVES ...................................................................................................................... 5 2.2. SPECIFIC OBJECTIVES ........................................................................................................ 6 2.3. PROGRAMME CONTENT ..................................................................................................... 6 2.4. INTERVENORS AND OPERATING METHOD – TECHNICAL ASSISTANCE ................................. 8 2.5. DETAILED PROGRAMME COST AND FINANCING PLAN ...................................................... 10 2.6. RATIONALE FOR THE CHOICE OF FINANCIAL PRODUCT .................................................... 11 III - EVALUATION OF PROGRAMME IMPACTS ........................................................ 11 3.1. ECONOMIC IMPACTS ....................................................................................................... 11 3.2. ENVIRONMENTAL IMPACTS ............................................................................................. 11 3.3. SOCIAL IMPACTS ............................................................................................................. 12 3.4. IMPACTS ON GENDER EQUALITY ..................................................................................... 12 3.5. SUSTAINABILITY OF PROGRAMME IMPACTS .................................................................... 12 IV – SUPERVISION MECHANISM ................................................................................... 12

1/12

List of acronyms BOPP

Benso Oil Palm Plantation

CDM

Clean Development Mechanism

CSPWD

Cape Saint-Paul Wilt Disease

ERR

Economic Rate of Return

FASDEP Food and Agriculture Sector Development Policy FFEM

French Facility for Global Environment

GOPDC

Ghana Oil Palm Development Company Ltd

GPRS I

Ghana Poverty Reduction Strategy

GPRS II

Growth and Poverty Reduction Strategy

GREL

Ghana Rubber Estates Limited

KfW

Kreditanstalt für Wiederaufbau (Credit Institute for Reconstruction)

MDGs

Millennium Development Goals

MoFA

Ministry of Food and Agriculture

NEPAD

New Partnership for Africa’s Development

NOPL

National Oil Palm Ltd

ROAA

Rubber Outgrowers and Agents Association

ROPP

Rubber Outgrowers Plantations Project

SIPH

Société internationale de plantations d’hévéas (International Company for Rubber Plantations)

TOPP

Twifo Oil Palm Plantations

2/12

I – SECTOR AND ISSUES 1.1. Presentation and diagnostic of the sector Ghana’s development strategy is set out in its poverty reduction strategy framework. Following an initial GPRS I (Ghana Poverty Reduction Strategy) for 2003-2005, the Government is currently preparing a GPRS II (Growth and Poverty Reduction Strategy). It will be presented to development partners during a consultative group meeting scheduled on 7 November 2005 in Accra. GPRS II follows on from the previous strategy, but clearly aims to allow Ghana to achieve the state of middle-income country in 2015, with a per capita income of USD 1,000, while continuing to work for the achievement of the Millennium Development Goals (MDGs). The development of agriculture continues to be the main priority of GPRS II, due to its weight in the country’s economy and the size of the rural population. Its modernisation and diversification will reinforce food security (copra, palm oil…), improve the monetary incomes of the poorest populations, promote exports (rubber, palm oil…) and reduce imports (rice). The rubber sector is currently in a favourable situation and its medium and long-term outlook are encouraging. This is due to the strong global demand for rubber (in particular in connection with the strong growth in emerging Asian countries). In view of the increase in the price of oil, this demand preferentially shifts to natural rubber, for which prices on the world market have been on an upward trend since 2001: it averaged USD 1.3 per kg in 2004 (USD 1.6 per kg mid-2005), with projections of USD 2 in 2010 and USD 2.5 in 2020. A price of USD 1.5 by 2010 has been used as the basis for the calculation of the economic assessment of the programme. Rubber plantations have a positive environmental impact, by carbon sequestration (role of carbon sink) and by reducing emissions related to producing synthetic rubber (substitution effect). Consequently, they should be able to benefit from the financial mechanisms resulting from the Kyoto Protocol (Clean Development Mechanism [CDM]), which would further strengthen the financial profitability of the programme. Ghana has 19,000 hectares of rubber plantations, including 12,000 hectares of industrial plantations. Out of the 7,000 hectares of village plantations, 3,600 are recent (created with AFD financing), the others need to be replanted. Current production stands at some 12,000 tonnes a year, ranking Ghana in fifth position in Africa. A Ghana Rubber Master Plan was produced in 2001. The main industrial operator is Ghana Rubber Estates Limited (GREL), a company privatised in 1997, 60% owned by SIPH,1 25% by the Ghanaian State and 15% by Ghanaian private capital. In terms of oil cultivation (oil palm), there is a demand from the Ghanaian market: domestic consumption is in the region of 200,000 tonnes a year (10 kg per capita per year), with palm oil mainly used for food purposes, but also for the manufacturing of detergents and soaps. There would appear to be a balance between consumption and local production. Consumption projections show that if production does not develop at the same rate, Ghana will need to import up to 100,000 tonnes of oil over the next five years. A production deficit is also expected for the entire sub-region by 2020. In view of the growing domestic demand, primary processing industries plan to expand their capacity:

1

Société Internationale de Plantations d’Hévéa, SIPH, also controls another rubber plantation company, SAPH in Côte-d’Ivoire, with a 65.8% shareholding. 98% of SIPH is owned by SIFCA Group.

3/12

• GOPDC (Ghana Oil Palm Development Company Ltd), which produces 30,000 tonnes of oil a year, has launched an extensive investment programme: renewal and extension of plantations (+7,000 hectares), increase in the processing capacity (40 to 60 t/ha) and construction of a refinery in order to add value, export a finished product and move away from the client base of Unilever Ghana; • BOPP (Benso Oil Palm Plantation) and TOPP (Twifo Oil Palm Plantations)2 produce a total of just under 40,000 tonnes of oil a year. TOPP, which would be the operator of this component of the programme, wishes to launch a project for plantations over 3,000 hectares (the purpose of the programme). For both companies, plantations from the industrial core are renewed over an area of approximately 250 hectares every year; • NOPL (National Oil Palm Ltd) produces approximately 4,000 tonnes, without there being any knowledge of a replantation plan. On the world palm oil market, the average price between 1990 and 2000 stood at USD 450/t (with a peak at USD 600/t in January 1999), with a subsequent low point at USD 285/t in 2001, and has since risen with a marked acceleration: USD 390/t in 2002, USD 445/t in 2003 and USD 470/t in 2004. This recent recovery is due to the cap on the areas planted in Asia, whereas there is strong growth in demand. The medium-term prospects remain encouraging. The average price of USD 350/t, used in the programme study, can therefore be considered as cautious. Coconut growing concerns almost 800,000 people, i.e. 5% of the total population and almost 8% of the rural population. Total nut production, in the region of 220,000 tonnes, is mainly concentrated in the West and Central regions. For about forty years now, SPWD (Cape Saint-Paul Wilt Disease), a deadly yellowing disease, has been spreading. It is estimated that 11,000 hectares have to date been decimated by the disease, out of a total of some 43,000 hectares. The disease is now threatening the entire coastal area of the West region, which raises fears of an almost total destruction of the coconut grove over the next fifteen years. Research-development programmes have, however, highlighted the tolerance of a certain number of varieties (Grand du Vanuatu and Sri Lanka Green Dwarf and certain hybrids), which makes it possible to envisage replanting. The Government of Ghana is aware of the importance of the challenges and wishes to pursue the ongoing operations (including with AFD support) and has prepared a Concept Note, which sets out the objectives and principles of a new operation in the coconut sector. 1.2. Importance for the country The program aims to allow Ghana to: – Adopt a sectoral policy for perennial crops; – Increase export revenues for rubber and palm oil; – Ensure the supply for its domestic market for palm oil and other derivative products; – Continue to combat the deadly yellowing coconut palm disease and save an industry which is of significant importance in financial and social terms for the populations in question.

2

TOPP shareholders include: the Ghanaian Government (40.46%), Unilever Ghana (40%), PS Investment (15.53%) and State Insurance Company, Paterson Zochonis Limited and National Investment Bank (total of 4.01%).

4/12

1.3. Government policy The strategy of Ghana’s Ministry of Food and Agriculture – MoFA) is formalised in the Food and Agriculture Sector Development Policy (FASDEP), which is currently being reviewed. The objective of FASDEP is for an annual growth rate in the agriculture sector of 6% (in line with the objectives of the New Partnership for Africa’s Development [NEPAD]). FASDEP comprises five strategic focuses: – Support for agri-food industries considered as being strategic, in order to facilitate their integration into national, regional and international markets; – Support for a more effective management of natural resources; – Strengthening the human resources and institutional capacities of all the actors involved in the agriculture sector, in particular MoFA and the producers’ organisations; – Improvement in access for farmers to financial services; – Improvement in infrastructure in rural areas. FASDEP is consistent with the Ghana Vision 2020 strategy and GPRS II, which focuses on the development of agriculture in order to contribute to growth, employment and the strengthening of human resources. The proposed programme is fully in line with Ghana’s agricultural strategy, particularly areas 1, 3 and 4 of FASDEP. 1.4. Contribution to the strategic areas of AFD The Partnership Framework Document sets out agriculture as one of the focus sectors for France’s operations in Ghana. This programme is fully in line with this focus area. More specifically, it will directly and indirectly contribute to two objectives of the 2006-2008 programming for AFD’s operations in Ghana: increase and secure incomes from agriculture and improve production factors. The programme is also in line with one of the strategic sectoral focuses of AFD’s Rural Development Department, which is to “define, with the major agro-industrial groups and the banking system, in the simultaneous framework of contract farming and public-private partnerships, the technical and financial conditions of the development at a significant level of perennial crops in village areas”. II - THE PROGRAMME 2.1. Objectives The programme has four objectives: – Contribute to the definition of a national policy to develop village plantations for perennial crops; – Increase the country’s export earnings (rubber, palm oil) and participate in the country’s food security (palm oil, copra); – Contribute to reducing poverty in rural areas; – Ensure sustainable development by combating climate change and preserving natural resources (soil, plant cover), in particular by restoring the fertility of degraded soils.

5/12

2.2. Specific objectives Three main objectives have been defined for the programme: • Improve the incomes and living conditions for producers, the production of the three sectors, and the country’s exports and food security by increasing the areas planted with rubber trees (7,000 hectares with 2,600 outgrowers), oil palms (3,000 hectares with 700 outgrowers) and coconut palms (new plantations with tolerant varieties and replantation of areas degraded by the deadly yellowing disease over 4,000 hectares with 1,300 outgrowers). • Strengthen the actors in the different industries: 

The village outgrowers, by supporting their professional structuring, so that they are better equipped to defend their interests;



The industrial operators (GREL for rubber growing, Unilever Ghana-TOPP for oil palm, industrial and artisanal processors for coconut palms), in order to more effectively integrate the issue of village plantations and sustainable development into their development strategy;



The banking system, which it is necessary to support in order to encourage it to move into this difficult market segment (lack of guarantees from borrowers apart from the land title, long immaturity period of plantations – between four and seven years depending on the sectors –, small individual credits – between EUR 1,000 and EUR 6,000 on average – fragmentation of beneficiary borrowers…);



Research institutes, in order to improve the links between research and development;



The State and Ministry of Agriculture, in order to adopt a national policy in this respect.

• Combat climate change (by carbon sequestration on the new rubber plantations and the reduction of emissions related to the production of synthetic rubber) and preserve the natural resources of the soil (in particular by adopting agricultural techniques that restore fertility). 2.3. Programme content The advantages of grouping together three perennial production sectors (rubber, oil palm, coconut) in a single programme to promote village plantations will be as follows:  A coherence of operations from the geographical aspect (same area: Central and West regions), technical aspect (same types of investment, need for inputs and services, production cycle and marketing), institutional aspect (same contractual framework between outgrowers, operators and banks), and social, land and environmental aspect (carbon sequestration and soil protection);  Economies of scale for Ghana’s contracting authority, common to the three sectors, donors (management of a single programme), operators (which will be able to jointly handle their industrial production and village production), banks (lower dispersion of borrowers, grouped into a single “perennial crops” customer service, homogenisation of financial conditions), and research institutes (experimentations on intercrops combined with perennial crops); 6/12

 A synergy between village plantation organisations, as well as in public-private partnerships, firstly between MoFA and research institutes, secondly, between private operators and outgrowers. The programme comprises four components: Component 1: Institutional Support to the Ministry of Food and Agriculture and Food (MoFA)  Definition of a national policy for village plantations on perennial crops, in particular on the basis of Master Plans in the oilseed sector, prospects in the East region for rubber plantations, and the feasibility study on the continuation of the revival of coconut growing;  Conducting of socioeconomic studies, firstly in order to have a review of the conditions of family farms before the programme and, secondly, to estimate the impacts of the programme;  Appraisal of the CDM component for rubber plantations, related to the Kyoto Protocol, with a view to mobilising additional financing for carbon sequestration and emission reductions. Component 2: Village rubber outgrower plantations  Creation of 5,000 hectares of new plantations in the West region and 2,000 hectares in the Central region, following a “small outgrowers” scheme organised on the basis of GREL;  Consolidation and exploitation of the 4,055 hectares created with previous AFD support;  Establishment of a credit system to finance plantations;  Implementation of a research-development experimentation programme for rubber;  Strengthening of the Rubber Outgrowers and Agents Association – ROAA), in order to make the programme’s actions sustainable;  Creation of road infrastructure. Component 3: Village oil palm plantations  Creation of 3,000 hectares of new plantations in the Central region, following a “small outgrowers” scheme based on TOPP;  And, as with rubber, establishment of a credit system, an experimentation programme, an outgrowers’ association and creation of road infrastructure. Component 4: Village coconut plantations  This component has been outlined on the basis of a project currently reaching completion in the sector, financed by AFD in Ghana, and the external evaluation of this project conducted by GRET/IRAM. Its content will be similar to the other sectors: creation of new plantations, replantation, establishment of a credit system, research programme, production of tolerant plant material and strengthening of the Association of Coconut Outgrowers. Its costs, as well as its technical, economic, financial, social

7/12

and environmental rationale, will be specified by the feasibility study provided for in the support to MoFA. 

This feasibility study will be conducted in the course of 2006, provided the following conditions are fulfilled: – Satisfactory level of repayment for the credit allocated during the current phase; – Adoption of a coherent logical framework for the activities of the Association of Coconut Outgrowers; – Agreement with MoFA on the production scheme for plant material; – Financing by MoFA for the 2006-2007 interim period. 2.4. Intervenors and operating method – technical assistance

MoFA will be the contracting authority for the programme. Project management will be as follows: – For the institutional support component, by the MoFA Agriculture Department; – For the village rubber outgrower plantations, by GREL; – For the village oil palm plantations component, by TOPP; – For the village coconut plantations component, by a project unit at GREL (depending on the results of the feasibility study, the project managers could be one or several private technical operators working downstream from coconut production: Wienco, Dupaul, Faenza, others); – For the rural roads programme, by the Feeder Roads Department of the Ministry of Roads and Transport. The Feeder Roads Department will be supported by an independent consultant for the conducting of technical studies, the preparation of bidding documents, assistance in the selection of restoration companies and the supervision of works. The institutional support component at MoFA will be implemented via a 3-year residential technical assistance contract and service contracts for studies, which will be subject to a competitive bidding procedure. The implementation of each “sector” component will be managed via an operator contract signed over-the-counter with MoFA: with GREL for rubber, with TOPP for oil palm and with the project unit at GREL (or with one of the companies mentioned above) for the coconut sector. The industrial operator will provide management and coordination services for the entire operation. Additional contracts will be signed, following bid invitations, with MoFA for: – The programmes for rural roads: consultant engineer, construction companies; – Support to outgrowers’ associations: consultancy firms or NGOs; – Programmes for research and the production of plant material. Credit component: The investments related to village plantations will be financed by credits to outgrowers. Each credit allocation will be managed by tripartite agreements between the banking

8/12

system, operators and individual village outgrowers (selection of outgrowers, division of roles and functions for the distribution of credit, supervision of the holdings and loan collection). In view of, on the one hand, the very specific nature of the loans to outgrowers (low level of unit amounts, dispersion of client base, financial terms with maturities and grace periods in line with the long periods of immaturity of the plantations, etc.) and, on the other hand, the low level of involvement (or no involvement) of the banking system in the allocation of such loans, it is planned to launch a bid invitation procedure in order to select, on the basis of criteria leading to a better service/price ratio, the bank(s) which will be responsible for the allocation and management of loans. There will be two options for this competitive bidding: a first option whereby the banking operator will bear the commercial risk of the loans, with the exchange risk remaining the responsibility of the Government of Ghana, and a second option whereby the banking operator will only provide a service for the implementation of the loans, with both the exchange risk and commercial risk being borne by the Government of Ghana. In this second option, there would be two parts to the billing of the service: a fixed part (amount per application assessed) and a variable part, the amount of which would depend on the performance of the banking system (a commission depending on the loans disbursed during the immaturity period and a commission depending on the loans collected during the repayment period). The basic principles for the implementation of the loans to the outgrowers would be as follows: – The loan management would take place by plantation phase, with each loan being backed to the plantation year (with the number of loans being equal to the number of plantation tranches); – The banking operator would establish, for each loan, a repayment schedule with fixed instalments, with the instalments for the first years of the start of production having to be calculated in a manner which ensures that the outgrowers’ income allows them to service their debt. The outgrowers will be represented in associations, the objective of which will include negotiating purchasing mechanisms for the production of the plantations on the basis of the international price, contributing to the maintenance cost for the network of roads inside the plantations, and setting up guarantee funds in order to compensate for any repayment defaults. A steering committee including all the programme stakeholders will meet periodically to approve its main orientations, as well as the annual technical and financial commitments for each component, and evaluate its progress. It will follow on from the meetings held by substeering committees by sector. The organisation of these committees will be the responsibility of MoFA. The disbursement methods for AFD’s financing would be as follows: – Depending on the payment conditions of the contracts mentioned above, the operators’ contracts and the contract(s) with the bank(s) will be subject to six-monthly advances according to the annual technical and financial commitment programmes validated by the steering committees of the various sectors and controlled a posteriori by detailed audits; – In the form of successive advances for the functioning of the contracting authority. The rubber component will be financed pari passu by KfW and AFD (on a basis of 42% for KfW and 58% for AFD). All the procedures have been harmonised between the two donors.

9/12

2.5. Detailed programme cost and financing plan EUR M

Ghana AFD

KfW GREL TOPP Outgrowers

Total

% 5%

Institutional support to MoFA

2.00

2.00

Perennial crops policy (1)

0.60

0.60

Socioeconomic surveys

0.20

0.20

Rubber prospecting in East region

0.10

0.10

Master Plans oil sector

0.25

0.25

Coconut growing feasibility study

0.15

0.15

CDM

0.20

0.20

Supervision missions

0.22

0.22

Audits

0.12

0.12

Steering committees

0.16

0.16

Rubber

1.78

8.62

5.42

Investments on plantations ROPP III

1.78

4.32

3.12

Investments on plantations ROPP II

1.12

Management services

2.02

1.46

Rural roads programme

0.81

0.59

Support to Outgrowers’ Association

0.28

0.20

Applied research

0.07

0.05

Oil palm

1.96

6.62

Investments on plantations

0.34

3.78

2.07

1.62

19.90

1.36

10.58

2.07

0.48

6.03 1.40

0.17

0.65 0.12

1.12

2.24

0.45

10.15

0.45

4.57

0.86

0.86

0.26

4.12

Support to Outgrowers’ Association

0.50

0.50

Applied research

0.10

0.10

Coconut growing

0.20

Loan management costs

49%

1.12

Management services Rural roads programme

2.01

3.60 0.27

0.10

25%

0.20

4.00

10%

0.90

1.27

3%

Miscellaneous and contingencies

0.36

1.89

0.48

0.18

0.10

0.32

3.33

8%

TOTAL

4.30

23.00

6.00

2.25

1.22

3.88

40.65

100%

%

11%

57%

15%

6%

3%

10%

100%

(1) including EUR 450,000 for the residential technical assistance.

The financing for the coconut growing component will be submitted to a future Board of Directors meeting once the results of the feasibility study are known. It should be noted that, for the first time in Ghana with this type of financing, the private agroindustrial sector has accepted to provide a substantial amount of cofinancing for the village plantations for perennial crops (over EUR 2m for GREL and over EUR 1m for TOPP), with this financing being earmarked for the management services.

10/12

2.6. Rationale for the choice of financial product Ghana, which reached completion point in July 2004, is eligible for financing via highly concessional loans. III - EVALUATION OF PROGRAMME IMPACTS 3.1. Economic impacts The programme will increase the incomes of farmers (rubber, palm oil), contribute to the country’s food security (palm oil and coconuts), generate profits for the partner private companies (GREL, TOPP), and generate foreign currency inflows for the Ghanaian Government, as well as tax revenues. The financial economic rate of return (ERR) for the rubber sector is estimated at 17% over thirty years for a rubber price of USD 1.5/kg. For the oil palm sector, the ERR is assessed at 6.2% over twenty-seven years. This rather low level of profitability is due to the need for additional preparation works because of the relief and the considerable amount of fertilizer inputs as a result of the soil degradation.3 The net income of rubber outgrowers is estimated at EUR 7.7 a day in year 12 and at EUR 12.9 a day after loan repayment (years 20 and after), with a conservative assumption of USD 1/kg for the price of rubber. With an assumption of USD 1.5/kg, the figures are EUR 13.8 a day and EUR 19.5 a day, respectively. For oil palm, the outgrowers’ incomes would stand at approximately EUR 8.1 a day from year 12 and at EUR 12.9 a day after loan repayment (year 26 and after). In both cases, the income from the labour is far higher than for other crops (food crops and cocoa in particular) and the average daily agricultural income, in the region of EUR 2.5 on average. The tax revenues generated by the rubber sector alone are estimated at EUR 3.4 m a year. 3.2. Environmental impacts The programme should have a positive impact on the environment by its contribution to: the carbon sequestration by the new plantations created and the limitation of carbon emissions related to the production of synthetic rubber. Consequently, it will fit in with the fight against climate change. A scientific supervision-evaluation of the quantities of carbon sequestered and the reduction of emissions generated will be set up, with a view to mobilising additional financing via the Kyoto Protocol’s CDM. Specific technical assistance has already been mobilised on this theme (service by ONFi on AFD’s consultants budget and case of the application of a FFEM project). In addition, by intensifying and extending plant cover in the South of Ghana, the programme will have an overall impact on the fight against desertification nationwide and in the sub-region. In particular, the replanting of coconut trees in the areas devastated by the yellowing disease will have a positive impact on the environment.

3

The creation of contours and additional fertilizer inputs represent an extra cost of EUR 750 per hectare (i.e. half of the cost of planting per hectare).

11/12

3.3. Social impacts The projects for perennial plantations are a source of diversification for family incomes and curb the exodus of young people. They create a considerable amount of jobs. The creation of outgrowers’ associations is a major step forward in the organisation of rural areas. In the case of rubber, it has made it possible to set up a system to negotiate purchase prices for rubber with GREL, as well as a solidarity credit fund for outgrowers. ROAA is an almost autonomous association from a financial perspective, and is now a major actor in the sector. The association of coconut outgrowers still needs to be strengthened, but could benefit from the example of rubber. In Buabin, this type of organisation still needs to be set up. Finally, the programme will allow farmers to familiarise themselves with a credit system and to build up relations with financial institutions, to which they generally have little access. 3.4. Impacts on gender equality In the ongoing rubber plantations project (GREL II), the proportion of women who directly benefit stands at 20%, which is a significant result (and which corresponds to the initial objective). This objective has been increased to 25% for the present programme. Similarly, women are encouraged to participate more actively in the governing bodies of ROAA. For the “oil palm” component in Buabin, the registration of applications by TOPP highlights a shared interest in the programme: 75% of men and 25% of women. In the coconut sector, women play a key role, as producers and processors. Consequently, support for the revival of this sector will strengthen their economic and social situation. 3.5. Sustainability of programme impacts The rubber, oil palm and coconut plantations are long-term investments. They produce over periods ranging from twenty to forty years. All the profitability calculations have been made over periods of between twenty-five and thirty years. The technical assistance to the outgrowers is particularly important in order to ensure the quality of production over the long term. It is guaranteed by the involvement of agro-industrial operators, who have long been present in Ghana. The outgrowers’ associations should also take over a number of actions and ensure their continuity (training, supply of inputs, credit management, securing purchase prices…). The rural roads will be maintained either by the Feeder Roads Department for the main roads, or by the agro-industrial operators for the network inside the plantations. IV – SUPERVISION MECHANISM The programme will be supervised by MoFA’s Crop Services which, until now, have been actively involved in projects supported by AFD in the sector of perennial crops. The programme steering committee and sub-steering committees by sector set up by MoFA will contribute to this supervision.

12/12