Graphic Online

Graphic Online 

Save timber industry from collapse - GTMO cautions gov't

Author: Kwame Asare Boadu
Kwame Asamoah Adam, CEO, Ghana Timber Millers Organisation (GTMO)
Kwame Asamoah Adam, CEO, Ghana Timber Millers Organisation (GTMO)

About 96 timber companies in the country have collapsed in the last 15 years, leading to the loss of over 75,000 jobs.

The crumbled companies represent 80 percent of the vibrant timber firms that operated in the country.

According to the Ghana Timber Millers Organisation (GTMO), the remaining 20,000 jobs were under threat because many of the timber companies were operating under capacity and could fold up anytime.

The organisation traced the slump in the timber industry to a combination of factors, including the lack of raw materials, over-regulation and the general high cost of doing business.

It warned that if government policies on the industry did not change, soon more mills would shut down and the industry might never fully recover.

Ashanti worse


Daily Graphic investigations, which were corroborated by the Gtmo, revealed that most of the collapsed mills were in the Ashanti Region, specifically Kumasi.

They include Paul Sagoe Timbers, Pant Timbers, Gazup Sawmills, West Africa Hardwoods, Anthony Sawmills, Gambrah Sawmills, Alhaji Tuper Company, Prima Woods, A.E. Saoud and Kumasi Timber Company.

Others are Fabi Timbers, Farez Timbers, Kaase Wood Complex, S.E.A. Timbers, J.E. Timbers, K.L.L. Timbers, Franco Timbers, K.A.T. Timbers, Jowak Timbers and the state-owned Wood Industries Limited.

The development has virtually crippled economic life in the once vibrant industrial enclave of Kumasi, especially around Kaase, Asokwa and Ahinsan.

Delving into the dire straits in which the one-time vibrant timber industry found itself now, the Chief Executive Officer (CEO) of the GTMO, Dr Kwame Asamoah Adam, told the Daily Graphic in Accra last Wednesday that the lack of raw materials, numerous charges by the Forestry Commission (FC) and the high cost of credit and electricity had combined to virtually cripple the industry.

“It’s becoming very expensive to run the timber companies and so many are opting out. The FC is always increasing its fees, without improving its services, and I can say without any shred of equivocation that the FC is pushing its abysmal failure onto the manufacturer,” he said.

Plantations

Over the years, not enough trees had been planted to meet the demand for wood, he noted.

Dr Adam stated that the job of the FC was to provide raw materials for the industry, but it had reneged on that responsibility.

According to him, past governments had invested very little in raw materials, yet they kept imposing taxes on the industry, to the disadvantage of the timber companies

“So it is not surprising that many people are losing their jobs because the companies cannot contain the situation and naturally would have to fold up.

“For over 100 years, we have only been exploiting from the natural forests, and this has its limitation,” he stressed.

Plantation strategy

In 2016, Ghana came up with the Ghana Forest Plantation Strategy (2016-2040) by which companies are being encouraged to establish commercial plantations on degraded lands to help prop up the ailing timber industry.

The 25-year strategy seeks to restore degraded landscapes through the development of commercial forest plantations, smallholder plantations and enrichment planting of degraded forests; and provide support for the incorporation of trees within farming systems.

The government admits, in the document, that a significant number of timber mills have folded up and indicates that the supply of logs in the long term from short rotation timber plantations will necessitate retooling, as most of the timber processing mills in the country are not equipped to process small-diameter plantation logs.

It observes that in order to compete effectively in both local and international markets, there is the need for the industry to adopt more modern technological competencies to move into value-added processing.

Dr Adam rejected calls by the FC to the timber companies to enter into plantation projects.

While admitting that more advanced processing was the way to go, he pointed out: “This argument that we should go into raw material production is misplaced.”

Drawing lessons from the cocoa industry, he asked, “Which cocoa processing factory goes into cocoa farming?”

No importation

A couple of years ago, the falling volumes of timber in Ghana, coupled with the rise in illegal lumbering, compelled the government to announce the decision to import timber to augment demands of the industry.

The then Minister of Lands and Natural Resources, Mr Mike Hammah, said the government had concluded arrangements to import timber from Cameroun, saying that was a short-to-medium-term measure.

But Dr Adam said that decision fizzled out because it was realised that it was too expensive.