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Nkrumah’s projects in ruins (II)

The giant silos marking the skyline at the Cocoa Processing Company in Tema

Story: GEORGE SYDNEY ABUGRI

They rise above the skyline close to the factories of the Cocoa Processing Company and the G hana Agro-Food Company Limited in Tema like giant whales standing upright for a kiss with the heavens.

The huge silos outside the Tema Harbour were constructed 43 years ago by the Government of Dr. Kwame Nkrumah to store cocoa, and those outside the harbour to store stockpiles of grain for national food self-sufficiency and security.

The cocoa storage silos with a potential storage capacity of 200,000 tonnes were built at a cost of £8,500,000 British pounds. Ghana was the world’s leading producer of cocoa at the time, producing more than 40 per cent of the global output of cocoa.

The plan to build the silos was, however, severely, criticized by the political opposition, the World Bank and other foreign interests.

The eventual abandonment of the £8,500,000 silos is best understood in the context of the general opposition to the national industrialization programme Nkrumah embarked upon shortly after independence.

Evidence now abounds that criticisms of the various programmes of national industrialization by the political opposition and Nkrumah’s critics were not wholly justified: One foreign report on Nkrumah’s industrialization and economic development plan was as follows:

“Nkrumah went on a massive spending spree, building roads, houses, schools, hospitals, factories, steel works, mining ventures and the largest dry-dock in Africa that was rarely ever used. He built the Akosombo Dam and a hydro-electricity power plant on the Volta River at the expense of the spread of endemic river blindness. He even constructed concrete silos for the storage of cocoa”.

Exception

Most of the projects referred to have remained key supporting infrastructure for the nation’s socio-economic development. The silos project has, however, remained a notable exception.

The World Bank condemned the silos project as impracticable, arguing that the mechanisms of filling and emptying the silos were uneconomic. Cocoa beans also tended to split when dropped from a height as far up as the top sections of the silos.

Even more importantly they argued, it was uncertain what would happen to cocoa beans stored in vast quantities in a closed space without air-conditioning in a tropical country.

It has since been explained by long-retired workers of the cocoa industry that Nkrumah left nothing to chance, and that the silos had been designed to store cocoa beans at regulated temperatures and humidity.

Many of them insisted the silos project was an excellent idea, similar to ones embarked upon at the time in Europe and America to withhold farmers’ produce when the market was not favourable to the farmers.

Experts in the industry say had the project not been interrupted and later abandoned altogether, it would have enabled Ghana to keep in adequate storage, up to half of her annual cocoa crop, any time the world cocoa prices fell too low.

The silos within the harbour were built by Nkrumah’s government as part of the Tema Food Complex Corporation (TFCC) project. Nkrumah intended the complex to serve as a food science research centre as well.

Research centre

Up till today, if renovated and adequately equipped, the facility has the infrastructure to house several faculties of a university of research centre of the type Dr. Nkrumah had in mind: A vast estate, several industrial plants, large blocks of offices, quality control laboratories and other facilities.

The complex’s giant 10-storey grain silos are the tallest storey buildings in the immediate harbour area. From the roof of the grain storage silos, you get a rather dizzying but also spectacular, eagle eye view of the habour below.

The multi-coloured stacks of metal shipping containers awaiting shipment abroad or haulage inland, ships swaying gently in the berthing bay and other ships afloat off berthing waters, awaiting instructions on where to berth.

The military overthrow of the First Republic temporarily interrupted the Tema Food Complex project. A plaque at the complex says the facility was inaugurated in 1974 by the late General Kutu Acheampong.

The complex began production of flour, vegetable oil, poultry feed, caned fish and other canned foods. Initially, the profits seemed to roll in, but the bug of mismanagement which bit many a state-owned enterprises throughout the 1970s and 1980s and reduced them to unproductive establishments, draining state finances did not spare the Tema Food Complex Corporation.

Shortly after establishing an image as the country’s leading industrial food complex, the corporation slid down the slope of productivity to near bankruptcy.

A massive and capital intensive private-government partnership then began to rehabilitate the food complex. Refurbishment included repairs, replacement of parts, new high technology installations, renovations and other work on all four industrial plants at the complex.

The Government of Ghana initially owned 25 per cent of the business equity shares, Bau Nord AG (IBN), a Switzerland-based business with over 30 years of business investment experience in Africa, owned the remaining 75 per cent.

Revenue

After taking over from the TFCC, the flour mill remained a paramount revenue earner for GAFCO.

By developing world standards the technology GAFCO employed in operating the mill was a marvel:

First there was the mill silo, a colossal concrete structure reaching 10-storeys into the sky. Within its vast bowels are 14 compartments with a grain storage capacity of 1,000 metric tones each.

All the complex’s milling operations were controlled from a computerized panel in a control room. (In the days of the Tema Food Complex Corporation, milling operations had been manual).

While other flour mills expended substantial investment capital in the haulage of grain from the harbour, GAFCO got its grain out of the harbour without the use of trucks or labourers. This is how the magic worked.

A large conveyor belt connected the mill and the harbour. Ships carrying wheat or other grain for the mill docked close to the conveyor belt. The wheat was then released from the ships’ holds into the conveyor belt and carried straight into the mill silo.

Huge volumes of wheat or maize were moved up the pipes from the lower floors by air suction. On each floor, machines performed various functions, grinding, removing alien particles, sieving, regrinding and refining.

Although GAFCO still operates, production is not at maximum capacity. Some of the silos which are not in use are infested with rodents, small colonies of stray cats and other vermin.

Centenary

As the inaugural celebration of the birth of Dr. Kwame Nkrumah’s centenary got underway recently, the Daily Graphic undertook enquires to determine the feasibility of supporting GAFCO to resume production at maximum capacity and the possible use of the complex to support food science research.

It was also to assess the feasibility of completing the cocoa silos for storage of the crop or at least for some other economic use.

Mr. Joseph Kudjordji, a veteran entrepreneur and CEO of a fishing company in Tema, says rehabilitating the cocoa silos will be a tough proposition.

“The foreign contractor, Dravichi, who was engaged by Nkrumah to build the silos fled the country after Nkrumah’s overthrow. He later pleaded to be allowed to return to complete the project, but was refused permission”, he recalled.

Mr. Emmanuel Asiedu, a retired official of the Cocoa Board, also told the Daily Graphic that ‘it will be difficult to locate many pipes and transmission lines in the abandoned silos, because Dravichi took all the technical drawings away. A lot of excavation will be necessary to locate the pipes and lines”.

An indigenously owned business company, Green Fuels Bio-diesel, was recently reported by theDaily Graphic to have invested in a project to produce bio-diesel from Jatropha seeds later this year. The company wants to put the silos to good use as warehouses.

Bio-diesel

According to the report, Green Fuels Bio-diesel had constructed warehouses and renovated the abandoned silos to store Jatropha seeds and finished products needed for the bio-diesel project. The Managing Director of Green Fuels, Mr. Joseph Karam, believes the project will help reduce the importation of bio-diesel.

He estimates that production will shortly peak to about 500,000 litres a day once production gets underway.

From Bolgatanga, Benjamin Xornam Glover reports that a visit to the Zuarungu Meat Factory revealed that the entire place is desolate with a bushy compound, and the factory block in a deplorable state following many years of closure.

In a chat with the Chief of Zuarungu, Naba Charles Ayamga, he said he was saddened by the fate of the many projects that were going waste, and blamed past governments after Dr. Kwame Nkrumah for failing to revamp industries established by Ghana’s first President.

He cited the Zuarungu Meat Factory among the lot as some of the major industries which had been left to rot following the overthrow of Dr. Nkrumah.

According to the chief, one major disturbing phenomenon was the fact that in the run-up to any major election in Ghana, all the political parties promise to have the factory rehabilitated, but once they get the mandate, the promises fizzle out into thin air.

Naba Ayamga argued that revamping the defunct Zuarungu Meat Factory would create jobs for the inhabitants, as well as provide them with a regular source of income.

Core activity

The Nkrumah government established the meat factory in Zuarungu and it provided the core economic activity for the people in the area. In those days products of the factory were said to be the best in Africa. The closure of the factory was attributed to mismanagement.

The chief, however, said his information was that the machines were in good condition and capable of working with a little rehabilitation, and said “if they can get the engineers back from Germany and make money available to buy cattle from Burkina Faso to run the factory it will be well for all”.

Naba Ayamga eulogized Dr. Nkrumah, whom he, described as a great and visionary leader. He said apart from creating the Upper Regions, Dr. Nkrumah, together with President Yameago, ensured construction of bridges over the river at Pwalugu and Nasia which eased transportation between the north and the south.

He bemoaned the fact that a major international airport in Ghana has been named after one of the military personnel who overthrew Dr. Nkrumah. He, therefore, called for a change of name for the airport to Kwame Nkrumah International Airport to reflect the tireless effort made by Dr. Nkrumah in developing that entry point.

Another pet project by Dr. Nkrumah located in the Upper East Region which has been left to rot is the Pwalugu Tomato Factory.

Like the Meat Factory, the entire facility was abandoned until recently, when it was rehabilitated and re-branded to process raw tomato into paste.

The former Pwalugu Tomato Factory was closed in 1990, but was reopened in 2007 under a new management and given a new name, Northern Star Tomato Company, as part of the District Industrialization Programme in Ghana.

According to the Regional Trade Officer at the Ministry of Trade and Industry, Mr. Joshua Azure, the Ministry facilitated the reopening of the factory in the hope that in future, private investors will come in and take over its running.

At the time of writing this report, the factory is not in full operation, due to what managers described as a lack of funds.

In an interview with the Daily Graphic a couple of weeks back, the Operations Manager of the farm, Mr. Kwabena Darkwa, said the factory had the capacity in terms of machinery to process about 500 metric tones of tomatoes a day.

However, the major challenge had been that of funding. He said the Government’s support, in terms of funding, did not come regularly, and therefore management continued to face some challenges.

He was, however, optimistic that the problem would be rectified since management had received assurance from the Government that something positive would be done soon to improve the situation and keep the factory running.

“With the availability of funds, the factory is capable of absorbing all the tomato that is cultivated in the region as well as those grown outside the region.

Kwame Asiedu Marfo reports from the Western Region that the Bonsa Tyre Company (BTC) was one of the three factories built in the Western Region after independence towards the rapid industrialization of the country.

The other two are the Abosso Glass Factory in the Prestea-Huni Valley District and the Gold Refinery located at Tarkwa in the Tarkwa Nsuaem Municipality.

While the Bonsa Tyre Company is on divestiture and the Abosso Glass Factory has been left to deteriorate over the years, the Gold Refinery at Tarkwa has been turned into a hostel facility for the University of Mines and Technology (UMT).

However, the suggestion is that the Government needs to expedite action on the divestiture of the Bonsa Tyre Company or think about other alternative to save the factory from total destruction.

It has been suggested that the Government, through the Divesture Implementation Committee (DIC), should be looking at other ways of divesting the company, including going public, after bringing the company to an attractive level of performance that will make people willing to invest in it.

Investors

This is because if the factory is made to stay idle much longer, the key assets, including machinery would continue to deteriorate, thereby making it less attractive to investors.

Conservative estimate indicates that about US$50 million may be required to revive the factory, which has been on the divestiture list since 1992.

The rehabilitation of the factory’s operations will involve maintenance of the machinery, rehabilitation of the bungalows and infrastructure for the restart of tyre production.

It will also involve inauguration of some equipment and the introduction of light truck radial tyres, since there is a strong demand for those tyres, and that they are expected to be the mainstay of the product range.

The Bonsa Tyre Company was one of only three tyre production facilities in the whole of West Africa, with the other two owned by Michelin and Dunlop in Nigeria.

In 1961, the then Government of Ghana, under President Kwame Nkrumah, invited a Czechoslovak firm to build the tyre manufacturing company in Ghana.

To support the factory, a huge rubber plantation was established, while out-growers were also encouraged to go into small plantation production.

Construction began in 1963 as a joint venture between Ghana and Czechoslovakia, competent high-level and middle level staff were trained both in Ghana and Czechoslovakia and employed in the factory.

Ghanaian engineers worked with the Czech engineers in the constructing the factory.

In 1966, after the overthrow of Dr. Nkrumah, the project changed hands when Firestone acquired 60 percent of the shares and the Ghana government retained 40 per cent.

The company was re-registered as Firestone Ghana Limited and produced heavy duty light duty, car and tractor tyres as well as other related pneumatic tyre products such as inner tubes.

From 1969 to 1977, the company was able to produce at 90 per cent of installed capacity.

From an initial production of 24,000 units of tyres of different specifications, output reached 310,000 units by 1977.

At its peak, the company was among the top five companies in the country, and was at one time considered only second to the Volta Aluminum Company (VALCO).

So, the argument is that there was absolutely no reason why the factory had to collapse.

The factory Accountant of the Bonsa Tyre Company, Mr. A.M.O. Bruce-Cobbold, told the Daily Graphic that the project was viable and that it must not be allowed to die.

He said it could be made to play a meaningful role in the country, and particularly in the Tarkwa-Nsuame Municipality.

Opportunities

“While the mines have life, this plant, if run properly, will be in business for as long as vehicles will require tyres to stabilize the employment opportunities”, he said.

Mr. Bruce-Cobbold said the company had excellent facilities to train the youth as mechanics, welders and pipe fitters in other skills, and could also play a meaningful role in the youth employment programme in the municipality.

He explained that the factory, if reactivated, would create at least 400 direct jobs, while trained and skilled workers would become productive again, with the factory becoming more attractive to prospective strategic investors.

Mr. Bruce-Cobbold further explained that Firestone ran the company successfully until 1980, when they sold their 60 per cent shares to the Ghana government.

In the same year, he said Bonsa Tyre Company was incorporated and took over from Firestone.

He said it was in 1987 that the company’s operations started to decline, so Firestone withdrew their licence.

Then, he explained that in 1990, the Ghana government secured a loan of US$30.7 million from the African Development Bank, with Dunlop as technical consult for the rehabilitation of the factory.

Matching fund

The Government was to provide a matching fund of US4 5.4 million, while the factory was to provide about US$ 10.4 million from its internally generated fund to support the rehabilitation of the factory.

Ghana contributed US$ 3.01 million as a matching fund, leaving a balance of US$2.4 million.

Mr. Bruce-Cobbold said internally, the poor nature of the machinery, coupled with a lack of working capital has been of the factor which militated against successful rehabilitation of the factory.

He said Dunlop abandoned the rehabilitation project in April 1998, and that by the time they were leaving, the rehabilitation of the factory was about 95 per cent complete.

He said in June 1998, Dunlop transferred the technology and licence to Bonsa Tyre Company, and during the rehabilitation period, Production level was very low, so in August, 1999, production was stopped, while in May, 2000, the Government finally laid off all the workers and maintained a skeleton staff of about 22, most of them being security men.

He said tyre manufacturing was a very expensive project, adding “it is a real capital intensive project”.

“It is important to speed up the divestiture process in order to forestall any further deterioration of the plant and the equipment which are over 40 years”, he stressed.

He further stressed the need for Governments intervention to revive the factory within the shortest possible time to forestall any further deterioration in the plant, so as to reap the benefits from the factory.

Mr. Bruce-Cobbold further explained that the physical state of the machinery could be said to be good. However, he said, one could not vouch for the electronic parts that had been left unused for so many years.

He said some steel parts had started to corrode, but generally the plant was in quite a good state.

*Source: Daily Graphic

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