Parliament has approved a credit agreement between Ghana and Knights A.S. of the Czech Republic for an amount of €10,000,000 for the supply of three hundred sets of Global, Multipurpose Mini Tractors and two hundred and twenty Compact Tractors.
The credit facility includes active and passive accessories and spare parts for distribution to Small and Medium Scale Farmers.
Chairman for the Parliamentary Select Committee on Finance and Member of Parliament for New Juaben South, Dr. Mark Assibey-Yeboah, stated that the Finance Committee and the Food, Agriculture and Cocoa Affairs Committee observed that the agricultural machinery and equipment that would be supplied would be used to support small holder and medium scale farmers throughout the country.
Presenting the Joint Committee’s report on the credit facility on the floor of Parliament, Dr. Assibey-Yeboah indicated that the tractors would be used mainly to support the production of food crops such as maize, rice, cassava, vegetables and soya.
On the Value for Money Audit, Dr. Assibey-Yeboah informed the House that the Joint Committee was told that since the project is a sole-sourcing one, conducting a Value for Money Audit is a requirement under the Public Procurement Act, 2003 (Act 663) and also a condition precedent for the disbursement of the loan.
He, however, pointed out that Value for Money Audit would be done before any of the processes under the project is initiated, to ensure smooth implementation of the project.
Committee’s report
Under the terms and conditions of the credit facility, the loan amount constitutes €10,000,000 with no interest.
The repayment period for the credit facility is four years while availability period covers one year.
However, the credit facility had no Management and commitment fees.
Also, insurance cover for the tractors is at the expense of the supplier.
Suitability of the tractors
The Joint Committee was made aware that the tractors to be procured under the project are suitable for the Ghanaian climate.
The Ministry of Food and agriculture explained to the Joint Committee that some of the farming lands in the county have shallow top soil, and that undertaking deep ploughing with heavy duty tractors buries the top soils deeper and it leads to loss of valuable soil nutrients to plant.
The Ministry informed the Joint Committee that the Cabrio Compact Tractors are designed and conditioned to work on shallow top soil lands as well as muddy fields due to its gross weight, size and surface area of the tyres.
The Committee was again, informed that the Cabrio Compact Tractors have a power take-off-shaft and two point linkages for attachment of accessories both at the front and rear.
The Ministry further explained to the Committee that the Cabrio Compact Tractors would be used by medium scale farmers while the Global System is a hand held machinery meant for small scale farmers.
Tax waiver
The Joint Committee noted that as part of the conditions for the disbursement of the loan, all goods to be procured under the agreement is to be exempted from the payment of duties and taxes.
The Ministry informed the Committee that a request for the waiver of taxes and duties would be presented to the House for consideration at a later date.
Subsidy
It was revealed to the Joint Committee that beneficiaries of the facilities would enjoy a concessional purchase arrangement and a subsidy rate of 40 percent from the government of Ghana.
Source: GhanaJustice/S.Ayisi
