Procurement Challenges In The Implementation Of Fertilizer Subsidy Program In Ashanti Region.

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In July 2008, the government of Ghana instituted a country-wide subsidy on 50Kg bags offour types of fertilizer in an effort to mitigate the effect of food prices. The fertilizer subsidy was a unique example of a public-private partnership in which the government consulted heavily with fertilizer importers in the design stage and relied exclusively on the existing private distribution system to deliver fertilizer to farmers. While this structure offers clear benefits, initial observations suggest scope for improvement in both the system design and implementation. Poor timing, shortage of fertilizer and a small network of fertilizer retailers participating in the program prevented fertilizer use from increasing as much as was possible within the program budget and may have disadvantaged smaller retailers. The success of Ghana’s fertilizer subsidy program hinges on effective management of the program and the enthusiasm and confidence of the beneficiaries. Management, in this context, relates to the availability of fertilizer at the right time and place and in the right quantity; easy access to fertilizer at a low transaction cost; and ensuring the actual use of the right quantities of the fertilizer. This translates into a low transaction cost; and ensuring the actual use of the right quantities of the fertilizer. A stable policy environment on fertilizer subsidy program implementation in Ashanti region is conducive to change, absolutely critical for promoting growth in fertilizer use in the region. Such growth is especially important if small-scale farmers are to increase production, ensure food security, and protect the environment. The report presents findings of the study on The Implementation of Fertilizer Subsidy Program in Ashanti region from fertilizer suppliers, distributors, retailers, farmers and agricultural extension officers in the region. A combination of quantitative and qualitative approach was used to assess the distribution and availability of subsidized fertilizer, price of fertilizer during the subsidy year, farmer’s education on the subsidy program, use of subsidized fertilizer by small-holder farmers and constraints in the fertilizer business in the region. The findings show that there is considerable scope for improvement in the distribution of fertilizers to ensure higher effectiveness of fertilizer implementation program and to render farmers’ participation in the program more sustainable.Based on the research findings it can be concluded that; Prices are rather too high as most farmers can still not afford at the subsidized price.
A Thesis Submitted to the Department of Building Technology, Kwame Nkrumah University of Science and Technology in partial fulfillment of the requirements for the award of a degree of Master of Science in Procurement Management.