Food Security: Jordanian Agricultural Project in Sudan

(MENAFN - Jordan Times) The Sudanese government has set 2009 as the deadline for the implementation of an agreement signed in 1998 with Jordan, allowing it to rear livestock and grow crops on around 250,000 dunums of agricultural land.

An official involved in the stalled project told The Jordan Times on Thursday the government is negotiating with two private sector companies which expressed interest to engage in the project, which can help the Kingdom in its efforts to tackle rising prices of food items on the international market.

One of these is the leading livestock and food importer/manufacturer, Hijazi and Ghosheh Group.

Its chairman, Issam Hijazi, said that under the current circumstances his firm is very interested in the project and is looking into its economic prospects.

"Our company provides the local market with 100 per cent of its needs of red meat, yet we are suffering from a shortage of fodder, a situation which pushes up prices," said Hijazi, adding that this project, as detailed by the Agriculture Ministry, seems to have the potential to solve the problem of fodder supply and thus decrease operational costs, eventually leading to lower prices of red meat and ease the pinch of skyrocketing prices of food.

In 1998, the government signed an agricultural protocol with the Sudanese government, which entitles Jordan to utilise around 250,000 dunums on the banks of the Nile, the ministry's director of private sector affairs, Abdullah Shishani, told The Jordan Times.

The agreement is valid for 70 years and can be renewed with the approval of both sides, said Shishani, pointing out that since Jordan has not yet made use of the vast fertile land allocated for the project, the Sudanese government warned in 2006 that it would revoke the deal, indicating investors are showing increasing interest to take advantage of the offer if Jordan steps out.

The government conducted a $359,000 feasibility study on the project, funded by the Islamic Bank in Jeddah. Wrapped up in 2003, the study showed the estimated size of investment at $118 million. It said the yields would provide the Kingdom with at least 60 per cent of its annual needs of livestock meat, 100 per cent of clover, 40 per cent of garlic, 100 per cent of bananas and 100 per cent of mangoes, he added.

"Based on these results, we contacted the private and the public sectors, the universities and all parties interested in the project, including the Social Security Corporation, as each of them received a copy of the study," said Shishani, adding that the government was to send a delegation representing the private sector to Sudan in order to get familiarised with the project.

"Until the year 2007, no one has expressed interest in the economic initiative," Shishani said.

But Hijazi stressed they have not had the slightest idea such a plan even existed.

In 2005, the government formed a committee headed by the then-minister of agriculture, comprising the minister of industry and trade, the Amman mayor and others, to work with the private sector to set up a local holding company to undertake the project.

But the idea remained on paper, Shishani said.

Former agriculture minister Mustafa Qrunfleh agreed the investment is utterly feasible, attributing the lack of interest on the part of the private sector in the past to the fact that fodder and food items were subsidised and the supplies were abundant.

Other factors included the poor infrastructure and the setbacks that have faced the scheme.

For example, said Shishani: "We have been informed that the governor of the Nile River State has distributed more than half the land included in the agreement to the locals in the area, leaving Jordan with around 87,000 dunums to invest in."

This rang the bell, said Shishani, that quick action must be taken before it was too late.

"This is a golden opportunity and if not utilised, we will regret it for ever," he stressed.

"Although the private sector is now showing interest in the project, this should not keep the government from seriously considering taking the initiative, even without the private sector," he added.

Qrunfleh agreed, saying that in light of the shortages in the world's supplies of essential food and the subsequent hike in prices, the project poses the answer to Jordan's woes.

"It is food security that is at stake here. Why wait 10 years without doing anything?" he asked.

Despite the long reluctance by all stakeholders, Shishani says there is still time.

In light of the size of land left and the current hike in prices and shortage of food supplies at the national and international levels, the government, on April 6, addressed the Arab Authority for Agricultural Investment and Development to carry out a new feasibility study for the project, Shishani said.

More good news, the official added, is that the Sudanese government has recently opened a highway between the project site and the Port of Sudan, a project that will radically solve the transportation problem.

"A new dam is under construction on the Nile to produce hydroelectric power. This is expected to minimise the operational costs of the project by 50 per cent," he added.

The original agreement already includes several incentives such as a two-year customs duties exemption on imported equipment used in the project, smooth flow of capital, freedom to export the project's production and legal protection of assets and ownership rights.

Jordan's production of wheat constitutes 7 per cent of the Kingdom's annual needs, while barley crops cover only 6 per cent of local demand, lentils 17 per cent and chickpeas 8 per cent, according to ministry figures.

In 2006, Jordan produced 44,000 tonnes of wheat and 36,000 of barley while imports stood at 598,000 and 622,700 tonnes respectively.

In order to be self-sufficient, Jordan needs to cultivate 917,143 dunums of wheat and 890,000 dunums of barley in areas which depend on irrigation. This needs 240 million cubic metres of the country's precious water resources a year. Not feasible in Jordan, but the country can look to the fertile lands of Sudan for answers.

Hijazi said it is true the project serves the interests of his group, but at the end of the day, it is the national interest which will be served.