Tuesday, January 27, 2009

CLOVES TRADE LOOKING FOR A FREE MARKET?

2009-01-27 10:29:10 By Anjali Nayar, PEMBA
It`s an idyllic sight: farmer Salim Juma yells at his agile sons as they clamber in high trees on Zanzibar`s northern island of Pemba, to harvest cloves whose spicy-sweet aroma floats on the breeze. But the scene belies the slow decline of the spice for Zanzibar, a semi-autonomous archipelago in the Indian Ocean off Tanzania that was once the world`s largest producer. With the islands` revenue from tourism hit by global recession, the spice`s potential as a foreign-exchange earner is sharpened, even as the trade has been declining. For that, farmers blame persistent government interference. Since the African majority overthrew a minority ruling Arab elite in a revolution in 1964, government monopoly Zanzibar State Trading Corporation (ZSTC) has set the prices farmers are paid for cloves and tourism is now Zanzibar`s economic priority. Zanzibar once enjoyed a near-monopoly in world markets and its cloves still reputedly yield the highest-quality oil, flavour and aroma, but its production of the spice has slipped to less than 10 percent of the world market. Now it lags far behind Indonesia and Madagascar for the spice, used in cigarettes such as those known as kretek in Indonesia, perfume, cooking and herbal medicine. Juma instructs his sons Salim Mabrouk, 13, and Twahir Khamisi, 16, as they collect fresh green buds: ``If you come across dry stems, bring them down because they will weaken the trees.`` The farmer, whose five acres lie just outside Mchanga Kwale village in the rolling hills of central Pemba, says it has been another unproductive season for the family farm. Since the 1950s, clove production in Zanzibar has fallen to 10,000 tonnes per year from 24,000 and the number of clove trees has more than halved to about 2 million, said Abubakar Mohamed Ali, executive director of the Zanzibar Clove Producers Organization, ZACPO. ``Those which are still in existence are old and non-productive,`` he said. Cloves were first grown on the archipelago in the 18th century: at one point, cultivation in plantations used slave labour. They generated wealth and riches for rulers including Sultans of Oman. The government focus on tourism since the 1980s has been part of a drive to liberalise the economy, but the global economic slowdown has hit tourist numbers. Just under 128,500 holidaymakers visited the islands in 2008 compared with 143,300 in the previous year, according to the state-run Zanzibar Commission for Tourism. Maabad Muhiddin, the commission`s senior marketing officer, said arrivals began dropping in June. Tax collector Zanzibar Revenue Board says tourism accounts for about 44 per cent of Zanzibar`s gross domestic product. In the year ending October, the sector earned $41.2 million, down 48 percent compared with a similar period in 2007, according to the central Bank of Tanzania. By comparison in the year to October, clove exports fetched $6.3 million, down from $8.9 million in the same period in 2007. International clove prices have trended higher in recent years with sharp seasonal variations: those from Zanzibar hit a high of $5,800 per tonne excluding freight in 2008, according to the Public Ledger, a publication that tracks the prices of over 700 internationally traded commodities. But farmers say this has not translated into higher prices for them. In the 2008 season, they were paid between $2.15 and $2.69 per kg for their cloves -- about half the selling price. ``We ship, export our product mostly to the UK, to our agent there. We give all of our product and he sells to other countries there,`` said Ali Abeid, the ZSTC clove oil distillery`s assistant producer. Under Zanzibar law, farmers may only sell cloves to ZSTC. Many smuggle their crop to neighbouring Kenya in search of higher prices. Clove trees take at least five years before they start flowering, so poor prices have dissuaded farmers from replacing old or diseased trees, and some have abandoned their fields. The government of the Chama Cha Mapinduzi (CCM) party under the islands` President Amani Abeid Karume has for years vowed to liberalise the clove industry, and in 2003 hired the Economic Research Bureau at the University of Dar Es Salaam to formulate a development strategy to be in place by the end of 2007. But little has been done, prompting many of Zanzibar\'s farmers to turn to crops such as seaweed and coconuts, which are freely traded. ``We don`t know why the government is hesitating to liberalise the system,`` said ZACPO`s Ali.``We want to make the government leave this business, so people can benefit from cloves.\" The islands` main opposition party Civic United Front has also pledged to liberalise the industry. ``We like cloves even though they don`t give us much,`` Juma said. ``We have to struggle with it anyways because if we were to abandon this business, our situation would be worse.``
SOURCE: Guardian

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