Misplaced Priorities: Why Minister Sabally’s Groundnut Licensing Proposal Misses the Mark

By Dr. Ousman Gajigo

Mr. Demba Sabally, the Minister of Agriculture, was recently quoted suggesting that there should be steep penalties for any businesses or individuals that engage in groundnut trading without a license. Minister Sabally advocated for fines of up to D5 million and imprisonment of up to five years. This misguided suggestion reveals a fundamental lack of understanding of the challenges facing the sector and a failure to appreciate which issues deserve priority.

Of all the problems facing groundnut marketing, having too many traders is decidedly not one of them. The major problem is that the local market for groundnuts is actually limited. Apart from the government-owned NFSPMC (National Food Security Processing and Marketing Corporation), most traders simply buy groundnuts for export. Indeed, most private buyers are willing and able to offer farmers higher prices than the government does. We should be encouraging more entrants into the market, not erecting obstacles.

The absence of competition in groundnut marketing goes beyond the limited number of buyers. Existing regulations that force private companies to register with the NFSPMC are the biggest factor undermining competition in the local groundnut market. In effect, private traders are forced to be regulated by their own competitor.

This problem is serious enough that it was noted by the government’s own GCCPC (The Gambia Competition and Consumer Protection Commission). In its 2023 report, the GCCPC concluded that the regulation requiring businesses to register with the NFSPMC effectively allows the state-owned enterprise to elbow out its competitors. The registration requirement was also found to be selectively enforced against small-scale marketing companies only.

It is important to keep our eyes on the ball. The key objective in groundnut marketing is to deliver high returns to groundnut farmers, and one way of achieving that is to ensure greater competition among buyers. The ultimate goal is not the mere profitability of the NFSPMC or any other government-owned entity—the success of the NFSPMC is a means to a greater end, a point that appears to be lost on Minister Demba Sabally.

Surprisingly, Deputy Speaker of the National Assembly Seedy Njie was among those who pushed back on Minister Sabally’s misguided directive. It speaks volumes about the minister’s lack of judgment that Mr. Njie comes across as the more measured voice of reason. Punitive fines or prison sentences may be warranted when businesses engage in objectively harmful conduct – but that is not the case here. Groundnut trading is a legitimate activity whose practitioners should be welcomed, not penalised.

The groundnut sub-sector, and agriculture in general, is in urgent need of attention from government officials. Most farmers lack key inputs. Irrigation infrastructure is virtually non-existent. Limited local processing capacity constrains demand for farm produce and reduces returns for farmers. Post-harvest handling remains inadequate, leading to significant losses through spoilage and pest infestation. These are the issues the Ministry of Agriculture should be prioritising – not yet another renaming of a state-owned enterprise that has already undergone three name changes.

I urge National Assembly members to disregard Minister Sabally’s ill-advised directive. As long as businesses are registered with the Attorney General’s Chambers and pay their taxes to the GRA, no further registration should be required. The government should be working to reduce unnecessary red tape, not add to it. National Assembly members would do well to advise Minister Sabally to spend less time on the campaign trail and more time developing a genuine understanding of the important sector he oversees.