Cassava powder maker needs cash injection
Cassava powder maker needs cash injection
A number of National Assembly members have urged the government to help embattled companies after learning that the collapse of processing industry firms would cause huge impacts on local people.
The assembly president, Ms Pany Yathortu said the Bank of the Lao PDR should come up with concrete measures to help the embattled companies including a cassava powder maker to access funds to continue operating their businesses.
“I want to hear what measures the central bank will take to address the issue,” she said while presiding over the assembly conference earlier last month.
The central bank governor said that one of the measures would be to inject more funds into the cassava industry so as it can continue operations as normal. He said that the central bank would discuss ways to help the embattled firm.
The assembly members told the conference that a major powder maker in Vientiane is running out of cash therefore it cannot pay off debts to cassava growers, causing serious financial hardship for the farmers in question.
They said that the central bank played a significant role to enable the embattled firm to access funds so as they can pay off the debts to farmers in order to encourage them to continue growing cassava.
Cash crop production promotion is one of the government policies which aims to reduce poverty among local people. However, access to markets and volatile goods prices have caused a huge impact on the implementation of the policy.
Officials from the Ministry of Industry and Commerce said that the cassava powder industry remains favourable as demand on world markets is still high.
They said that one of the main problems which saw the cassava powder making firm unable to pay off its debts was poor management.
The commerce ministry suspected that the company spent most of its rolling funds to build infrastructure such as factory buildings and thereby ran out of cash to pay off the debt to farmers.
Observers said that the government should come up with concrete measures to keep the cassava powder making factory operating otherwise it would cause huge impacts on the cassava growers.
Cassava growers may stop growing cash crops as they no longer believe that the government is able to secure markets for them.
vientiane times
