Review of the cashew sub-sector in Guinea-Bissau

In 1988, cashews represented the largest source of farm-level income, accounted for more than half the value of the country"s exports, and generated about 20% of fiscal revenues (through export taxes). This study describes the structure and conduct of the Guinea Bissau"s internal market for cashew apple products (juice, wine) and cashew nuts. The performance of the internal cashew nut market is then assessed through a model of a hypothetical enterprise which assembles, sorts, and exports cashew nuts. This model reflects the major commercial activities involving the nuts, as well as the government"s primary interest in the cashew market. A second section of the study addresses the international market for cashew nuts, with particular emphasis on the evolution of cashew prices. A major finding is that the marketing of cashew nuts, from village-level producer to Bissau merchant, appears to be evolving into an increasingly efficient system under the pressure of stronger competition. However, the government"s lack of support for research and extension, compounded by the heavy export tax, tend to place the Guinea Bissauan industry at a comparative disadvantage with its international competitors. Recommendations focus on improving production and processing technologies and minimizing export disincentives in terms of taxes, export duties, and access to foreign exchange earnings.