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Mon, Sep

Fixing agric comes with several benefits

Agriculture was the backbone of the Ghanaian economy and contributed a large percentage to our Gross Domestic Product (GDP)

Gone are the days when agriculture was the backbone of the Ghanaian economy and contributed a large percentage to our Gross Domestic Product (GDP). Aside from providing employment for about 60 per cent of the population, it also ensured a constant supply of food all year round for the local economy.

In recent times, however, the sector has become a pale shadow of itself, with a myriad of challenges that have made it highly unattractive and unproductive.  

The unattractiveness is reflected in the slump in its contribution to GDP over the last five years. In 2010, the sector contributed 29.9 per cent to GDP; it declined to 25.6 per cent in 2011 and further dipped to 22.7 per cent in 2012. 

The dwindling fortunes continued in 2013, with the sector contributing 22.4 per cent to GDP. In 2014, it dipped further to 21.5 per cent. The argument that the fast growth in the services sector, powered by telecommunications, accounts for agriculture’s lowering contribution, does not hold because agriculture could have been concurrently growing to retain its lustre.

The challenge of high post-harvest losses still rages due to the unavailability of storage and processing facilities to help preserve the produce for future use. 

Ironically, large imports of agricultural products have become the order of the day. Rice, sugar, as well as oil and salt are imported every year, leading to a high import bill that erodes the value of the local currency. 

The GRAPHIC BUSINESS finds it disheartening that amid the dwindling fortunes of the sector, much focus has been shifted to oil and gas as the perceived game changer of the Ghanaian economy. The paper begs to differ.

Farmers are crying foul over their huge post-harvest losses; fisherfolk are also lamenting the reduced catch that has allegedly hit the sector as a result of oil exploration, yet imports are soaring every year.  

Fixing agriculture is pro-poor and can lift a large section of the populace out of the poverty line. Fixing agriculture comes with positive effects such as jobs at the processing factories and the value chain, direct employment in the sector, food security, lower inflation, stronger macroeconomic environment and ultimately a stronger local currency.

The Finance Minister, Mr Seth Terkper, announced the resolve of the government in the 2016 Budget to manage the transitional setbacks and paradoxes with perseverance and effective planning, with expected investments for brighter prospects for the economy expected to come mainly from energy, not agriculture. 

Budgetary allocation to agriculture also declined in the 2016 Budget, a move that has generated debate over the government’s readiness to develop the sector. From a budget of GH¢395.19 million allocated to the sector in 2015, it has dropped to GH¢355.14 million, representing a decrease of about 10 per cent (GH¢40 million). 

While the GRAPHIC BUSINESS lauds efforts by the government to fix the ailing economy, it believes that the bottom line, however, is that no major economic transformation can take place without the agriculture sector being fixed first.

It is possible to transform the economy, but that can be done better by fixing agriculture. It is time to eliminate the challenges facing the sector and restore its lost glory, reduce post-harvest losses, high import bills and help salvage the cedi. 

The government must also take a critical look at production and productivity, storage and marketing, processing and technology along the agricultural value chain.