The World Bank Group has called for reforms in Ghana’s agriculture sector to make it lead economic growth in the country.

In its Third Ghana Economic Update released here late Monday, the World Bank bemoaned the decline in the quality of investment being made by the state in the sector, which it fears might lead to the Dutch Disease in the face of a growing natural resource extractive sector.

Ghana’s economy expanded for the fifth successive quarter in September 2017 on the back of oil sector performance with economic growth rate reaching 9.3 percent year-on-year compared with the 4.6 percent for the third quarter of 2016. The industry sector grew rapidly in 2017 compared with the contraction of the sector a year earlier.

“The rise in the Extractive Industry appears to be constraining agriculture sector growth,” the report titled ‘Agriculture as an Engine of Growth and Job Creation’ observed, wondering whether that was not a sign of Dutch Disease.

The World Bank lamented that although the agriculture sector remained key to foreign exchange earnings the sector’s contribution to growth in Gross Domestic Product (GDP) had been declining. From a contribution of 24.8 percent share in GDP in 2012 the sector’s share declined to 18.9 percent in 2016 with a sharp deterioration in the terms of trade since 2011.

“Ghana’s public spending in agriculture is not only low, but also on a declining trend since 2009,” the World Bank added.

The report therefore listed three overarching sectors that needed policy reforms to improve the sector’s performance.

“Improving the quality and effectiveness of public expenditure in agriculture would be important in the context of limited fiscal apace,” it urged.

Under the Maputo Declaration of 2003, each African country committed to allocate at least 10 percent of its budget to agriculture annually.

In Ghana’s rural areas agriculture is the last resort of employment which highlights the sector’s role in job creation and poverty reduction, observed the World Bank, adding that “low productivity is the major cause of low earnings and under employment.”

It therefore added: “Improving the environment for agriculture businesses is key to adding value to the existing production and for job creation, while fFixing the cocoa sector is essential given the large size of the cocoa economy.”

Co-Author of the report Hardwick Tchale, Senior Agriculture-Economist at the word bank underscored also the need to “channel public resources into research to increase the use of technology ; invest in irrigation infrastructure to increase productivity and mitigate adverse effects of Climate Change; and leverage increased private sector investment in agriculture”

“The country’s primary reliance on primary commodities of cocoa , gold, and oil which are prone to volatility in international commodity prices create uncertainty about its actual future paths for growth, inflation , export receipts and domestic revenue,: Michael Geiger, Senior Economist for World Bank and co-author of the report stated in a press release accompanying the report.

Government has instituted a program of “Planting for Food and Jobs” supported by the much talked about One Village-One Dam program to improve upon agriculture production in the country as a means of anchoring food security and creating agricultural based jobs especiallyin rural areas and proposed processing hubs. Enditem.


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