No 'Positive Change' in Ghana's Agriculture?

The umbilical cord of the Ghanaian agricultural sector is still firmly anchored to nature's benevolence and its success or failure, and whether or not Ghana can become self-sufficient in food production still rests on nature's whims.

This was the thrust of what Mr. Ernest Akubuar Debrah, Ghana's Food and Agricultural Minister told Ghanaians last Tuesday when he re-started the government's "Meet-The-Press Series," which suffered a jolt after President Agyekum Kufour's ministerial reshuffle mid March this year.

The reshuffle, which The Chronicle code-named "a clear-out," saw baby-faced Dan Botwe, who hitherto chaired the series, losing his job as information minister.

With Mr. Kwamena Bartels, the Information and national Orientation Minister, dictating proceedings as Chair, the agriculture minister announced that for the year 2005, the country was "self-sufficient in most of her basic food items, including cassava, yam and plantain."

He was however quick to add that self-sufficiency in maize production will be "greatly influenced by rainfall reliability."

Though the minister shied away from confessing it is a known fact that the yield of Ghana's food crops; sorghum, millet, cassava, yam, plantain, groundnut, beans and a host of others, which have been the main source of nutrition to Ghanaians is dependent on rainfall.

From Mr. Debrah's own estimates, the country was only 92% self-sufficient in maize output in 2005. Rice output recorded only 45% self-sufficiency level in the same period.

He gave the level of self-sufficiency in cassava, yam, plantain, and cocoyam respectively as 214%, 350%, 115% and 117%, apparently indicating that the output of these crops in 2005 far exceeded what Ghanaians required by over a hundred percentage point each. What he did not say was how the excess output was handled.

In general, the minister admitted that the contribution of agriculture to the country's gross Domestic Product (GDP) has been falling since 2001 when his 'positive change' government assumed office. Statistically, the agric sector's contribution to GDP fell from about 40% in 2001 to 37% in 2005.

The sector's share of labour employment has also as a consequence, been falling, dropping from 60% in 2001 to 57% in 2005.

Though this is glaringly, evidence that the Ghanaian economy is still difficulty freeing itself from the woods of vulnerability; Mr. Debrah sought to dismiss that reality by stating rather that the trend fits well in theoretical economic logic, which suggests that a growing economy would witness a movement of labour at from the agricultural sector to industry.

What is missing in that logic, particularly with regards to the Ghanaian situation, is that the industrial sector is also in steep decline and not capable of absorbing exiting labour from agriculture. The 2006 Budget statement provides the evidence. From table 4, page 25, the budget showed that industry's percentage contribution to overall growth has been declining, falling from about 26% in 2002 to 24% in 2003 and then to 22.1% in 2004.

Mr. Debrah could not therefore be more wrong in his interpretation of the situation, especially coming from a government whose targeted GDP growth of 6% is expected to come largely from agriculture.

The Institute of Statistical, Social and Economic Research (ISSER) of the University of Ghana has even stated, in its mid-year review of the performance of the Ghanaian economy, that "early trends do not look very promising" to meeting the 6% growth target.

And this is because, the agricultural sector, which has been the mainstay of the economy, will not be witnessing the level of growth that government expects.

It is worth noting that the past years' growth rates in the sector were the result of "the strong performance of the cocoa sub-sector" which Mr. Debrah alludes to in his presentation.

With the cocoa sector not likely to record that same level of growth, not much can be expected from agriculture. It is also worth noting that between year 2004 and 2005, the sector lost a one percentage growth, recording 6.5% in 2005 as against 7.5% in 2004.

The declining contribution of agriculture to GDP and the fall in its labour share conveniently has nothing to do with the assumption by Mr. Debrah of an "improving economy."

Rather, it has to do with the fact that the country's agriculture is still primitive. A facts sheet released in September 2004 by the Statistics, Research and Information Directorate (SRID) of the ministry indicated that the country's agriculture was still predominantly a small-holder based and that about 90 percent of farm holdings are less than 2 hectares.

The document also showed that the main system of farming was still traditional, with the hoe and cutlass dominating as the main farming tools. Apart from the northern sector where bullock ploughing is practiced, mechanized farming is extremely limited.

Certainly, this cannot be attractive to the Ghanaian youth, especially so when profit margins in the sector are increasingly declining as a result of global economic happenings.

Contrary to Mr. Debrah's assertion, the movement of labour out of agriculture and the sector's dwindling contribution to overall GDP could best be explained by the removal of government's support and subsidies to farmers, coupled with the influx of cheap, but heavily subsidized agricultural imports from the developed world.

This mix of 'mispolicies,' has led to the collapse of the food crop sub-sector, particularly in the three northern regions of Ghana, impoverishing thousands of farmers and their dependents.

Thus, Mr. Debrah's commitment to "pursuing a policy of direct intervention to make available improved seeds and planting materials and relevant agro chemicals to small farmers on credit," is the appropriate response to the declining trend in agriculture's output. It is a better option than to assuming, albeit erroneously, that the current trend suggests an improving economy.

A worry here however is that the minister talks of this laudable initiative as being "an experiment only." Why only an experiment when indeed, industrialized nations, such as the United States of America and members states of the European Union, are currently heavily subsidizing their farmers, even in flagrant violation of the World Trade Organization's rules.

According to the Christian Aid, the EU gives its agribusinesses around $100 billion a year in subsidies and grants. A cow gets $3 a day in subsides from the EU, while 50% of Africa's people live less than $1 a day.

The UK based charity group also says that in 2003 alone, governments in the Organisation for Economic Cooperation and Development (OECD) subsidised farm exports to the tune of $350 billion, compared to providing just US$22 billion in aid to Africa. That's almost $1 billion a day!

The US government, for instance, in 2002 alone provided $3.7 billion in subsidies to its cotton agribusiness, three times the entire US aid budget for Africa at the time.

These should be useful statistics to Mr. Debrah, that direct intervention in the agricultural sector that will ensure food security and livelihoods to poverty stricken communities, is not an evil exercise, neither would it be strange.