BUDGET: Agric/manufacturing growth targets to fall

Accra, Nov. 15, GNA - Projected agricultural and manufacturing growth rates for the year 2007 might not be achieved largely because of the erratic rainfall pattern in the North and the energy crisis this year.

Mr Kwadwo Baah-Wiredu, Minister of Finance and Economic Planning, announcing this in Parliament during the presentation of the 2008 Budget Statement said the overall growth in agriculture for 2007 was projected at 4.3 per cent as against an estimated figure of 6.1 per cent. He said the fall could also be attributed to the relative decline in the Fishing Sub-Sector as a result of dwindling fisheries resources. In 2006, the sector saw a percentage growth of 4.5 per cent rate. As a result the agricultural sector's share of GDP to growth would also decline at 1.4 percent for the year under review as against a 1.6 per cent in 2006.

At the manufacturing side, Mr Baah-Wiredu said it was projected to grow by 7.4 per cent as against 9.5 per cent in 2006 mainly due to the energy crisis.

The Electricity and Water Sub-Sectors were the hardest hit by the energy crisis as there was a decline from 24.2 per cent in 2006 to minus 15 per cent in 2007.

He further said the energy crisis, as well as the importation of cheaper goods; were the main factors that affected the Manufacturing Sub-Sector leading to a reduction in growth by 2.3 per cent.

The Minister said the robust activity on account of Government's continuous focus on the agenda of providing basic infrastructure such as roads, schools, and the construction of various infrastructure, towards the hosting of the Ghana CAN 2008 led to a growth of 11.0 per cent in the Construction Sub-Sector.

He said the high growth of 30.0 per cent in the Mining and Quarrying Sub Sector was attributed to increases in gold production as the Newmont Ahafo Mine was brought into full production and bauxite output, though diamond exhibited the worst performance in the sub-sector. He said the Services Sector, which was not so dependent on electricity was projected to grow at 8.2 per cent exceeding the 6.7 per cent target by 1.5 percentage points.

Apart from the Transport, Storage and Communication Sub- Sectors, which grew below the 2006 level, the other sub-sectors exceeded the 2006 outturn.

The wholesale and retail trade and the financial sub-sectors exceeded their targets. Mr Baah-Wiredu said the deepening of reforms in the financial sector led to a robust growth in the sub-sector, resulting in a significant growth of 15 per cent, compared to a target of 10.0 per cent. He said; "we are of the conviction that, but for the energy crisis and escalating crude oil prices, the economy would have grown higher at around 7.0 per cent."