Business News of Tuesday, 3 February 2015
Source: Graphic Online
The government needs to redefine the role of agriculture in its national development agenda in order to address the challenges that globalisation brings to the sector, the General Agricultural Workers’ Union (GAWU) of the Trades Union Congress, has said.
The General Secretary of GAWU, Mr Edward T. Kareweh, told the GRAPHIC BUSINESS in an interview that the current unemployment rates, influx of imports and the declining manufacturing sector, all pose serious challenges to the economy but was upbeat that the trend could be reversed if agriculture was given the needed investment.
“The only way is to position agric to absorb and transmit some of the benefits or support to the various sub-sectors. If we do that it will be able to absorb the unemployment and when the people are having employment, they will now have the purchasing power and they can participate effectively in the market by buying goods and services from the other sectors,” he said.
Mr Kareweh’s comments come at the back of the recent data from the Ghana Statistical Service (GSS), which showed that growth in the crops sub-sector of agriculture declined from 5.9 per cent in 2013 to 3.6 per cent in 2014.
He explained that the decline of the crops sub-sector of agriculture suggested that agriculture was no more a priority as far as government spending was concerned.
According to this year’s budget statement, the agriculture sector continued to show signs of recovery, growing from 2.3 per cent in 2012 to 5.2 per cent in 2013 and then to 5.3 per cent in 2014.
The growth was on account of the forestry and logging sub-sectors, in which growth rebounded from a negative 0.04 per cent in 2013 to a 16.5 per cent in 2014. The Fisheries sub-sector also maintained its recent positive growth path, growing by 7.1 per cent in 2014, up from 5.8 per cent in 2013.
The crops sub-sector, however, experienced a decline, growing at 3.6 per cent, down from 5.9 per cent in 2013.
Mr Kareweh explained that the decline in the growth of the crops sub-sector was due to budgetary provisions in 2013 to continue with the fertiliser subsidy programme which failed to materialise, leading to a slowdown in growth.
According to him, whereas plantation agriculture might not need much fertiliser, there was a direct correlation between fertiliser application and yield in the crop sub-sector.
He said the decline could also be a response to market outlook. “If the previous year production was high and there was huge post harvest loss because the food was not lifted from the farm gate to the market and it got rotten, there will be a shortfall in production as people will cut down on production,” he explained.
He warned that the forestry and logging sub-sector, which recovered to push the growth in the entire agriculture sector up could become deceptive.
“What type of forestry and logging do we do? It tells you that we have increased the felling of trees in this country. It also implies that we have probably destroyed more forest reserve than before to be able to attain this increased production. That, in itself, is a positive growth with a negative implication to the economy,” he said.
Mr Kareweh said the slow growth of the sector was a reflection of policy choices of the country.
“It suggests that agric is no more given the level of importance needed because of emerging sub-sectors such as the oil and gas industry and emergence of services sector,” he explained.
He said the desire of the country to become the financial hub of West Africa was wrong, given that such strategies would only make the services sector a distributor to the rest of the sub-region but not necessarily the consumer or the beneficiary of the inflow from the services, particularly, the financial sector.
Ghana, he said, could only become a beneficiary of such a policy only when it had other institutions that could tap into the physical proximity of the hub.
The general secretary said the union anticipated that agriculture would remain largely same unless a radical policy change was put in place to transform it in a dramatic way.
He said so long as it continued to be largely rain-fed and with the uncertain climatic change, the country should not expect it to improve further.