Private Sector Associations as the Engine of Reform in Ghana
Introduction: Ghana’s Agricultural Sector
Agriculture is the backbone of many developing economies, as it is in Ghana. The largest sector of the economy is agriculture, accounting for 60-70 percent of the labor force, about 40 percent of GDP, and more than 55 percent of foreign exchange earnings. Ghana’s agriculture is dominated by small farmers and the average size of farms is less than an acre. Yet, despite their large numbers, rural entrepreneurs often lack proper representation and a unified voice in policy debates on the issues crucial to their livelihood. Most of them are not able to access credit, inputs, extension services (use of research-based knowledge to improve farming), and markets for their produce. This makes an increase in agricultural productivity and income generated by it difficult.
Helping farmers raise chronically low agricultural productivity remains a key challenge in Ghana and throughout Africa. The recent growth spurt of 5.5 percent annually between 2001 and 2006 was driven largely by extension of the land under cultivation, not productivity growth, and therefore is unsustainable. If only the needs and concerns of farmers could be better addressed, Ghana’s potential for lasting productivity growth is very promising. Yield gaps between the country’s current productivity levels for various crops and estimated achievable yields are in the range of 20 percent for oil palm, 40 percent for maize and rice, and 60 percent for cocoa.
From 2006 to 2009, Ghana’s economic and social development has been guided by a medium-term plan known as the Growth and Poverty Reduction Strategy (GPRS) II. The plan’s central goal is to accelerate economic growth so Ghana can achieve “middle-income country” status. Built into this strategy is a provision to accelerate agricultural productivity and income, reduce poverty, improve food security, and modernize the Ghanaian agricultural sector.
An important part of reaching this objective is strengthening farmer-based associations to enhance their access to credit and other services and to give them a voice in shaping agricultural policies. However, farmer-based associations in Ghana typically lack capacity to advocate and influence policies that directly affect the agricultural sector. The Private Enterprise Foundation (PEF), a Center for International Private Enterprise partner, is a non-profit organization devoted to the developmental needs of the Ghanaian private sector. PEF set out to provide the Ghanian private sector a voice and to create an enabling environment for private sector-led economic growth and development.
Anna Nadgrodkiewicz is Program Officer for Global Programs at the Center for International Private Enterprise. She holds a master’s degree in German and European Studies and a Certificate in International Business Diplomacy from Georgetown University’s Edmund A. Walsh School of Foreign Service.
The Private Enterprise Foundation is a member-based organization and national center for advocacy and promotion of private enterprise. It is a non-political organization founded in 1994 by the Association of Ghana Industries, Ghana National Chamber of Commerce and Industry, the Ghana Employers Association, and the Federation of Association of Ghanaian Exporters. The Association of Bankers and the Ghana Chamber of Mines have since attained membership status. PEF’s mission is to service the development needs of the private sector by influencing policies and regulations in order to create an enabling environment for a private sector-led economic growth strategy and national development.
The views expressed by the author are her own and do not necessarily represent the views of the Center for International Private Enterprise. The Center for International Private Enterprise grants permission to reprint, translate, and/or publish original articles from its Economic Reform Feature Service provided that (1) proper attribution is given to the original author and to CIPE and (2) CIPE is notified where the article is placed and a copy is provided to CIPE’s Washington office.
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