Harriet Nuamah, Budget Lead and Senior Programmes Officer at SEND Ghana – a policy and advocacy civil society organisation, has pleaded with government to come out quickly with other initiatives to raise funds to boost the agricultural sector as the sector now stands the risk of not being able to mobilize funds from donors.
According to her, the sector is unable to raise the required funding amount from donors and development partners amid the current global economic turbulence; a situation that she says could pose a real threat to food security.
Mrs. Nuamah complained that a sector as critical as agriculture should not be heavily donor-funded, adding that the current status quo is therefore inconsistent with government’s ‘Ghana Beyond Aid’ agenda.
Adding to that, she disclosed that the sector supports livelihoods through food, habitat, and jobs; provide raw materials for food and other products; provide job opportunities to individuals especially the youth in the country; and as well help build strong economies through trade. “Government should therefore not be reluctant about the sector,” she said.
Her fears are not out of place, as contributions of development partners’ funding to the sector ministry budget have indeed been fluctuating over the past four years, from 50.3 percent in 2019, 39.8 percent in 2020, 47.2 percent in 2021 to a sharp decline to 26.5 percent in 2022.
Dependency On Donors Has Become A Threat To The Agriculture Industry
However, as economies around the world continue to feel the pinch of the COVID-19 pandemic and Russia-Ukraine conflict-induced economic crisis, it is feared that donor or foreign funding can no longer be dependent on to boost output in the sector.
Evidently, apart from this year, reliance on donor funds for financing agriculture activities reduced from GH¢598million in 2021 to GH¢293million according to the 2022 agriculture sector budget.
Meanwhile, a study of government funding for the sector this year shows that the Annual Budget Funding Amount (ABFA) oil revenues’ contribution to the industry saw a steep rise from 2.99 percent in 2022 to 51.48 percent in 2023.
Together with other state funding sources, government will foot 59.5 percent of the sector’s GH¢2.1billion budget this year, down from 73.4 percent the previous year. Donor support for agriculture in Ghana, according to the International Fund for Agricultural Development, has reached more than US$1.5billion. The sector has been heavily reliant on donors from the United States of America, Europe and the Canadian government over the last couple of years.
Food security could be under serious threat, with the country increase dependency on donor agencies and development partners (DPs) to fund and boost local agricultural production and development.
This is despite an expected reduction in donor funding support for the country due to the global economic crisis.
In 2022, some 26.6 percent of the sector’s budget was funded by these agencies and DPs; but in 2023, 40.5 percent of the sector is expected to be funded by donors while government picks up the rest of the tab, a very worrying trend. This also brings into sharp focus government’s much touted ‘Ghana Beyond Aid’ agenda.
With much of what is consumed already imported – rice, tomato-paste, poultry, other meat products and cooking oil, among others – one could expect that what is produced locally would be funded by government and local private sector to offer some hope of becoming self-sufficient in food production; but the continuous reliance on donor benevolence paints a rather grim picture of what is to come.
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