by Karl Pauw
Ghana’s low budgetary allocation to agriculture is just one of the reasons why the country was considered “not on track” as measured against the African Union’s African Agricultural Transformation Scorecard (AATS) in 2018. However, some have argued that the quality of agricultural spending is more important than the level of spending. In this regard, organizations such as the World Bank and the Food and Agriculture Organization (FAO) have recently raised concern also about the decline in relative allocations to agricultural research, knowledge transfer and infrastructure in favor of spending on routine government operations in Ghana. In line with these concerns, development partners participating in the Agricultural Joint Sector Review (JSR) meeting in Kumasi in June 2019 called not only for an increase in funding allocated to the agriculture sector, but also improvements in the effectiveness of agricultural spending, with the potentially distortionary effects of large allocations to input subsidies highlighted as a specific concern.
Given its mandate to design effective yet affordable policies with a set of development objectives in mind, and in recognition of the possible need to prioritize among different activities due to budget constraints, the Ministry of Food and Agriculture (MoFA) requested some analysis on public agricultural expenditure and rural investment strategies in Ghana from the Ghana Strategy Support Program (GSSP) of the International Food Policy Research Institute (IFPRI) and the Monitoring and Analyzing Food and Agricultural Policies (MAFAP) project of the FAO. The objective of the analysis was to advise government on the optimal allocation of scarce public funds across alternative agriculture-related investment areas such as rural roads, irrigation, input subsidies or extension services.
On Friday June 14th, 2019, GSSP hosted a half-day seminar to share preliminary results of this study with around 30 stakeholders representing government ministries, development partners, civil society, research institutions and academia. In her opening remarks, MoFA Director of Policy, Planning, Monitoring and Evaluation, Mrs. Angela Dannson, highlighted the relevance of the analysis in the context of the current political leadership’s “rightful recognition of agriculture as the mainstay of the economy” given the sector’s “important role in in poverty reduction, rural development, resilience, and economic growth”. The event kicked off with a presentations on “Identifying key policy options for growth and gainful employment in Ghana” by Mr. Abdul Malik Iddrisu from the Department of Economics, University of Ghana, followed by two presentations around the theme “Strategic Public Spending: Scenarios and Lessons for Ghana” by Dr. Karl Pauw (IFPRI-Ghana) and Dr. Marco Artavia (FAO/MAFAP). During a lively panel discussion, MoFA’s Head of the Budgeting Unit, Mr. Nuhu Ibrahim, expressed his appreciation for the analyses presented, saying that results would usefully “inform upcoming planning and budget development processes”. He recommended use of the IFPRI investment modeling framework to “examine implications of investments in irrigation infrastructure” in the future.
An IFPRI Discussion Paper entitled “Strategic Public Spending: Scenarios and Lessons for Ghana” and GSSP Policy Note entitled “Public Agricultural Spending and Growth in Ghana: Spending More, Smarter”, which serves as a synopsis of the Discussion Paper, have now been published and are available for download.