Agriculture catching up the modern era: most of Ghana's agricultural output is produced by small-scale farmers, although a few large estates are also important players. This sector not only provides employment and broad-based income, it has tremendous potential for expansion and diversification. But the country is still lagging behind African best practice in the industry and needs to catch up rapidly. Report by Neil Ford.

Author:Ford, Neil

While the Ghanaian economy is enjoying strong growth and the emergence of a substantial oil and gas sector, the government is making all the right noises about ensuring that this growth is broad based. It is seeking to avoid the mistakes of Nigeria and other oil producers in the region by enabling the agriculture sector to match growth in the wider economy. This would spread the benefits to rural areas, slow down the pace of urbanisation and create the millions of jobs that the mining and oil and gas sectors just cannot deliver.

Cocoa production is perhaps the most important element in the Ghanaian economy. It is one of the biggest sources of export revenue, employs more people than any other industry and provides employment in areas that do not benefit from other substantive forms of economic activity. In addition, production tends to be controlled by small-scale farmers, so the economic benefits are shared around more fairly than in many other agricultural sectors, particularly as fair trade cocoa is playing an increasingly important role, both in Ghana and within global cocoa production in general. Ghana is the world's second-biggest cocoa producer after neighbouring Cote d'Ivoire and although output varies from year to year, the general trend is upwards. The Ghana Cocoa Board, which is usually known as Cocobod and which acts as the industry regulator, had set a target of producing 830,000 tonnes during the 2013-14 harvest but now appears confident that it will break through the 850,000 barrier.

This is partly the result of favourable weather but the acreage under cultivation is increasing as farmers expand their cocoa production. Sales from 1" October until 2nd January were 22% higher than over the same period last year. Despite this good news, the industry has been affected by external problems in recent months. Cocobod is currently owed more than $200m by international cocoa traders, although it is not clear if this is a recent or a longstanding problem. In addition, a strike by Ghanaian cocoa carriers held up exports to such an extent that Dutch trader Continaf estimates that there is a backlog of between one and two months.

Cross-border cocoa smuggling remains a problem in the region. Many farmers or traders in Ghana and Cote d'Ivoire smuggle their produce across their common border in order to benefit from differing levels of regulated prices and currency fluctuations. In addition, during the long Ivorian civil conflict, many...

To continue reading