IFPRI Discussion Paper 00784
August 2008
Agriculture for Development in Ghana
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New Opportunities and Challenges
Clemens Breisinger, International Food Policy Rearch Institute Xinshen Diao, International Food Policy Rearch Institute James Thurlow, International Food Policy Rearch Institute
and
Ramatu M. Al-Hassan, University of Ghana
Development Strategy and Governance Division
INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE
The International Food Policy Rearch Institute (IFPRI) was established in 1975. IFPRI is one of 15 agricultural rearch centers that receive principal funding from governments, private foundations, and international and regional organizations, most of which are members of the Consultative Group on International Agricultural Rearch (CGIAR).
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IFPRI’s rearch, capacity strengthening, and communications work is made possible by its financial contributors and partners. IFPRI gratefully acknowledges generous unrestricted funding from Australi
a, Canada, China, Denmark, Finland, France, Germany, India, Ireland, Italy, Japan, the Netherlands, Norway, the Philippines, Sweden, Switzerland, the United Kingdom, the United States, and the World Bank.
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Notices
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Contents
Acknowledgments v Abstract vi
1. Introduction 1
2. Agricultural Performance: National and Regional Perspectives 3
3. Modeling Agricultural Growth 13
开业活动策划4. Ba-Run Simulation Along Ghana’s Current Growth Path 15
5. Agricultural Growth Under the CAADP Framework 24
6. Summary, Conclusion and Policy Implications 36
Appendix: Specification of the DCGE and Micro-Simulation Model 39
References 47
List of Tables
1 Growth in trade and its contribution to overall economic growth 5
2. Agricultural GDP growth and contribution to agricultural GDP growth 5
3. Agricultural structural and regional contribution 7
4. Within-region agricultural income by sub-ctor 8
5 Average annual growth in production, yield and land 9
6 Yield gaps in Ghana 11
7 Houhold budget shares and income elasticity 12
8. Sectors/commodities in the Ghanaian DCGE model 13
9. GDP and ctoral growth in the ba-run and CAADP scenarios 16
10. Agricultural sub-ctor growth in the ba-run and CAADP scenarios 17
11. Sources of growth in the two simulations 17
12. Crop-level growth in the ba-run 18
13. Differential factor growth in agriculture across zones in the ba-run 19
14. Differential sources of agricultural growth across zones in the ba-run 19
15. Agricultural sub-ctor growth in the ba-run across the four zones 20
16. Growth in houhold income in the ba-run 21
17. Poverty rates in the ba-run 22
18. Crop yields in the simulations 24
19. Productivity contribution to crop growth in the CAADP simulation 25
20. Aggregate economic indicators for the agriculture/rural and non-agriculture/urban groups 27
21. Financial transfers between agriculture and non-agriculture in domestic commodity markets
under the CAADP scenario 28
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22. Financial transfer between agriculture and non-agriculture in factor markets under CAADP 29
23. Summary of visible and invisible transfers of financial surplus from agriculture under the
CAADP scenario 30
24. Agricultural growth across zones in the CAADP simulation 32
25. Additional sub-ctor growth across the four zones under the CAADP scenario 32
26. Growth in houhold income in the CAADP simulation 33
27 Poverty reduction under the CAADP scenario 34
A.1. D CGE model ts, parameters, and variables 40 A.2. D CGE model equations 44
List of Figures
1. GDP and agricultural GDP growth rate in Ghana, 1966-2006 3农村旧房改造设计效果图
2. Structure of economic growth in Ghana, 1966-2006 4
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3. Trends of major cocoa indicators in Ghana 6
4 Poverty rates in Ghana in 2005/06 10
5. Changes in poverty rates under simulations 22
6. Population distribution under the poverty line 35
ACKNOWLEDGMENTS
We have greatly benefited from the comments of and discussions with Aggrey Fynn (MoFA), Lena Otoo (MoFA), Ousmane Badiane, Shashidara Kolavalli, Shenggen Fan, John Ulimwengu (all IFPRI), and anonymous reviewers of this paper. We also thank participants of the Agricultural Sector Planning Group, including reprentatives of the Ministry of Agriculture, Ministry of Transport, Ministry of Local Governance, the Ghana Irrigation Authority and others for their uful comments and suggestions during the planning workshop in Accra, May 2008. Financial support for this study comes from the Agency for International Development (USAID) under IFPRI’s Ghana Strategy Support Program (GSSP) and the Agency for Technical Cooperation (GTZ).
ABSTRACT
This paper has been prepared in support of the Comprehensive Africa Agriculture Development Program (CAADP) roundtable in Ghana. The study also takes a fresh perspective on the role of agriculture for development in light of the global food crisis. It address two main questions: what are the impacts of Green-revolution type agricultural growth to reach the CAADP goal in Ghana? Given the large investments required to achieve such productivity-led growth, what is the ctor’s contribution to the overall economy? Results from the dynamic computable general equilibrium model suggest that by closing the existing yield gaps in crop production and supporting esntial growth in the livestock ctor Ghana can achieve CAADP’s 6 percent growth target. In this process, agriculture supports the rest of the economy through substantial and largely invisible monetary transfers to the nonagricultural ctors, which are primarily driven by the reduction of domestic food prices. Thus, CAADP growth benefits both rural and urban houholds, and reduces poverty by more than half within 10 years. However, widening regional disparities between the North and the rest of Ghana will increasingly po a challenge for the development. Additional measures more targeted towards generating growth in the lagging North will be necessary to bridge the income gap and reach Ghana’s poorest of the poor.
Keywords: CAADP, agriculture, poverty, Africa, Ghana, CGE
