President John Dramani Mahama recently assured Ghanaians who were worried about the economic challenges confronting the nation that his government understood the situation and was moving fast to reignite the economy.
But he was not happy with “pettiness of Politics” that drew some people to wish for the failure of the government rather they should called for a change that would see everyone playing his or her part in propelling the economy forward.
On-non oil economy president Mahama said in 2013 the non-oil sector of the economy grew by 5.81 percent over the previous year’s, while agriculture, in spite of all the challenges it faced, recorded a significant growth of 3.41 percent.
“The fact the we are transiting into a service economy is apparent from the strong that continues to be posted by the services sector” he added these and other growths recorded in others sectors of the economy placed Ghana in a bright positions economically for the future, he said president Mahama said since 207, the word had been faced with financial crisis and Ghana had been affected by the pressure, speaking further president said the government would continue to place the people at the centre as it worked to bring qualitative change to their lives. “Change can often feel uncomfortable, especially as it pulls away from the system and practices we know and use, change is what will propel us forward as a Nation, so claim the opportunities and prosperity that lie ahead,” he told Ghanaians.
Excerpt from the State of the Nation Address by President John Mahama on 21 2014:
(a) Foreign Exchange
Mr. Speaker, recent measures announced by the Bank of Ghana in response to the depreciation of the cedi created some concern among the business and investment community.
Ghana still remains the most attractive investment destination in West Africa and guarantees peace, safety, stability and security. I wish to assure investors that all agreements remain in force and repatriation of profits and dividends are guaranteed. The BOG has clarified its regulations in respects of foreign currency accounts and it is my hope that this has allayed the concerns of both the domestic and foreign investor communities.
Ghana has come from the environment in the a70’s and early 80’s when a command and control economy led to a strict regulation of foreign exchange. Reforms in the mid 80’s saw the introduction of forex bureaus and the liberalization of the foreign exchange regime. In this transition we moved from one extreme to another, a situation in which control of forex was so lax, that Ghana was fast becoming a source of foreign exchange for our neighours. Huge transactions in millions of dollars were being conducted in forex bureaus. This had not been the original intention. Dwindling confidence in our currency led to a situation where people hedged on the dollar. Persons with excess cedis converted them into dollars and deposited them in their foreign exchange accounts. We had a situation where forex holdings on behalf of business and individuals in our commercial banks amounted to over $3 billion.
In addition, our economy had become increasingly dollarized. Hotel room rates, vehicles, rents, school fees, household appliances, consumer items, cosmetics, clothes and other items were all quoted in dollars. The obvious problem with this is that the dollar is not our national currency. The currency of Ghana is the cedi, and the cedi will only gain strength if we begin to view and use it as that, our nation’s only currency. The attorney General and the EOCO have been charged to monitor the situation and severely sanction any institution sanction any institution advertising rates or prices and charging in foreign currency. A directive to the same effect has also been issued to government agencies.
(b) Agriculture and Food Security
Mr. Speaker, despite the fact that the agricultural sector has lost its prime spot as the largest contributor to GDP to the services sector, agriculture remains a key priority of government. Government’s vision to ensure food security in Ghana has been largely achieved. This has even been acknowledged by the international community. Last year, 2013, the UN Food and Agriculture Organisation (FAO) and the AU/Forum for Agricultural Research in Africa (FARA) recognized Ghana for achieving the MDG of reducing hunger and malnutrition in advance of the 2015 target date. The award was received by the Minister for Agriculture on my behalf, and it was dedicated to all the hardworking farmers of Ghana. I take the opportunity to salute my predecessors, President Jerry John Rawlings, John Agyekum Kufuor, John Evans Atta Mills (of blessed memory) for the role they all played in helping us achieve this feat.
Through the use of improved planting material, subsidized fertilizers, extension services and access to credit we have achieved surpluses in our traditional staple crops: cassava, yam, plantain and maize. This has enhanced food security in Ghana, as these foods are now plentiful in the market at reasonable prices.
And to continue on this positive note, Mr. Speaker, I would like to report that even with the huge volume and value of our rice imports, our local rice production has seen a significant increase of about 60%. This has necessitated the establishment by the private sector of two new rice-processing factories in Nyankpala in the Northern Region. Another rice processing factory is planned for atsutuare in the greater Accra Region.
Despite these successes, many challenges still confront the industry. Access to credit, lack of mechanized equipment for large-scale commercial rice production, non-availability of sufficient irrigated lands; all of these conditions constrain increased rice production.
However, Government is focused on partnering with the private sector to eliminate as many of these constrains as possible. In this regard, within the past year, Government completed rehabilitation work on some viable irrigation schemes and added more than 1,200 hectares of land, mainly for rice production. Another 8,000 hectares have been added by the private sector, to supplement nearly 6,000 hectare of land in the three Northern Region alone, which is 15,200 hectares of land total, all devoted of rice cultivation. It is my firm belief that if we maintain this progress, we are making in rice production, Ghana will, in the near future, become a net exporter of rice.
Mr. Speaker, as I said earlier, we achieved surpluses in our traditional staple crops including cassava. Cassava is the most consumed crop per capita in Ghana. An abundance of cassava, therefore, represents a good source of income for our farmers, but it also guarantees the availability of local foods such as banku, tuo zafi, gari, kokonte and fufu. When left to our devices, we Ghanaians are exceptionally innovative and industrious. Lately cassava has also been serving as a profitable input for the brewery industry. With the introduction of a new sliding scale for excise based on the use of local inputs, the breweries have been incentivized to introduce sorghum and cassava into beer production. These new brands are proving to be quite popular with consumers. This has been made possible as a result of the availability of 6million tons of extra cassava, over and above our national demand. The introduction of improved varieties, plus a well-developed value chain as well as the development of business oriented viable Farmer Based Organisations (FBOs) has been the basis of achievement. We have sustained our programme of subsidies for fertilizer and improved seeds. The fertilizer subsidy programme has increased in quantity from below 50,000 metric tones in 2008 when it was initiated to 150,000 metric tones in 2013. This year, 2014, the subsidy is expected to cover a volume of 180, 000 metric tones. I am also pleased to report that as a result of measures put in place, the incidence of smuggling of the product has largely been curtailed.
Under the livestock production programme, the Animal Production Division of the Ministry of Agriculture is assisting farmers in the sub-sector to improve the quality and quantity of meat they supply to the market.
Mr. Speaker, Government’s objective is to position agriculture as a truly viable and attractive area for private capital, just as we are seeing with mining, petroleum and housing. I call on the private sector to partner with us to create these new instruments that can allow us to share both the risk and benefits of such large-scale undertakings, which will trigger a more sustainable transformation, to deliver prosperity to our people. I am pleased to report that we’re entering in some of these partnerships already in the area of irrigation development. Collaboration between government institutions and private agribusiness groups is underway to deliver almost 30,000 hectares of irrigated land under the Sissili-Kulpawn project in the West Mamprusi area of the Northern Region. Environmental impact assessment studies are also underway for a combined irrigation, flood control and hydroelectric power station at Pwalugu in the Upper East region. The Ghana Commercial Agriculture Project (GCAP) funded by the USAID and the World Bank is working with traditional authorities in the Nasia river catchment are for another irrigation project.
Mr. Speaker, as mentioned earlier, work will commence on a new sugar factory at Komenda this year. This will be supported with an irrigation scheme for high yield sugar cane plantation to feed the factory. The factory is expected to create jobs and employment especially within the catchment area, and produce value-added bi-products such as energy and alcohol.
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