Economic considerations of farming

THE announcement of the Mills administration’s Budget and Economic Policy for 2010 was met with much deserved skepticism earlier last week.

DR. Kwabena Duffuor, the Minister of Finance and Economic Planning, indicated that focus would be paid to the oil and gas industry, private sector development, infrastructure, communication technology and the modernization of agriculture to grow the economy at the needed 8 to 10% per annum to qualify the country to middle income status by 2020.

ALL this within the context of a GH¢2.6 billion deficit at the end of 2008.

THE proposed budget goals of supporting these particular sectors are beginning to address ways to make Ghana self-sufficient, especially when it comes to modernizing agriculture.

WHILE the re-introduction of taxes on imported foodstuffs is a good way to turn Ghanaian consumers back to the more sustainable and environmentally friendly locally produced food, it must be taken into consideration that Ghana is not equipped to produce enough of certain staples locally right now.

THE budget then runs the risk of forcing prices of imported goods up without providing a more affordable local alternative.

THIS could be balanced, however, by the proposed investments in modernizing agriculture.

WHILE Ghana has long depended on its agricultural industry, it has been inevitably limited by outdated technology.

THE modernization of farming technology would not only expand farming into larger-scale local ventures, but also move Ghana towards self-sufficiency in many, if not all, staples.

NOT only would this benefit the consumers, who would have to pay less for the products since they would not have to make up for the costs of international transportation, but it would also funnel the money back through the Ghanaian economy, theoretically strengthening it.

THIS all depends, however, on the government backing up its budget proposal with practical social adjustments, constantly being aware of the short-term repercussions of their medium-term goals.