By: Fred Yaw Sarpong
An Economist and a Senior Lecturer at the University of Cape Coast School of Business, Dr. John Gatsi has emphasized that Ghanaians must produce more food crops to reduce the price of food stuffs on the market which will also have effect on lower inflationary rate.
The rate of inflation has two main components: Food inflation and Non-food inflation. The food inflation is driven by subgroups such as vegetables; coffee, tea and cocoa; fish and sea foods while the non-food inflation is also driven by subgroups education; housing, water, electricity, gas; transport; recreational and culture; clothing and footwear and among others.
Food inflation sometimes record the lowest rate and it contribute significantly to the year-on-year inflation. Dr. Gatsi was reacting to the National Democratic Congress (NDC) 2016 Manifesto.
Dr. Gatsi stated that over the years Ghana has seen with the little effort put in place in agriculture sector, food prices are reduce and for that matter they contribute to lower inflation development of the country.
“But if you look at the importation basket of the country you will also realize why we should be focusing on importation of food items we do not have the capacity to produce here in Ghana. However, we are rather importing fish stock, vegetables and other foods crops which we are already producing in the country from outside the country,” he mentioned.
According to the 2016 NDC Manifesto, “a strong focus will also be on increased agricultural production, especially food crops. The evidence shows that inflation is massively influenced by the food crops and fisheries component of the Consumer Price Index (CPI) basket.”
The manifesto added that “to ensure that food crops and fisheries sector do not impact negatively on inflation, a better congenial framework will be provided for the public and private sector to drive the modernization of the agricultural sector.”
“It is expected that this modernization of agriculture will feed into the macroeconomic management process while macroeconomic stability will, in turn, enhance private sector competitive agricultural production,” it added.
Dr. Gatsi said if NDC party who is promising focusing on those areas is able to do it, it means it government will be able to reduce the import of these imported items into the country.
“It will also help to create productive activity in production of fish stock and other food stuffs in the country and that will also help to reduce the inflation in the country,” he indicated.
“If you are able to produce enough to cater for the sector then you will be reducing the importation of fish stock and other food stuffs and it will mean that you are controlling inflation and at the same time you creating jobs, because the prices of food stuffs will come down.”