Developing Commercial Agriculture in Ghana

Ghana's Economic and Agricultural Transformation

“…Another failure has been insufficient provision of finance to agribusiness. Land rights are another important issue, both for obtaining sites for building agro-processing and storage facilities, but also for establishing large-scale commercial farms, even when the latter might serve as hubs for smallholder out-grower schemes (Amanor 2013;Throup et al 2014). Greater investment in these fundamentals would go a long way towards helping Ghana's small farmers become more competitive in their domestic as well as export markets.…”

“…More generally, Throup et al (2014) observe that large-scale commercial farming investment, by both domestic and foreign investors, will not proceed at scale in Ghana until investors are assured that no new stakeholders will emerge to claim the land after a deal is completed. This is a critical observation given that the government views enhancing commercial agriculture and strengthening value chains as a major route towards modernizing agriculture, evidenced by the Ghana Commercial Agricultural Project launched in 2012.²¹  77…”

“…The experience of some of the agro-processing units in the northern part of Ghana suggests that incentives such as tax breaks do not make much of a difference, whereas a reliable supply of raw material and infrastructure that influence the cost of operations are more important to the viability of operations.² A recent enterprise survey in Ghana found that access to finance was overwhelmingly identified as the main obstacle to growth (World Bank 2014). Land rights are another important constraint, both for obtaining sites for building agro-processing and storage facilities, and for establishing large-scale commercial farms, even when the latter might serve as hubs for smallholder out-grower schemes (Amanor 2013;Throup et al 2014). For perishable commodities like pineapples and tomatoes, public support for investments in transport systems and cold storage facilities is also important for building up supply chains for agro-processing.…”

Strong democracy, weak state: The political economy of Ghana’s stalled structural transformation

“…Notes: The sample is only for those who noted that there is tension/conflict in their respective communities. More generally, Throup et al (2014) observe that large-scale commercial farming investment, by both domestic and foreign investors, will not proceed at scale in Ghana until investors are assured that no new stakeholders will emerge to claim the land after a deal is completed. This is a critical observation given that the government views enhancing commercial agriculture and strengthening value chains as a major route to modernizing agriculture, evidenced by the Ghana Commercial Agricultural Project launched in 2012.…”

“…McMillan (2013) also points to the challenge of land tenure insecurity for the Blue Skies processed fruit company in Ghana. Due to land tenure disputes, many commercial investors prefer to rely on outgrower schemes or nucleus schemes with smallholders rather than invest in new land, but these arrangements also are fraught with risks (Throup et al 2014). The government certainly recognizes the problem of tenure insecurity and even noted this as a binding constraint in its Food and Agriculture Sector Development Policy.…”