Hon Elvis Osei Mensah Dapaah
Ahafo Ano South West

Mr Speaker, I thank you for the opportunity to make this Statement on the recent appreciation of the Ghanaian cedi and the opportunities it presents for Ghana's agricultural transformation. While the cedi's sharp recovery signals a welcome macroeconomic shift, it offers a unique window for structural investment in agriculture to address persistent food inflation, reduce input cost and boost productivity in a sector that remains central to livelihoods and national stability.

Mr Speaker, Ghana's public investment in agriculture has been persistently low and alarmingly, it has dropped even further under the current administration's 2025 budget. Only GH₵1.5 billion was allocated to the agriculture sector in 2025—a mere 0.5 per cent of the total GH₵290 billion budget. This is down from roughly 1.9 per cent of the budget in 2023 and 2024, which were already below the African Union 10 per cent Maputo/Malabo commitment.

Mr Speaker, per the Bank of Ghana's rates, the Ghanaian cedi has surged in 2025 from GH₵14.7 in the early part of the year to the GH₵10.2 in May against the U.S. dollar. The cause of this recovery follows a mix of both global and domestic factors; weakening US dollar on the world market, rising gold reserves at the Bank of Ghana (a result of the previous government’s initiative) and perhaps some yet to be seen fiscal and monetary policies. Food inflation in the country continues to remain high. Although inflation reduced to 18.4 per cent in May, food inflation is still hovering above 22 per cent. Such appreciation presents an opportunity for agriculture, which underpins economic stability and food security amid high food inflation.

Mr Speaker, a stronger cedi can make imported agro-inputs such as fertilisers, seeds, agrochemicals, and machinery more affordable, as Ghana imports the bulk of its agriculture inputs. For example, in 2024, Ghana imported GH₵38.6 billion worth of machinery and electrical equipment, representing 15.4 per cent of total imports. Also, bulldozers and herbicides anti-sprouting products and plant-growth regulators made the top 10 products that were imported in 2024, representing about 3.5 per cent of imports.

Mr Speaker, in the poultry value chain, one of the most persistent challenges is the cost of day-old chicks, most of which are imported due to weak local hatchery capacity. A stronger cedi makes these imports cheaper, potentially lowering production costs of local poultry farmers. Imported feed ingredients such as soyabean meal, maize additives, and premixes are also sensitive to exchange rate movements. If the cedi holds, domestic poultry producers may become more competitive, but also border protections and market linkages must be managed to prevent dumping of cheap frozen imports that undermine local input.
Mr Speaker, Ghana imports substantial quantities of rice, wheat, sugar, cooking oils, and flour. The appreciation of the currency reduces the cost of these imports, easing some pressure on consumers, increasing disposable income for households, and potentially slowing food inflation. However, cheaper imports can also undercut local producers. For example, local rice poultry value chains have long struggled to compete with their imported alternatives due to scale and cost disadvantages. There must be a right balance: consumers want relief, but producers need protection.

Mr Speaker, the impact of cedi appreciation may also be felt in electricity pricing. Under Ghana's tariff adjustment mechanism, inflation and debt servicing influence utility prices. If the recent drop in the inflation and exchange rate pressures is sustained and if debt servicing costs are not rigidly passed on, utility tariff could ease or stabilise in the next quarter. Cheaper power could improve margins, support production schedules, and attract more investment into agro-industry.

Mr Speaker, while the cedi appreciation offers relief for inputdependent producers, it poses real risk for exporters, especially in agriculture. Over 70 per cent of Ghana's NonTraditional Exports (NTEs) are agricultural products. The danger is that this appreciation, if not matched by a decline in the cost of doing business, from port charges to transport to financing, exporters could lose market share or see shrinking margins. This could discourage scale-up investments in high-value agro-export chains. While the cedi appreciation offers a short-term cost advantage, the more impactful way to tackle food inflation is by boosting domestic productivity through strategic investment.

Mr Speaker, Ghana's agricultural sector is structurally weak due to its heavy dependence of imported food and input. In 2024, over half of Ghana's food supply was imported, amounting to around $2 billion, exposing the country's external shocks and undermining domestic productivity. There is a need to create room to expand support for local fertiliser blending plants, invest in seed research and certified domestic seed systems, and reduce fiscal pressure from import-heavy subsidy programmes. Investing in local input ecosystems enhances long-term affordability and builds resilience against future exchange rate shocks.

Post-harvest losses in Ghana are persistently high, estimated at 20 per cent to 30 per cent for crops due to limited processing and cold chain capacity. Scaling agro-processing is crucial to absorb seasonal yield, stabilise prices, and create rural jobs. Investment priorities should include industrial agroprocessing hubs near production zones, and small-scale equipment— Many farmers lack access to reliable transport, cold storage, or structured aggregation centres. Investment in upgrading feeder systems will help reduce post-harvest losses. Improving logistics lowers food wastage, shortens mark cycle, and enhances national food distribution.

Mr Speaker, only 2 per cent of Ghana’s arable land is irrigated, making crop production highly vulnerable to climate variability. With food inflation being a recurring concern, year-round production is critical. The cedi gain could be used to support expansion of smallholder irrigation schemes and rehabilitation of underperforming public irrigation projects. Irrigation links directly to increased crop intensity and supports off-season cultivation, especially for vegetables and high-value crops. Low mechanisation is a constraint across much of Ghana’s agriculture. Most smallholders rely on manual tools or animal traction, limiting land expansion and delaying time-sensitive operations like planting and harvesting.

A stronger cedi makes it more affordable to import machinery, spare parts, and assembly kits. Strategic investment could include scaling mechanisation, service centres with public-private partnerships, supporting access to appropriate machinery for smallholder zones and incentivizing local assembly and repair workshops to reduce foreign dependency. Agriculture contributes over 21 per cent of Gross Domestic Product (GDP), but its access to finance remains disproportionately low. Data from Ghana Investment Promotion Centre (GIPC Quarterly Report) shows that Foreign Direct Investment (FDI) into agriculture averaged less than 2 per cent of total inflows between 2018 and 2024. For instance, only US$1.5 million was recorded for the three projects in 2024, representing just 0.24 per cent of the year’s total FDI of the US$617.6 million.

This pattern is not limiting to foreign investment. Domestic credit to agriculture also remains marginal, with the sector receiving less than 5 per cent of the total bank lending in recent years. These figures point to the persistent and widening agriculture financing gap. The issue is not simply one of low funding, but also of high barriers to accessing what little credit is available. The recent 5th Anniversary Report of Ghana Incentive-based Risk-sharing System for Agricultural Lending (GIRSAL) reaffirmed what many actors in the sector already experience, that despite effort there, there is risk to agricultural lending. Systematic challenges remain.

Due to perceived high risk, loans to actors in the agricultural value chain are often priced higher than in other sectors, while many smallholders, farmers and agribusiness lack the traditional collateral demands by the financial institutions. Though the sector remains high impact, there is a large financing gap, without targeted credit schemes, blended finance and scale-friendly instruments, agriculture will continue to miss its potential, with favourable macro trends.

To conclude, Mr Speaker, I want to reiterate the fact that although the cedi has appreciated recently, this surge has been driven by a combination of global and domestic factors. It offers a unique window for structural investment in agriculture to address persistent food inflation, reduce input costs, and boost productivity in a sector that remains central to livelihoods and national stability.

I thank you once again, Mr Speaker.