MAFAP programme latest analysis for Ghana shows that total government expenditure rose significantly in nominal terms throughout the 2016–2023 driven partly by the government’s response to the COVID-19 pandemic as well as transfers to energy producers, at the cost of a record fiscal deficit and a large increase in public sector debt. Interest payments consumed about half of government revenues in 2021 and 2022. In real terms, total government expenditure stagnated in 2023. Public expenditure on agriculture (PEA) also increased in nominal terms throughout the study period, growing at an average annual rate of 33 percent.

However, in real-terms, spending declined. Between 2021 and 2023, there was a sharp decline in PEA when adjusted for inflation from GHS 2.1 billion to approximately 1.6 billion in 2023, a 14% drop in agricultural expenditure in real terms in just two years (constant values are expressed in 2016 prices as it is the first year of analysis). As a result, public expenditure on agriculture (PEA) as a share of total public expenditure – narrow (CAADP) indicator – fell from 3.1 percent in 2020 and 2021 to 1.9 percent in 2023. This level remains significantly below the CAADP target of 10 percent and is relatively low compared to many other African countries.

Public expenditure in support of food and agriculture, that is, when including rural development and consumer transfers, fell from 8.1 percent of total government expenditure in 2016 to 4.6 percent in 2023.

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The nominal rate of protection (NRP) at farm-gate – the ratio of the price gap at farm-gate in relation to the reference price – was -25%, on average and across all 5 commodities: groundnuts, maize, rice, palm oil, and yam between 2005 and 2021, with the most negative value being -57% in 2015, and the most positive value being 71% in 2021.

There are, however, substantial differences across the five commodities analysed:

• Groundnuts: The observed NRP at farm gate was equal to -26%, on average, between 2007 and 2021. Producers faced negative price incentives for most of the time, with only positive price incentives in 2011, 2020 and 2021.
• Maize: The observed NRP at farm gate was equal to 8%, on average, between 2005 and 2021. Producers benefited from positive price incentives, except between 2006–2010, 2013 and 2021 when the NRP was negative.
• Palm oil: Although the observed NRP at farm gate was equal to -3%, on average, between 2005 and 2021, during 2005–2006, 2014, 2016, 2018, 2020–2021, producers benefitted from positive price incentives.
• Rice: The observed NRP at farm gate was equal to -13%, on average, between 2005 and 2021. Producers faced negative price incentives for most of the time, with only positive incentives between 2005–2008 and 2020–2021.
• Yam: The observed NRP at farm gate was equal to -3%, on average, between 2006 and 2021. Producers faced negative price incentives in most of the years, with only positive price incentives during 2011–2012, 2017, and 2020–2021.

MAFAP is supporting the National Development Planning Commission (NDPC) to strategically select agrifood value chains to be promoted through public investments. The aim is to prioritize sectors with the highest potential to improve several outcomes, namely agrifood GDP growth, reducing rural poverty, job creation, imports substitution and exports promotion, and the affordability of healthy diets. This analysis and the resulting policy recommendations are aimed at feeding into Ghana’s Food Systems Strategy and Investment Plan (FSSIP).

MAFAP has carried out an analysis for the Ministry of Food and Agriculture to estimate and locate off-farm losses in maize and rice value chains, and to identify the driver factors behind such losses. The study also identified profitable and scalable technological solutions to curb losses in these important Ghanaian staple foods.