Prof. Quartey forecasts 1D1F could cut food prices

The Head of the Economics Department at the University of Ghana, Professor Peter Quartey, says a successful implementation of the government’s One-District-One-Factory policy, could positively impact inflation.

It will also lead to significant reduction in the prices of foodstuffs, Prof. Quartey anticipates while speaking on the Super Morning Show on Joy FM, Thursday, May 10, 2018.

“I believe and hope that this One-District-One-Factory concept will kickstart very quickly so that some of these products can be processed so that in so doing we will have lower food prices,” the economist said following the announcement that inflation dropped to 9.6% from 10%  in March.

It is the first time in five years, government statistician Baah Wadieh stated attributing the significant drop largely to happenings in the non-food basket.

Although this will not automatically translate into a reduction in food prices, Prof. Quartey observes some structural issues in the agriculture sector that need to be attended to sustain the gains in order to address inflation.

One of such is the need to have processing plants to add value to farm produce, stressing that having at least a factory in each district across the country could see some farm produce being processed thereby driving food prices down.

The Chinese government has pledged to release $400 million to support the government’s One-District-One-Factory initiative. 

Trade Minister, Alan Kyerematen, on Wednesday, signed the $400 million turnkey financing facility with China National Building Materials Corporation (CNBM) for 22 enterprise projects under the One-District-One-Factory programme.

Read: Gov't secures $400m Chinese deal to kick-start 1D1F; 22 projects earmarked

However, the renowned economist cautioned “…that in our attempt to ensure that there is increased production and lower prices farmers don’t receive very low prices and get discouraged in the course of their production.”

“If our food production would increase [and] we also ensure that food prices don’t increase astronomically, that would help a lot,” Prof. Quartey added.

 

 

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