Food Crisis Looms In Ghana

14/11/2012

The Food and Beverages Association (FABAG) says food crisis is looming in emerging economies such as Ghana. 

The FAO recently announced a cut in its 2010 global wheat forecast by about 4 percent, adding that global supply of wheat may shrink next year if severe drought continues in Russia, the world’s leading wheat producer. 

Prices of wheat and other cereals have jumped by more than 50 percent since June and are likely to rise further due to expectations of tighter supplies. 

In a statement, the FABAG said there were also concerns about a repeat of the food crisis in 2007/08 that increased interest rates in many countries. 

Russia imposed a temporary export ban in response to record-breaking heat wave. 

The statement, signed by the President of FABAG, Nabil Moukarzel, pointed out that exorbitant prices of wheat globally could put pressure on inflation and possibly interest rates in emerging economies like Ghana. 

“We, in FABAG, believe that this development must be of concern to Ghana. It means the prices of wheat and by-products such as bread, biscuits and spaghetti will rise sharply thereby impacting negatively on the Ghanaian consumer.” 

This, according to him, would consequently affect the prices of other food staples such as maize and rice.

“Due to the poor rainfall pattern in the country this year with a potentially poor crop output, local food production appears not to be in good standing, Mr. Moukarzel said. 

“With food constituting about 50 percent of the consumer price index of Ghana, a lot of people would be impoverished if government does not proactively re-examine some of its fiscal policies that directly relate to food prices.” 

There has already been a general decline in consumer demand due to the cost of goods and services, resulting in increased smuggling activities. 

“We are aware of the government’s recent efforts to combat smuggling but the continuous disparity in the tax and import duty levels between Ghana and its neighbors does not help in the fight.” 

With the downward trend in inflation in recent times, FABAG noted that government would have to quickly act in order to sustain the benefits that lower inflation brings.

In view of the recent fluctuations in commodity prices, the association urged the government to act boldly to mitigate the negative effects.

Source: 

www.dailyguideghana.com