Effectiveness of existing policies and institutional frameworks in promoting economic growth through agro-industrialization in Ghana

Résumé

Background Agriculture remains central to Ghana’s economy, contributing nearly 20% of GDP and employing one-third of the labor force. Yet the sector faces persistent challenges, including low productivity, postharvest losses, limited mechanization, and inadequate value addition. In response, the Government of Ghana launched flagship initiatives, 1D1F and PFJ , to stimulate agro-industrialization, create employment, and promote inclusive growth. This study evaluates the effectiveness of these policies in promoting economic development. Methods A quantitative research design was applied, drawing on secondary data from the Central Bank of Ghana covering 2003–2023. Ordinary Least Squares (OLS) regression and Poisson Pseudo-Maximum-Likelihood (PPML) estimators were used to examine the relationship between agricultural industrialization, innovation, and GDP growth. Document analysis of government reports and policy papers complemented the statistical findings. Results The findings of this paper reveal that government policies (dummy for 2017) were effective in promoting economic growth through agro-Industrialization. Ghana’s initiatives—such as PFJ and 1D1F have played a vital role in advancing agro-industrialization, stimulating economic expansion, reducing poverty, and driving structural transformation. These interventions have functioned as catalytic platforms, spurring technological progress, value enhancement, and employment creation. Recommendations Policymakers should make deliberate efforts to align the pursuit of foreign exchange earnings with the objective of national food security. Prioritize deeper Value Chain Linkages. Progress beyond merely constructing factories and instead institutionalizing stronger connections between PFJ producers and 1D1F processors, accomplished through contract farming arrangements and improved market information systems. Ongoing contributions from both government and private actors in rural transportation, energy distribution, and storage facilities are essential. Such investments would curtail post-harvest losses, reduce transaction expenses, and enhance the overall competitiveness of the agro-industrial sector.

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