To effectively stimulate economic activities as the nation adjusts to the pandemic’s presence, government should as a matter of urgency make certain activities the private sector’s exclusive reserve – particularly indigenous Small and Medium-sized Enterprises (SMEs).
This forms part of recommendations by an economist with the Department of Data Science and Economics at the University of Cape Coast, Dr. William Godfred Cantah, on the sector’s role in poverty reduction during the pandemic-adjusted recovery period.
According to Dr. Cantah, such a measure will have a positive domino-effect owing to the sector’s sheer. He added that the measure will be particularly helpful for rural communities.
Using the flagship Free Senior High School (SHS) programme as an example, he stated that contracts for manufacturing uniforms and furniture as well as provision of food should prioritise local suppliers.
Speaking during a presentation at a roundtable discussion organised by the Economic Governance Platform (EGP), he said: “If you go to one school in any of our local communities, they could have over 400 new entrants. The uniforms that they wear, why don’t you go to the local community, to the small scale tailors there – let them come together to form a cooperative and award this contract to them, and then money goes to them directly and multiplies within the local economy”.
The economist noted that an added benefit of such an engagement would be the state’s ability to widen the tax bracket by roping-in the otherwise informal market participants.
Despite fixation on the agricultural sector, Dr. Cantah noted that the sector, being the backbone of the economy, is unlikely to propel the country to high-income status even in the long-term; adding that advancements in the sector must be treated as first steps toward economic transformation.
He said data-driven evidence abounds to show that agriculture ranks last in terms impacting growth in the sector for high-impact, productive employment. “The Living Standards survey shows that poverty among household members engaged in the agriculture sector is about 42.7 percent, but poverty among non-agric public and private sector workers is just 23 percent. The implication is that you are likely to be poor if you engage in the sector,” he explained.
He however asked for focus on the agribusiness value chain due to its linkages with all other sectors of the economy.
Participants at the discussion, which had as its theme ‘An assessment of economic growth pathways through which the private sector can contribute to the acceleration of poverty reduction in the post-COVID-19 recovery period’, bemoaned what they described as the recycling of economic policies accompanied by catchy slogans but without the political willpower to follow through.