PERCEPTION OF FARMERS’ ON THE EFFECTIVENESS OF THE FERTILIZER SUBSIDY PROGRAMME.

(CASE STUDY OF SENE WEST AND SENE EAST DISTRICTS OF THE BRONG AHAFO REGION OF GHANA)

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The final outcome of the input subsidy program as a means of promoting the agricultural industry is intended to improve farming efficiency. Agriculture is a critical sector for many developed and developing countries around the world because it employs the majority of the rural population and contributes significantly to income generation, Gross Domestic Product (GDP), foreign exchange earnings, and food needs for an ever-increasing population. Providing fertilizer subsidies to farmers through a reduced market price ensures fertilizer availability, which is expected to influence farm level efficiency and production. FAO (2015) estimates that global food production must increase by 70 percent by 2050 to feed an additional 2.3 billion people. Eighty percent of the increase in production in developing countries will have to come from improved crop yields and production, thus making it pertinent for the government to subsidize fertilizers in order to be affordable for farmers. Fertilizer subsidy programmes, though expensive, have succeeded in raising input use by farmers and increasing agricultural productivity in many countries. There is ample evidence that increased use of fertilizer has been responsible for an increase in agricultural productivity worldwide. Fertilizer is an important seed in the green revolution, contributing to as much as fifty percent (50%) of yield growth in Asia (Hopper, 1993). In a background paper during the Fertilizer Summit in Abuja, Camara & Heinemann (2006) stated emphatically that no country in modern history has made great strides in agricultural production without first increasing the use of fertilizer through subsidies.Several studies have found that one-third of the production of cereals worldwide is due to subsidized fertilizer and other related factors of production, while other scholars have stated that the only real cure for land hunger in West Africa is to increase production. The Sahel lies in the increased productivity of the arable land through the use of inorganic fertilizers.

Well-planned fertilizer subsidies were the secret behind the success of the Green Revolution, which swept through Asia and Latin America in the 60s and 70s. For instance, whereas in 2002-2003, Sub-Saharan African farmers used an average of 9 kg of fertilizer per ha of arable land, fertilizer subsidies enabled fertilizer use to reach as high as 100kg/ha in South Asia, 135kg/ha in Southeastern Asia, and 73kg/ha in Latin America. This resulted in a situation where agricultural production and productivity soared in Asia and Latin America during the last four decades, but stagnated in Africa, resulting in a rising dependency on imported grains and an increase in the number of undernourished people.

Ghana’s agriculture is dominated by small-scale farmers with an average farm size of about 1.5 ha and is characterized by low use of improved technology. Yields are therefore generally low, with most crops at 60 percent of achievable yields, indicating that there is significant potential for improvement. A major contributor to low yields is poor soil fertility resulting from nutrient depletion and low input use. Most of Ghana’s smallholder farmers are struggling to live and to feed their families on less than US $2 a day. The World Bank (2004) asserts that supporting smallholder farming is the most effective way of stimulating economic development and reducing poverty. This accounts for the reason why smallholder farmers constitute the target population for this study. Assistance to agricultural production in the form of fertilizer subsidies, which Ghana and many other African governments withdrew from in the 90s, has gradually become a new policy direction within the last seven years. There is common agreement that increased use of fertilizer and other productivity-enhancing inputs is a precondition for rural productivity, growth and poverty reduction, and so they are unable to afford the high prices of commercial fertilizer, which is not even available in the required quantities and quality. The impetus for the introduction of the renewed fertilizer subsidies which gingered the researchers into this study therefore emanated from a number of quarters, such as evaluating the perception of farmers about the effectiveness of the fertilizer subsidy.

1.2 STATEMENT OF THE PROBLEM

The International Fertilizer Development Centre has examined Ghana's fertilizer subsidy program since its inception in 2008. However, only commercial directors of fertilizer importing firms, the accountant in charge of administering the voucher program, and the stock keeper in charge of receiving and disbursing vouchers at the Ministry of Food and Agriculture were interviewed for these assessments. Only seven districts, based on an opportunistic selection of districts that could be accessed from the main trunk road cutting across the country, were considered for interview during the evaluation. The real beneficiaries of the fertilizer subsidy, who are the farmers themselves, were left out in these evaluation exercises. A substantial knowledge gap remains in the area of factors that affect fertilizer use and access to fertilizer under various subsidy programmes.The literature available only looks at the total quantities of fertilizers to be imported, the total cost, and the sources of fertilizer without considering the perceptions of small-scale farmers' views about the programme, which are vital for ensuring timely availability of the preferred fertilizers at affordable prices, even as they are very important for the participation and sustainability of a programme. It is therefore important that beneficiaries’ perceptions of the effectiveness of the subsidy in the study area of the design and implementation procedures be considered in the evaluation. The failure of earlier evaluations to take the views of beneficiaries into consideration as part of their evaluation therefore constitutes a wide gap which has to be filled, hence this research.

1.3 OBJECTIVE OF THE STUDY

The broad focus of this study it to examine the perception of farmers’ on the effectiveness of the fertilizer subsidy programme. Specifically the study seek to

1. Examine the level of participation of farmers with the fertilizer subsidy programme.

2. Examine the level of satisfaction of farmers with the fertilizer subsidy programme.

3. Find out farmers' perceptions about the weaknesses and strengths of the programme.

4. To determine if the fertilizer subsidy programme  was effective enough to bring increase yield in agricultural product since its introduction in Ghana

1.4 RESEARCH HYPOTHESIS

HO1: The level of farmers satisfaction about the fertilizer subsidy programme is low.

HI1: The level of farmers satisfaction about the fertilizer subsidy programme is not low

HO2: Fertilizer subsidy programme has not been effective to bring increase yield in agricultural product since its introduction in Ghana.

HI2: Fertilizer subsidy programme has  been effective to bring increase yield in agricultural product since its introduction in Ghana

I.5 SIGNIFICANCE OF THE STUDY

This research will add value to existing research by investigating the perceptions of beneficiaries about the nature of the subsidy programme and its implication on the availability, accessibility and affordability of subsidized fertilizer. Consequently, the findings of this research will be used as a reference point and provide guidance for future programme designers and implementers to come out with more pragmatic fertilizer subsidy programmes Since the study delves into the strengths and weaknesses of the fertilizer subsidy programme, the results could be used to reinforce the strengths for sustainability as well as taking corrective measures to address the weaknesses and/or shortfalls of the current fertilizer subsidy programme in the study area.Finally the study will contribute empirically to the body of knowledge and serve as a reference material for both student and scholars who wishes to conduct further studies in relate field.

1.6 SCOPE OF THE STUDY

The scope of this study borders on  perception of farmers’ on the effectiveness of the fertilizer subsidy programme(FSP). The study engaged farmers in Ghana who are the beneficiary of the  FSP in the bid to ascertain their level of participation and satisfaction on the programme. More consideration was given to ascertain if the agricultural yields has increased since the introduction of the programme. Howvevr the study was delimited to Sene West And Sene East Districts Of The Brong Ahafo Region Of Ghana

1.7 LIMITATION OF THE STUDY

There were several constrain encountered during the study of the prominent was communication problem as most of the respondent  farmers are primitive and had difficulties in giving the right response to the instrument because they preferred to be communicated to in their language. During data collection, the researcher also had to put forth extra effort to understand the respondents' interview schedules, several of whom fell into the incomprehensible age group. Also, there were finance and transportation constraints to deal with. Insufficient funds tend to impede the efficiency of the researcher in sourcing the relevant materials, literature, or information and in the process of data collection (internet, questionnaire, interview). More so is especially access to government documents and other reports and publications concerning the fertilizer subsidy programme. For example, list of beneficiary farmers from government, Ministry of Food and Agriculture (MOFA) and other stakeholders like Distributors, Agents as well as importers were not readily available. Other limitations of this study included limited access to sufficient data from farmers, considering their inability to keep accurate records. Most of farmers’ records were from memories which were not comprehensive enough

1.8 DEFINITION OF TERMS

Effectiveness: Effectiveness in this study is defined as the degree to which the fertilizer subsidy programme is able to meet the expected goals of increasing fertilizer usage to bring about an improvement in production levels as perceived or observed by beneficiary farmers.

Perceptions: Perceptions, opinions and attitudes have been used interchangeably. In this study is used to mean farmers views on, or assessments of the FSP.

Fertilizer Subsidy: Fertilizer subsidy is commonly understood to mean direct budgetary support payments made by government to lower the farm gate prices of fertilizers.

---

---