Former Chief Executive Officer of the Environmental Protection Agency, Dr. Henry Kwabena Kokofu, has cautioned that Ghana risks a major economic crisis if it continues to depend heavily on gold at the expense of other sectors.
According to the former Member of Parliament, an economy that focuses largely on a single commodity while neglecting other productive sectors is bound to face serious long-term challenges.
Speaking on Channel One TV as monitored by NewsDesksGH on February 26, he warned that Ghana could suffer the effects of “Dutch disease” and resource scarcity if urgent diversification measures are not implemented.
Dutch disease refers to a situation where a country’s overdependence on one booming natural resource, such as gold, leads to the neglect and decline of other key sectors like agriculture and manufacturing, ultimately weakening the broader economy.
Resource scarcity, on the other hand, highlights the risk of depletion associated with non-renewable resources, meaning once heavily exploited over time, they eventually run out, leaving the economy vulnerable if alternatives are not developed.
“Any economy that hinges on a particular commodity, all emphasis placed on that to the neglect of all other sectors, you are bound to have a serious economic challenge,” explained Dr. Kokofu.
He stressed that gold, although lucrative, remains a non-renewable resource that will eventually be depleted.
“It is a natural resource, an elementary student will tell you we have the renewable and the non-renewable, and gold falls within the non-renewables. So with time, it will get finished.”
Dr. Kokofu further noted that the exploitation of gold comes with significant consequences for the country’s economy.
“So if the government, al that it can do is continuously place emphasis on the exploitation of gold and nothing else, then we’re very much in a crisis.”
He underscored the need for a broader economic strategy anchored on diversification and value addition.
“There’s the need to diversify the economy base, the income generation, the export drive.”
“We continuously base our export revenue on exportation of raw materials, and that is seriously affecting our going forward as a nation.”
The former Environmental Protection Agency boss urged government to prioritise agribusiness, value addition and industrialisation as part of a sustainable economic transformation.
