Regional disparities in Ghana: Policy options and public investment implications

"The development pattern in Ghana is characterised by a north-south divide in which the north lags far behind the south... This paper sets out to identify avenues for pro-poor growth in Ghana, focussing on agricultural opportunities, particularly in northern Ghana. Using an economywide, multimarket model and based on time series production data between 1991 and 2000 and Ghana Living Standards Survey data of 1991/92 and 1998/99, this paper analyzes the possible poverty reduction trends up to 2015 by assuming different patterns of growth. The results show that agriculture-led growth has a larger poverty reducing effect than nonagriculture-led growth... A review of the literature shows that while the north generally is a net migration area, the rewards of migration have been limited because people who migrate have no skills and are, therefore, limited to entering the informal job market where wages are low. The implication is to enhance this labour with education and skills. Ultimately, the regions must attract production investment to boost economic activity and generate local growth. The state must play a leading role in investing in productive and social infrastructure as a way of facilitating the environment for private sector operators.: from Authors' AbstractPro-poor growth, Pro-poor policies, Regional inequality, Poverty reduction, Agricultural growth, Economywide modeling, Public investment,

Regional Disparities in Ghana: Policy Options and Public Investment Implications

Ghana has achieved sustained growth and poverty reduction during the 1990s, but such growth did not benefit the three poor northern regions and the development gap has increased between the south and north. One of the most important reasons is that much of the growth has been generated by export agriculture in which northern Ghana has little contribution if any. This paper sets out to identify avenues for pro-poor growth in Ghana, focussing on agricultural opportunities, particularly in northern Ghana. Using an economywide, multimarket model and based on time series production data between 1991 and 2000 and Ghana Living Standards Survey data of 1991/92 and 1998/99, this paper analyzes the possible poverty reduction trends up to 2015 by assuming different patterns of growth. The results show that agriculture-led growth has a larger poverty reducing effect than nonagriculture-led growth. Within agriculture, growth in staple crop production reduces poverty more than export crops. In northern Ghana, the staple crops whose growth exerts the largest effect on poverty reduction are groundnut, cassava and cowpea. However, despite the large effects of the agriculture-led growth, the projections of poverty rates in the regions, particularly Upper East are still high implying a need for complementary avenues for poverty reduction. A review of the literature shows that while the north generally is a net migration area, the rewards of migration have been limited because people who migrate have no skills and are, therefore, limited to entering the informal job market where wages are low. The implication is to enhance this labour with education and skills. Ultimately, the regions must attract production investment to boost economic activity and generate local growth. The state must play a leading role in investing in productive and social infrastructure as a way of facilitating the environment for private sector operators

Agriculture and Social Protection in Ghana

Ghana was one of the first countries in Africa to embark on structural adjustment reforms. 25 years on, its continuing commitment to reform for national economic development has yielded impressive gains in growth and poverty reduction. Poverty in the country is measured through periodic Ghana Living Standards Surveys (GLSS). In 1991/92 GLSS3 found that 51.7% of the population were living below the national poverty line. By 1998/99 (GLSS4) this had fallen to 39.5% and by 2005/06 (GLSS5) it had fallen to 28.5% (Ghana Statistical Service 2007). In absolute terms the number of poor people in Ghana has fallen from 7.9 million in 1991/92 to 6.2 million in 2005/06. At current growth rates, Ghana should achieve MDG1 before 2010.DfI

Why Northern Ghana Lags Behind in Ghana's Growth and Poverty Reduction Success

Ghana's post adjustment growth and poverty reduction performance has been hailed as impressive, albeit with spatial disparities in the distribution of welfare, especially between the north and south of the country. Researchers generally agree that economic growth does not always reduce poverty. Indeed, the effectiveness of growth in reducing poverty depends on the level of inequality in the population. Growth that increases inequality may not reduce poverty; growth that does not change inequality (distribution-neutral growth) and growth that reduces inequality (pro-poor growth) result in poverty reduction. Policy makers can promote pro-poor growth by empowering the poor to participate in growth directly. Policy makers can focus on interventions that improve productivity in smallholder agriculture, particularly export crops, increasing employment of semi-skilled or unskilled labour, promoting technology adoption, increasing access to production assets, as well as effective participation in input and product markets. Also, increasing public spending on social services and infrastructure made possible by redistribution of the benefits of growth benefits the poor, indirectly

Do Comprehensive Africa Agriculture Development Program (CAADP) Processes Make a Difference to Country Commitments to Develop Agriculture?

The CAADP is a commitment of African countries to pursue economic growth through agriculture-led development to reduce poverty and hunger on the continent. It stems from the failure of previous interventions on the continent largely attributed to their weak ownership. CAADP is expected to serve as a framework that adds value to national and regional strategies for the development of agriculture. Some of its key principles that are expected to add value are the building of partnerships, dialogue, peer review, and mutual accountability at all levels as well as exploitation of regional complementarities. CAADP countries are expected to achieve 6 percent growth in the agricultural sector and allocate at least 10 percent of the national budget to agriculture. The objective of this paper is primarily to understand how continental initiatives such as CAADP can and do influence country commitment to seek agriculture-led development. This paper employs Ghana as a case study to examine whether CAADP processes leading up to and including the country roundtable process enhance the visibility of the role of agriculture as a means of reducing poverty. The study explores whether countries take the leadership in adopting the CAADP framework. First, the paper provides perspective on the agricultural sector in Ghana and the role of agriculture in development strategies. Further, it reviews how the processes for implementation of CAADP have evolved and how they have influenced implementation in Ghana. It evaluates what impact CAADP may have on the content of agricultural policies in Ghana. Finally, the paper makes some suggestions for improving CAADP implementation.Agriculture, CAADP, Development strategies, NEPAD, Participation, values,

Agriculture for development in Ghana: New opportunities and challenges

"This paper has been prepared in support of the Comprehensive Africa Agriculture Development Program (CAADP) roundtable in Ghana. The study also takes a fresh perspective on the role of agriculture for development in light of the global food crisis. It addresses two main questions: what are the impacts of Green-revolution type agricultural growth to reach the CAADP goal in Ghana? Given the large investments required to achieve such productivity-led growth, what is the sector's contribution to the overall economy? Results from the dynamic computable general equilibrium model suggest that by closing the existing yield gaps in crop production and supporting essential growth in the livestock sector Ghana can achieve CAADP's 6 percent growth target. In this process, agriculture supports the rest of the economy through substantial and largely invisible monetary transfers to the nonagricultural sectors, which are primarily driven by the reduction of domestic food prices. Thus, CAADP growth benefits both rural and urban households, and reduces poverty by more than half within 10 years. However, widening regional disparities between the North and the rest of Ghana will increasingly pose a challenge for the development. Additional measures more targeted towards generating growth in the lagging North will be necessary to bridge the income gap and reach Ghana's poorest of the poor." from Author's AbstractAgriculture, Poverty, Computable general equilibrium (CGE), Development strategies, Comprehensive Africa Agriculture Development Program (CAADP),

Insecticide use on vegetables in Ghana: Would GM seed benefit farmers?

"Tomato, cabbage, and garden egg (African eggplant, or Solanum aethiopicum) are important crops for small-scale farmers and migrants in the rural and peri-urban areas of Ghana. Genetic modification has the potential to alleviate poverty through combating yield losses from pests and diseases in these crops, while reducing health risks from application of hazardous chemicals. This ex ante study uses farm survey data to gauge the potential for adoption of genetically modified (GM) varieties, estimate the potential impact of adoption on farm profits, and highlight economic differences among the three crops. Farmers' expenditures on insecticides are below the economic optimum in all three crops, and the estimated function for damage abatement shows that insecticide amounts are significant determinants of cabbage yields only. Nonetheless, yield losses from pests and disease affect insecticide use. A stochastic budget analysis also indicates a higher rate of return to vegetable production with the use of resistant seeds relative to the status quo, even considering the technology transfer fee for GM seed. Non–insecticide users could accrue higher marginal benefits than current insecticide users. Comparing among vegetable crops with distinct economic characteristics provides a wider perspective on the potential impact of GM technology. Until now, GM eggplant is the only vegetable crop that has been analyzed in the peer-reviewed, applied economics literature. This is the first analysis that includes African eggplant." from authors' abstractBiotechnology Developing countries, Genetically modified crops, pesticides, Pests Management, eggplant, damage abatement, stochastic budget analysis,

Evaluating the Viability of Shea Butter Production: A Comparative Analysis

This paper analysed the viability of shea butter processing in the Northern Region of Ghana using household level data on three different processing methods. Semi-structured questionnaires were administered to shea butter processing units. In all 110 processors were interviewed comprising 40 processing units for each of the Traditional and the Improved Shea Butter Processing Technology (ISBPT) methods and 30 for the Bridge Press (BP) method.  The analytical techniques used included NPV, B/C ratio, sensitivity analysis and switching values. From the NPV and B/C ratio analyses, shea butter processing generally is a viable enterprise. While the estimates (NPV and B/C) of the BP method are higher than those of the ISBPT method, the estimates of the ISBPT method are higher than those of the Traditional method. The switching value and sensitivity analysis showed that the BP and ISBPT methods are more conditioned to handle risk than the Traditional method. Based on the findings, shea butter processing is recommended to government, Non-governmental Organisations and other stakeholders involved in the fight against poverty as a viable enterprise that offers an opportunity for the economic empowerment of women in both urban and rural areas. Keywords: NPV, B/C ratio, switching values, sensitivity analysis, shea butter, viability

Productivity and Technical Efficiency of Cocoa Production in Eastern Ghana

This paper analyzes the productivity, technical efficiency and its determinants among cocoa producers in the Eastern region of Ghana. A multi-stage random sampling technique is used to obtain a cross sectional data on 190 respondents. The stochastic frontier model is adopted to analyze the research objectives. The results reveal that productivity level of cocoa responds positively to land size, the level of agrochemical, labour and intermediate input used. However, productivity responds negatively to the increasing age of the cocoa trees. Cocoa producers in the region exhibit decreasing returns to scale. The mean technical efficiency among the cocoa producers is estimated to be 85%, indicating that the possibility of enhancing production given the present state of technology and input level can be achieved in the short run by increasing technical efficiency by 15% through adoption of practices of the best cocoa farm. Exogenous factors such as access to extension services, technical support and credit are found to reduce the level of technical inefficiency among the producers. Also older farmers and male farmers are   efficient than younger and female farmers. Farmers with more experience in cocoa production also produce with technical  efficiency. Key words: Cocoa, productivity, technical efficiency, stochastic frontier, Ghana