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

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,

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),

Vegetable Production and Pesticide Use in Ghana: Would GM Varieties Have an Impact at the Farm Level?

The objective of this study is to evaluate pesticide use as an important factor affecting potential adoption and farm level impact of genetically modified (GM) vegetable varieties in Ghana. Tomato is the most consumed vegetable and a food security crop. Cabbage is a vegetable of growing importance but limited cultivation and is produced in urban areas. Garden egg is a native African crop of wide consumption and importance for rural economies. Farm level information was collected in randomly selected sites in southern and central regions of Ghana. Partial budget analysis shows that investments in pesticides are rather low, especially for tomato and garden egg. Analysis of production using an abatement framework shows that insecticide amounts are significant in determining cabbage output levels only. Rate of returns of GM seeds however can still be high. GM varieties would need to show not only a high abatement rate and a high yield potential but mainly an affordable price, to reduce total costs and induce adoption.Farm, Genetically Modified, Ghana, Tomato, Agricultural and Food Policy, Consumer/Household Economics, Environmental Economics and Policy, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Health Economics and Policy, International Relations/Trade, Marketing, Productivity Analysis, Research and Development/Tech Change/Emerging Technologies,

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 (GM) 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-engineered varieties, estimate the potential impact of adoption on farm profits, and highlight economic differences among the three crops. Farmer's 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 the pests and diseases affect insecticide use. Stochastic budget analysis also indicates a higher rate of return to vegetable production with the use of resistant seeds relative to status quo, even considering the technology transfer fee for GM seeds. 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.Crop Production/Industries, Research and Development/Tech Change/Emerging Technologies,

Application of Livelihood Vulnerability Index in Assessing Vulnerability to Climate Change and Variability in Northern Ghana

Climate change is impacting on climate dependent activities such as agriculture in Africa and Ghana. The extent of the impact of climate change in agriculture depends on the level of vulnerability or exposure of farmers to these impacts. This study estimates the level of vulnerability of smallholder farmers to climate change and variability in northern Ghana using the Livelihood Vulnerability Index highlighting access to, and utilization of water resources. The approach estimates vulnerabilities in terms of exposure, sensitivity and adaptive capacity. The data is based on a survey of 320 farm households, complemented with secondary data on rainfall and temperature. Results of the study shows that Northern Region is the most exposed region to climate change and variability. Upper West Region is the most sensitive to climate change and variability especially with regards to water stress; and the Upper East Region has the least adaptive capacity. Northern Region is the most vulnerable in terms of the overall livelihood vulnerability index, followed by the Upper East and Upper West regions. Key Words: Livelihood, Vulnerability, Climate change, Climate variability, Northern Ghan

IMPACT OF CROP PRODUCTIVITY ON POVERTY AMONG FARM HOUSEHOLDS IN GHANA

Ghana Poverty Reduction Strategy I & II sought to increase crop productivity to reduce high poverty incidence in farm sector, but the magnitude of impact of the productivity on poverty is not present in all agro-ecological zones in Ghana. The aim of the study is to estimate poverty headcount ratio, poverty gap and poverty severity, and link crop productivity to poverty according to agroecology subject to a two-step instrumental variable regression technique using Pseudo Panel data from the Ghana Living Standards Survey (GLSS rounds 5 & 6). Farmers’ poverty headcount ratio, poverty gap, and poverty severity reduced from 57%, 25%, and 14% in 2005 to 37%, 14%, and 7% in 2013 respectively. The result further indicates that 1% growth in crop productivity reduces the probability of poverty headcount ratio, poverty gap and poverty severity by 0.28%, 0.38% and 0.75% respectively in all agro-ecological zones. Additionally, the paper shows that education, livestock and remittance income reduces poverty, while household size and great distance to access water increase poverty differently from agro-ecology. The study recommends rapid crop productivity growth by prioritizing technology adoption and institutional coordination to suit agro-ecological conditions among the poor, illiterate and non-partisan

Framework for analyzing the role of ICT on agricultural commercialization and household food security

This paper develops a framework for analysing the link between ICT application in smallholder agriculture, household commercialization, and food security. Lack of market information exacerbates the problem of low-level equilibrium poverty that locks smallholder producers into subsistence production where they typically trade in low volumes. The paper examines the effectiveness of ICT-based market information systems on smallholder market linkages in a broader context that encompasses, among others, different cultures, commodities, and farmer types. Investment in physical infrastructure and in providing access to inputs/assets that farmers need in order to facilitate the use of such information services is important

Performance and Constraints of Small Scale Enterprises in the Accra Metropolitan Area of Ghana

Small Scale Enterprises play a crucial role in the development of entrepreneurial capabilities and indigenous technology which generate employment. Promotion of such enterprises in developing economies like Ghana is of paramount importance as it brings about a great distribution of benefits. The study seeks to quantify the determinants of the factors influencing performance of small scale enterprises in Accra Metropolitan Area of Ghana. Kendall’s coefficient of concordance was used to test the agreement between the ranked constraints of the small scale enterprises in relation to performance. The study uses structured questionnaire to interview 150 small scale entrepreneurs in Accra Metropolitan Area (AMA). Data collected was analyzed using Statistical Package for Social Science (SPSS) and Econometric views (E-views). Results of the analysis indicate that age of entrepreneur is the most influential determinant of performance of small scale enterprises. The Kendall’s coefficient of concordance indicates that there is 91 percent agreement between the respondents in the ranking of the constraints in relation to performance. High cost of borrowing is the most important constraint faced by the small scale entrepreneurs. Based on the results, we recommend a flexible policy geared towards helping young entrepreneurs, as well as reducing the high interest charges on loans. Key words: Performance, Constraint, Small Scale Enterprise, Accra Metropolitan Area, Ghan