1 University of Reading Department of Agricultural Economics 8- Management POLICIES AND INSTITUTIONS IN GHANAIAN AGRICULTURE H. Mettrick Development Study No. 9 June 1971 POLICIES AND INSTITUTIONS IN GHANAIAN AGRICULTURE By H. Mettrick First Report of the Readin Legon Joint Research 'Project in Village Development, South East Ghana. FOREWORD This is the first of a series of reports dealing with an investigation of agriculture in the southern part of the Volta Region, and the appraisal of possibilities of change. These reports will be based on studies carried out during 1969-71. A research project (hereafter referred to as Research in Village Development, S.E. Ghana) was jointly sponsored by the Departments of Agricultural Economics in the Universities of Reading and Ghana, and assisted by the Ministry of Agriculture, Ghana and the British Overseas Development Administration. It was designed with the following objectives: (a) to elaborate a programme of development in agriculture which includes suggestions about production patterns, capital investmant, economic and social institutions and organisations, designed so as to raise the level of living of the local people by a path acceptable to them; (b) perfection of a technique of survey, planning, programme formulation and subsequent liaison that effectively coordinates existing agencies and their programmes with the local extension service and results in fruitful action - a technique which may later be put to more widespread use in rural Ghana. The personnel taking part in the Project have been drawn from the two Universities and from the Ministry of Agriculture, Ghana. Valuable guidance has been provided by an Advisory Committee drawn from these three institutions. Generous assistance has also been given by the Regional Agricultural Officer and his staff in the Volta Region. 11 At the time of writing the pattern of research activity has so far included A field survey of selected villages, preceded by a more widely ranging reconnaissance; Specialist investigations of (a) the policy and institutional background to local development, (b) the technical and economic aspects of certain promising innovations, and Associated post-graduate studies. This first report deals with the first specialist investigation. It is based on work done by Hal Mettrick, which included a three-month stay in Ghana late in 1969. The material collected then has been brought up-to-date and expanded to a minor extent. Useful comments on an earlier draft were made by Dr. Blair Rourke of the University of Ghana. D.S. THORNTON, Project Leader Department of Agricultural Economics University of Reading June 1971. POLICIES AND INSTITUTIONS IN GHANAIAN AGRICULTURE Background for the formulation of a local development programme Foreword Page Chapter 1. PLANS AND POLICIES AT NATIONAL LEVEL 1 Constraints on Government action Review of planning Policy objectives Development strategy Issues in agricultural policy Planning machinery Chapter 2. THE INSTITUTIONAL FRAMEWORK 35 2.1. Decentralisation 2.2. Local government 2.3. The Ministry of Agriculture 2.4. Special crop development Boards 2.5. Co-operatives 2.6. Credit 2.7. Community Development J 2.8. Research Chapter 3. MIRKETING_AND MARKETS 69 3.1. The marketing system 3.2. Storage, transportation and processing 3.3. State intervention in food marketing 3.4. Price trends for selected commodities page Chapter 4. BACKGROUND TO DEVELOPMENT IN S.E. GHANA 85 4.1. Physical and social infrastructure 4.2. Population, labour and employment 4.3. Land tenure 4.4. Pattern of farms Chapter 5. CLOSING COMMENTS 102 5.1. The nature of the development problem 5.2. The planning and implementation problems APPENDICES 105 Regional crop production targets 1971/2 II Training requirements for technical manpower in the Ministry of Agriculture III Large-scale units in the Southern Volta region -1- CHAPTER I PLANS AND POLICIES AT NATIONAL LEVEL 1.1. CONSTRAINTS ON GOVERNMENT ACTION (a) Political considerations The most significant event in Ghana's recent history was the police and military take-over -on 24th February, 1966 which removed the Convention People's Party of Kwame Nkrumah and set up the National Liberation Council. Its importance lay not simply in the shift in ideology, but in the sense of a new beginning which caused a fresh look to be taken at many aspects of Ghana's gdministrative and development policy. There are few Ghanaians who would deny th-lt changes were necessary. Apart from the important political and ideological questions, the economic situation was such that "external economic relations had practically collapsed by 1965. There can be no doubt of the severity of the economic constraints under which the Government has been operating since the coup and these will be examined below. But there have also been constraints of a political or even socio-psychological nature. These are subtler, but no less binding. To begin with, there has been the impact of experience under the Nkrumah regime on general policy-making. That they have a profound effect is unquestionable; there is a very real desire to profit form the mistakes of the past and to ensure that they are not repeated in future. There have been a large number of commissions of enquiry in the last five years into the functioning and malfunctioning of a variety of Ghanaian institutions with a view not only to remedying the defects of the particular institution, but also to learning lessons which can be put into practice elsewhere. It is fashionable now to see very little of value in any of Nkrumah's initiatives, but there are dangers in this. One is of a negative response to the past, an assumption that anything with an Nkrunah label attached to it is necessarily bad. The second danger is of an over-reaction to the past. In the world of politics, any conflict is inevitably presented in over-simple terms - the more violent the conflict the more the issues tend to become polarised. In this case part of the cause for past failures might be analysed correctly, but some of the complexities might 106 obscured. If the errors, of the pre-coup period are seen as only springing from the "C.P.P.'s over 1 peculiar version of socialism" or from its "pandering to the whims of one man" 1. Although these words are quoted from the Progress Party Manifesto, it is not suggested that the P.P. is guilty of the over-simplification referred to. -2- it is unlikely that the failings will be fully ali.a.lySed. An example is the rejection of direct participation of Government in large-scale enterprises as a main spearhead for agricultural advance. Experience would certainly suggest a rejection of public participation in production, but it should also be asked whether a continued emphasis on large-scale enterprise in any form is desirable. The effect on the Volta Region of the Progress Party's victory at the elections in 1969 is of particular interest in the present context, but it would be premature to draw conclusions. Volta Region was, of course, a major stronghold of the opposition National Alliance of Liberals. The Progress Party has m-omised that No area of the Country will be neglected because it has not supported the Progress Party". There are two good reasons why the Government might give substance to this promise. The first is that the Progress Party may hope to win support in the Region; it now needs to demonstrate th-lt it is a national party and not an Akan party. The genuine political substance of each of the parties will only emerge over time, and the victor in this situation has a considerable advantage over the loser in that he can pre-empt all the best tunes. The second reason stems from the continuing significance of the National Liberation Council (in spite of its having officially dissolved itself) on which the Ewe people of the Volta Region were very well represented. (b) Economic Constraints Recent history is also relevant, of course, when discussing economic constraints on development. The .present shape of the Ghanaian economy and the economic problems which the Government has to face are very much a conse- quence of past economib policies. It is important, from a planning point of view, to understand how the Government's freedom of action is circumscribed. The Two-Year Develonment Plan 1968-70 argued that, in addition to the general constraints which are common to all low-income countries, (such as capital scarcity, a low saving rate, a high rate of population growth, illiteracy, shortage of highly skilled labour, unemployment and underemployment, weak organisational capacities, and LIrge differences in personal and regional_ incomes,) Ghana had four particular constraints: namely the size of the foreign debt, the dependence on cocoa, the degree of under-utilisation 'and redundancy of some investments, and the over-centralisation of decision- making. The first three of these constraints are referred to in the following paragraphs. The fourth is discussed at length in Chapter 2. -3— (1) The '--lance of Pairn;:nts aivd the forei,rn debt In recent years the shortage of foreign exchange has been a crippling constraint on the Ghana Government's freedom of economic manoeuvre. The principal means used to tackle the problem have been a devaluation of the cedi 1 (by 3O on 8th July 1967), a rigid control of imports and monetary and fiscal policies directed towards holding back domestic demand. The severe effects on the growth of the Ghanaian economy are most dramatically illustrated in the fall of gross domestic fixed capital formation (mainly buildings and construction) from NØ 250m to less than 14. 150m (at fixed prices) between 1968 ,nd 1969. There has also been a decline in real GNP per head.