UE1 Session 9 Seminar Presentation

8/3/2019 UE1 Session 9 Seminar Presentation

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UE1 Session 9 Seminar Presentation

Session 9: Cities and Structural Adjustment

Seminar Topic: Structural Adjustment

Programmes and an Analytical Profile ofContemporary City of Accra

Team Members: Alan FeeneyHironori ShojiRune DigeChristopher WrightQiqi ChenKang ChenXiaojun Xu


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Contents

1. Introduction

2. Political

3. Economic

4. Social

5. Environment

6. Conclusion


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Introduction

Accra(2006 est.)

Source: CIA World Factbook

Urbanization population: 51% of totalpopulation

GDP - real growth rate: 5.7%. Account

for10%-20% of Ghana's total GDPGDP - composition by sector:

agriculture: 13.08 %industry: 22.34%services: 64.58 % ( largest)

U

nemployment rate: 12.2% Population below poverty line: 11.8%

Cost of living: 75th, between Melbourne and Houston

Net enrolment: 80.9%

Source: Ghana Statistical Services


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Introduction

1966-1981 1983 1991 20041957 2009

Political Independent

Underdevelopment

Export-based economy

Structural Adjustment

Programmes

Sponsored by IMF and

World Bank.

Development Policy

WB scrapped the SAPs

and came up with the

new policy.

the Great Decline

Economic mismanagement,over-regulation, 123%

inflation, towardsbankruptcy.

(Kwadwo, 2000:470)

Achievements

Reached GDP growth

of6%, helped decrease

inflation and saw a

growth in real incomes.

Accra Urban Profiling

The second phase of the

new programmemain themes:

governance, slums,

gender and HIV/AIDS

Timeline


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Introduction

Structural Adjustment Programmes

Aim: To transform all the economies in the world into capitalisteconomies inserted in one system under the management ofinternational capital.

Main Features: Shorter-term stabilizationLonger-term adjustments

Implementation: The process of undergoing structural adjustments

forcing the receiving country to devalue their currency, downsizepublic service, raise interest rates, privatize public enterprises, andreduce government spending on welfare, health, and education.

(R. Rojas, 1997, Notes on structural adjustment programmes)


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Political and Administrative Profile

Source: wikipedia.org, commonownership

Political Make-up of Greater Accra

Region:

Accra Metropolitan Assembly (AMA)population 1,695,136

Tema Municipal Assembly (TMA)population 506,637

Ga Rural Assembly (GRA) population548,011

Yearly budget of AMA $9,140,139(estimated)

AMA has responsibility for: sanitation

services, educational infrastructure,provision of markets, planning anddevelopment control of infrastructure,public safety including some security.

Source: 2000 census, UN-Habitat 2009


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Decentralisation

Decentralisation can be an excellent means of promoting improved representation of the

poor and enhancing the targeting of service delivery (Katseli, OECD Development centre, 2004)

Decentralisation encouraged by SAP programmes, and by more modern programmestargeting poverty reduction, using two main arguments:

Decentralisation can lead to an increase in efficiency using local time and placeknowledge to implement policies and programmes that reflect peoples real needs andpreferences (Musgrave, 1983)

Decentralisation can lead to improved governance and enhances accountability andmonitoring of government officials and decision makers (Blair, 2000; Manor 1999)

Strong central government required which Ghana is said to possess due to polls have beenwidely considered as transparent, free and fair largely due to the establishment of an

Electoral Commission that has strengthened democratic procedure (UN-Habitat, 2009, AccraUrban Profile, pg 36)


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Objectives Background ProcessImpacts of

Decentralisation

Political,administrative andfiscal deconcentration

Official Manifesto:

Transfer of publicsector tasks fromnational to local level

GNI per capita of1,640 (1997)

Social institutions ofTraditional Chiefs

Literacy rate of72.7% (2001)

CorruptionsPerceptions Index: 3.3(2003)

Committees andCouncils establishedthrough elections,1999

Limited budget ingeneral at local level

Information flowrated as good (2002)

Participation ratedas good (2002)

Central Governmentretains great control

Positivedecentralisationexperience, inconsistentimplementation ofreforms

Overall povertydecrease but effectsslightly felt by poor

Access to politicalparticipation increasedfor poor and illiterate

Some sharpenedethnic conflict

Source: table summarised from Decentralisation and Poverty, Jutting, J. 2004,OECD Development Centre working paper no. 236


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Macro Economic Stability

Poverty, Inequality

Employment, Industrial Change

Economic aspects


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Economic aspect

I. Fiscal Policies (i.e. Promote macroeconomic stability, Strengthentax administration, decentralization)

II. Public Sector Reform (i.e. Achieve a smaller and more effective

public service)

III. Monetary Policy and Financial Sector Reform (i.e. Reduceinflation through monetary restraint, Improve efficiency of financialsector by accelerating financial sector reforms)

IV. External Sector Policy (i.e. Broaden and deepen the foreignexchange market, Ensure that trade system enhances externalcompetitiveness)

V. Sectorial Policies (i.e. Liberalize the cocoa sector)

VI. Statistical issues (i.e. Improve quality and timeliness of statistics)

Summary ofMacroeconomic andStructuralAdjustment Policies, 1998-2000

( IMF, 1998)


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Economic aspect

1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993

GDPgrowth

(%)-3.5 8.3 5.8 4.3 5.9 9.4 4.6 3.3 5.0 4.1 4.7

CPI(%) 142.4 6.0 19.5 33.3 34.2 26.6 30.5 35.9 10.3 13.3 27.7

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

3.5 4.1 4.5 5.2 5.1 4.7 4.2 4.5 4.7 5.1 5.3 6.0

34.2 70.8 26.1 22.1 15.8 13.8 40.5 21.3 15.2 23.6 11.8 14.8

( IMF, WEO Database, 2011 )

Main Macro Economic Indicators

- Real GDP growth averaged about 4-5% a year throughout mostof the period

- Inflation was brought down from 142 % in 1983 to 10% by the endof 1991


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Economic aspect

( Coulombe and Wodon, 2007)

Average

welfare

Poverty

incidence

Poverty

gap

National 1276 0.517 0.185

Accra 1840 0.231 0.051

National 1513 0.395 0.139

Accra 2460 0.044 0.009

National 2050 0.285 0.096

Accra 2720 0.106 0.029

Consumption-based povertymeasures, 1991-2006

1991/92

1998/99

2005/06

- Thanks to strong economic

growth, national povertyand poverty in Accra havedeclined


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Economic aspect


based on the 2000 census

- Poverty concentrates onrural Savanah areas

- Accra is one of the leastpoor areas


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(UNU, n.d.)

Economic aspect


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Economic aspect


1991/92 1998/99 2005/06

National 0.353 0.378 0.394

Urbanaverage

0.321 0.340 0.355

Accra 0.324 0.283 0368

Consumption based Gini index, 1991-2006

- National inequality has increased

- Growth of inequality in Accra is larger than that ofurban area average


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Economic aspect


- Public sector employment has declined

- But new employment has gained in informal sector(formal unemployment has grown)


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Economic aspect


- Share of manufacturing sector has declined

- On the contrary, shares of trading,Transport/Communication and Financial Services


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Social aspects

Demographic trends

Key challenges

Informal settlements

Gender

Polarisation


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Social aspect

Various sources including AMA, GSS, WHO (based on census data)

Demographics

Population 1960 1970 1984 2000 2010P

AMA 338,000 637,000 969,000 1,659,000 -

GreaterAccra 492,000 805,000 1,431,000 2,906,000 3,910,000

Ghana 6,727,000 8,559,000 12,296,000 18,912,000 24,223,000

% share Greater Accra 7.3% 9.4% 11.6% 15.4% 16.1%


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Social aspect

Key social challenges

Population growth and young age profile places huge pressure onurban infrastructure and services

SAP impact on incomes and living conditions Unemployment Removal of state subsidies/ user fees Growth of informal sector

Local government lacks resources to respond 65/70% of revenues on sanitation alone (yet still inadequate)


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Social aspect

Informal settlements

Physical development runs faster than planning (UN Habitat 2009) 58% of population in informal settlements

Social problems linked to growth of informal city Water and sanitation Health Housing provision

Tensions between landowners and slum-dwellers

Vicious spiral putting greater stress on infrastructure and services


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Social aspect

Gender

80% of women in Accra employed in informal economy

SAP has gendered consequences

Impact on women Increasingly difficult to enter formal employment Competition from unemployed men Reduced contribution from men to household incomes Household duties combined with informal sector economic

activities

Vulnerable groups


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Social aspect

Social polarisation

Emerging middle class in business and government employment

Changing patterns of consumption

Trade liberalization fuels foreign investment, remittances and return ofmigrs

Inequality reflected in upmarket real estate construction alongsideexpansion of slums


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Social aspect

Accra Mall

Where the upper/ middle class shop

Accra Mall


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Social aspect

Jamestown

and this is where the rest shop


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Environmental aspect

Post-SAP physical expansion

Explanatory factorsof the expansion

Urban environment problems

Reasons to explain the problems


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Most of the expansion has been postSAPin periurbanAccra


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Urban Environment Characteristics:

Choked drains, though

huge expenditure onsanitation

Indiscriminate waste

disposal

Uncollected refuse in

central waste containers


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Conclusion

Decentralisation needs to be extended to financial powers at the same time as

administrative powers.

While major economicindicatorsshows positive trend, the gap between rich and

poor expanded.

Publicsectorsshrank and informal sectors absorbed employment.

Increasing pressure on urban

infrastructure and services,

overwhelming local governments

capacity to respond.

Due to the unplanned physicalexpansion caused by SAPs, local

governmentsurban management

capacity has been outstripped.


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Conclusion

Single economicstructure

Primary products

primary agricultural products: cocoa, coffee, cotton etc.

Primary minerals: oil, gold etc.

Positive trend

Foreign direct investment increased while official development assistance

shrank.

Showing more national pride and independent consciousness.


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Conclusion

Who are the beneficiariesof S

APs?

WillAccra be capable of eliminatingitsslum areas?

Doother LDCsundergone SAPs face the same challenges?

Documents

UE1 Session 9 Seminar Presentation