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2.
The Context of Country-level Frameworks
It is
instructive to place the development frameworks discussed in this review
in the context within which they were developed and are being implemented.
2.1
General context
2.1.1
Historical context
Ghana
has had a very long history and tradition of planning for national development:
Ghana was reputed to have completed the first development plan in the
world, the Guggisberg Plan, in 1919. This was more of a public investment
programme than a comprehensive development plan but it provided the framework
for the first efforts to develop the Gold Coast up to 1926. This very
first plan was developed by the colonial administration without any participation
by the people and was implemented largely by the administrative service.
After
that period, very little real development took place until the independence
movement provided the impetus for further development of the country.
Beginning from the immediate pre-independence era, the economic and social
development of Ghana has been guided by several planning processes. These
include:
- the First Ten Year
Development Plan (which was condensed into a Five-year Plan 1951-1956)
- the Consolidation
Development Plan 1957-1959
- the Second Development
Plan 1959-1964
- the Seven-Year
Development Plan 1963/64-1969/70
- the Two-Year Development
Plan 1968-69-1969/70
- the One-Year Development
Plan July 1970-June 1971
- the Five Year Development
Plan 1975/76-1979/80
- the Economic Recovery
Program 1984-1986
- the National Development
Policy Framework: Long-Term Development Objectives (Ghana-Vision 2020)
At
the national level, the major planning processes that have impacted most
on national development to date are:
- The 7-Year Development
Plan (1963/64-1969/70)
- The Economic Recovery
Programme (ERP) (1983-1987)
- Ghana -Vision 2020
(1996)
Currently,
the development efforts and direction of Ghana are being implemented within
the framework of the Ghana-Vision 2020. Major development programming
approaches to achieving the goals of the Ghana Vision-2020 at the national
level have involved the following initiated in the years shown in parenthesis:
- The National Economic
Forum (1997)
- Public sector reforms
under CSPIP, PURFMAP, MTEF, and NIRP (1994)
- World Bank sponsored
Comprehensive Development Framework (CDF, 1999)
- United Nations
Development Assistance Framework (UNDAF, 1997)
- Japanese promoted
Integrated Human Development Programme (IHDP)
Key
cross-cutting strategic approaches developed to ensure sustainability
of the national strategy for development cover:
- Decentralization
(1988)
- Poverty Reduction
(1995)
- Natural Resource
Management (1995)
- Gender
All
strategic development frameworks in Ghana are national. However, regions
and districts prepare their development strategies and plans under the
decentralized planning system within planning guidelines derived from
the Vision-2020 overall policy and strategic framework. The closest to
sub-national strategies were the integrated regional planning frameworks
of the 1970s and 1980s. However, those approaches were not strategic,
were only partially integrated while their preparation did not follow
the commonly-accepted norms for designing strategies for sustainable development.
2.1.2
Political context
The
country had been under a quasi-military regime (PNDC) since 1982 that
oversaw the implementation of the ERP, which involved large doses of economic
liberalization. However, the political atmosphere was still not liberalized
until 1992 when there was a transition to multi-party democratic governance.
In practice, the main opposition party boycotted Parliament during the
first period of civilian government (1992-1996). The participation of
all parties in the second period (1996-2000) saw the intensification of
true multi-party democracy that has been consolidated by the change of
government last year. Overall, the last decade has witnessed the emergence
of democratic institutions, such as a free and liberalized press and organs
for addressing serious frauds and lapses in human rights and administrative
justice, all of which are necessary for the institutionalization of good
governance. Thus, political liberalization finally caught up with economic
liberalization after a decade.
2.1.3
Socio-economic context
Ghana
began the spiral of long-term economic decline in the 1960s due to low
investment, low and falling efficiency of resource use and declining exports.
Between 1960 and 1982 real per capita income fell at an average annual
rate of nearly 2 percent while annual inflation rose from 6.2 percent
to 123 percent. In response, the ERP was initiated to reverse the country’s
downward trend and start a process of sustained growth. Since 1982, the
focus has been on economic liberalization and stabilization, social development,
long-term growth, poverty reduction, gender balance and regional integration.
In response,
real GDP growth averaged 4 percent annually while inflation dropped to
20 percent during 1992-94.
However,
the performance of the economy slipped from 1992 when large fiscal imbalances
resulted in heightened inflation and currency depreciation. Within this
context, there was the need to consolidate economic gains, including improving
the coordination of economic management, and to begin to address poverty
issues in a systematic manner.
The
development of Ghana Vision-2020 was in reaction to the need to ensure
long-term growth to avoid the drastic drop in living conditions by addressing
poverty in an integrated manner and improving the management of the economy
to place the nation on a path of sustainable growth.
Currently,
the economy is characterized by: (a) market-determined and private sector
oriented policy framework, but private sector response to the economic
framework and incentives has been low, (b) the state divesting controlled
enterprises and restructuring of public sector administration, (c) largely
agrarian setup with low manufacturing value-addition, (d) low savings
and investment (e) dependence on two commodities for foreign exchange
earnings, (f) high debt, both external and domestic.
2.1.4
Development trends and key factors
The
design of strategic frameworks for national development has been influenced
by key trends and factors, both positive and negative. These include:
- the pain and memory
of past economic downturn
- the resultant economic
liberalization and market-based stance of economic policy which has
yielded a fragile stabilization as the economy is still prone to destabilization
by external economic factors
- the transition
to multi-party democratic governance
- relative peace
and stability
- increasing population,
unemployment, demand on social services and a fall in living standards
- poor natural resource
management resulting in loss of forest cover and general environmental
degradation
2.1.5
Administrative context
The
administrative context for the development of national development strategy
frameworks in the post-ERP era involved the establishment of: (a) organs
for economic management, including the Economic Management Team, (b) an
emerging consultative approach (culminating in the National Economic Forum
in 1997 and the recent National Economic Dialogue in May 2001), (c) a
development planning system including a legal framework and a planning
institution (the NDPC), (d) a decentralized planning system
Despite
this economic management and development-planning environment, major donors
felt the need to design their own frameworks for development assistance
planning, partly in response to ineffective donor coordination and integration
of donor development programmes. This situation partly accounted for the
development of the CDF and Common Country Assessment (CCA).
2.1.6
Regional context
The
development of the current Second Medium-Term Policy framework and plan
has taken due cognizance of regional factors. Thus, the framework emphasizes
economic growth and poverty reduction, popular participation in economic
and political decision-making, and, good governance to consolidate the
relative peace and stability that Ghana enjoys in relation to other strife-torn
areas of the sub-region. The framework also explicitly seeks to enhance
the economic integration of the sub-region.
2.2
Institutional context: effectiveness of regulations and incentives
The
effectiveness of regulations and incentives determines the nature and
effect of the institutional context for the development of strategic initiatives.
Broadly, in consonance with the progressive consolidation of economic
and political liberalization, the approach to internalizing economic and
environmental costs, to facilitate best-practice investments, is by fiscal
and regulatory frameworks, rather than bureaucratic control mechanisms.
For example, (a) the EPA has adopted the polluter-pays principle to internalize
environmental costs, (b) investment allowances and incentives by the Ghana
Investment Promotion Centre (GIPC) help correct some market failures in
the investment environment, and, (c) the Public Utilities Regulatory Commission
(PURC) attempts to level the playing field regarding utility costs. However,
the effectiveness of regulations and incentives is hampered by imperfections
in the availability and access to information and data on economic and
social parameters of national development. This affects the efficacy of
development planning strategy formulation.
Public
awareness of sustainable development has been heightened, especially by
the integration of environmental and social issues (such as HIV/AIDS and
family planning) in development through enhanced activities of civil society
groups, particularly NGOs. The institutionalization of parliamentary and
multi-party democracy, decentralized administration, and, increased public
awareness campaigns by such constitutionally-mandated bodies as the National
Commission on Civic Education (NCCE) and the Commission on Human Rights
and Administrative Justice (CHRAJ), is facilitating the development of
a consumer or civil-society driven society and incentives away from command
and control to market-based mechanisms.
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