Report No. 6635-GH Ghana: Policies and Issues of Structural Adjustment March 30,1617 Western Africa Region FOR OFFICIAL USE ONLY Document of the lbirld Bank This document has a restricted distribution and may be used by recipients only in the performance of their offcial duties. Its contents may not otherwise be disclosed without WorWl Bank authorization. CURRENCY EQUIVALENTS Currency Unit Calendar 1985 From January 1986 From September 1986 US$1 054.054 090.0' 0128-156 1/ Cedi (0) 1 US$0.0185 US$0.011 US$0.0073-0.0065 FISCAL YEAR JANUARY 1 - DECEMBER 31 ABBREVIATIONS ADF - African Development Fund Cocobod - Ghana Cocoa Board ECG - Electricity Corporation of Ghana EFF - Extended Fund Facility ERP - Economic Recovery Program GHAIP - Ghana Italian Petroleum Company Limited GNPC - Ghana National Petroleum Corporation GOIL - Ghana Oil Company Limited GP&T - Ghana Posts and Telecommunications GPHA - Ghana Ports and Harbour Authority GRC - Ghana Railway Corporation GWSC - Ghana Water and Sewerage Corporation IFAD - International Fund for Agricultural Development LODP - Letter of Development Policy MFEP - Ministry of Finance and Economic Planning NATCAP - National Technical Cooperation Assessment OHCS - Office of the Head of Civil Service PIB - Prices and Incomes Board PNDC - Provisional National Defence Council SAF - Structural Adjustment Facility SAIS - Structural Adjustment Institutional Support SEC - State Enterprises Commiss-Lon SGMC - State Gold Mining Corporftion SIL - Special Import Licence SOE - State-owned Enterprise UNFPA - United Nations Fund for Population Activities VRA - Volta River Autnority 1/ A dual enchange rate system was established on September 19, 1986 when a foreign exchange auction was instituted for specified transactions. The 090 rate applied to the first window (cocoa and residual oil exports, petroleum and essential drugs imports, and central government debt service contracted before January 1, 1986); the rate on the second window was established at the weekly auction. The two rates were unified with effict from February 20, 1987; all transactions are now valued at the rate emerging in the weekly auction. In the week ending March 20, 1987, the marginal rate at the auction was 0156 = US$1. FOR OMCIAL US ONLY GHANA: POLICIES AND ISSUES OF STRUCTUFAL ADJUSTMENT Table of Contents Page No. ECONOMIC INDICATORS FOREWORD SUMMARY AND CONCLUSIONS .......................*. i CHAPTER I - RECENT ECONOMIC DEVELOPMENTS Introduction ... . **. . *9**99*9*9***............ .................. 1 Recent Policy Measures ........................... 1 Economic Growth ............ 3 Agriculture ........ . 3 Industry .......................... 5 Services ........... ......................... 5 Savings and Investment ........, .................. 5 The Budget ....................................... 7 Money and Credit .....999 ................... ....... 8 Prices and Wages .*****........9999999999 ** *** *... 9 Balance of Payments .......... .. . .. . .. . . .. . .. . .. . . 9 Conclusion ...... . * 12 CHAPTER II - STRUCTUi'AL ADJUSTMENT ISSUES Achievements of the Eewonomic Recovery Program 13 Remaining Adjustment Tasks ....................... 13 The Government's Medium-Term Objectives 15 Incentive Policies 16 Exchange and Trade 16 Cocoa 18 Pricing Policy ........... .18 Marketing .......20 Domestic Resource Mobilization ................... 22 Financial Sector ..... . . . . . . . 22 Private Sector Investment Climate 24 Public Sector .......... 26 State Enterprise Reforms 26 Public Sector Management .................... 28 Conclusion ... 30 This document has a restricted distribution and may be used by recipients only in the performance | of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CHAPTER III - PUBLIC EXPENDITURE PROGRAM - Introduction ...... *¢¢¢*v¢**s*v4 32 Achievements under the Economic Recovery Program (1984-1986) ..o................ 32 Public Expenditure Program 1986-1988 ............. 33 Wage Policy ........33 Expenditures on Other Goods and Services...... 34 Education 34 Health 35 Agriculture ........ . . 35 Public Investment Program (1986-1988) ............ 36 Financing Plan ............38 Productive Sectors 40 Agriculture .................... . 40 Minu ing .................... 42 Manufacturing 42 Economic Infrastructure 42 Energy 42 Transportation 43 Roads and Highways ......... ... .. . .. 43 Communications 43 Water ...... 44 Social Sectors..... . .... . 44 Health 44 Education 44 Protection of Super-Core Projects ................0 . 45 Remaining Tasks and Institutional Issues ......... 45 CHAPTER IV - MEDIUM-TERM PROSPECTS The Alternative Scenarios 46 Policy Reforms .ooo.. ..... ..... 0 00... 47 Investment and Growth in Production ........... 48 Sectoral Growth Prospects ...........oooo.oo..oo.. 49 The Adjustment Path for 1987-1989 ............. 51 Social Impact ....***1***000****0# 53 Balance of Payments 1987-1989 ...............0. 54 Export Growth ............oo ...o.... 0.o...... 54 Import Projections .**0*0*********.000 .0... . .. 55 Terms of Trade oo.o..o.oo ...o.... ...ooo.oeo..o.. 56 External Balance and Capital Inflows ............. 56 Conclusion 000000000000000***O 58 CHAPTER V - EXTERNAL ASSISTANCE NEEDS Aid Trends in 1985-1986 .........004.. 000....... 60 Ghana's Aid Requirements in 1987-1989 .......... 62 Technical Assistance .00.............0.0....... 0 66 Aid Coordination ........o..000...0.......000*.9e 67 External Debt Management .....*.........*.**0...*. 68 Conclusion STATISTICAo.o.o.......o............. o o 70 STATISTICAL APPENDIX ....o....oooo*******o 96 ANNEXURES Annex A Selected Policy Changes Since 1985 .......... 71 Annex B Macro-Economic Projections, 1985-1995 *....... 76 Annex C Flow-of-Funds Framework, 1984-1989 .......... 83 Annex D Balance of Payments and Aid Data . 0........... 90 LIST OF TABLES 1 Economic Indicators 4....................... . * . 4 2 Selected Production Indicators ................... 6 3 Summary of Government Finance, 1982-87 ..s.....o. 10 4 Ghana: Selected Indicators of Structural Adjustment ........... . .................... . 14 5 Incentives for Cocoa Farmers .................... 18 6 Public Investment Program: 1986-1988 by Sector 38 7 Ghana - 1987 Public Investment Program .......... 39 8 Ghana - Projected Financing of the 1987 Public Sector Investment Program 41 9 Two Scenarios .... ............. .............. .. 47 10 GDP Growth Rate by Subsector 50 11 Selected Economic and Financial Indicators ...... 52 12 Export Growth Rates Under the Two Scenarios ..... 55 13 Balance of Payments Overview 1985-1989 ......... 57 14 Aid Commitments to Ghana, 1985-86 600006..60..-. 61 15 Overall Aid Pipeline, 1985-1989 ...........,..... 65 16 External Debt Service on Government and Government-Guaranteed Debt .................... 69 GHANA ECONOMIC INDICATORS GNP PER CAPITA IN 1985: US$390 1/ GROSS NATIONAL 'PRODUCT IN 1985 ANNUAL RATE OF GROWTH (S Constant Prices) Cedis Mil. % 1979-84 GDP at Market Prices 372,982 100.0 -2.5 Gross Domestic Investment 27,094 7.3 -8.3 Gross National Saving 11,539 3.1 -3.3 Current Account Balance 15,555 4.2 -- Export of Goods, NFS 36,931 9.9 -10.9 Import of Goods, NFS 48,153 12.9 -11.8 OUTPUT AND LABOR FORCE Output in 1985 Labor Force, 1983 Cedis Mil. Mil. S Agriculture 153,373 41.1 2.584 57.2 Industry 57,651 15.4 0.691 15.3 Services 161,959 43.5 1.242 27.5 4.517 100.0 GOVERNMENT FINANCE 1985 1986 Cedis Mil. S of GDP Cedis Mil. S of GDP Total Revenue and Grants 40,311 10.8 73,625 14.4 Total Expenditure and Net Lending 47,891 12.8 73,326 14.3 Overall Deficit (-) -7,580 -2.0 299 .1 MONEY, CREDIT AND PRICES 1977 1978 1979 1980 1981 1982 1983 1984 1985 Money and Quasi-money 2/ 3,044 5,131 5,942 7,949 12,029 14,837 20,497 28,552 44,987 Bank Credit to Government 3,203 5,636 4,903 6,518 10,649 11,057 21,059 22,819 24,825 Bank Credit to Private Sector 560 739 796 940 1,342 1 rl58 2,841 6,104 10,517 (Percentages or Index Numbers) Money and Quasi-money as % of GDP 2/ 27.3 24.4 21.1 19.4 15.7 16.7 10.7 10.2 12.8 General Price Index (1977-100) 100.0 173.1 267.3 401.2 868.6 1,062.4 2,357.4 3,304.2 3,647.2 1/ Atlas Methodology. 2/ Includes primary banks only BALANCE OF PAYMENTS MERCHANDISE EXPORTS (AVERAGE 1983-86)) 1985 1986 1/ (USs Million) US$ million _% Trade Balance -95 -7 Cocoa Beans & Products 397 65.8 Exports f,o.b. 632 773 Gold 101 16.8 Imports c.i.f. 727 780 Residual Oil 24 4.0 Timber 28 4.6 Invisibles (Net) -188 -186 Electricity 29 4.8 Services -220 -235 Manganese 8 1.3 Transfers 32 49 Diamond 4 0.7 All Other Goods 12 2.0 Current Balance -283 -193 Total 603 100.0 Capital Account Grants 105 115 Official Capital (Net) 32 88 EXTERNAL DEBT, DECEMBER 1985 Private Capital (Net) 5 18 Capital n.e.s. 2/ 24 -84 US$ Bil. Overall Balance -117 -56 Total Outstanding and Disbursed M< 1.2 Net IMF 122 17 Arrears Payments -57 4 Other 33 Gross International Reserves (End of Period) 145 172 DEBT SERVICE RATIO FOR 1986 3/ February 1973 - June 18, 1978 Total Outstanding and US$1 ¢1.15 Disbursed M< 47 Since Aug. 26, 1978 US$1 - 0 2.75 Since ApAil 21, 1983 US$1 - 024.69 Since Oct. 10, 1983 US$1 - 030.00 IBRD/IDA LENDING (December 31, 1986) Since March 25, 1984 US$l - 035.00 Since August 25, 1984 US$1 - 038.50 IBRD IDA Since December 3, 1984 US$1 = 050.00 Since April 19, 1985 US$1 - 053.00 Outstanding & Disbursed 112.77 422.34 Since August 12, 1985 US$1 - 057.00 Undisbursed 0 352.59 Since Oct. 7, 1985 US$1 = 060.00 Outstanding, incl. Since Jan. 11, 1986 US$1 m 090.00 Undisbursed 112.77 774.93 Since Sept. 19, 1986 Second Window Auction US$1 - 0128-156 1/ Estimates. 2/ Includes errors and omissions. 3/ As % of exports of goods and non-factor services (includes IMF debt). March 20, 1987 FOREWORD (i) This report, Ghana: Policies and Issues of Structural Adjustment, assesses the structural adjustment program being implemented by the Goverrment and its projected impact on the economy over the next decade. The report examines the role of donors in supporting the continuation and broadening of an already ambitious reform program. (ii) The Statistical Appendix presents a tim3 series of key economic data for Ghana. As the appendix mainly draws on officially published data sources, some of the text tables may differ slightly from the Statistical Appendix. The text tables are drawn from diverse sources, and include Bank or IMF staff estimates wherever the official data are either inconsistent or incomplete. (iii) The report is based on the findings of a mission which visited Ghana in November 1986. The mission consisted of Theresa P. Jores (Chief of Mission), Caroline Doggart (Economist/Consultant), and Pirouz Hamidian-Rad (Economist). Timothy Condon (Economist) was responsible for the initial work on macro-economic projections. The mission drew on the analysis of a parallel public expenditure review mission, led by Mr. Luis Ramirez, and the preparatory work for the Structural Adjustment Credit. Nilda Maypa provided secretarial support at headquarters. SUMMARY AND CONCLUSIONS Introduction 1. In April 1983, the Government of Ghana launched an ambitious set of reforms that was intended to reverse the economy's steady deterioration since 1970. The policy measures of the Economic Recovery Program aimed at realigning relative prices in favor of production and away from trading and rent-seeking activities, improving government finances, and encouraging private investment. The International Monetary Fund has provided support through three stand-by arrangements, the most recent approved in October 1986. Donors, including IDA, responded by committing higher amounts of corcessional assistance, including program aid. The previous report of the World Bank analyzed the initial response of the economy to the measures. It also identified some of the remaining policy and institutional reforms naeded before the full potential of the economy could be realized. r-ring the November 1985 Consultative Group meeting the GovernmenL and donors came to a consensus on the main elements of the reform program. Based on this and additional work carried out in the course of 1986, the Government has developed and begun to implement a detailed action program that continues the structural adjustmernt of the economy. 2. In addition to updating information on recent economic developments (Chapter I), this report analyzes the structural adjustment program and identifies areas which require additional study or reforms (Chapter II). Chapter III analyzes the rolling three-year public expenditure program, a key component of the structural adjustment process. On the basis of the Government's program, projections are made which trace through the impact of the reforms on the economy (Chapter IV). The final chapter examines recent aid trends and estimates Ghana's external assistance requirements over the next three years. The analysis indicates that the reform program in Ghana has made substantial progress since the last Consultative Group meeting which is reflected in economic performance. Implementation of the Government's structural adjustment program would significantly improve prospects for sustained growth in the economy and balance of payments viability. An essential ingredient for the success of the broadened reform effort is expanded donor support. Recent Economic Developments 3. Major actions taken during 1986 included another devaluation of the cedi. In January 1986 the rate was adjusted from g6O-$1.00 to g9O0$1.00. The Government moved towards a market-determined rate in September by establishing a second window foreign exchange auction. By the end of 1986 the real value of the cedi (on a trade weighted basis) had declined by over 90 percent compared to its level at the beginning of 1983. In February 1987 the official and auction exchange rates were unified at the auction rate. The Government further adjusted administered prices, particularly the cocoa producer price, petroleum, and utility tariffs. Public sector wages again were raised to compensate partially for the past - ii - severe erosion; the differential between earnings of the highest and lowest levels in the civil service was widene,'. In spite of an increase in nominal interest rates, in real terms they again became slightly negative. However, an adjustment in Marsh 1987 is expected to restore positive levels of interest rates. Implementation of programs to rehabilitate transport, energy, mining, timber and cocoa gained further momentum and began to show results. 4. The econor.y continued to respond strongly to the policy reforms. Real GDP is estimated to have risen by about 5 percent in both 1985 and 1986. This was despite a deceleration in growth of agriculture in 1985 when output of most food crops declined, following tne fall in producer prices aftex the bumper 1984 harvests. Some recovery occurred in 1986 as prices stabilized. Cocoa production improved markedly in the 1985/86 season. Industry led economic growth in both years, but output grew less in 1986. The fiscal position deteriorated sharply in the first half of 1986 due to shortfalls in budgetary receipts and larger than anticipated expenditures following the January wage adjustment. However, corrective measures put in place during the second half of the year reversed much of the deterioration. Thus, the provisional outturn for the year indicates a strengthening in the Government's fiscal performance. Current budget savings (net of grants) rose sharpl.y to 1.8 percent of GDP, but partly at the expense of needed recurrent outlays on other goods and services. Development expenditures remained at 2 percent of GDP, below what had been initially planned. Domestic bank financing of the budget was constrained and within the programmed ceilings. The 1987 budget, announced in February, demonstates the Government's intention to continue domestic resource mobilization efforts ard to improve the structure of expenditures. 5. In spite of a sharp growth in money supply during 1985-86, the liquidity position of the commercial banks tightened in the face of higher demand for credit, particularly to finance imports as a result of the decline in the value of the cedi. Inflation remained in conu.rol, but as food prices returned to the usual seasonal pattern, it accelerated from an annual average increase of 10 percent in 1985 to about 25 percent in 1986. A contributing factor appears to be the impact oi the second window foreign exchange auction, which squeezed out much of the rent element in prices and resulted in some cost-push pressures. As for the balance of payments, 11X 1985 there was a disappointing stagnation in non-petroleum imports, which did not grow in nominal terms over 1984 levels due to a shortfall in aid disbursements. Although imports grew sharply in 1986 as flows of concessional assistance increased, strong export growth resulted in an even lower current account deficit than in 1985. Structural Adiustment Issues 6. Over the last four years Ghana's Economic Recovery Program has brought about substantial adjustment in the economy by realigning prices and restoring fiscal and monetary discipline. In addition, some progress has been made in improving the climate for private sector investment. In spite of these achievements and the initial favorable response of the - iii - economy, the Government recognizes that in order to lay a firm base for sustained growth and balance of payments viability, further actions are needed to strengthen and broaden the policy reforms. The specific goals for 1987-89 are: to sustain economic growth at 5.0-5.5 percent per annum; to more than double investment and national savings, expressed as shares of GDP; and to improve resource management within the public sector. The main instruments which the Government plans to use in order to achieve these objectives are: incentives policies, measures to increase domestic resource mobilization, actions to encourage a sufficient private sector response to the economic reforms, and improvements in management and resource use in the public sector. 7. The centerpiece of Ghana's structural adjustment program is a market-determined exchange rate applied to all economic transactions and a liberal trading regime in which protection is provided by an even and moderate tariff structure. Unification of the official rate and the foreign exchange auction in February 1987 extended the application of a more realistic exchange rate to cocoa and petroleum. In the meantime, imports of consumer goods continue to be channeled through special import licenses (SILs). The integration of the market for consumer goods imports with the foreign exchange auction is the next key task, to be completed in a phased manner by early 1988. The Government favors a gradual approach in order to avoid sharp upward pressure on the rate. In line with the changes in the exchange and trade system, several interim tax reforms have been implemented. A more comprehensive re-examination of the trade tax structure is to be carried out by a Government Task Force during 1987. Recognizing the importance of a strong export response to trade liberalization, the Government is strengthening export promotion and has abolished export licenses. For non-traditional exports, a medium-term strategy to direct additional promotion efforts is to be developed. 8. Improved incentives for cocoa farmers has been one of the major policy reforms of the Economic Recovery Program. However, because of higher than anticipated increases in rural inflation, it was not until the 1985/86 crop year that the real cocoa producer price increased significantly. The ability to reach and sustain the production target of 300,000 metric tons per annum depends upon adequate incentives for farmers to rehabilitate and replant. Looking ahead to the next crop year, after making adjustments for likely wage and price trends in 1987, a producer price of about %150,000 per ton would make rehabilitation and replanting of cocoa financially profitable. Based on current estimates of the long run production response to a higher farmgate price, a share for farmers in the range of 55-60 percent of the f.o.b price would further improve incentives and, at the same time, maximize fiseal revenues from cocoa exports. Setting a target for the longer term would require consideration of additicnal factors and improved data that are being pursued in a study of cocoa incent' es. 9. Part of the explanation for the high level of taxation of the cocoa farmer in Ghana is the excessive marketing costs of the Ghana Cocoa Board (Cocobod). Although there has been some success during the Economic - J.v - Recovery Program in lowering marketing costs, in 1986 the Cocobod's share of the f.o.b. price was 27 percent (excluding retrenchment costs). This is high compared to other producer countries. The Government believes that it is inadvisable to make radical changes in the present marketing system now for several reasons including poor infrastructure and the risk of disrupting the recovery of cocoa exports. These considerations do not imply that a gradual switch to a marketing system with more participation by the private sector woulca not work well or be more cost effective than the present arrangement. It does, however, argue for an indepth study of the options open to the government for improving the efficiency of cocoa marketing. In the meantime, the Government recognizes the need to reduce the costs of the Ghana Cocoa Board. These efforts will be guided by the principle that the Cocobod should confine itself to activities which cannot be done more efficiently by other institutions or the private sector. The Cocobod has initiated the restructuring by laying-off some of the remaining redundant staff and is reviewing its operations with a view to reducing costs to about 15 percent of the f.o.b price by 1988/89, in favor of higher producer prices. These measures will be integrated into a rolling three-year corporate plan beginning with the crop year 1987/88. 10. Successful implementation of the structural adjustment program depends on a well-functioning and broadly based financial system. The public's willingness to hold fir,ancial assets in Ghana has increased as a result of higher interest rates and lower inflation. However, confidence in the banking system is still weak. Bank operations are relatively inefficient and their portfolios include a substantial proportion of loans whiclh could prove difficult to collect. For the medium-term, the need to generate balance of payments surpluses in order to deal with the overhang of external arrears, scheduled IMF repurchases, and short-term liabilities will have a major impact on credit behavior. In developing a financial program, a careful balance will need to be struck between legitimate credit needs anl ensuring macro-economic stability. Careful monitoring of the key macro-economic aggregates, a better assessment of the credit needs of the productive sectors and a flexible approach to credit targ6ts will be required in this period of major changes in the economy. The Government plans to review the financial sector during 1987 with assistance from the World Bank. The review would look closely at credit allocation, ways to improve the efficiency of bank operations, and measures to develop capital markets. Audits and detailed portfolio reviews will be carried out in several banks. In order to ensure that the behavior of net foreign assets does not squeeze domestic credit to an extent which threatens the economy's growth objectives, the Government should consolidate outstanding external arrears into medium-term loans. An important factor in this regard is the necessity of continued access to the resources of the International Monetary Fund, preferably through the Structural Adjustment and the Extended Fund Facilities, in order to reduce the net transfers tc the IMF over the next several years. 11. Achievement of the growth objectives of the structural adjustment program relies on the response of the private sector to the improved incentives. However, so far private sesn'r investment has lagged. To some v extent this is explained by the large changes occurring in relative prices and the substantial unutilized capacity at the beginning of the Economic Recovery Program. However, factors contributing to still weak private sector confidence include the initial changes in regulations for the foreign exchange auction and the manner in which the revenue authorities took actions to improve collections of corporate income taxes. Several measures would improve the policy environment for the private sector. They include more frequent consultations between the Government and the private sector on current policies; reducing the excessively high corporate income tax rate and the even higher taxes on dividends and capital gains; making a public statement that the confidentiality of bank customer relations would be respected; and easing the restrictions on the economic activities open to foreign investors. 12. A key objective of the Government's program is to improve the performance and efficiency of the state-owned enterprise (SOEs) sector and to reduce its size in order to decrease the burden on the economy. After carrying out an initial diagnostic study, a Government Task Force has developed a policy framework. It includes a more lational legal framework, progressive reduction of budget transfers to state-owned enterprises, greater resource transfers to the Governmetit and exposure of SOEs to more competition and market discipline. Institutional arrangements are designed to achieve day-to-day management autonomy for the enterprises, while enabling the Government to monitor performance in order to ensure accountability. Corporate plans will be the basis of performance agreements between the Government and selected priority enterprises. In addition, some 30 enterprises are to be put up for sale, liquidated or converted into joint ventures. The size and envisaged pace of the Government's program reflects its recognition that divestment of state-owned enterprises will not be easy. For the program to succeed, the Government will need to give priority to enterprises which are large drains on _he budget and include firms potentially attractive to the private sector. 13. Implementation of the structural adjustment program is severely straining the capacity of the public sector to manage the economy. Policy-makers in Ghana do not have sufficient analytical support, a gap which will become increasingly binding as the economic reforms proceed. In spite of the improvement in the Govetnment's fiscal position, the budget system has fallen into disuse since 1983, partially beceise of the financial crisis and the priority given to cash flow management. In addition, during the past years of economic decline the conditions of employment and the efficiency of the civil service deteriorated. The Government has decided to fo'rus its efforts on strengthening a few key policy functions and the reform of the civil service. Between 1975-82 civil service employment grew at the high aver&ge rate of 14 percent. As a result, there is excessive staffing, particularly at the lower echelon- which lowers productivity, compounds management problems, and restricts the Government's ability to pay reasonable salaries. The Government courageously has committed itself to a reduction in the size of the public service of roughly 5 percent a year during 1986-1988. Timely - vi - implementation is essential if wage differentials in the civil service are to improve. In the interim, since successful implementation of the structural adjustment program depends on the high morale and productivity of at least key civil servants, the Government intends, first, to mobilize local expertise to supplement the existing civil service and secondly, to provide additional remuneration to selected individuals working on critical tasks. Public Expenditure Policy 14. Public expenditure policy will play a vital role in achieving the goals of the structural adjustment progran.. The production response to changes in policy depends on adequate and well maintained economic infrastructure and on improving the quality and level of investment in human capital. The combination of expanding civil service employment and declining revenue has severely distorted the structure of recurrent expenditures, in particular the balance between the number of employees and the provisions for goods and services. The impact of across-the-board expenditure controls on these items in recent years and the Government's belief that while there are scarcities in certain areas, there is also waste, point to the need to allocate outlays more systematically. Initial work has focused on education, health, and agriculture. The aim is to develop guidelines for allocations in these sectors, based on what is required to. perform adequately essential services. 15. One of the Government's objectives in drawing up a rolling three- year public investment program is to improve planning and implementation, thereby increasing the returns on these e;penditures. It represents an effort to break out of the past pattern of largely ad hoc allocations and stop and go funding which left many projects starved of funds and only partially completed. The following criteria were used to select projects: (i) A minimum economic rate of return for all large projects (over $5 million), for which the technique was applicable. If an ERR had not already been calculated, out the project seemed to have the potential for generating an adequate rate of return, it was included on a tentative basis. Implementation, however, would await a detailed feasibility study. (ii) In cases where the ERR criterion was not applicable or where the analysis was incomplete or dated, a judgement was based on the following considerations: the proportion of the prnject funded by foreign aid with the aim at least 60 percent finan<;ng; ongoing projects or those ready for implementation; the ability to generate additional revenue for the Government or, at the least, low recurrent cost implications; whether the project would generate or save foreign exchange; and its impact on employment creation and the alleviation of poverty. At this stage, attention focused on projects financed through the budget. Tentative projections indicate that public investment (including budget - vii- expenditures and foreign aid financing) would increase from 6 percent of GDP in 1986 to 9-10 percent in 1987-88. Reflecting the emphasis on maintaining and improving economic infrastructure in Ghana, these expenditures account for 60 percent of the program. Outlays on productive sectors represent 30 percent of the PIP with a focus on supporting services in agriculture and the rehabilitation of the wholly or partially government-owned mining companies. It is assumed that the private sector would be the primary source of investment ii manufacturing. Social sectors (education, and health) make up the remaining 11 percent of investments. Budget allocations will be protected for a select group of super-core projects critical to the success of the structural adjustmer.t program. 16. Although the preparation of the 1986-1988 public investment program has improved planning in Ghana, it is only a first step. Much work remains to be done, beginning with the rollover of the program in mid-1987. The major priorities are: (a) to ensure that the program is integrated completely into the budget; (b) to carry out feasibility studies and economic analysis for som- 40 large projects; and (c) to assign responsibilities for preparing and monitoring the public investment program on a continuous basis. Medium-Term Prospects 17. Once most of the structural adjustment measures outlined above are in place prospects for the economy achieving sustainable growth of 4-5 percent per annum, supported by a large increase in investment, are strong. Eiie relatively large resource transfers expected from abroad would cushion the needed adjustment in consumption. While the public sector will be responsible for rehabilitating infrastructure, the private sector is expected to invest in order to improve the economy's productive base. 18. In agriculture, it is projected that the real increase in cocoa producer prices will permit exports to expand to 260,000 metric tons by 1989, then increase slowly to reach 300,000 tons by 1995. The near-term increases will come from improved husbandry and greater availability of inputs, while after 1990 the yield from hybrids planted during the 1970s and early 1980s will begin to be felt. The adequacy of incentives and extension services will be an important determinant of production. of food and industrial crops. Output of this sector is projected to grow at 2 percent a year in 1986-90, then increase to 3 percent in 1990-95. Timber performance in 1985 and 1986 was very good; exports are projected to rise to a level of 730 thousand cubic meters by 1995. Industry is expected to show the highest growth rate. Manufacturing will continue to benefit from the increased availability of imported spares and raw materials and the higher level of domestic demand. On the whole it should benefit from import liberalization, which, while eliminating inefficient domestic firms, should also expand the opportunities for efficient import substitution. Growth in mining depends critically on the success of on-going rehabilitation and modernization. Gold production capacity in Ghana is estimated to be 600,000 fine ozs. a year, compared to a 1986 output of 288,000 thousand fine ozs. Ghana is expected to produce close to that amount by 1995. - viii - 19. National and foreign savings must both increase in order to finance the required investment levels. Investment is projected to more than double from its current level of 10 percent of GDP to 23 percent by 1989. National savings would more than double from an estimated 6.6 percent of GDP in 1986 to close to 15 percent by 1989. In the area of public savings, domestic resource mobilization resulting from new revenue measures, tax reform and improvements in tax administration would increase total revenue from 13.6 percent of GDP in 1986 to 16.5 percent by 1989. There are complementary recurrent expenditure policies. They include holding personal emoluments to less than 6 percent of GDP, reflecting in part the planned reduction in the size of tne civil service. Private sector savings is expected to be stimulated by the restoration of confidence, the growth in personal incomes after 1988, and financial sector reforms. Private savings, measured as a share of GDP, rise from 5 percent in 1986 to 11 percent by 1989, taking into account a strong increase in remittances from abroad. 20. If the policy reforms contemplated under the structural adjustment program do not materialize the outlook would not change significantly at first because of the momentum already built up. But if the gains in exchange rate policy erode, if agriculture incentives are allowed to decline and if trade liberalization stalls, the export momentum would falter, food shortages would take place, and public investment would decline due to a fall in revenues. The adverse impact of these on the balance of payments would be exacerbated by a decline in external capital flows as donors retreat. The shortfall in private investment would reduce the economy's future growth potential. Furthermore, the fall in foreign exchange availability would make the debt service burden unmanageable, triggering yet another downward spiral. 21. Implementation of the structural adjustment program is expected to result in growth in export volume averaging 8 percent a year. Although the bulk of the increase will come from cocoa earnings, its share of total exports should fall from 67 percent in 1986 to 52 percent by 1995. Among nonr-cocoa exports, gold should rapidly increase its importance as output recovers. After a more than 20 percent rise in the nominal value of non-oil imports in 1986, growth in imports is projected to moderate somewhat to average 10 percent during 1987-89. Because of the decline expected in cocoa prices and the required inicrease in imports, the balance of payments outlook for Ghana over the next three years is for a widening of the current account deficit. A large volume of concessional assistance will be needed not only to finance this deficit, but also to achieve a strong overall surplus in the balance of payments to deal with the overhang of external arrears, short-term debt, and IMF repurchases. External Assistance Requirements 22. While donors have provided strong s-apport to Ghana, new aid commitments in 1986, excluding technical assistance, at $370 million, were nearly 20 percent below the level achieved in 1985, and significantly short of the World Bank-s recommendation to the November 1985 meeting of the ix - Consultative Group. However, the level of aid disbursements improved sharply in 1986 over 1985 performance. In order to meet the targeted levels of disbursements for 1987-1989, donors will need to increase the levels of their aid. This recommendation is justified by the extent of the structural adjustment program being implemented in Ghana and the corresponding need for concessional financing to ensure that the envisaged benefits are realized. In order to cover slightly over a third of imports of goods and nonfactor services in the 1987-1989 period, commitments of $575 million are needed in 1987, and an average of $635 million in 1988 and 1989. 23. This may appear to be a large increase over the low 1986 actuals, but represents partly the decline in the value of the dollar and the slippage of several commitments from 1986 to 1987, including the IDA Structural Adjustment Credit. During 1987-1989 the most pressing need is for quick disbursing funds to finance urgent import requirements now being provided efficiently and quickly through the weekly foreign exchange auction. Donors are urged to design assistance in such a way that it can be channeled through the auction. Such program and sector commitments should average $230-240 million in 1987-1989. Food and commodity aid is particularly important to assist the government in reducing the social costs of adjustment, and new commitments should average at least $50 million. Moreover, wiUn an investment program now prepared, the project aid pipeline needs to be built up, focusing on activities included in that program. The bulk of these emphasize rehabilitation and improved use of existing _city. Project aid commitments (excluding technical assistance grants which are estimated to average about $20 million per annum) are recommended to increase from $275 million in 1987 to $330 million in 1989. Donors should finance a high proportion of total cost, and where possible, recurrent and maintenance costs, particularly in the social sectors. Donors are also encouraged to take advantage of cofinancing opportunities, including those provided by ongoing or prospective IDA operations. There has been good progress in 1986 in the area of aid coordination. Frequent local level meetings and both an industry and a social sector meeting for interested donors have been accompanied by an improved flow of aid information, thanks partly to a strengthened International Relations Division in the Ministry of Finance and Economic Planning, with UNDP assistance. 24. In spite of the relatively low stock of outstanding debt and its generally concessional terms Ghana's debt service burden has increased in recent years and will remain severe over the medium-term. This is largely because of the service on 12-month oil credits, obligations to the IMF, and the reductions planned in arrears. The debt service ratio, inclusive of IMF purchases and settlement of payment arrears, was 47 percent in 1986. In the period 1987-89 debt service will increase further, peaking at 67 percent in 1988. It is important that the debt service burden not constrain the implementation and success of the structural adjustrent program. Externel concessional assistance will be critical to ensure an - x - adequate amount of import financing in the context of the large payment obligations which face Ghana over the next three years. 25. Since the last meeting of the Consultative Group for Ghana, the Government has made considerable progress in almost all areas identified then as critical to the successful evolution of the program. As described above, a comprehensive structural adjustment program has been prepared, to be supported by a $115 million IDA and African Facility Credit. The government has certainly lived up to its part of the "compact". In what is now the fifth year of the reform program, Ghana remains at the forefront of economic adjustment in Sub-Saharan Africa. Its persistence and expanded effort deserve support. Donors should respond generously and quickly. Without that support, the success of the structural adjustment program will be endangered. Donors should take the opportunity of the implementation of the structural adjustment phase of the reform effort to demonstrate their commitment and support to Ghana for the medium-term. I. RECENT ECONOMIC DEVELOPMENTS Introduction 1. In April 1983, the Government of Ghana launched an ambitious set of reforms that was intended to reverse the steady deterioration in the economy since 1970. The policies of the Economic Recovery Program (ERP) focused on realigning relative pUices in favor of production and exports and away from trading and rent-seeking activities, improving government finances, and encouraging private investment. The International Monetary Fund supported the program with two stand-by arrangements. A third one-year stand-by arrangement was approved in October 1986. At the end of 1986 total IMF credit (including drawings under the Compensatory Financing Facility) outstanding to Ghana was SDR 611 million or 299 percent of quota. Total assistance from members and observers of the Consultative Group for Thana has risen sharply, with commitments in 1984-86 averaging $430 million, compared with $198 million between 1980-83. 2. The World Bank's previous report / analyzed the initial response of the economy to the measures. It also identified some of the remaining policy and institutional reforms needed to realize the country's economic potential. In addition, at the November 1985 Consultative Group meeting the Government of Ghana outlined a policy framework for the medium-term. During that meeting the Government and donors reached a consensus on the major reforms needed. Based on this preliminary work and discussion, and drawing on additional analysis carried out in early 1986, the Government has developed a detailed set of actions that constitute a structural adjustment program, Besides reviewing recent economic developments (Chapter I), this report will analyze the main elements of the proposed program and identify areas requiring further study or reform (Chapter II). A key component of the structural adjustment process is the rolling three-year public expenditure program, discussed in Chapter III. On the basis of the Government's planned actions, projections are made which trace through the impact of the reforms on the economy (Chapter IV). The final chapter examines recent aid trends and outlines the external assistance requirements of the Government's program over the next three years. Recent Policy Measures 3. In the context of the recovery program several important policy measures have been taken since 1985 (see also Annex A). (i) The Government made substantial progress toward a market- determined equilibrium exchange rate. The cedi depreciated from %2.75-$1.00 in April 1983 to %60-$1.00 by October 1985. In January 1986 the rate was further adjusted to 990$1.00. On September 19, 1986, the Government established a second window foreign exchange auction, covering most transactions excluding cocoa, petroleum, debt service for official debt 1/ Ghana: Towards Structural Adjustment, World Bank Report No. 5854-GH, October 7, 1985. -2 contracted before the beginning of 1986, and some essential drugs. Consumer goods continued to be imported under special import licenses (SILs). By the end of 1986 the cedi had depreciated in real terms by over 90 percent from its level at the oeginning of 1983. On February 20, 1987, the Government unified the official and the auction foreign exchange markets at the auction rate. (ii) Administered prices have been adjusted to reduce domestic distortions arising wholly or partly from an overvalued exchange rate. The cocoa producer price was raised by 50 percent to P85,000/metric ton effective for the 1985/86 mid-crop season which began in late April 1986. An additional ¢500/metric ton is to be paid if the production target for the 1986/87 season of 230,000 metric tons is reached. The producer price for coffee also was raised. After adjusting petroleum prices after the cedi devaluation in January 1986, the Government marginally reduced fuel prices in March in the wake of the sharp fall in oil prices on international markets. However, on June 30, prices reverted to their former levels, implying an implicit tax on petroleum equiva- lent approximately to 20 percent of the gasoline price. Petroleum prices were adjusted again in February 1987 to reflect the unification of the official and auction exchange rates. In addition, during 1986 utility tariffs and postal charges were increased significantly. In mid-1986 fertilizer prices were raised on average by about 80 percent to fully reflect the c.i.f. import price (at %90=$1.00), although a subsidy remained to cover handling and distribution costs. (iii) Effective January 1986, public sector wages and salaries were raised by the same percentage as occurred in the minimum wage (070 to %90/day). The Government also restruc- tured salary scales, increasing the pre-tax ratio between the highest and lowest grades. In addition, allowances were raised. These measures were taken because real wages for senior civil servants had fallen to about 10 percent of 1977 levels. The revised salary structure widened the pre-tax ratio between the highest and lowest grades from the previous 2:1 to almost 6:1. Average public service salaries went up by about 80 percent over 1985. In February 1987 the Govern- ment announced a 25 percent increase in the minimum wage. The same adjustment will be applied across-the-board to public service salaries. (iv) Interest rates have been raised in stages to the point that they became positive in real terms in 1985. As part of the Government's policy of trying to maintain positive real interest rates, in August 1986, deposit and lending rates were increased. However, with the acceleration in inflation, in 1986 (para 13) interest rates became slightly negative in real terms. In March 1987, the Government raised lending and deposit rates (with the exception of loans for agriculture) across-the-board by 3 percentage points. This is expected to restore positive real levels. The rates on 12-month time deposits have more than doubled since October 1983 to the present level of 23 percent. The maximum lending rate is now 26 percent. (v) Programs to rehabilitate transport, energy, mining, timber and cocoa made further progress, supported by foreign assistance. Rehabilitation of the western railway line is nearly complete and has paid dividends in terms of higher shipments of export freight. The Government announced a major reform of the education system. These projects have been integrated into a rolling three-year (1986-1988) public expenditure program (Chapter III). Economic Growth 4. Real GDP is estimated to have risen by 5.1 percent in 1985, compared to 8.6 percent in 1984 when most of the recovery from the drought took place (Table 1). The main factors causing the slowdown in the rate of growth were (a) the decline in non-cocoa crop production in response to the fall in prices after bumper harvests in 1984; and (b) the stagnation in non-oil imports in 1985 resulting from lower than expected aid disbursements (Chapter V) and only partial utilization of available external credit facilities because several sectors, including agriculture and mining, were strapped for local currency. The only activities showing a strong improve- ment in performance compared to 1984 were cocoa, manufacturing, and elec- tricity and water. Real output in the economy at the end of 1985 was 4 percent lower than the most recent peak in production (1978). Preliminary estimates for 1986 indicate growth of about 5 percent. 5. Agriculture. Production of most food crops declined in 1985. Estimated output of maize, the main cereal, fell by 30 percent (Table 2). Acreage cultivated dropped to pre-drought levels as the wholesale price fell to 40 percent of the 1983 high. The trend was similar for starchy staples, such as cassava. Food crop output in 1986 benefitted from generally adequate and well distributed rainfall. Cocoa production improved markedly in the 1985/86 season. Purchases rose from 174,000 metric tons in the previous crop year to 219,000 metric tons, exceeding original estimates. According to field reports, farmers responded to the sharp producer price increases in May 1985 with improved husbandry and harvesting practices, which increased estimated yield from 194 kilos/ha. to 243 kilos/ha. Estimates for cocoa purchases in 1986/87 are 230,000 metric tons; about 180,000 metric tons had been purchased by the end of 1986. The lower growth in production expected for the 1986/87 crop year compared to the previous season reflects to some extent a less favorable rainfall pattern, but also highlights the need for further improvement in incentives for farmers (para 32-35) as Ghana is still below its production potential. - 4 - Table 1: ELXXIMIC IDDICAICRS Percent CSrge Unit 1984 1985 1986 a/ 1985/1984 1986/1985 National Accots CDP at Market Prices Cedi million 5,158 5.420 5,705 5.1 5.3 Agriculture at conistant 2,780 2,802 2,951 0.8 5.3 Industry 1975 prices 599 707 752 18.0 6.4 Services 1,779 1911 2,002 7.4 4.8 GDP at narket prices Cedi billion 271 373 511 Investment 2 of GDP 7.6 7.3 10.3 National Savlnga 4.7 3.1 6.6 !Minq and E4dcn b/ Mkney and Quasi-M4txy (M2) Cedi billion 35.3 56.2 86.4 59.2 53.7 Net DOonstic Assets end of period 39.9 67.1 95.1 68.2 41.7 Bank Credit to GCovenmnt (net) 24.2 27.2 29.6 12.4 8.8 ".oa Pinancing 3.6 13.6 16.9 277.8 24.3 Credit to the rest of the ecommy 13.7 26.0 42.7 89.8 64.2 Others (net) -1.6 0.4 7.4 - - M2 as a % of GDP at n rket prices 13.0 15.1 16.9 Prices Cosumer Prices Amrual 40.2 10.4 24.6 19.5 c/ 33.3 c/ of %hich: Food Percentage 11.0 -11.1 20.3 11.6 c/ 30.4c/ Non-Food Chane 78.4 28.3 27.0 14.7 c/ 34.9 c/ Wholesale Prices 81.5 56.3 30.2 - GDP Deflator 35.9 31.2 30.2 - Balance of Payments US$ millUon xyports of Goods and NFS 604 671 818 11.1 21.9 inports of Goods and NFS 810 876 955 8.1 9.0 Resxurce Gap -206 -204 -137 - - Current Acaoimt Deficit -215 -283 -193 - - Capital Account Net 94 167 137 78.5 -17.5 of which Net Aid Disbursl wts d/ 253 199 344 -21.3 72.9 Gross Reseives (end of period) 132 145 172 9.8 18.6 Current Account Deficit as % of GDP at Current Maket Prices -2.8 -4.1 -3.7 Nxnal FEchrge Rate Cedis per US dollar (period average) 35.3 54.1 98.9 53.3 82.8 a/ provisional estimtes b/ including priny and seondary banks c/ Decerber 1986 over Deiber 1985 d/ gross aid irfl]s minus log-tme amortization Source: Governuent of Ghana and Baik staff estimates EI/GHCM1 6. Industry. Mining output expanded by 15 percent in 1985. Bauxite output more than tripled as rehabilitation of the western railway line made possible higher shipments. Production of diamonds nearly doubled as mining began from a new deposit. Gold production rose by 7 percent and mangunese output was up by a third, the latter also reflecting higher capacity available on the railway. Further recovery stalled in 1986 because of labor problems in the gold mines and delays in implementing the rehabilita- tion program of the State Gold Mining Corporation. Diamond production dropped in 1986 because repair of the washing plant required closure of the facilities. Bauxite output rose by 20 percent, while manganese declined, reflecting the depletion of oxide ores. Growth in manufacturing accelerated from 13 percent in 1984 to 22 percent in 1985. Although aid disbursements were generally low in 1985, manufacturers in the private sector were the primary beneficiaries, and thus were able to import critical raw materials and spare parts. Data on capacity utilization for manufacturing are not yet available but the strong growth in 1984-85 almost certainly has raised capacity utilization from the low level of 30 percent in 1983. The most dynamic components were food processing, tobacco, petroleum refining, iron and steel and other metal products. A slowdown in growth is expected in 1986 although the sector would still outpace the overall economy. This reflects the end of the initial quick recovery from a low base due to improved supplies of raw materials and spare parts. Future production increases will occur more gradually after additional investment is made, primarily for rehabilitation. Although capacity utilization is still low, effective capacity utilization is probably much higher because equipment is old and has been poorly maintained. Construction activity grew at a faster rate in 1985 because of the improved availability of cement and the increase in public investment. However, growth moderated in 1986 because of renewed problems with the supply of clinker which forced the shutdown of the sement factory and lower growth in Government financed maintenance and investment. 7. Services. Growth in services exceeded overall economic expansion in 1985. Transport was up by 10 percent in line with continued progress in rehabilitation of infrastructure, higher railway freight carried, and improved supplies of spare parts and vehicles for road transport. The growth of wholesale and retail trade slowed slightly in 1985 and is expected to decline further in 1986. This reflects the shift in incentives away from trading activities to production and, in 1985, the impact of higher taxes on special import licenses for consumer goods. Fiscal restraint has confined growth in government services to an average of only 2 percent a year since 1983. Savings and Investment 8. Preliminary Bank staff estimates indicate that the level of investment in 1985 dropped slightly compared to 1984, to 7.3 percent of GDP. Public investment expenditures as a share of GDP (including foreign aid for projects in both the central government and state-owned enterprises) rose only marginally because of low aid disbursements. Private investment stagnated, reflecting the still uncertain investment climate, in part because of the sharp changes occurring in relative prices as the reform -6- Table 2: SELBCIE) PXUMN INDICPS ('000 metric tons, unless otherAisq noted) est. 1970 1980 1981 1982 1983 1984 1985 1986 Cereals 858 674 725 543 308 965 780 905 Maize 726 32 T76 346 172 574 395 495 Rice 49 78 97 36 40 76 80 80 Millet 141 82 119 76 40 139 120 140 Sorghun 186 132 131 86 56 176 185 190 Starchy Staples Cassava 2,388 2,322 2,065 2,470 1,729 4,065 3,075 3,040 Cbcoyam 1,136 643 631 628 720 600 580 n,a. Yam 909 650 591 588 866 725 560 660 Plantain 1,641 734 829 749 342 760 676 n.a. Cocoa al 413 258 224 179 159 174 219 230 Logs ('00O O3) 1,560 480 550 410 560 578 620 890 Sawn Tinber ('000 m3) 360 150 190 150 189 180 223 232 Index of Mineal Production (1977=100) 100 73.8 68.2 59.9 50.2 57.9 66.3 62.6 b/ Gold ('000 fine troy ounces) 642 353 341 331 277 287 299 288 Diamonds ('000 carats) 2,550 2,149 836 684 339 346 636 556 iegan ore 392 250 223 160 175 267 357 333 Bawdte 337 225 181 64 70 49 170 204 Electricity Generation 2,920 5,316 5,373 4,982 2,575 1,819 3,020 3,599 b/ of which. Akoscbo Hydroelectricity 2,882 5,276 5,341 4,103 2,080 1,469 2,461 3,000 b/ Crude Oil Reflnery[hRghput 1,120 1,058 1,129 1,040 481 747 958 985 a/ Purchases by Cocobod during season beginning in year stated. b/ January-October 1986 Source: Gbana Statistical Service SPI/GRCM program was implemented, and excess capacity. Foreign savings in 1985 is estimated at 4.1 percent. of GDP compared to 2.8 percent in 1984. National savings are estimated reridually at 3.1 percent for 1985, mostly from the private sector. In 1986, investment is estimated to have risen to about 10 percent of GDP. Public investment increased, primarily because of higher aid disbursements; private investment was also more dynamic. National savings rose sharply, as foreign savings declined with the strengthening of the balance of payments. Higher national savings reflected increases both in current savings of the central government and in private savings. The Budget 9. The Government's fiscal position deteriorated sharply in the first half of 1986 due to shortfalls in budgetary receipts and larger than anticipated expenditures following the January wage and allowance adjustment. However, corrective measures were taken during the second half of the year, reversing much of th. deterioration. These included establishment of the foreign exchange auction in September. In addition, after negotiations with union representatives, the Government put in place from June 1 a revised salary scale which reduced the initial wage and allowance awards. Thus, the provisional outturn for 1986 indicates that the Government was able to strengthen its fiscal performance. Revenues rose to 13.6 percent of GDP because of the implicit tax on petroleum (since the decline in international prices was not passed to consumers), improved administration of the company tax, an increase in receipts from cocoa arising from the .-valuation and larger crop, anid the impact of the salary increase on personal income tax proceeds. Less progress was made on restructuring expenditures, mainly because of uncertainties over resource levels. Recurrent expenditures rose to nearly 12 percent of GDP because of the wage awards and higher interest payments. Recurrent outlays on other goods and services declined marginally in nominal terms (implying a 25 percent real decrease) compared to 198, leading to a scarcity of resources for essent.'al operations and maintenance. For example, only a negligible amount of routine road maintenancA was carried out for lack of materials, although staff and equipment were available. Development outlays (excluding external project assistance) remained at about 2 percent of GDP, only half the original budget provision. The shortfall affected several critical sectors. Oeriodic road maintenance covered only a quarter of needs and several water projects were delayed. Current budgetary savings (net of grants) rose sharply to 1.7 percent of GDP. The overall budget deficit was only .7 percent of GDP, reflecting the constraint posed by negative outflows on non-concessional foreign financing. This occurred because the decline in oil prices in 1986 resulted in lower inflows from borrowings (used to finance half of total petroleum purchases) relative to repayments on previous loans. Domestic bank financing of the budget declined to 0.5 percent of GDP. 10. The 1987 budget, announced in February, reflects the Government'6 intentions to continue domestic resource mobilization efforts and to improve the structure of expenditures. Revenues are programmed to rise to about 16 percent of GDP as a result of the impact of the depreciation of - 8 - the cedi and higher excise taxes. The growth of recurrent expenditures is to be held to 1 percent of GDP because of a moderate i7age adjustment (25 percent average increase). As a result, higher current savings are projected. Development expenditures (excluding external project assistance) are estimated at nearly 3 percent of GDP in line with the provisions made in the public investment program 1986-88 (see Chapter IV). This represents a real increase of 60 percent over 1985 levels. It is critical that this level is reached in order to fund such important projects as road maintenance and the rehabilitation of the western railway line and agricultural feeder roads. An allocation is also made for the special efficiency program, which would cover the costs of the planned retrenchment of staff, including re-training. Anticipated foreign financing for the budget reflects higher concessional aid, reflecting anticipated program assistance. These inflows, as well as the efforts to increase tax revenue and constrain recurrent expenditures, would enable the Government to make substantial repayments to the domestic banking system. This is an ambitious target, representing a sharp turnaround from even the previous period of declining domestic bank credit to the Government. The programmed repayments would permit more credit to go to the rest of the economy. Money and Credit 11. Annual growth of broad money accelerated during 1985-86 to over 50 percent, compared to a 1984 increase of about 40 percent. In 1985 the major explanation was the sharp rise in cocoa financing (although this is self-liquidating by the end of the seasor in September) and in credit expansion to the private sector. In 1986 the factors were the improvement in the net foreign assets position resulting from the stronger balance of payments performance, and the foreign exchange losses of the Bank of Ghana associated with exchange rate changes and the settlement of arrears. Credit to the central government remained constrained during both years and within the ceilings agreed in the IMF programs. The transitional difficul- ties in implementing wage adjustments in 1986 resulted in a larger than planned increase in credit to the government at mid-year, but the measures put in place during the last half of the year remedied the problem. The broad money to GDP ratio recovered to 15 percent in 1985 and to 16.9 percent in 1986, reflecting both the sharp drop in inflation and the policy of trying to maintain positive interest rates. 12. In spite of the increase in broad money, the liquidity position of commercial banks (primary) tightened during 1985-1986. The ratio of reserves to deposits dropped from 64 percent at the end of 1984, to 58 percent at the end of 1985, and to 46 percent by mid-1986. The ratio of loans and advances to deposits rose from 60 percent in 1984, to 69 percent in 1985, and to 77 percent by mid-1986. Because the Bank of Ghana reduced reserve requirements in May 1985, at the end of 1985 the amount of excess reserves held by the commercial banks (18 percent of deposits) was only marginally lower than the 1984 level. However, by mid-1986, the ratio of excess reserves had fallen to only 6 percent. In response to the continued decline in liquidity, the Bank of Ghana again reduced reserve requirements in October 1986. - 9 - Table 3: SUMMAR OF GQ13VERNMf FINANCE _ 1982-87 (Cedi MLlllAl) 1982 1983 1984 1985 1986 1986 1987 Actual Actl Actual Revised R!dEt Prov. ulget Revemues 5,200 10,184 21,727 38,692 83,432 69,757 102,103 of which: Taxes cn 1ncme and property 1,506 1,780 4,125 7,993 20,904 14,121 17,230 Taxes on International transactions 788 4,990 8,242 15,764 34,454 28,466 49,251 Taxes on goods and services 2,146 1,689 5,562 8,373 18,774 19,620 26,502 Non-tax revenue and other n.e.s. 760 1,725 3,798 6,562 9,300 7,550 9,120 Foreign Grants 52 57 914 1,620 4,332 3,868 7,883 Total 2TpenLiture and Net lErdIg 9,220 15J175 27,485 47,892 90,039 73,326 108,905 of wich: Recurrent xperxditure 8,029 13,401 22,700 38,462 63,858 60,833 81,691 Development xpezpditure 1/ 817 1,354 3,994 7,303 20,181 9,826 18,214 Net lerding 1/ 374 420 791 2,127 6,000 2,667 4,800 Special Efficiency 2/ - - - - - - 4,200 Cmerall Deficit/§0r1lus -3,968 -4,934 -4,844 -7,580 -2,275 +299 +1,081 Financing: 3,968 4,937 4,844 7,580 2,275 -299 -1,081 Foreign (net) 215 970 1,816 3,522 -725 -5,614 2,419 Borrmwing 5,073 9,562 144*i90 13,412 26,128 Repanents 3,257 6,040 15,431 19,026 23,709 Daeastic (net) 3,718 3,964 3,028 4,058 3,000 5,315 -3,500 Banldng Systen 434 2,145 2,437 3,006 2,000 2,471 -5,500 Social Security 371 230 591 1,052 1,000 3,182 2,000 Other 2,913 1,4% - - - -867 - Unidentified 35 93 - - - 529 - MsIrandum Items: Interest Payments 2,168 2,204 3,425 5,086 8,257 11,341 17,265 As percent of GDP (%) Revenues 6.0 5.5 8.0 10.4 16.6 13.6 16.1 Recurrent Ependitu¢es 9.3 7.3 8.4 10.3 12.7 11.9 12.9 3urrent Bxdget Savings (net of grants) -3.3 -1.7 -0.4 0.1 3.9 1.7 3.2 Development penditure and Net Lending 1.4 1.0 1.8 2.5 5.2 2.4 3.6 Overall Deficit (net of grants) -4.7 -2.7 -2.1 -2.5 -1.3 -0.7 -1.1 Net Dbmestic Financing 4.3 2.2 1.1 1.1 0.6 1.0 -.6 Net Foreign Fnanci%g 0.2 0.5 0.7 0.9 -0.1 -1.1 .4 1/ Thcx es foreign assistance tied to projects. 2/ Provision for retrewment progran, inclwding training. Scurce: Ministry of Finance and Economic Plannirg. SGP/IIq - 10 - Prices and Wages 13. In 1985, the consumer price index (CPI) rose by 10 percent, compared to 40 percent in 1984, in large measure because food prices dropped after the recovery from the drought. However, inflation accelerated during the year. The point-to-point rate rose from 7 percent in June 1985 to 19 percent in December 1985. As expected, after the temporary phenomenon of declining food prices came to an end, inflation increased to an average of about 25 percent in 1986. Food prices rose on average by 20 percent, in contrast to the decline of 11 percent in 1985. The second window foreign exchange auction, which squeezed out much of the rent element in prices, resulted in some cost-push pressures for non-food commodities in the last months of the year. In addition, higher fuel prices and utility rates raised prices during the first half of the year. Nevertheless, ir. 1986 the increase for non-food commodities (27 percent) was slightly lower than the 1985 average of 28 percent. However, the price trend for this component of the CPI jumped from a point-to-point rate of about 24 percent in August- September to 29 percent in October and to 35 percent in December. It is still relatively low considering the large devaluation of the exchange rate at the beginning of the year, coupled with the subsequent sharp depreciation in the auction. There is some evidence of consumer resistance to higher prices which has adversely affected retail turnover. 14. As already noted (para 3), in January 1986 the Government raised salaries in the public service, resulting in a 80 percent increase in the wage bill for 1986 as compared with the previous year. Even after the adjustment, however, the average wage in real terms was only about 40 percent of 1977 levels for senior public servants and 65 percent for lower level workers. In addition to reversing the sharp decline in real wages and increasing structural relativities, the salary adjustments appear to have improved slightly the position of the public sector relative to the private sector. Although complete data is not available, several public enterprises and many private sector companies did not fully match the Government's wage adjustments in 1986. Preliminary indications suggest that during 1986 wages increased on average by about 60 percent for public corporations and the private sector. Recent increases in the minimum wage mandated by the Government have narrowed only slightly the rural-urban wage differential. In May 1984, the rural wage rate was three times the official minimum wage. In 1986 farm labor was paid g250/day (based on rates paid by cocoa farmers; wages in the North and for other crops are probably slightly lower), compared to the minimum wage of 090/day. In 1987 the Government raised the minimum wage by 25 percent to 0112/day and adjusted public service salaries across-the-board by the same percentage, as real levels of compensation are still substantially below 1977 levels. Several allowances were also raised, particularly for transport. Balance of Payments 15. The current account deficit in 1985 amounted to $283 million, 4.1 percent of GDP. This was substantially less than had been projected because of a shortfall in non-petroleum imports, which did not grow in - 11 - nominal terms over 1984 levels. A major reason for this development was the decline in aid disbursements in 1985 because of a change in the structure of commitments away from quick-disbursing assistance and the slow translation of aid indications into commitments. Imports of consumer goods under special licensef. (SILs) amounted to half of what had been projected, as traders were confronted with higher taxes. 16. Export earnings in 1985 grew by 12 percent reaching $630 million, the bulk of the increase coming from cocoa. The rise in cocoa earnings was due entirely to the bigger volume of shipments as realized prices for beans sagged. Ashanti Gold Corporation achieved its planned level of gold sales, but because of the delays in rehabilitation and higher than usual local sales, the State Gold Mining Corporation only reached half of its projected exports. As a result, the volume of gold exports was unchanged from 1984. As the Volta River Authority returned to normal operations after drought-induced cutbacks, and prices increased, electricity export earnings rose by 75 percent to $35 million. The value of timber exports was adversely affected by a decline in the average price as logs recovered faster than processed products. However, volume shipped nearly doubled from 1984 levels. 17. The current account deficit was mainly financed by grants and official long-term loans totaling $224 million, lower than the 1984 level. These flows finane.ed somewhat less than half of non-petroleum imports. Taking into account other official and private capital, the overall deficit was $117 million, covered by IMF purchases of $124 million borrowings by the Bank of Ghana. Arrears were reduced by nearly $60 million. Including payment arrears and IMF charges, total debt service was equivalent to 62 percent of exports, compared to 46 percent in 1984. Gross international reserves rose to $145 million by the end of 1985, equivalent to about 10 weeks of imports, compared to $132 million at the end of 1984. The figures for Ghana's gross international reserves have been revised downwards since the last economic report to correct a misclassification of the assets of the Bank of Ghana. 18. Provisional figures for the 1986 balance of payments indicate that the current account deficit declined to $193 million, equivalent to 3.7 percent of GDP. Export growth was strong in 1986 as total receipts rose by 20 percent. The volume of cocoa exports rose 15 percent and prices strengthened. There were also major improvements in timber exports and in receipts from sales of electricity. The latter rose by 40 percent because of higher demand from the aluminum smelter. Given the decline in gold production in 1986, the value of these exports did not increase above the level of 1985, in spite of an increase in price. Manganese shipments were constrained because of increasing difficulties in selling lower grade ore. In contrast to 1985, the value of non-oil imports rose by over 20 percent, primarily because of tne sharp improvement in disbursements of concessional assistance. In addition, the lifting of import restrictions for most producer goods facilitated imports at the end of the year. The value of oil imports declined, reflecting lower international prices. Net private transfers, mostly remittances through special import licenses, rose - 12 - slightly compared to 1985, owing to a reduction in tax rates and the elimination of the requirement for up front payment of taxes. 19. The main source of financing for the current account deficit was concessional assistance, totaling $358 million, 60 percent higher than the 1985 level. Official grants and long-term loans again financed nearly half of non-oil imports. Inflows of export credits were somewhat higher in 1986, reflecting the restoration of normal trade financing as Ghana's economic performance strengthened. Private external capital inflows remain small apart from financing through the International Finance Corporation and a consortium of banks for the rehabilitation of the Ashanti Gold Corporation. Short-term capital outflows reflected, among other items, the balances in IDA's Special Accounts for program credits. The overall balance of payments deficit declined to $56 million. Financing of the deficit was quite different from 1985. Net inflows from the IMF were only $17 million, reflecting delays in negotiating the third stand-by arrangement, which became effective only in October. After three years of progress in reducing arrears, little was achieved in 1986, although the Government avoided the buildup which had been expected given the trend for the first half of the year. At end-1986 external payments arrears totaled $171 million. The remainder of the deficit was financed by an increase in medium-term borrowings by the Bank of Ghana. Gross international reserves rose to $172 million, equivalent to 11 weeks of imports. The small reduction in arrears, coupled with improved export performance, lowered the debt service ratio to 47 percent (including the IMF). Conclusion 20. As indicated above, the Economic Recovery Program made substantial progress during 1985-86. Economic growth was sustained. The Government reversed the decline in public service wages and the compression in the salary structure without sacrificing overall fiscal performance. Monetary policy became less restrictive, but this reflected higher demand for credit from the private sector, not the government. The extent of financial intermediation in the economy also increased. In spite of the large drop in the value of the cedi, inflationary pressures have been contained. Exports are responding to the ch3nges in incentives. The level of imports is gradually becoming more adequate for the needs of the productive sectors, in large part because of higher aid disbursements. The level of external payments arrears has been reduced and balance of payments performance has strengthened. The Economic Recovery Program has been largely successful in achieving most of its initial stabilization objectives. However, the Government recognizes that in order for the country to realize its potential and for living standards to improve, the reform effort must continue so as to bring about the necessary structural adjustments in the economy. - 13 - II. STRUCTURAL ADJUSTMENT ISSUES Achievements of the Economic Recovery Program 21. Over the last four years Ghana's Economic Recovery Program has achieved substantial adjustment in the economy by realigning prices and restoring fiscal and monetary discipline. In addition, progress has been made in improving the climate for private sector investment. The main achievements are summarized below and in Table 4. 22. The core of the reforms has been the depreciation of the real effective exchange rate by about 90 percent since 1983. Conservative demand management has helped reduce sharply the gap between the parallel and official exchange rates. Thus incentives for exports and for channel- ling transactions through official markets have improved sharply. The major adjustment in the exchange rate has guided the realignment of relative prices throughout the economy. The government has simplified and lowered import tariffs and substantially liberalized imports both by lifting almost all restrictions on goods financed from importers' own foreign exchange and, more recently, by removing restrictions on most producer goods through access to the auction. Thus protection levels have been significantly lowered to encourage efficient import substitution and shift relative incentives in favor of exports. The cocoa producer price has more than doubled in real terms, although implicit taxation is still excessive. Administered prices have been promptly adjusted to pass-through fully the devaluation of the exchange rate. With the decline in world oil prices in 1986, Ghana's petroleum prices by mid-1986 exceeded international levels even at the parallel market exchange rate, although they were still well below those prevailing in neighboring countries. With the virtual dismantling of price controls, prices of other goods were allowed to reflect these changes in the exchange rate and administered prices. The decline in inflation, the impro-vement in private sector climate, and the attainment of positive real interest rates in 1985 have contributed to the increase in the level of financial intermediation. Domestic resource mobilization responded strongly to the changes in the exchange rate, improved administration, and additional re:enue measures. This enabled the Government to lessen reliance on inflationary financing from the banking system. Remaining Adjustment Tasks 23. In spite of these achievements and the initial favorable response of the economy, the Government recognizes that in order to lay a firm basis for sustained growth and balance of payments viability, further actions are needed to strengthen and broaden the policy framework underlying the reform program. Although the balance of payments has improved, exports remain well below their established potential, while the level of imports is inadequate to support the recovery process. Moreover, the debt service burden is nigh and there are still external payments arrears. Confidence problems and the continued weakness of the financial system result in - 14 - Table 4: Ghana: Selected Indicators of Structural Adjustment 1983 1984 1985 1986 Real Effective Exchange Rate Index 1983 - 100 100.0 69.2 57.1 30.2 Annual change (%) -76.6 -30.8 -17.5 -47.1 Ratio of Parallel Market to Official Exchange Rate 22.2 3.2 2.8 1.8 Real Cocoa Producer Price (1970/71 = 100) 1" 34 38 62 80(est) Cocoa Producer Price as share of World Price at Parallel Exchange Rate 1/ 6 9 13 20(est) Items Under Price Control 23 21 17 8 8 Gasoline Price as Share of International Price at Parallel Exchange Rate 27 37 57 108 Real Interest Rate Short-term Deposit Rate (6 months) (X) -51.1 -20.4 6.0 -6.1 Maximum Lending Rate (%) -49.5 -16.8 8.7 -3.3 Broad Money as a ratio of GDP 3/ 11.1 13.0 15.1 16.9 Tax Revenue as a percent of GDP 5.5 8.0 10.4 13.9 Net Credit to Government (end of period) (as share of GDP) 11.4 8.9 7.3 5.9 Index of Real Wages (1977 - 100) Civil Service Senior Management 10 7 13 36 Accountant 16 12 24 55 Clerical 26 22 43 64 Unskilled Labor 32 27 55 56 Volume Index of Major Exports: (1977 a 100) Cocoa 63 60 68 78 Timber 19 23 46 66 Gold 70 72 72 73 External Payments Arrears (US$ million) 440 232 175 171 1/ Crop year beqinning in year stated. 2/ Up until 1983 price controls were comprehensive. 3/ Narrow definition of money before 1984. SISA/GHCEM1 . 15 - inadequate support for the productive sectors, the failure to mobilize the savings needed to fund investment, and the low preference for holding financial assets. Agriculture, the dominant sector in the economy, is operating below potential. The cocoa farmer is still taxed excessively, thereby discouraging the restoration of Ghana's production. Effective protection for manufacturing varies too widely; tax anomalies and eroded protection could distort or impede the supply response of enterprises to the removal of foreign exchange rationing. The response of the private sector to the reforms has been uneven and hindered by uncertainty about economic policies and the Government's intentions. Tax administration remains weak and incentives for production and energy conservation are inadequate. Further domestic resource mobilization is required in order to raise public investment from its still low level. Improved investment planning is needed to raise the returns on public sector projects. State-owned enterprises strain the Government's management capacity, and are a drain on the budget, instead of contributing to resource mobilization. Senior civil servants, accountants, and technicians are still grossly underpaid, while there are too many employees at the lower rungs of the civil service. Finally, weak management and implementation capacity have emerged as serious obstacles to the success of the structural adjustment program. The Government's Medium-Term Objectives 24. Within the general aim of laying a base for sustained growth and balance of payments viability, the Government's specific goals for 1987-1989 are the following: (i) sustain uconomic growth at around 5.0-5.5 percent per annum; (ii) increase the level of investment from about 10 percent of GDP in 1986 to 23 percent of 1989 GDP; (iii) raise national savings from the present 7 percent of GDP to 15 percent by 1989; (iv) improve the management of resources within the public sector. 25. The main instruments which the Government plans to use in order to achieve the objectives of the structural adjustment program are: incentives policies, primarily unification of the various exchange rate markets and maintenance of a flexible exchange rate policy, including the full pass-through of any adjustment to the domestic economy, i.e. cocoa producer prices, petroleum, and other administered prices, and further trade liberalization; measures to increase domestic resource mobilization through tax reform, higher public savings, and strengthening of the financial system; actions to encourage a sufficient response by the private sector to the economic reforms- and reforms to improve management and resource use in the public sector. The Government's program is ambitious and covers a wide spectrum of policy issues. This chapter will focus on the major issues raised in the key areas of incentives policies, the mobilization of domestic - 16 - resources, the private sector investment climate, and public sector reforms. There is also a brief discussion of the social impact of the structural adjustment program. The following chapter examines the Government's efforts to rehabilitate the country's economic and social infrastructure and increase the returns to public investment. Incentive Policies Exchange and Trade 26. The centerpiece of Ghana's structural adjustment program is the aim of achieving a market-determined exchange rate applied to all economic transactions, and a liberal trading regime which provides a relatively uniform and reasonable level of effective protection. After successive devaluations, the exchange rate is now more realistic. The establishment of the second window foreign exchange auction in September 1986 and the replacement in October of highly restrictive import licensing by the automatic issue of licenses for most production inputs were major steps in the liberalization of the economy. Unification of the official rate and the foreign exchange auction in February 1987 extended the application of a. more realistic exchange rate to cocoa and petroleum. 27. Virtually the only non-capital transactions which remain to be integrated into the foreign exchange auction are imports of consumer goods and factor and non-factor services. Consumer goods continue to be imported through special import licenses (SILs) financed by foreign exchange provided by the importer. The integration of this market with the foreign exchange auction is the next key task in future liberalization efforts. The Government is reluctant to fully join the markets immediately because of the risk of sharp depreciation of the exchange rate, particularly when confidence in the auction is still being built up. Such a depreciation could impede access by producers and increase opposition to the system. It is important to remember that the SIL market functions well, is based on a close to equilibrium exchange rate and is competitive. Also, the Government has eliminated the special taxes which had been levied on these imports, thereby reducing the protection given to domestic producers. An additional consideration is that the SIL market increases the supply of foreign exchange to Ghana, at a time when supply through other channels is impeded by lack of confidence in the financial system. Although confidence is improving, the process will be a gradual one. 28. However, integration of the markets as quickly as is prudent given the above considerations is important because without it the official exchange rate in Ghana will not be fully market determined. In addition, the continuation of the parallel market for SIL imports may encourage holdings of foreign exchange outside the domestic banking system. Recognizing this, the Government intends to allow access to the auction by April 1987 for several categories of goods, which in 1986 accounted for over 50 percent of the value of SIL imports. This is a first step towards full integration of the markets by early 1988. - 17 - 29. A related issue is future policy on export retention accounts. These were established at a time of acute scarcity of foreign exchange and quantitative controls on imports financed from official foreign exchange. The objective was to ensure that the key export sectors could meet their essential foreign exchange requirements. The establishment of the foreign exchange auction and the elimination of most import controls have eliminated the rationale for most of the retention accounts and their gradual elimination would augment the supply of foreign exchange to the auction, thereby broadening that market. The Government intends to review the policies on retention accounts during 1987 with a view to reducing them for large traditional exporters (cocoa, mining) beginning with the Ghana Cocoa Board, subject to contractual cbligations to third parties. 30. In line with the reforms in the exchange and trade system, in the February 1987 budget the Government announced several interim tax reforms, including the removal of the special tax on most consumption goods imports; abolition of many previous exemptions to sales taxer and import duties; and the consolidation of excise duties into a new structure of sales taxes on domestic production, except for tobacco products and beverages. In addition to these interim reforms, the recent changes in the exchange and trade system call for a re-examination of the trade tax structure. Although the tariff structure in Gnana is fairly moderate and even (with a standard rate of 20-25 percent), net protection in some cases is quite uneven because of the incidence of other taxes and excise duties and various exemptions. In addition, there may be a need to provide protection through higher tariffs on a temporary basis to some industries during the adjustment process. Most export production in Ghana is estimated to receive negative protection because it is not compensated fully for domestic taxes and protection. During 1987 a Government Task Force will review the trade tax system. The work program includes: (i) redesigning the structure on the basis of certain agreed principles, such as a shift from taxation of production to taxation of consumption, a distinction between the protection and revenue roles of tariffs, and rationalization of the incentives for import competing activities, and estimating revenue yield; (ii) measuring effective protection under the present system and exchange rate and designing a tariff structure which would provide relatively uniform protection and allow for temporary protection in the case of infant industry, temporary adjustment, or dumping; (iii) defining appeals procedures and the criteria to be used in an ongoing tariff review to justify infant industry, temporary, and arLtidumping protection; and (iv) designing improved duty relief arrangements for exporters. 31. If trade liberalization is to succeed, and not strain the balance of payments, exports must increase rapidly. The change in the exchange rate has already provided a strong incentive for higher exports from Ghana. In January 1987 the Government took the additional step of abolishing export licensing., In addition, export taxes on timber and minerals have been eliminated. The Export Promotion Council is being reconstituted and strengthened. However, additional measures need to be taken. Some improve- ments are needed in the existing scheme to provide fisnal relief through drawbacks for export production inputs. For example )nsideration should - 18 - be given to a duty suspension arrangement for exporters. In the area of non-traditional exports, the Government should develop a medium-term export development strategy. As an input to this strategy, during 1987 the World Bank, in cooperation with the International Trade Center, will carry out a study to assess the potential for non-traditional exports from Ghana. Through this work policy or other barriers to activities which offer promising prospects will be targeted for special attention. Cocoa 32. Pricing Policy. Cocoa is the mainstay of the economy of Ghana. Although.a long term objective of the structural adjustment process is to diversify the economy, the success of reform efforts over the next 3-5 years depends on ensuring full utilization of cocoa production capacity and providing sufficient incentives to encourage the replanting and rehabilita- tion necessary to sustain output of about 300,000 metric tons per annum. Significant increases in the cocoa producer price have been one of the major policy reforms of the Economic Recovery Program. However, as shown in Table 5, it was not until 1985/86 that the real cocoa producer price increased significantly. Table 5: Incentives for Cocoa Farmers Est. 1982/83 1983/84 1984/85 1985/86 1986/87 Total cocoa purchases by GCB '000 mt 179 159 174 219 230 Nominal producer price (0 per metric ton) 2/ 12,000 20,000 30,000 56,600 85,500 Real producer price (1970/71 - 100) 49 34 38 62 80 Nominal producer price as percent of f.o.b. price at official exchange rate b/ 38 24 25 24 28 Nominal producer price as % of world price at parallel market rate b/ 9 6 9 13 20 a/ as of beginning of crop year / estimated average for crop year Source: Ghana Cocoa Board and staff estimates. - 19 . 33. A symptom of the failure to provide adequate incentives for cocoa farmers has been the presence of strong incentives to smuggle cocoa from Ghana tS neighboring countries in order to obtain a better selling price. As incentives become more adequate smuggling should decrease, subject also to improvement of roads for cocoa evacuation in the western region. At the beginning of the Economic Recovery Program the Ivory Coast producer price was about 5 times the price in Ghana at the estimated parallel market exchange rate. By 1985/86 that differential, while still substantial, had narrowed to about 3 times. The current producer price in Ghana of $567 per ton at the auction exchange rate (about 0155u$l in March) compares with $1,310 per ton in the Ivory Coast. Although there has been a decrease over the past several years, further adjustments are needed in the producer price in order to eliminate the price incentive to smuggling. 34. Because of the relatively aged stock of cocoa trees in Ghana, the effects of disease and bush fires, and previous low levels of rehabilitation and replanting by farmers, the ability to reach the production target of 300,000 metric tons per annum by 1995 depends upon adequate incentives for farmers to rehabilitate and replant using improved hybrid varieties. At the current producer price, it appears that cocoa rehabilitation is marginally unprofitable, while there is a strong inducement for replanting. The major reasons for the higher incentive for replanting is the return in early years from food crops (such as plantain), grown to provide shade for seedlings, and higher benefits in later years because of the better yields achieved with hybrid varieties. In actual practice, the distinction between rehabilitation and replanting is blurred as most farmers combine the two. The analysis does, however, suggest that a further strengthening of price inducements for the farmer is required. Looking ahead to the next crop year, after making adjustments for likely wage and price trends in 1987, a producer price of about gl50,000 per ton would be required for both rehabilitation and replanting of cocoa to be financially profitable. This would raise the farmers' share of the f.o.b. price to an estimated 40 percent, at the official exchange rate. 35. Based on current estimates of the long run production response to a higher farmgate price, a share for farmers in the range of 55-60 percent of the f.o.b. price would maximize fiscal revenues to the Ghana Cocoa Board and to the Government from cocoa exports. This is a reasonable intermediate target. In setting a share for producers for the long-run other factors would need to be considered: the impact of the higher price on rural incomes, alternative sources of Government revenue, and competitiveness with other countries. It is also important to verify the production response of farmers under current conditions in Ghana in order to better guide future pricing decisions. These would be examined in a study of cocoa incentives during 1987. Nevertheless, current data justifies a gradual increase in the farmers' share of the f.o.b. price. Although the possible output response in the skort run is much lower since cocoa has a long gestation period, if the impact of a diversion of smuggling is taken into account, a gradual increase in the share of farmers is expected to increase revenues from cocoa even in the near term for both the Ghana Cocoa Board and the Government. The difficulty of forecasting the average - 20 - exchange rate which will prevail during a period of active exchange rate policy has meant that the farmer's share has deteriorated from its level at the beginning of the crop year. For example, the 1985/86 producer price for the main crop represented only 24 percent of the f.o.b. price (at the official exchange rate) after the January 1986 exchange rate devaluation, compared to 40 percent at the beginning of the season. Similarly, for the 1986/87 crop year the share of the farmer has declined to less than 30 percent (at the auction rate) from a share of 45 percent at an exchange rate of P90-$1.00. In order to ensure that the cocoa producer price is maintained at an adequate share of the f.o.b. price, beginning in 1987/88 farmers will be compensated at the end of the crop year for developments in the exchange rate, world cocoa prices, and output that result in a higher cedi value of export proceeds than orginally anticipated. 36. Marketing. Part of the explanation for the excessive taxation of the cocoa farmer in Ghana is the excessive marketing costs of the Ghana Cocoa Board (Cocobod). This institution currently provides services to. farmers, such as inputs, extension, and research; owns cocoa and coffee plantations and processes cocoa; and handles internal and external marketing for cocoa, coffee, and sheanuts. During the first phase of the Economic Recovery Program, studies were carried out and some measures were taken to reorganize and improve the efficiency of the Cocobod. Some 16,000 staff were retrenched and 25,000 "ghostworkers" eliminated from the payroll by the end of 1985. In addition, effective January 1987, responsibility for cocoa feeder roads was transferred to the Department of Feeder Roads. Although marketing costs have been reduced, in 1986 the Ghana Cocoa Board's share of the f.o.b. price was about 27 percent (excluding retrenchment costs). This share is high compared to costs in other major producing countries, even after taking into account the broader responsibilities of the Cocobod for extension and research. The recently approved 1986/87 budget, including the cost reduction measures described below, would still result in a Cocobod share (excluding retrenchment and financing costs) of about a quarter. Excluding extension and research, the share would drop to about a fifth. 37. In Malaysia and Brazil, major cocoa producers, there is less government participation in the industry. Input provision and internal marketing and exporting are in the hands of the private sector. Competi- tion among traders and exporters results in marketing costs estimated at no more than 10-15 percent of the world price, leaving for the farmer about 85-90 percent, out of which he must cover input costs and some transport. These incentives have led to intensive cultivation practices, resulting in yields per hectare of 800-1200 kg compared to 200-250 kg in Ghana. An alternate procedure which operates in West Africa (Ivory Coast and Cameroon) is a mechanism whereby the government sets prices at different stages of production, but private producers and traders carry out most activities. Yields per hectare in these countries (300 kg for Cameroon and 480 kg for the Ivory Coast) also exceed those in Ghana. 38. These marketing systems, which rely more on the private sector than does Ghana, demonstrate higher efficiency in marketing, better - 21 - provision of supporting services, and give greater incentives for the farmer, thereby encouraging higher production and yields. However, the Government believes that a major change in marketing is not advisable at this time in Ghana for several reasons. One, private traders and haulers may be unwilling to evacuate cocoa if infrastructure in producing areas is inadequate. In Ghana, infrastructure, particularly roads, is poor in some cocoa growing areas, particularly the western region, where production has now shifted. Two, a radical change in marketing arrangements, as, for *xample, occurred recently in Nigeria, can be disruptive. Given the importance of cocoa in the economy, Ghana cannot afford to jeopardize the recovery now occurring in production. Three, cocoa financing puts signifi- cant demands on the banking system. Reforms and further strengthening of the weak financial system in Ghana may be needed to ensure that adequate resources are available for crop purchases if the system is managed by many private traders and exporters. Now the Cocobod is assured access to sufficient credit. 39. These considerations do not imply that a gradual switch to a marketing system managed by the private sector would not work well or be more cost effective than the present arrangement. It does, however, argue for an in-depth study of the options open to the Government for improving the efficiency of cocoa marketing and extending the liberalization in other sectors of the economy to cocoa. It is important that such a marketing study be carried out early in the Government's structural adjustment program in order to prevent a lagging cocoa sector from holding back the full recovery of the economy. Acknowledging this need, the Government has requested the World Bank to prepare a report on the relevance of the experience of other countries to Ghana. 40. In the meantime, the Government recognizes the need for measures to reduce the costs of the Cocobod. The short-term strategy which is being developed will be guided by the following principles: (i) Cocobod will attempt to confine itself to activities which cannot be done more efficiently by other institutions or the private sector, and in keeping with this; (ii) the Cocobod will progressively shed all extraneous activities which are not directly related to its purchasing and marketing functions and to extension and research; (iii) the Cocobod will lay-off all remaining excess staff in a phased manner; and (iv) that in effecting reductions, care will be taken to protect essential functions; (v) a systematic review of the operational costs of the Cocoa Board while carrying out (i) and (ii) above with a view to reducing such costs in order to favor higher producer prices. - 22 - 41. As first steps, in 1987 the Cocobod divested unviable plantations and laid-off the staff (approximately 10,000) made redundant as a result. In addition, substantial staff reductions are to be made in the Cocoa Services Division. A joint venture is planned for the insecticide plant, a Cocobod subsidiary. The Cocobod also intends to achieve economies in capital expenditures. It is critical that the Cocobod not raise staffing levels (net of the above mentioned retrenchment) in the junior and lower grades and casual day labor. Increases in staff wages and allowances should be strictly limited to Government-mandated adjustments. The Cocobod budget for 1986/87 shows subsidies for the marketing of sheanuts and coffee which are being borne by the cocoa farmer. The Government needs to re-examine its policy for sheanuts where the producer price is higher than the current international price. Cocobod's role in coffea and sheanut marketing also should be reviewed. 42. In the longer run, however, in order to continue the streamlining of the Cocobod, it is necessary to assess the effectiveness of the entire operation. Th9 current accounting and financial control systems are inadequate to do this. Neither do they provide to the management the information needed to run the Cocobod. During 1987 a commercial accounting system will be introduced in the Board which will make it possible to assess tho cost effectiveness of different operations (e.g., haulage and processing). On the basis of that information, further reform measures will be developed in the framework of a corporate plan which will initially cover a three year period beginning with the crop year 1987/88. The goal of this plan will be to take the additional s eps necessary to lower the Board's share of the f.o.b. price to 15 percent by 1988/89. Domestic Resource Mobilization Financial Sector 43. Successful implementation of the structural adjustment program depends on a well-functioning and broadly based financial system to mobilize resources and channel them efficiently to productive activities, particularly in the private sector. The Economic Recovery Program has made considerable progress in this area. The velocity of circulation has decreased from 7.7 percent in 1984 to an estimated 6 percent by the end of 1986 as the willing- ness of the public to hold financial assets has risen in response to higher interest rates and lower inflation. Nevertheless, it is still substantially above the rate which existed in Ghana during the 1970's. There is still a lack of confidence in the banking system. In addition, banks in Ghana are relatively inefficient with spreads between lending and deposit rates which are high by international standards. 44. Since 1984, the issue of whether there is adequate "liquidity" in the Ghanaian economy has been widely discussed. It is a complex question, subject to considerable uncertainty and contradiction. On the one hand, it is difficult for the private sector to raise sufficient working capital for operations and imports given the large depreciation of the cedi, generally weak balance sheets (reflecting past losses), and conservative bankers. - 23 - At the same time, commercial banks have held excess reserves. During the course of 1985-86, however, liquidity became tighter as evidenced by the drop in excess reserves in the banking system even after the Bank of Ghana lowered the reserves ratio. For the medium-term, the need to generate balance of payments surpluses in order to reduce payments arrears, meet short-term obligations, and finance scheduled IMF repurchases will have a major impact on credit availability. In developing a financial program, a careful balance will need to be struck between meeting the credit require- ments of the productive sectors and ensuring macro-economic stability. Careful monitoring of the key macro-economic aggregates, a better assessment of the credit needs of the productive sectors, and a flexible approach to credit targets will be required in this period of major changes in the economy. 45. Beyond the short term, the provision of adequate credit in the economy depends on further increasing the public's willingness to hold financial assets. The Government plans to achieve this by maintaining positive interest rates, primarily through controlling inflation. This is a necessary, but not sufficient condition. Until the public has more confidence in the banking system the response to higher real interest rates will be muted. A positive step is the Government's intention to redeem from the public ahead of schedule the bonds which individuals received as compensation when the 050 note was demonetized. The Government needs to consider additional actions to reassure the public, such as making a public commitment to freeze accounts only in exceptional circumstances and to respect the confidentiality of bank-customer relations. Financial institu- tions should be encouraged to develop innovative ways of mobilizing resources, particularly among groups whose incomes are incrt-asing as a result of economic reforms, for example, cocoa farmers and exporters. Less recourse by the government to financing through the banking system also frees resources for the private sector. Already the share of credit to the government has dropped from about 9 percent of GDP in 1984 to 6 percent in 1986. A further decline in the share of credit to the government is needed over the next several years, but phased so as not to jeopardize the necessary increases in high-return development expenditures. 46. In addition to the liquidity issue, there is wider concern over the ability of the financial system in Ghana to facilitate the structural adjustment of the economy. First, poor past economic performance and weak credit analysis and collection procedures have left some banks with a sizeable portfolio of poor loans, relative to their capital base. This is a major reason for the banks' unwillingness to provide more loans to what they consider marginally creditworthy firms, in favor of holding Government securities. Second, in general, the banks in Ghana operate inefficiently. There are several reasons for this: small currency denominations, too many branches, and the relatively small size of the financial system given the currency still held by the public outside of the banks. Regarding the first problem, the Government is now considering the issue of larger denomination currency notes. Third, commercial banks in Ghana levy numerous additional charges which tend to lower the interest actually received by the depositor and to increase the lending rates charged. These wide - 24 - spreads are probably necessary in order to cover non-performing loans and the high costs of operations, but they discourage the mobiization of additional resources and borrowing foi productive activities. Fourth, capital markets in Ghana are undeveloped. There is no stock market and only limited merchant banking. 47. The Government plans to review the financial sector during 1987 with assistance from the World Bank. The review would look closely at credit allocation, ways to improve the efficiency of bank operations, the strengthening of Bank of Ghana's supervision of the commercial banks, and measures to develop capital markets. This wIll be supplemented by management and financial audits and detailed portfolio reviews of key banks in order to determine the extent of the problem and remedial measures. 48. Finally, in order to ensure that the behavior of net foreign assets does not squeeze domestic credit to an extent which threatens the economy's growth objectives, the Government should seek 'he consolidation of outstanding external arrears into medium-term loans, thereby reducing the amount of cash outlays needed to lower the amount outstanding. In addition, the Government could consider new borrowing by the Bank of Ghana, within the constraints posed by the external debt position, to lengthen the maturity structure of its current portfolio. Of course, an important factor in this regard is the necessity of continued access to IMF facilities, preferably through the Structural Adjustment and the Extended Fund Facilities, which would lower the net transfers to the IMF over the next several years. Private Sector Investment Climate 49. Achievement of the growth objectives of the structural adjustment program relies on the response of the private sector to improved incentives. Although Government will have a key role in providing adequate and well-maintained infrastructure, investment in production is expected to come from the private sector. While steps have been taken to improve the private sector climate, so far the investment response to the Economic Recovery Program has lagged. This is not surprising, given the large changes in relative prices and the uncertainties prevailing in the economic environment. Moreover, the large unutilized capacity at the beginning of the ERP has focused the private sector towards modest rehabilitation investments rather than the creation of new capacity. 50. However, the business community continues to receive mixed signals. Business owners generally welcomed the foreign exchange auction and the related easing of import restrictions. But changes in regulations, unclear and inconsistent application, particularly on the cedi deposit required for successful bidders, and restrictions on access caused by the requirement for tax clearance certificates (which the Government abolished at the end of the year) caused some confusion. The manner in which the revenue authorities implemented the otherwise necessary and overdue collection of current and outstanding tax payments also contributed to the mixed signals. This resulted in sudden increases in tax assessments for - 25 - many companies and a requirement for advance payment of quarterly obliga- tions. These actions weakened the financial position of many firms and also affected the banking system during 1986 as customers d_ew down demand deposits and clamored for higher overdrafts and other credit lines in order to meet tax demands. The worst of the crisis is now over. The Government has announced that companies can pay taxes due at the end, instead of at the beginning of the quarter. Provided that a reasonable appeals procedure can be set up to deal with disagreements, which may be quite legitimate, corporations should return to a more regular cash flow position in the course of 1987. However, the suspicions created will take time to dissipate. 51. Several measures could improve the policy environment for the private sector. They include: (i) fostering closer consultation between the Government and the private sector, for example, by increasing the frequency of meetings of the existing tripartite committee or other forum, dealing with current policy actions; (ii) reducing the restrictions on private investment posed by the still excessively high tax rates on corporate income and on capital gains (which discourages portfolio investment) and the multiple taxation of dividends. In the 1987 budget the Government announced a reduction in the corporate income tax rate for manufacturing enterprises from 50 percent to 45 percent. There is also a need to make prompt tax rebates in cases in which companies are required to make presumptive advance tax payments when in fact they are making losses. More encouragment would be provided to invest in new or more risky ventures if there were a provision in the tax code which permitted losses to be carried forward; (iii) continuing to moderate the excessively progressive personal income tax rate. Even after the changes in the structure of the personal income tax announced in the 1986 and 1987 bludgets a marginal rate of 55 percent applies to incomes exceeding only 0300,000 per annum (approximately $2,000); (iv) improving communication channels to avoid misapprehension and misunderstanding and to ensure that the expected response to economic reforms is forthcoming. This is particularly important for the foreign exchange and imnort regimes where little effort has been expended to explain t e detailed functions, rationale, and operational requirements to the public; (v) easing the restrictions on the activities open to foreign investors. Otherwise, this may deter joint ventures and the corresponding transfer of know-how and technology. Also, the Government needs to sign treaties with more countries in order to avoid the double taxation of foreign investors; and - 26 - (vi) developing a phased program to clear up the backlog of blocked funds for capital repatriation and dividends and to phase in access to the foreign exchange auction for approved transactions in those categories. The Government intends to permit access to the foreign exchange auction for those service and transfer payments approved by the exchange control authorities since the beginning of the auction. The Government should also actively encourage a mechanism whereby some of the backlog of blocked funds could be converted into equity investments; Public Sector State Enterprise Reforms 52. A key objective of i-he Government's structural adjustment program is to improve the performance and efficiency of state-owned enterprises (SOEs) in order to increase their contribution to Ghana's economic recovery. SOEs are important in nearly all economic sectors. Virtually all of Ghana's major exports are produced and/or marketed by SOEs and they operate key economic infrastructure. Although the sector is large (the Government has a majority interest in 181 enterprises), the financial resources mobilized by it are small. In 1983 the consolidated final accounts of 63 enterprises (for which information was available) showed a loss equivalent to 0.2 percent of GDP. Actual losses are probably considerably larger since most financial statements substantially undervalue assets and enter- prises not reporting operating results tend to be loss makers. Reflecting the generally poor financial performance, many SOEs have liquidity problems. The current ratio for the sector in 1984 was only 0.84. As a result, many enterprises have arrears to other SOEs, the Government, and private suppliers and contractors, complicating efforts to improve fiscal performance. In addition, some SOEs are supported through the Government budget. In 1985 total transfers to state-owned enterprises from the budget in the form of subventions, equity, and loans were equivalent to nearly 1 percent of GDP, twice as high as in the previous year. The Government's institutional arrangements for dealing with SOEs were characterized by overlapping and uncoordinated responsibilities among technical ministries, the Ministry of Finance and Economic Planning, the State Enterprise Commission, and the individual enterprises. While enterprises were often subject to interfe- rence in day to day management, the Government does not have adequate knowledge of their performance. On paper the State Enterprise Commission had broad powers, but it was ineffective because of inadequate resources and staffing. 53. After carrying out an initial diagnostic study of the sector, a Government Task Force has developed a policy framework to address these problems. It includes greater management autonomy, a more rational legal framework, progressive reduction of budget transfers to state-owned enterprises, use of investment criteria, clearance of arrears, greater resource transfers to the Government in the form of dividends and timely tax payments, and exposure of SOEs to more competition and market discipline. A major objective is co reduce the dependence of state-owned - 27 - enterprises on the budget through setting ceilings on transfers, which would be reduced in stages, and establishing clear guidelines for evaluating requents for support. This would be supported by changes in pricing and tarifti and by efforts to reduce operating costs in individual enterprises. Under the Government's structural adjustment program, institutional arrangements are designed to achieve day to day management autonomy for the enterprises while enabling the Government to monitor the performance of SOEs in order to ensure accountability. The mechanism by which this will be done is through the preparation of three-year corporate plans by key state-owned enterprises, which will be the basis of performance agreements embodying targets and including mechanisms of rewards or penalties. These will be negotiated each year with the Government. The State Enterprise Commission would advise and be responsible for monitoring performance. Corporate plans will set out the objectives of the enterprise, strategies, establish performance targets and include actual and projected financial statements. 54. In addition, the Government intends to reduce the size of the SOE sector. In the first phase the Tank Force has identified about 30 enter- prises which will be put up for sale, liquidated or converted into joint ventures. The initial list includes enterprises which are not considered to be of strategic importance, loss makers, and net losers of foreign exchange, as well as profitable ventures which could benefit from wider access to capital, management, and technical expertise. It is expected that Shout five enterprises would be offered for sale, including the State Fishing Corporation, a major drain on the budget, and liquidation would be initiated for an additional five inactive companies by the beginning of 1988. The size and envisaged pace of the program reflects a recognition that divestment of state-owned enterprises in Ghana will not be an easy task and the need for Government action in complementary areas. It requires preparatory work in the areas of asset valuation, completion of adequate financial accounts, and packaging of investment proposals. There is no stock market on which shares of state-owned enterprises could be sold. However, stocks are bought and sold through several existing brokers and facilities could be set up in commercial banks. In addition, many state-owned enterprises are characterized by operating problems, losses, and overstaffing, making them unattractive to private investors. The investment climate in Ghana poses barriers for some investors in the form of restrictions on dividend remittances and multiple taxation of dividends (para 51). In many ways the success of the Government's state-owned enterprise retionalization program will depend on parallel actions taken to improve the investment climate and private confidence in the financial system. Because of the constraints mentioned above it is important that the program be carried out in a phased, flexible, and pragmatic manner. At the same time, the Government needs to target enterprises which are large drains on the budget and include firms which are potentially attractive to the private sector. - 28 - Public Sector Management 55. The first part of the Economic Recovery Program necessarily focused on major changes in incentives and critical rehabilitation. However, implementation of the Government's structural adjustment program is severely straining the capacity of the public sector to manage the economy. Policy-makers in Ghana do not have sufficient analytical support, a gap which will become increasingly binding as the reform program proceeds. In addition, economic policy coordination is weak. In spite of the improvement in the Government's fiscal position, the budget system has fallen into disuse since 1983, partially because of the financial crisis and the priority given to cash flow management. The policy guidance provided to line ministries in recent years has been minimal. Investment planning was equally weak, in part reflecting the low level of resources for public sector investment. In addition to shortages of staff and equipment, the Ministry of Finance and Economic Planning is not properly organized to carry out its functions within the structural adjustment program. For example, recent efforts to improve recurrent budgeting and investment planning had to be undertaken by Task Forces. 56. During the past years of economic decline the conditions of employ:ment and the efficiency of the civil service deteriorated dramatically. A rapid expansion of employment, five times greater than the annual growth of the labor force, was coupled with falling wages, particularly at the higher levels. This resulted in many vacancies in higher level posts, low morale, and poor productivity. In addition, the Government, in particular the Office of the Head of the Civil Service, does not have adequate informa- tion about the size, structure, etc. of the civil service. This gap in knowledge contributed to the difficulties in implementing the wage and salary increase during 1986. The structural adjustment program cannot be implemented without measures to increase the efficiency of the civil service. 57. The Government has decided to focus on strengthening a few key policy functions and reforming the civil service. In order to provide economic policy analysis to the Government a special unit is to be created within the Ministry of Finance and Economic Planning. To better coordinate economic policies a small unit is to be set up within the office of the Chairman of the Committee of Secretaries. A recent technical assistance mission of the IMF assessed the budgetary process in Ghana and has made recommendations which are currently being discussed by the Government. The main priorities for improvement of the budget include: (a) instituting financial planning; (b) development of a foreign exchange budget for the Government; (c) inclusion of all foreign aid; (d) preparation and distribu- tion of more complete and detailed information; (e) more timely preparation and announcement; and (f) strengthening the monitoring of implementation. The intent of these recommendations is to enable allocation decisions to be made by the budget, and not as currently happens, as a residual of various decisions made for cash flow management reasons. In addition, coordination between the Ministry of Finance and Economic Planning and the line ministries during preparation and implementation of the budget needs to be strengthened. - 29 - 58. Tho policy measures which are being implemented to improve investment planning are covered in the next chapter on public expenditures. However, in addition, the Government has decided to re-organize the planning function. Initially it was thought that divisions within the Ministry of Finance and Economic Planning would be reorganized and re-staffed in order to carry out investment planning. However, in late 1986 the Government announced its intention to set up a comprehensive national planning system. A committee has been set up to determine the modalities for implementing the new structure, but it has just begun its work. Inputs to the decisions include the previous work done by the Public Administration Restructuring and Decentralization Committee (PARDIC) and a 1986 study financed by the UNDP. Although details are still to be worked out, the outlines of the proposal are: (1) a split in the Ministry of Finance and Planning; (2) the establishment of a National Planning Commission; and (3) decentralization of investment from the central government to the local level. The proposals reflect the Government's desire to move away from the past ad hoc system of planning to a more structured and permanent one. There are several positive features to the proposals, which would contribute to more effective implementation of the structural adjustment program. A National Planning Commission may improve inter-ministerial coordination on economic and p_anning issues. In addition, the Government's management of the investment program would be eased considerably by shifting small and community level projects to the local level, which also would improve the link between priorities and the needs of the community. However, such a major change also has costs and risks. A new planning establishment could strain limited management resources and spread them too thin. Moreover, it is important that the investment program and the budget be closely connected. These considerations should be taken into account in designing the new structure. 59. Between 1975-82 civil service employment grew at the high average annual rate of 14 percent. As a result, there is excessive staffing, particularly at the lower echelons, which decreases productivity, compounds management problems, and restricts the Government's ability to pay reasonable salaries. The Government courageously committed itself to a retrenchment of the public service of up to 5 percent a year (roughly equivalent to 15,000) during 1986-1988. However, since making the initial commitment in late 1985, progress in carrying out the retrenchment has been somewhat slower than the initial timetable. The first phase of lay-offs in 1986 totaled up to 11,000 through a combination of eliminating "ghost workers" and some dismissals, particularly in the Ghana Education Service. For 1987 the Government has identified 6,740 surplus employees comprising 1,000 civil servants over retirement age and 5,740 excess non-teaching staff; they will be discharged by the end of May. The remaining 8,260 of the 15,000 target are to be off the Government's payroll by the end of October 1987. In addition, the Government needs to finalize the compensation scheme which should meet legal obligations, while being consistent with fiscal prudence. Slow progress in this area would result in the continued inefficiency of the public service, thereby slowing down implementation of the structural adjustment program, and would constrain the progress which can be made in increasing salary relativities. After the initial round of - 30 - lay-offs is carried out, further reductions are to be based on a review of staffing and functions within the civil service, to be carried out in the latter half of 1987. The Government also plans to improve the expertise and strengthen staffing for the Office of the Head of the Civil. Service. 60. Regarding future salary adjustments, the Government should continue to improve wage differentials in the civil service. This is bound to be a gradual process given resource constraints. Illustrative calculations (based on the 1986 salary and allowance structure and taking into account the 1987 across-the-board cost of living increase) indicate that it would take roughly 1 billion cedis extra in salary adjustments, skewed towards the higher two-thirds of the scale, to improve differentials by about 10 percent (i.e. from a 4:1 pre-tax ratio to 4.4:1) This includes some "catch up" since the 1987 salary award included some lump sum increases in allowances which, other things being equal, narrowed differentials. Estimated savings in the 1987 wage bill (net of retrenchment costs) if 15,000 employees at the lower grades were redeployed at the beginning of the year are roughly the same. Given the tight resource constraints, to a large extent the Government's ability to achieve the much needed improvement in salary levels at the upper echelons is dependent on progress on retrenchment. 61. However, the successful implementation of the structural adjustment program depends on the high morale and productivity of at least a key group of civil servants who are critical to the process. For that reason, the Government intends in the short-run, first, to establish a mechanism for mobilizing local expertise on both a short and long term basis to supplement the civil service and secondly, to set up a transitional arrangement to provide additional remuneration to selected civil servants working on key structural adjustment tasks. Local experrise would be mobilized by estab- lishing an organized pool of Ghanaian consultants and personnel available for secondment for Government service for short or long-term assignments from elsewhere in the public or private sectors, or international employment. This would be a transitional mechanism to attract highly qualified staff back into the civil service. Recruitment would be managed by an outside agency experienced in the provision of consultancy services in order to ensure consistent treatment regarding contracts and fees. In order to avoid accusations of favoritism, additional compensation to selected civil servants could be provided as a form of overtime payment to cover the time and expenses associated with participation an task forces, committees, etc. outside of regular working hours and the support work for those tasks. Conclusion 62. This chapter has analyzed the main instruments which the Government plans to use in order to achieve the objectives of the structural adjustment program in the areas of incentives policies, domestic resource mobilization, private sector investment climate, and public sector reforms. In some areas, such as the cocoa producer price, the reforms and phasing have been planned in detail. In others, such as trade taxation and the financial sector, the objectives are clear, but the specific measures - 31 - and their timing are still being studied. The program is well integrated and ambitious. The potential for successful implementation is good given the past achievements of the Economic Recovery Program and the build up in donor support, among other factors. At the same time, there are risks. The Government's implementation capacity is weak and structural adjustment imposes more, not less, burden on that capacity. Technical assistance, including IDA's Structural Adjustment Institutional Support Project, is designed to minimize the potential difficulties. Some of the reforms will adversely affect some groups and in some instances the benefits of adjust- ment will not occur immediately. It is important for the Government to continue to explain the rationale of its reform efforts so as not to risk delays because of adverse reactions to transitional costs. The supply response to the reforms could be delayed because of the liquidity constraints already discussed or infrastructural bottlenecks. The review of the financial system will recommend measures to facilitate the provision of credit to the productive sectors within the context of continued monetary restraint. In the area of infrastructure, the Government is strengthening public investment planning in order to better allocate resources and to increase the returns on projects. - 32 III. PUBLIC EXPENDITURE PROGRAM Introduction 63. Public expenditure policy will play a vital role in achieving the goals of the Government's structural adjustment program. The production response to changes in policy depends on adequate and well-maintained supporting economic infrastructure- transport, communications, power, water - which is mainly the responsibility of the public sector. The Government also has primary responsibility for investment in human capital through the provision of health and education services and specific interventions to alleviate poverty. The infrastructure base in Ghana has eroded substantially because of the previous failure to invest and to maintain adequately existing facilities. In addition, the sharp decline in both real civil service salaries and in the provisions for operations and maintenance has lowered the quality and quantity of recurrent services. 64. Recognizing these problems, in the first phase of the Economic Recovery Program, the Government began to expand investment, notably in transport. However, projects still suffer from stop and go funding from the budget and shortages of cedis. There are still bottlenecks, such as port facilities, and others will appear as the economy grows. Substantia.lly larger expenditure is required to accommodate the needs for operations and maintenance and for rehabilitation of the country's economic and social infrastructure. At the same time, measures are needed to ensure the most efficient use of the limited resources available and to eliminate waste and unproductive expenditures. Though revival of the economy will yield increased revenues, a significant cotntribution can be made by better use of existing resources. Investment projects need to be appraised on the basis of common criteria to ensure that they maximize benefits to the economy. Achievements under the Economic Recovery Program (1984-1986) 65. During the Economic Recovery Program the Government made some progress in improving public expenditure policies. In the area of wages, real salary levels for civil servants have risen since 1984, but initially the improvements benefited the lower levels more than the upper ranks. In 1986 the Government widened differentials in the salary structure by skewing the wage increase towards the higher grades in the civil service. However, differentials are still low compared with other countries and inadequate to sufficiently motivate the civil service to implement the structural adjustment program. There has been less progress in achieving more adequate funding for other goods and services in the recurrent budget. Real spending per employee has continued to drop during 1984-86 and these expenditures have been subject to across-the-board reductions during the fiscal year because of resource constraints. T:e needed increase in capital expenditures has begun, albeit at a slow pace. As a share of GDP, capital expenditures (including development expenditures from the Government's own resources and counterpart funds, and foreign project financing) have risen from only 3.6 percent in 1984 to 5.9 percent in 1986. - 33 - However, during the last three years capital expenditures, like spending for other goods and services in the recurrent budget, have been subject to cuts during the year in response to shortfalls in anticipated domestic and external resources. Over time this has resulted in a stock of hundreds of partially completed projects. In road maintenance, shortfalls in funding in 1986 caused a thousand workers to be left idle because of lack of bitumen and other essential supplies. The main achievement during the Economic Recovery Program has been the near completion of the rehabilita- tion of the western railway line, which has facilitated the shipment of exports such as cocoa, bulk minerals, and timber to the port. Public Expenditure Program 1986-1988 Wage Policy 66. As already discussed, in 1986 the Government significantly improved remunerations for public service employees in Ghana. Such a step was critically needed. Although wage adjustments in late 1984 and 1985 had increased real salaries marginally over the lows of early 1984, the real salary of a Permanent Secretary (or equivalent) was about 10 percent of 1977 levels, while the real salary of a messenger stood at half of the 1977 level. The differential between the salaries of the highest and lowest paid employees in the public service had narrowed to only 2.3:1 before taxes. The salary measures finalized in mid-1986 increased the differential between the highest and lowest paid workers to 5.7:1. Taking into account tax relief implemented in 1986, the post-tax differential is estimated to be 4.1:1, compared to the previous 1.5:1. There is evidence of improved morale and efficiency of the public service during 1986 as a result of the salary adjustments. 67. However, these changes are not sufficient and a key goal of the Government's wage policy should be to improve relativities still further subject to resource constraints. The Government's progress on reducing the size of the public service will be critical in order to free resources for this effort. Tentative projections show that given the anticipated tight fiscal position over the next few years, total emoluments should be constrained at slightly above their present level of 5.5 percent of GDP. This implies that wage increases would be tied to adjustments for the cost of living, real economic growth, and saNIngs from redeployment. Even within this constraint it would be possible over the next three years for the Government to improve relativities (based on wages and allowances) to 7.5-8.0:1 pre-tax and 5.0-5.5:1 post-tax (on the basis of 1986 tax rates). This would bring Ghana more in line with other countries. Since the marginal income tax rate in Ghana is high (peaking at 55 percent), much of the progress in this area should come from adjustments in the tax structure, particularly in the early stages. 68. It will be important for the Government to avoid across-the-board cr flat wage increases, which would reverse the progress made in 1986. Although it may only be possible to reverse salary decompression gradually because of resource constraints, the mechanisms - 34 - discussed in Chapter II (para 62) can provide some immediate support to mobilize the skills needed to implement the structural adjustment program. In addition, continued progress in this area is important, a wage and salary review is to be undertaken during 1987 along with the staffing and functional review of the civil service (para 61). The results of the study would be incorporated in the 1988 budget. Expenditures on Other Goods and Services 69. The combination of expanding civil service employment and declining revenue has distorted the structure of recurrent expenditures, in particular the balance between the number of employees and the provisions for other goods and services (items 2-5). Between 1975 and 1982 average real expenditure on goods and services per civil service employee declined by about 85 percent. Although the Government has made efforts to improve this situation, as a result of shortfalls in revenues in 1986, expenditures on other goods and services measured as a share of GDP declined from the level of nearly 4 percent in 1984-85 to 2.4 percent. In 1986 average real expenditure on goods and services per civil service employee was less than 10 percent of the 1975 level. The impact of this decline is evident both in the lack of materials (paper, office machines) for civil servants to perform their jobs and inadequate supplies (essential drugs, dressings, books) for health and education services, and agricultural extension (for lack of vehicles). 70. The impact of across-the-board expenditure controls on these items in recent years points to the need to allocate outlays more systematically. In addition, budget officials believe that while there are scarcities in certain areas, there is also substantial waste in this budget category. Initial work has focused on education, health, and agriculture, both because they account for a large share of spending and because these services have been most affected by restraints on expenditures. The aim is to develop guidelines to be used to make allocations for these items, based on what is required to perform adequately essential services. Given the past deterioration, it is likely that this objective can be reached only gradually and will depend also on the impact of staff retrenchment carried out over 1987-89. Progress on the work is hindered by lack of detailed information on actual spending in these categories. One of the objectives of the improvements in budgeting (para 57) should be the provision of such data in a timely fashion. 71. Education. The proportion of the education budget allocated to non-salary recurrent items has fallen from 19 percent in 1975 to 15 percent in 1984 and to only an estimated 6 percent in 1986, within a declining total. In the primary school system wages now account for 97 percent of the recurrent budget and lx secondary schools the share is 78 percent, above the average in other African countries of about 91 percent and 72 percent, respectively. As part of the reform of the education system, supported by IDA with cofinancing provided by the OPEC Fund and Norway, the Government is restructuring the budget of the Ministry of Education. Resources are to be shifted from the wages category through a freeze on - 35 - teaching positions, a decline in the number of non-teaching staff, and the elimination of "ghost workers" in an on-going audit. In addition, the boarding and meal subsidies for secondary schools are to be phased out. Spending for other items of recurrent goods and services are to be increased. The goal is to lower the share of salaries in re_urrent expenditures by 1987 to 92 percent for primary schools and to 74 percent for secondary schools. This process will be assisted by expanded cost recovery for building fees, exercise books, and text books which are to be earmarked for the purchase of supplies. Thus far the objectives set for attaining a better balance between salaries and other goods and services have been based on an analysis of the situation during the mid-1970's when the budget was better structured. However, in the long-run a framework is needed to develop expenditure guidelines related to students, teachers, or buildings, depending on the spending item. Work should continue to develop the information on school costs which would enable these guidelines to be developed. 72. Health. The share of the Ministry of Health's recurrent budget allocated to wages has increased from 44 percent in 1978/79 to 60 percent in 1985 and to 75 percent estimated in 1986. The effect of cutbacks in other goods and services in health has severely constrained support to primary health care at the community level by restricting deliveries of essential supplies, mobile health units, and field supervision. Preliminary work on the health budget, based as in the case of education on allocations in past years when shares were better balanced, results in the recommendation to triple in real terms the funding for other goods and services for the Ministry of Health. This takes into account the recommendations of the World Health Organization for an 'essential drugs" program in Ghana. The program is designed to reduce costs by restricting the range of publicly supplied drugs to a limited and carefully selected number that could serve a large majority of cases seen, particularly in primary health facilities. Also included are improvements in inventory, storage and distribution of drugs. 73. This analysis is only the first stage in developing useful guidelines for recurrent expenditures. Additional work is needed to rrepare standard unit costs for the principal types of healtb facilities. These guidelines could then be used by each region to make budget allocations and to estimate the recurrent cost implications of investment projects. The Ministry of Health should work toward developing and applying such guidelines for the 1988 budget. In the area of cost recovery, the increaae of hospital fees in 1985 has mobilized resources which are currently shared by the general budget (50 percent), the Ministry of Health (25 percent), and the hospital (25 percent). Further increases are needed because fees are still below marginal costs, with a view to shifting the cost of curative health care to the user. 74. Agriculture. The share of other goods and services in the Ministry of Agriculture's budget has dropped from roughly 40 percent in 1977/78 to only 15 percent estimated for 1986. In the case of agriculture, the task of developing guidelines for recurrent expenditure is complicated - 36 - by the planned restructuring of the Ministry, including gradual divestment of certain functions such as input supply and provision of mechanization services. Little work has been accomplished in the area of developing guidelines for non-salary recurrent expenditures for agriculture, but there is potential for improving allocation using this tool. The Ministry of Agriculture should develop guidelines for the running and maintenance of vehicles based on well functioning on-going projects. In addition, based on the work program for extension staff, guidelines on vehicle needs and transport and travel allowances can be calculated. In the area of cost recovery, the Ministry is planning to increase fees for veterinary drugs and medicines and to increase the farmers' fees for irrigacion operations and maintenance costs, A major objective of IDA's proposed Agricultural Services Rehabilitation Project is to improve research and the delivery of extension services and credit to farmers by providing additional financial resources and by assisting the Ministry of Agriculture to implement needed reforms and institutional changes. Public Investment Program (1986-1988) 75. One of the Government's objectives in drawing up a rolling three year public investment program (PIP) is to improve the planning and imple- mentation of public investment in Ghana, thereby increasing the returns on those expenditures. It represents an effort to break out of the past pattern of largely ad hoc allocations and stop and go funding which left many projects starved of funds and only partially completed. The large increases envisaged in public investment which are needed to support the structural adjustment of the economy make it critical that sueh improvements are implemented without delay. The preparation of the 1986-1988 public investment program represents a major step forward in this process. The achievements to date will need to be consolidated and expanded upon in subsequent years as the program is updated and rolled over. 76. The criteria used to select projects for the investment program were: (i) A minimum economic rate of return of 15 percent for all large projects (with total costs exceeding $5 million), for which the technique was applicable. If an ERR had not already been calculated, but the project seemed to have the potential for generating an adequate rate of return, it was included on a tentative basis. Implementation, however, would not be funded through the budget until an ERR was estimated, based on a feasibility study. (ii) In cases where the ERR criterion was not applicable or was based on insufficient or dated information, a judgement was made based on the following considerations - the proportion of the project funded by foreign aid with the aim of at least 60 percent financing; ongoing projects or those ready for implementation; the ability of the project to generate - 37 - additional revenue for the Government or, at the least, with low recurrent cost implications; the generation or savings of foreign exchange; and its contribution to employment creation and the alleviation of poverty. At this first stage there were many projects for which time did not permit the calculation of an economic rate of return because a recent feasibility study was not available. As stated above, for those projects, judgement was used to decide if the project had the potential for showing a return higher than 15 percent. On this basis, some projects with over $5 million of investment were included tentatively, subject to meeting the economic rate of return criterion when a full feasibility study is carried out and before implementation begins. Until that time these projects would not be considered for any allocations from the central government's development budget. Projects lacking feasibility studies whose economic rates of return were doubtful were not included in the public investment program. 77. The detailed public investment program covers about 80 percent of the development -xpenditures of the central government, in addition to investments of the major parastatals. However, at this stage, attention focused on projects financed through the budget. Tentative projections indicate that public investu ent (including budget expenditures and foreign aid financing) would increase from 4 percent of GDP in 1984-85 and an estimated 6 percent in 1986 to 9-10 percent in 1987-1988. 78. The public investment program for 1986-1988 is summarized below (Table 6). It shows only the part of the program for which financing was secured by the end of 1986 and thus is not all inclusive, but it is representative of the Government program as a whole. Reflecting the emphasis on maintaining and improving economic infrastructure in Ghana, these expenditures account for 62 percent of the program. Outlays on productive sectors represent 33 percent of the PIP with a focus on supporting services in agriculture and rehabilitation of the wholly or partially government-owned mining companies. It is assumed that the private sector would be the primary source of investment in manufacturing. Social sectors (education and health) make up the remaining 5 percent of investments. The overall strategy of the Government is to concentrate its resources in the critical areas of economic and social infrastructure and to participate directly in other areas only when there is a gap in the availability of private investment or exceptional circumstances. Table 7 shows the proposed 1987 budgetary component of the public investment program. - 38 - Table 6: Public Investment Program: 1986-1988 By Sector 1/ (in millions of Cedis) Number Total of Investment Prolects 1986-88 Sector Productive 56 59,231 33 Agriculture 34 19,560 11 Industry 13 5,827 3 Mining and Timber 9 33,844 19 Economic Infrastructure 86 109,789 62 Transportation 15 27,372 15 Roads and Highways 24 43,262 25 Communications 17 2,588 2 Energy 21 26,937 15 Water 9 9,630 5 Social 20 9,724 5 Education 5 3,475 2 Health 15 6,249 3 PIP Totals 162 178,744 100 1J Based on en:ternal financing secured as of December 31, 1986. Exchange Rate: P150 - US$1 Financing Plan 79. The financing plan for thie 1987 investment program is shown in Table 8. As is the case in Tables 6-7, only financing secured as of the end of 1986 is included. Excluding investments of the state-owned enterprises financed through retained earnings and commercial borrowings, the proposed public investment program totals g53.8 billion, or 8-9 percent of projected GDP. Projects of the central government represent 60 percent of the program, with those managed by the state-owned enterprises accounting for the rest. Investment by the state enterprises is somewhat understated as these estimates do not include financing provided through their retained earnings or commercial borrowing. The current savings of the central government; (minus the allocation for the special efficiency program) are projected to total slightly above 3 percent of GDP. Information on the current savings of the state-owned enterprises included in the public investment program has not been consolidated. Net external financing is projected to total 7 percent of GDP. Program assistance is the most important (4.4 percent of GDP) with external project funds on-lent to the state-owned enterprises second. Amortization payments are expected - 39 - Table 7: an - 1987 Public InvestmePt 1/ (Cedis M111ian) Secured Foreign Financing Domestic t FYnancing Total &et cost Colpmet it m1d 1987 FC t LC IC (A) Productive Sectors 13,331 10,603 427 30 906 1,365 Agriculture 7,102 5,160 427 - 800 715 Industry 3,229 2,943 - 30 106 150 Mining and Tiiber 3,000 2,500 - - - 500 (B) Ekonomic Infrastructure Sectors 34,995 21,910 398 2,290 9,785 612 Transport .),517 7,395 - 525 1,051 546 Roads and Hig%"ays 14,191 4,545 378 1,765 7,503 - Ccmamications 988 922 - - - 66 Energy 6,474 5,880 20 - 574 - Water 3,825 3,168 - - 657 _ (C) Social Sectors 5,445 1,602 1,248 442 2,153 - EAucation 3,232 452 1,055 375 1,350 - Health 2,213 1,150 193 67 803 - PIP Subtotals 53,771 34,115 2,073 2,762 12,844 1,977 1/ Includes only foreign financing secured as of Deceber 31, 1986. Excludes financing (and associated expenditures) fran camcercial sources, dcmestic and foreign, and from the retained earnings of public enterprises. EKchange Rate: ¢150 - US$1 PIP/QHCD11 - 40 - to reach 4.6 percent of GDP. Net domestic financing is slightly negative because of the central government's planned repayments to the commercial banks. The 1988 allocations in the public investment program are tentative at this stage, to be firmed up when the PIP is updated to cover the period 1988-1990. However, preliminary figures show a substantial financing gap in the programs for agriculture, roads and highways, communications, petroleum, water and health. Productive Sectors 80. Agriculture. Despite the progress made during the first phase of the Economic Recovery Program there. are several constraints to further growth in agriculture. There is a need to improve incentives, mainly through pricing policies. In addition, essential support services, especially extension and research (and their linkages) remain weak. The supply and distribution of inputs, particularly fertilizer, seeds, and cocoa inputs, are inadequate both because of the scarcity of foreign exchange and inefficient Government intervention. There has been widespread deterioration of the Ministry of Agriculture's transport fleet and physical infrastructure in the sector. The Ministry of Agriculture's capability to formulate, plan and monitor policy is weak. The thrust of the Government's future agriculture strategy is to continue to increase and diversify output in line with comparative advantage through the removal or reduction of the constraints mentioned above. The Government's role will be rationalized in order to develop more competitive markets and to allocate resources more efficiently. The reforms will be phased so that producers can adjust gradually to more competitive and efficient modes of production. Major priorities are to increase export earnings from cocoa, timber and non-traditional exports, to improve food security and to provide stronger support services. 81. The main components of the public investment program for agriculture include rehabilitation and expansion of productive capacity in the food sector (35 percent of the total). This covers improvements in the quality and distribution of inputs (seed, fertilizer, and seedlings); enhanced research and extension support to food crops and livestock and fishing activities; reducing crop and livestock losses; mechanization; and grain storage and handling. The project for mechanization is subject to review. The construction of additional grain storage will be re-examined after completion of a review of food security strategy during 1987. Projects to rehabilitate and expand productive capacity in cash crops account for 30 percent of proposed agriculture investment. These include on-going oil palm projects, cocoa rehabilitation, and development of rubber and cotton. Rural development, emphasizing raising incomes through expanded agricultural output, will continue in the Volta Region and begin in the relatively disadvantaged Northern Region. This makes up slightly above a fifth of the agriculture program. The consolidation of irrigation development through strengthening the Irrigation Development Authority, improving agronomy on existing schemes, and selected rehabilitation accounts for 10 percent of investment. Institutional support for the - 41 - Table 8: GHANA - PROJECTED FINANCING OF THE 1987 PUBLIC SECTOR INVESTMENT PROGRAM (in millions of cedis) TOTAL BUDGETARY CAPITAL EXPENDITURES 57,982 Public Sector Investment Program 53,771 Central Government 32,789 Selected Public Enterprises 1/ 20,982 of which: Central Government transfers 2,551 Other Capital Expenditures and Net Lending 4,211 FINANCING 57,98^ Public Sector Savings Central Government 2/ 16,212 External Financing (net) 45,270 Central Government 50,377 Concessional 39,190 Non-project 3/ 22,507 Project 16,683 Non-Concessional 4/ 11,187 State-Owned Enterprises 18,602 Concessional 18,602 Total Amortization -23,709 Domestic Financing (net) -3,500 Banking System -5,500 Central Government -5,500 Other 2,000 1/ Excludes Ghana Water and Sewerage Corporation and Ghana Railway Corporation which are funded through central government budget. 2/ Current savings minus allocation for Special Efficiency Program 3/ Realized 4/ Oil financing - 42 - Ministry of Agriculture most importantly through reorganizing and strengthening the planning division, makes up the rest of the program. 82. Mining is the second largest foreign exchange earner in Ghana. The recovery in exports envisaged under the structural adjustment program includes the successful rehabilitation of mining. The largest component of the investment program is rehabilitation of the gold mines, accounting for three-quarters of the total. Ashanti Gold Fields (55 percent owned by Government), which accounts for the major share of gold production in Ghana, is implementing the largest project. It began in late 1985 and consists of sinking two new shafts, re-equipment, and the introduction of carbon-in-pulp treatment for the large quantity of tailings accumulated at the mine. Rehabilitation of the State Gold Mining Corporation accounts for about 20 percent of the program and includes financing of a foreign manage- ment contract and rehabilitation of the Tarkwa and Prestea mines. Sale of the dredging operations at Dunkwa to the private sector is being considered and thus is not included in the investment program. Investments by the Ghana National Manganese Company include the ongoing re:iabilitation of equipment and the oxide washing facility, in addition to the commissioning costs of the existing but never used nodulization plant, pending a review of its viability. Finally, the Ghana Bauxite Company is rehabilitating its equipment and vehicle fleet. 83. Manufacturing. The program for manufacturing is a relatively small proportion (3 percent) of the PIP because of the dominant role envisaged for the private sector. In addition, publicly-owned firms are expected to stand on their own feet financially and to operate as commercial entities with no transfers from the central government budget. The major project is rehabilitation of the Bonsa Tyre Company which is awaiting a final decision on a suitable technical partner, needed to ensure access to technology and to additional equity. Also included are investments to improve scrap handling for GIHOC Steelworks and to rehabilitate the Tema Food Complex. The successful implementation of the latter project also requires an appropriate technical partner. Economic Infrastructur. 84. Energy. The Government's energy strategy is based on the following guidelines: (a) to improve the availability and long-term security of supply at reasonable cost; (b) to reduce the country's vulnerability to short-term disruptions in supply; (c) to rationalize the development of indigenous resources; (d) to promote greater operational efficiency and the financial viability of energy producing and distributing organizations; (e) to promote greater efficiency of energy use by applying appropriate policy instruments and measures to manage demand. In addition to pricing policies (para 3), the energy investment program is designed to implement this strategy. 85. It is divided about equally between projects related to petroleum and those dealing with electricity. In petroleum, about two-thirds of the program is allocated to exploration. Drilling, on-shore in the Tano Basin - 43 - and off-shore in the Keta Basin, has already begun, but implementation of other exploration projects, particularly Saltpond, will depend on the participation of private operators. The rest of the petroleum investment program consists of the completion of the on-going rehabilitation of the refinery and a follow-up phase, rehabilitation of the distribution system, and construction of a lube plant. For electricity, the main projects are the extension of the electricity grid to the northern region of the country and the on-going power rehabilitation project. 86. Transportation accounts for 40 percent e.f the public investment program with roads and highways projects making t'p about 60 percent of the total. This relatively high share reflects the need for urgent and extensive rehabilitation. By 1983, after a decade of minimal investment and neglect of maintenance, transport infrastructure had deteriorated to such an extent that it became a binding conttraint on the Economic Recovery Program. Since Ghana's economy is highly dependent on the production of export commodities, adequate land transport services and efficient ports are vital. While significant improvements have been made over the last several years, particularly on railway rehabilitation, serious bottlenecks remain. The primary requirement for investment is rehabilitation and maintenance of infrastructure and services that are already in place. The Government is also taking steps to improve the management of the state-owned enterprises which play a large role in the sector. 87. Slightly over a third of the roads and highways investments are for maintenance or rehabilitation with the periodic maintenance of trunk roads the largest activity. That program is partially funded from a road levy on petroleum products. Cocoa feeder roads, recently transferred from the Ghana Cocoa Board to the Department of Feeder Roads, account for 10 percent of the roads and highways investment program. Rehabilitation and completion of priority bridges account for about 6 percent of the program. The remainder of the investment in roads and highways is primarily directed towards the completion of on-going projects, for example, the Axim-Elubo Road (a coastal road in the western region connecting the Ivory Coast and the Trans-West Highway) and the Kaneshie-Mallam Road connecting Accra with the Winneba Road which continues to one of the two major ports in Ghana. Regarding the latter, the Government is considering possible changes in design to lower costs. A major reconstruction project is the Yamoransa- Anwiankwanta Road, an important connection between Kumasi and Takoradi through a rich agricultural and timber area. The major projects in other transport are the completion of the western line project of tne railway and the rehabilitation of the Takoradi and Tema ports. In addition, it is proposed to begin some investments on the eastern and central railway lines. Other projects include the rehabilitation and replacement of buses for the public companies operating in the sector, and the completion of the transport system on Lake Volta, and related improvements in petroleum handling facilities. 88. Communications accounts for only 2 percent of the investment program. This reflects the preliminary nature of planning, rather than the status of infrastructure, because needs are great. In addition to - 44 - completion of rehabilitation of the earth station and of the cable network, a more extensive program for upgrading and expansion of the telecommunica- tions network is tentatively included in the last year of the program to allow time for additional planning and design work. Improvements in the management of the Posts and Telecommunications Corporation would need to precede any major investments. 89. Water projects have a dual importance within the investment program as a key component of e-onomic infrastructure and as the means of supplying safe water to a larger share of the population. The program focuses on the completion of on-going supply schemes in several regional capitals and in investment in urgent rehabilitation of the Accra-Tema water and sewerage facilities. Water supply in rural areas is to be expanded by providing shallow drilled wells fitted with hand pumps. An important component of the program is institutional support to assist in improving the management and efficiency of the Ghana Water and Sewerage Corporation. Social Sectors 90. Investments in health account for 3 percent of the total program. Although the Government has followed a policy of primary health care since 1978, resource and management constraints so far have prevented much progress towards reaching the target of providing it to 80 percent of the population by 1990. One of the Government's objectives is the achievement and maintenance of an efficient balance between the use of hospital-based medicine and primary health care facilities. In addition, the aim is to allocate health resources equitably between urban and rural areas and among regions. Primary health care investments account for about a fifth of the program. This includes staff training, establishment of necessary organ- izations and support to family planning and nutrition programs. There is also a project to rehabilitate health stations. Some new facilities will be required, but they will be limited to health stations in rural areas or polyclinics in growing urban areas. Hospitals will not be expanded. The number of health stations needed will not be known until a detailed planning exercise is completed. The investment program tentatively provides for the construction of 100,000. Although the Government's focus is on primary health care, it is also necessary to protect investments in secondary care. About a third of the health investment program is allocated to hospital rehabilitation. 91. The government has begun to implement a major reform of the system of education. The purposes are to improve pedagogic and cost effectiveness. A key element is the reduction of pre-university education from 17 to 12 years. The Government also intends to allocate more resources to the primary and secondary levels, as compared to tertiary institutions. The priority is not new construction, but the rehabilitation of existing facilities, which accounts for 40 percent of the investments. The provision of books and equipment, necessary to support the revised curriculum for secondary schools represents about a fifth of the program. There are also small allocations for university equipment and the - 45 - rehabilitation of teacher training colleges. In all, the projects in education make up 2 percent of the public investment program. Protection of Super-Core Projects 92. Within the public investment program, about 20 projects, funded from the central government budget, which are critical to the structural adjustment program have been identified. The list emphasizes agricultural supporting services; transport rehabilitation, particularly the western railway line and feeder roads; road maintenance, and the completion and rehabilitation of health stations. In total, the projects represent 40 percent of the Government's 1987 development budget (excluding foreign project financing). Their budget allocations will be protected from resource shortfalls during the year. The cash flow required for these projects will be estimated and a quarterly advance made to an imprest account from which each project could draw. Withdrawals from the accounts by project authorities would be supported by evidence of spending in the previous quarter. It is anticipated that this mechanism would be operational by May and the imprest accounts funded by counterpart funds generated by program assistance. Remaining Tasks and Institutional Issues 93. Although the preparation of the 1986-1988 public investment program represents a major improvement in planning in Ghana, the effort is a first step. Much work remains to be done, beginning with the rollover of the program to cover 1988-1990. The major priorities in the work program are (a) to enst.re that the investment program is integrated completely into the budget; (b) to carry out feasibility studies and economic analysis for some 40 large projects for which this has not been done; and (c) to assign responsibilities for preparing and monitoring the public investment program on a continuous basis. In cooperation with the Budget Division of the Ministry of Finance and Economic Planning and the Accountant General, the PIP Task Force will be responsible for monitoring the progress of the program on both a financial and physical basis. They would prepare a mid-year review of the 1987 program by the end of September. Up to now work on the investment program has been spearheaded by a special Task Force since the Ministry of Uinance and Planning was not adequately staffed to undertake the work. The decision to assign responsibility for this task on a more permanent basis has been complicated by the recent decision to put in place a national planning system. The modalities to implement this decision have yet to be worked out. In the meantime, it is important that the efforts to improve public expenditure policy proceed. The responsibility for the task should be absorbed as soon as possible into the normal work of the Government. Otherwise its effectiveness in improving budgetary procedures and project implementation will not be fully realized. - 46 - IV. MEDIUM-TERM PROSPECTS 94. Ghana's economy has responded favorably to the stabilization and adjustment measures of-the Economic Recovery Program. As discussed in Chapters II and III, the Government recognizes that to maintain the momentum of the adjustment process and sustain growth, further reforms and adequate and well allocated public expenditures are required. This chapter updates the macro1 conomic scenarios developed for the last country economic report, - and analyzes prospects for Ghana's economy under alternate policy assumptions. The Alternative Scenarios 95. The continued reform scenario takes into account the planned policy and public expenditure initiatives under the adjustment program and assumes the continued vigorous pursuit of structural changes. The adjustment fatigue scenario assumes that the pace of reform slackens and then tapers off. The momentum of economic recovery in 1984-86 and the progress to date on infrastructure rehabilitation are sufficient to permit relatively strong growth under both scenarios through 1990. However, the projections for the longer term (1990-95) are quite different. Continued reform leads to sustainable long term GDP growth of 4-5 percent, while adjustment fatigue leads to stagnation as the economy feels the impact of only partial improvement in incentives. 96. In the adjustment fatigue scenario the reforms proposed under the structural adjustment program do not materialize. In particular, the gains in exchange rate policy are allowed to be eroded, agriculture incentives decline, and trade liberalization stalls. Consequently, the export momentum falters and food shortages develop. The adverse impact on the balance of payments is exacerbated by a decline in external capital flows as donors retreat. Public investment drops to inadequate levels because of insufficient domestic and external resources. As confidence in the economy weakens, a shortfall in private investment reduces growth potential. The fall in the supply of foreign exchange forces cutbacks in essential imports and makes the debt service burden unmanageable, triggering yet another downward spiral. 97. The major differences in the projected outcomes are shown in Table 9. Gross domestic investment grows at an annual average rate of only 3.6 percent over the 1986-95 period in the absence of further adjustment. Economic growth is, therefore, substantially lower, resulting in a decline in per capita GDP. Recovery of both exports and imports falters under the Ghana: Towards Structural Adjustment, Report No. 5854-GH, October 7, 1985. - 47 - adjustment fatigue scenario. The rest of the chapter focuses for the most part on the "continued reform" scenario. Table 9: TWO SCENARIOS (Annual Average Growth Rates; Percent Per Annum) (constant 1984 Cedis) Continued Reform Adjustment Fatigue 1985-90 1990-95 1985-90 1990-95 Population 3.0 3.0 3.0 3.0 GDP per Capita 2.1 1i1 0.5 -0.9 GDP 5.1 4.0 3.5 2.0 Consumption 3.0 3.6 3.4 1.9 Investment 24.1 6.1 4.0 3.8 Exports 8.2 3.0 5.5 0.6 Imports 8.4 3.1 4.4 1.3 Policy Reforms 98. The continued reform scenario incorporates the policies to be implemented under the structural adjustment program. As discussed in Chapters II and III, the Government of Ghana is implementing major reforms in many areas including: (i) exchange and trade; (ii) cocoa sector; (iii) public expenditure; (iv) state-owned enterprises; and (v) public sector management. The exchange rate will reach an equilibrium level during 1987-88. As part of trade policy reforms, consumer goods imports will gradually be absorbed into the exchange auction and administrative controls will be replaced by price rationing of foreign exchange. In addition, the Government will simplify and rationalize trade taxes, removing the bias against exports and making protection more even and moderate. In the cocoa sector the Government will increase producer incentives to ensure achievement of production goals, streamline the Ghana Cocoa Board's operations and confine its activities to only those which cannot be done more efficiently by other institutions or the private sector, thereby reducing its operating costs to 15 percent of the average f.o.b. price. Public expenditure policies will improve the allocation of recurrent outlays, raise the level of investment, and increase its efficiency through better planning and the application of investment criteria. State-owned enterprises will depend less on budgetary transfers and increase their contribution to domestic resource mobilization. Management of the public sector will be strengthened through better organizational structures, mobilizing additional skills, training and civil service reform. These measures are necessary ingredients for the continued reform scenario, which is described in more detail below. - 48 - Investment and Growth in Production 99. The average incremental capital output ratio (ICOR) is relatively low (about 3) during the initial years of the structural adjustment program because of low capacity utilization in many sectors and the recovery which will be brought about through rehabilitation and improved incentives. Long overdue rehabilitation of infrastructure such as ports is likely to have a large impact on private sector production. Thereafter, the average ICOR would return to a more normal level of 4.6 by 1995. In contrast, it has been assumed, under the adjustment fatigue scenario, that investment productivity declines towards the end of the period to 5. Given these ICORs, the key to sustaining output growth in the longer term under the continued reform scenario is the jump in investment identified in the near term. GDP growth averages between 5-6 percent during the initial period and then subsides to around 4 percent during 1990-95. Consumption must accommodate the rise in investment, but its fall is cushioned by resource transfers from abroad; by 1989 consumption accounts for 85 percent of GDP compared with 92 percent in 1986. 100. During 1986-88 the public sector is the main source of invest- ment; the private sector's role will be modest reflecting the uncertainty caused by the changes in relative prices and a wait-and-see attitude. Government's implementation of a three-year rolling investment program, composed primarily of economic and social infrastructure rehabilitation, should increase the efficiency of investment, in part because better planning will reduce the costly fits and starts resulting from swings in government revenue. While donors will provide financing for a large share of the program, the gov.rnment's own current savings also will be important. The policy reforms designed to improve resource management in the public sector are key here. 101. While the public sector is responsible for rehabilitating infra- structure, over the medium-term the private sector is expected to invest in order to expand the economy's productive base. Although growth in public investment is strong, private investment will gradually increase its share of the total. By 1987 three years of recovery combined with the visible support for Ghana from the international community should begin to bolster confidence. The Government will help by creating a stable economic and political climate for private investors. These efforts have already begun with the recently issued Statement of Industrial Policy, the promulgation of a new Investment Code, and the reconstitution of the Ghana Investment Centre. A stable economic and political environment is only a pre-condition for the increase in private investment, however. Further stimulus should come from the accelerator effects of output growth and lower excess capacity. Investment opportunities in efficient import-substitution and export activities should also expand as a result of exchange rate adjustment and trade liberalization. The Government's intention to decrease its role in some state-owned enterprises will also expand the opportunities for private sector initiative. - 49 - 102. Once most of the structural adjustment measures are in place, the prospects for the economy achieving a growth path of 4-5 percent a year will be strong. The exchange rate will be at an equilibrium level, private sector confidence will be restored and the investments made in the mid and late 1980's will begin to bear fruit. As financial deepening continues, credit to the private sector will become more adequate. Trade liberalization will be facilitated as the exchange rate auction is broadened to include consumer goods and services. Sectoral Growth Prospects 103. The performance of agriculture depends on the sub-sectors of cocoa, timber, and food and industrial crops, of which the latter two account for about 80 percent of value-added. Agricultural output will continue to respond favorably to improved price incentives. The adequacy of incentives will be an important determinant of production of food and industrial crops, though more effective provision of extension services will also play a role. The planned restructuring of the Ministry of Agriculture is also intended to improve other services to farmers such as the supply of inputs and research, and would strengthen the link between research and extension. Output of food and industrial crops is projected to grow at 2 pencent per year in 1986-90, then increase to 3 percent in 1990-95. The volume of food imports would rise up through 1989 and then begin to decline. 104. Cocoa output has responded well to higher producer prices. The Government is committed to ensuring that farmers gradually increase their share of the world price. It is projected that the real increase in producer prices will permit exports to expand to 260,000 metric tons by 1990 from 219,000 in 1985/1986. This is conservative, but based on estimates of Ghana's potential production capacity. The near-term increases will come from improved husbandry and greater availability of inputs, while after 1990 the yield from hybrids planted during the 1970s and early 1980s will begin to be felt. Replanting is expected to continue at a rate of 30,000 hectares per year. Efforts to control cocoa swollen shoot virus disease will also improve yields. These factors would permit a growth in cocoa production to about 300,000 tons by 1995. Timber continues to be a dynamic element of Ghana's exports. The arrival of forestry equip- ment, scheduled for 1985, was delayed until 1986, and as a result exports should show another strong gain in 1987-88. The timber levy was reduced in 1986, and the 6 percent export levy was replaced by an increase in stumpage fees. This should improve incentives, although additional measures are needed to improve forest management, rehabilitate forest plantations, and rationalize concessions. Assuming progress in these areas, exports are projected to increase to a level of 730,000 cubic meters by 1995, compared to 354,000 in 1986. 105. As can be seen from Table 10, industry is projected to be ten fastest growing sector. In the near-term manufacturing would contir e to benefit from the increased availability of imported spares and raw material. The rapid growth of this sector in the past two years was - so - facilitated by the existence of substantial excess capacity. This source of output growth will still be possible in some activities, notably food processing. In beverages, wood products, paper products, and cement, capacity utilization is approaching historically normal levels, and net investment will be necessary to respond to increased demand. On the whole, manufacturing should benefit from the more liberal exchange and trade regime, which, while eliminating inefficient firms, should also expand the opportunities for efficient import substitution. Previous studies of the manufacturing sector in Ghana have shown that a significant number of enterprises (50-60 percent) currently in operation would be efficient at world prices. As mentioned in Chapter II (para 30), a review of trade taxation would also examine the need foL temporary protection in the case of infant industries. Table 10: GDP GROWTH RATE BY SUBSECTOR (in 1984 Cedis; Percent) Continued Reform Adjustment Fatigue 1985-90 1990-95 1985-90 1990-95 Agriculture 3.0 3.1 2,3 1.4 Cocoa 6.2 2.7 3.4 -0.1 Forestry 6.7 5.1 4.6 2.5 Others 2.2 3.0 2.0 1.5 Industry 11.3 5.1 6.8 2.0 Mining 10.0 4.1 6.6 1.9 Manufacturing 12.0 5.4 6.9 2.1 Utilities 10.7 4.9 6.6 2.0 Construction 9.7 4.9 6.7 2.0 Services 5.5 4.6 3.9 2.6 Transport 5.2 4.6 3.8 2.5 Wholesale & Retail 6.0 4.8 4.2 2.8 Financial Services 5.2 4.4 3.7 2.8 Public Admin. 1.9 2.4 0.7 0.0 Other Services 4.0 4.0 2.7 2.0 GDP . 5.1 4.1 3.5 2.0 106. Growth in mining depends on the success of on-going rehabilitation and modernization. The annual production capacity in Ghana is estimated at 600 thousand fine ozs., about double 1986 output. Ghana is expected to attain nearly that level by 1995. An encouraging sign is that applications for gold prospecting licenses have risen, in part because the improvement in the exchange rate has increased the attractiveness of exporting at the official rate. Ghana Consolidated Diamonds Ltd. has increased production capacity thanks to its new operations at the Birim deposit. After repair of the washing plant in 1986, production is - 51 - projected to hit one million carats per year by 1988, and be sustained at that level until 1995. The Ghana Bauxite Corporation has begun to rehabilitate the washing plant which could expand capacity to 500,000 metric tons per year, more than double current production. The medium-term outlook for manganese shows growth slowing down due to exhaustion of ore deposits. The picture could change if the Ghana National Manganese Corporation's nodulization plant proves viable. This would permit the exploitation of low-grade carbonate ore deposits and expand capacity to 400,000 metric tons per annum. 107. Growth in services, which now accounts for about 40 percent of GDP, is projected to be a relatively strong 5.4 percent in 1986-90, mainly on the strength of gains in whAesale and retail trade, financial services, and transportation. Transportation has grown rapidly due to the rehabili- tation of the economy's infrastructure and will benefit from the projected output increases, particularly in exports. Growth in wholesale and retail trade will diminish over time because of the shift in incentives away from trading activities, but will benefit from higher domestic production and after 1988, from the growth in consumer demand. Growth in financial services will be strong during the next several years as confidence in the banking system is gradually restored. In the 1990-95 period, growth in the services sector tapers off to 4.6 percent, slightly higher than the average for the economy as a whole. The Adjustment Path for 1987-1989 108. The policy measures to be implemented in the structural adjustment program have been incorporated into the continued reform scenario using a simple internally consistent macro-economic accounting framework that tracks the sources and uses of funds in the economy for the period 1987-1989. The behavior of the main indicators is summarized in Table 11. More detailed information appears in Annex C. The economy is projected to grow at about 5 percent per annum. National and foreign savings must both increase in order to finance the required investment levels. Investment is projected to more than double from its current level of 10 percent of GDP to 23 percent by 1989. National savings is projected to more than double from an estimated 6.6 percent of GDP in 1986 to close to 15 percent by 1989. 109. In the area of public savings, domestic resource mobilization resulting from new revenue measures, tax reform and improvements in administration are projected to increase total revenue from 13.6 percent of GDP in 1986 to 16.5 percent by 1989. Also, unification of the official and auction exchange rates is expected to raise proceeds from the cocoa export tax. The projected increases in revenues, coupled with the reduction in the Ghana Cocoa Board's costs, more than offset the improvements in the producer price so that Government revenue from cocoa increases to 4.3 percent of GDP in 1987 from 2.7 percent in 1986. There are complementary recurrent expenditure policies. The latter include holding personal emoluments to less than 6 percent of GDP, reflecting in part the planned reduction in the size of the civil service. The state-owned enterprise - 52 - Table 11: Selected Economic and Financial Indicators Annual Average Actual Estimates Projections …________ ------- ---------------- -------------------------- 1980-83 1984 1985 1986 1987 1988 1989 Gr'owth Rates (X) GDP -5.1 8.6 5.1 5.3 5.0 5.3 5.3 GPf Deflator 106.6 3.5 31.2 30.2 18.0 12.5 7.5 Percent of Market Price GDP ___________________________ National Accounts: Corsumption 96.5 95.1 95.7 92.3 89.8 86.7 85.0 Investment 4.3 7.6 7.3 10.3 17.1 21.0 22.8 Pr_vate 3.1 4.0 3.4 4.4 7.9 11.1 11.9 Bucsetary Cap. Expenditures a/ 1.4 3.6 3.8 5.9 9.2 9.9 10.8 National Savings 3.9 4.7 3.1 6.6 8.5 12.2 14.8 Pub 'Lc bl -4.4 -0.4 0.1 1.7 3.2 3.5 3.6 Private 8.3 5.1 3.0 4.8 5.3 8.7 11.2 of which: Foreign Transfers i.0 1.0 0.5 0.9 1.3 2.0 2.8 Foreign Saving 0.6 2.8 4.2 3.7 8.6 8.8 7.9 Central Government Budget: Total Revenues 6.4 8.0 10.4 13.6 16.1 16.2 16.5 Total Expenditure 12.2 11.8 14.1 17.8 22.8 23.6 24.4 Recurrent 10.7 8.4 10.3 11.9 12.9 12.7 12.9 Capital 1.5 3.4 3.8 5.9 9.2 9.9 10.8 Special Efficiency 0.0 0.0 0.0 0.0 0.7 0.9 0.6 Overall Deficit 5.8 3.8 3.8 4.1 6.6 7.4 7.9 Broad Money (M2) c/ 13.0 15.1 16.9 18.1 20.0 22.0 Balance of Payments Exports of GNFS 4.5 8.0 9.9 15.8 21.7 22.2 22.7 Imports of GNFS -5.4 -10.7 -12.9 -18.5 -28.6 -30.0 -30.5 Resource Balance -0.9 -2.7 -3.0 -2.6 -7.0 -7.7 -7.8 Current Account Balance -1.6 -2.8 -4.2 -3.7 -8.6 -8.8 -7.9 Overall Balance -1.0 -1.6 -1.7 -1.1 2.8 3.0 2.5 ------------------------------------------ a/ From 1984, includes State Enterprises capital expenditures financed by external concessional assistance. b/ Represents Central Government's savings only. c/ Includes both primary and secondary banks. Source: Bank staff estimates. - 53 - reforms bring about a decline in the share of subsidies and transfers in the government budget. Despite the growth in expenditures on other goods and services, which is necessary to reverse past neglect, the current savings of the central government is projected to increase from 1.7 percent of GDP in 1986 to nearly 4 percent by 1989. 110. Private sector savings is expected to be stimulated gradually by the restoration of confidence and the growth in personal incomes after 1988. Financial sector reforms, which include restoring positive real interest rates, the introduction of instruments to mobilize small savlngs and longer term resources, and tax policy changes to stimulate savings, support both the increase in the savings effort and the return of the private sector to the once suspect banking system. The ratio of broad money to GDP is projected to continue to recover toward a historically more normal value; by 1989 the ratio (covering primary and secondary banks) is projected to be 22 percent. Although this is a large jump from the ratio of 16.9 percent in 1986, it is consistent with the re-monetization experi- ences of other countries in the aftermath of hyperinflation. It is also substantially less than the ratio of broad money to GDP (26 percent covering primary banks only) which prevailed in Ghana on average during 1965-79. Continued financial deepening is necessary to offset the impact on credit to the private sector of the strengthening of net foreign assets during 1987-1989 and continued monetary restraint. In addition to the efforts of local Ghanaians, the exchange rate reforms and build-up of confidence are expected to encourage private remittances, which are projected to reach $120 million by 1989, equivalent to 3 percent of GDP. Other private savings, measured as a share of GDP, increases from 4 percent in 1986 to 8 percent by 1989. Social Impact 111. The prolonged decline in the economy through 1983 caused a substantial reduction in per capita real incomes and food production. The social impact of the adjustment program needs to be evaluated in the context of the costs of a failure to adjust. The adjustment fatigue scenario indicates that without further reforms, the recovery to date would falter, and the economy would resume its downward decline with adverse consequences for all Ghanaians. Under the continued reform scenario, the economy is able to reach a level of growth which raises per capita incomes. The improvement in producer incentives, higher levels of investment, and the shift in resources from urban to rural areas and from traders to producers will enhance opportunities throughout the economy, but particularly for small farmers, and will expand employment. The shift in resource allocations within higher expenditures towards primary health care and primary and secondary education will benefit lower income groups. In sum, the majority of the population is likely to be better off with the policy reforms than without. 112. The adjustment policies could have a potentially adverse impact on the poor through (a) price changes resulting from exchange rate movements and petroleum taxation; (b) the retrenchment of civil service and - 54 - state enterprise employees; and (c) employment losses arising from the effect of trade liberalization on inefficient firms. The price impact is likely to be moderate because the prices of most end-products already reflect their scarcity values, as indicated by the limited impact of exchange rate adjustment on inflation so far. Inflation is expected to decelerate during the program period, helping the poor. The economy should be able to absorb the displaced workers from the public sector. The major increase in public investment will occur in labor-intensive activities such as road maintenance. Employment creation will also occur in agriculture, where wage rates are already higher than in the urban areas (para 14). The Government's proposed compensation to workers will ease the transition. Previous sector work suggests that a high proportion of firms currently operating in Ghana are efficient at world prices (para 105) meaning that, on balance, trade liberalization should expand employment. Finally, the Government intends to develop special programs for those groups which will not be among the first to benefit from the adjustment program. These include food-for-work schemes, credit to the self-employed, and training programs. The 1987 budget provides for both compensation payments (g2,800 million) and the cost of other programs (gl,400 million) for retrenched workers. Additional donor support is expected for the latter. Balance of Payments 1987-1989 Export Growth 113. Export growth (in constant prices) under both the continued reform and adjustment fatigue scenarios is shown in Table 12. Exports are not as dynamic in the absence of further reforms because of the impact of the incomplete exchange rate adjustment on the profitability of export activities and the constraints posed by less rehabilitation of important economic infrastructure, particularly in transport. With continued reform, export growth is expected to average 8 percent a year through 1990. The bulk of the '_crease will come from cocoa earnings (para 104). Among non-cocoa exports, gold, bauxite, timber, and diamonds are projected to expand in the near term because of the rehabilitation in progress for these sectors. Gold should rapidly increase its importance as output recovers in the mines of both the Ashanti Gold and the State Gold Mining Corporations. As Ghana Consolidated Diamonds brings new capacity into operation, diamond earnings should rise, and could be boos. I further if private miners are attracted to official marketing channel.. The outlook for the two bulk minerals is uncertain: manganese exports will be hampered by the exhaustion of high quality ores, while bauxite depends on the continuation of existing marketing arrangements. Their joint share of export earnings is unlikely to exceed 2 percent. Although timber exports should continue to grow, there is unlikely to be much improvement in terms of value added in sales, except for perhaps an increase in the relative importance of lumber compared with logs. There also may be a small rise in the wake of the Timber Export Development Board's efforts to reestablish G.-tana among the suppliers of wood products to traditional European markets. Assuming that water levels at the Volta dam remain at normal operating levels, the Volta River Authority's (VRA) exports of electricity to neighboring countries and - 55 - to the aluminum smelter (VALCO) could amount to slightly over $50 million a year. The structural transformation of the economy will also open up new possibilities for non-traditional exports. Table 12: EXPORT GROWTH RATES UNDER THE TWO SCENARIOS (in 1984 Prices; Percent Per Annum) Continued Reform Adjustment Fatigue 1985-90 1990-95 1985-90 1990-95 Cocoa 6.3 2.7 3.5 -0.1 Timber 14.1 5.1 12.0 2.5 Gold 10.5 4.3 7.0 2.0 Diamonds 8.4 0.0 8.6 0.0 Electricity 15.7 0.0 13.1 0.0 Nontraditionals 22.1 8.3 2.7 2.0 Non-Factor Services 1.2 3.0 8.0 2.8 Total Exports GNFS 8.2 3.0 5.5 0.6 114. In the continued reform scenario, cocoa's share of total exports of goods falls to 52 percent by 1995 from 67 percent in 1986. Thus, despite the success of the reform program in restoring cocoa production, Ghana's dependence on it diminishes. Conservatively, cocoa price projections do not take into account the price premium Ghana enjoys for superior quality. A decline in cocoa prices would have a serious impact on the structural adjustment program. If cocoa prices dropped 10 percent below what is currently being projected, it would add about $50 million to the financing gap each year (para 118). If financed on non-concessional terms the debt service ratios would rise by about 5 percentage points. Economic growth would also be somewhat lower. Import Projections 115. The projected rapid growth of the economy during 1986-89, in particular the strong increase in investment and industrial production, will require imports even though incentives will encourage enterprises with more domestic value-added. The volume of petroleum, capital and other intermediate goods, which account for 85 percent of Ghana's imports and for which the scope for import substitution is small, increase by over 20 percent between 1985 and 1989. Reflecting the still low base, import volume is expected to increase at close to double the rate of economic growth during 1986-1989. After 1990 the growth in imports is projected to drop to less than the increase in the overall economy for several reasons. Changes in incentives will shift production away from activities which intensively use imports to ones that are based on domestic resources. Improvements in efficiency, particularly energy, will dampen demand. Ghana will also be able to reduce its food imports after 1989 due to smaller increases in demand and higher growth in food crop production. - 56 - Terms of Trade 116. Ghana's terms of trade are projected to deteriorate through the early 1990's primarily because of the declining real price of cocoa. Nominal cocoa prices are expected to drop by 14 percent between 1986 and 1990 before beginning a gradual recovery in the period 1990-1995 of about 4 percent per annum. The projected long-term strengthening in cocoa prices moves the terms of trade slightly in Ghana's favor mainly because of real increases in the world prices of cocoa and timber. Nevertheless, by 1995 the terms of trade index is still 12 percent below the level of 1986. External Balance and Capital Inflows 117. Under the continued reform scenario, the current account deficit of the balance of payments is projected to widen in 1987-1988, primarily because of the projected trends in exports and imports. Private transfers are expected to increase as the incentives to make remittances through official channels improve in line with achievement of a more realistic exchange rate and heightened confidence in the banking system. The current account deficit is projected to increase to 8.7 percent of GDP in 1987-1988. The sharp growth in the cedi value of the deficit is explained by the large devaluations of the cedi, particularly in 1987 when Ghana is projected to move rapidly towards an equilibrium exchange rate. After 1988, however, the current account deficit is projected to fall, both in nominal terms and as a ratio to GDP. 118. However, the increase in the current account deficit does not prevent the balance of payments from swinging into an overall surplus of slightly over $100 million in 1987 and remaining at about that level in 1988-1989. This is because of the projected increase in concessional assistance, needed to reverse the import compression that contributed to -he economy's decline and to support the structural adjustment process. Disbursements of concessional assistance (grants and long-term loans) are projected to rise by about a third by 1989, compared to 1986 levels, assuming commitment levels which are set out in Chapter V. The program requires such a level of overall surplus in order to finance the elimination of external arrears by 1989, short-term liabilities, and repurchases from the IMF; the latter average $186 million between 1987 and 1989, peaking in 1988. In addition, the Government intends to reduce remaining external payments arrears. Provision is made also for a needed modest buildup in gross international reserves. This would 'eave an average financing gap of $24 million over the 1987-1989 period (Table 13). Ways to fill that gap are discussed in Chapter V. - 57 - Table 13: Balance of Payments Overview 1985-1989 (US$ million) 1985 1986 1987 1988 1989 Exports 632 773 777 845 920 of which Cocoa (412) (519) (475) (490) (524) Imports -727 -780 -891 -985 -1,073 of which Oil (-200) (-125) (-148) (-153) -158 Trade Balance -94 -7 -114 -140 -153 Non-Factor Services (net) -110 -131 -154 -172 -182 Resource Balance -204 -138 -268 -312 -335 Net Factor Income -111 -105 -113 -125 -125 Net Private Transfer 32 49 50 80 120 Current Account Balance -283 -193 -331 -357 -340 Financed by: Grants 93 115 162 157 194 Official medium and long term loans (net) 32 99 252 235 211 Disbursements (287) (358) (418) (424) (396) Amortization (-255) (-259) (-166) (-189) (-185) Other capital 41 -77 25 86 42 Overall Balance -117 -56 108 121 106 Monetary Movements 117 56 -108 -177 -123 Financing Gap - - 56 1' Memorandum Item Gross Aid Disbursements 224 358 428 469 487 of which: based on commitments made prior to 1987 224 358 291 225 150 Source: Annex D, Page 1 - 58 - Conclusion 119. It is sobering that the continued reform scenario succeeds only in restoring many economic indicators to levels that Ghana had attained in th6 past. It is not surprising, however, given the sharp decline during the previous decade. The reforms designed to achieve sustainable growth in the long-term constitute an integrated package that employs a wide variety of measures to effect changes across all sectors of the economy. The impressive efforts of Ghana's policy-makers to date, and the evident progress of those efforts, give cause for optimism, although the task ahead remains difficult. Implementation of the structural adjustment program, however, will not be sufficient to ensure the outcomes which have been described in this chapter. External concessional assistance, which has contributed to the success of the Economic Recovery Program, also has an important role to play in the implementation of the structural adjustment program. - 59 - Ghana's Economy: Performance and Prospects (1975 - 1995) Ghana: Performance of 30P. Agriculture, Ghana: Extomra Trade and Currnt and Manufactul ng Account Balance . Actual Pro¢ledn ,o 4 ACTUAL PROJECTION , XOOODS OF - SOOO- V' 2 I I iiis' 'ioa' liai' ,Or-?, 'vDio' '1943' IPT1979 196? oslOS 985 197, t989 190? logs logs Ghana: Rati of Broad Money (M2) to GOP Ghana_ Exports of Cocoa and COoaN Prducts 400. 20- 0 ~~~~~~~~~~~300- 20 / ~~~~~~~~~~~~~~~~~Actual '. 0*40Preolectlon 2 15 0 200- PROGRAM o 10- 100- 1977 1979 1iG1 lo8s 19i5 1987 1989 1973 1976 1979 1982' '19 19'8 i9g91 1i94 Ghana: Annuol Inflotion Rafo Ghona: Exports of Gold 150- 1S000_ ACTUAL 100-~~~~~~~~~~~~~~~00 0 0 // ~~~~~~~~~~~~~~~~~~~~~~~~Projection a6 Actual 50 \ ° PROGRAM 10000 0 1 I 000 I I IT 1978 1980 1982 1984 1986 1988 1990 1976 1978 1980 1992 1984 1986 t988 1990 1992 1994 - 60 - V. EXTERNAL ASSISTANCE NEEDS 120. Since the last meeting of the Consultative Group for Ghana, the Government has made substantial progress in almost all the areas identified then as critical to the successful evolution of the reform program. As discussed in earlier chapters, a comprehensive structural adjustment program has been prepared and is to be supported by a $115 million Structural Adjustment Credit from the International Development As3ociation. The Government also has prepared a rolling three-year public investment program (1986-1988). Ghana has lived up to its part of the "compact" with the Consultative Group. This chapter recommends how donors should support the new momentum in the reform effort. The response of donors to the recovery program to date has been impressive relative to the very low levels of aid the country was receiving in 1983. Nevertheless, assistance needs to be stepped up if the structural adjustment program is to succeed in laying the foundations for sustained growth, at a time when obligations arising from short-term debt, external arrears, and scheduled IMF repurchases are high. The chapter discusses aid requirements over the adjustment program (1987-1989) and provides the World Bank's recommendations on the volume and composition of new commitments. The chapter also reviews Ghana's projected debt service burden. Aid Trends in 1985-1986 121. Actual aid disbursements in 1985 were less than had been initially expected. They are estimated to have reached only $224 million, nearly 20 percent below concessional flows in 1984. The lower disbursements are explained by several factors. First, the structure of 1985 commitments shifted away from fast disbursing program and food and commodity assistance to project aid. Second, a large part of 1985 indications was not translated into commitments until late in the year. Third, implementation problems of both donors and the Government caused delays. These included delays in obtaining legal opinions on loan agreements and in appointing consultants, and the obstacles posed by import licensing. Disbursement performance worsened compared to 1984 on both pipeline and new commitments. For the former, the aid disbursement ratio (the ratio of disbursements from the pipeline during the year to the undisbursed pipeline at the beginning of each year) dropped from 34 percent in 1984 to 27 percent in 1985. Only 18 percent of new commitments was disbursed in 1985, compared to 34 percent in 1984, when the share of emergency food relief was high. The consequences for the economy were twofold: one, non-oil imports showed no growth in 1985 over 1984 levels; and two, there was a substantial buildup in the aid pipeline by the beginning of 1986, which should contribute to higher disbursements in the future. 122. Aid commitments to Ghana in 1986, excluding technical assistance, are estimated at $370 million, 20 percent below the level achieved in 1985, and significantly short of the World Bank's recommendation ($500 million) to the November 1985 meeting of the - 61 - Consultative Group. To some extent, the shortfall is explained by the slippage of some commitments to the first half of 1987, such as IDA's Structural Adjustment Credit ($115 million), the Yamoransa road project with financing to be provided by Japan, and two agriculture sector operations (ADB and IFAD). Thus, achievement of the required level of aid disbursements over the next several years is not necessarily at risk, but it is important to translate aid indications given for 1986 into commitments as quickly as possible. The share of bilateral aid in the total inched up from about a third in 1985 to 40 percent in 1986. Bilateral commitments reached $145 million, compared to the $210 million indicated at the last Consultative Group meeting. Multilateral commitments reached $227 million, compared to the $291 million expected. Taking into account the delayed commitments which either have been made by donors during the first quarter of 1987 or are anticipated before the middle of the year, multilaterals would exceed their indications at the 1985 Consultative Group meetings by about $100 million. On the same basis, bilateral commitments would be only slightly above the 1986 indications, showing the need for further effort: on the part of bilalteral donors. The proportion of quick-disbursing aid was slightly less than half, the same as the 1985 share. The composition of bilateral aid commitments has shifted slightly towards quick-disbursing aid, although there was no increase in the level of such assistance. Multilateral commitments continued to shift towards more project aid. Table 14: AID CONMITMENTS TO GHANA, 1985-86 (US$ million) Bilateral Multilateral Total 1985 1986 1985 1986 1985 1986 Project 79 65 166 129 245 194 Program/Sector 62 61 134 85 196 146 Food/Commodity 18 19 11 13 29 32 Total a/ 159 145 311 227 470 372 of which: Grants !/ 73 84 30 26 103 110 Grants as % of Total 46 58 10 11 22 30 /J Excluding technical assistance grants Source: World Bank staff estimates based on information supplied by Ministry of Finance and Economic Planning and Donors 123. In spite of the lower than expected aid commitments in 1986, preliminary estimates indicate that disbursement performance has improved sharply in 1986 resulting in total inflows of about $360 million. The ratio of disbursements from the pipeline at the beginning of the year rose to 33 percent and from new commitments increased to an impressive 26 percent (the 1984 level). Several factors contributed to this welcome development. One, new program commitments, such as the European Communitygs STABEX loan and IDA's Industrial Sector Adjustment Credit, disbursed quickly. In particular, there was a strong response by manufacturers to program facilities for imports. In addition, some - 62 - bilateral donors made program assistance more attractive by allowing importers to space their repayments, instead of requiring the total cedi equivalent up front. Two, the import licensing system was less of a constraint because there was a large backlog of licenses in the system. The licensing regime was abolished for most producer and intermediate goods in October, which helped to speed up disbursements in the last quarter of the year, but the full effect on importers will not be evident until 1987. Three, the Central Project Monitoring Unit, set up by the Government in late 1985, has been successful as a troubleshooter and has helped speed up, on the Government side, both the process of turning indications into commitments and aid disbursements. However, additional efforts are still required. Donors could take advantage of more cofinancing opportunities, thereby avoiding the delays of separate appraisals. The Government's removal of most import restrictions is a major step, but should be complimented by measures to speed up the process of obtaining legal opinions and of the appointing consultants. Ghana's Aid Requirements in 1987-1989 124. The availability of foreign exchange will continue to be a key constraint to Ghana's economic recovery as the country implements the structural adjustment program. As discussed in the previous chapter, the current account deficit is expected to average about $340 million during the period. Import projections are based on meeting the minimum requirements for raw materials, spares, intermediate and capital goods, necessary if growth objectives are to be met. Few resources are left for imports of consumption items. Although efforts to rehabilitate important export sectors have begun to show results, particularly for cocoa and timber, over the next three years the growth in export proceeds will be constrained by the projected stagnation in international cocoa prices. Export receipts will not be adequate to cover necessary imports as well as other payment obligations, particularly debt service. Although commercial trade credits have a role to play in import financing as international lenders regain confidence in Ghana's financial position, excessive reliance on these sources would exacerbate an already heavy debt burden. At a minimum, the level of aid disbursements should be sufficient to meet slightly over a third of projected imports of goods and non-factor services (GNFS). However, this would still leave a financing gap averaging $24 million in 1987-1989 (Table 13). Actual Projected 1984 1985 1986 1987 1988 1989 (US$ million) Imports (GNFS) 810 876 955 1,100 1,210 1,310 Current Account Deficit 215 283 194 331 357 340 ODA Disbursements 270 224 357 428 469 487 ODA as % of Imports 33 26 37 39 39 37 ODA as % of Current Account Deficit 126 79 184 129 131 143 - 63 - 125. The aid pipeline at the beginning of 1987 is estimated at $859 million. Out of this total $291 million (34 percent) is expected to be disbursed in 1987, $225 million in 1988, and $150 million in 1989. New commitments of $575 million in 1987 (the increase reflecting in part the need to "catch up" after the shortfall in 1986 and the impact of the depreciation of the dollar), and an average of $635 million each in 1988 and in 1989 are recommended in order to meet minimum requirements, assuming disbursement rates similar to those of 1986. The share from bilateral donors is expected to increase from an average of a third in 1984-86 to an average of 44 percent in 1987-1989. The recommended commitments represent a modest increase of slightly over 10 percent in real terms, compared to the average for 1984-1986. It is justified by Ghana's strong nast commitment to the Economic Recovery Program, the need to pro. a strong stimulus to the structural adjustment process, to enable the country to reduce dependence on commercial borrowing, and to ensure an adequate level of imports at a time when external debt obligations will be high. After 1989, Ghana's needs for concessional assistance would decline somewhat, as the economy benefits more from the structural adjustment program. 126. Quick-disbursing program and sector support of about $230-240 million each year during 1987-1989 is recommended. This level of support is essential to finance imports for rehabilitation and to increase capacity utilization through provision of spare parts and raw materials. The experience with IDA's Second Reconstruction Imports Credit (cofinancing from the Netherlands and the United Kingdom) has shown that broad and flexible sectoral allocations result in speedier disbursements. The changes now occurring in the Ghanaian economy make it more difficult for anyone, including donors, to identify which sectors, let alone which enterprises, will adjust most quickly to the new incentives. Program loans which can be used by a variety of enterprises are most appropriate in this situation. Other donors have committed similar program assistance for manufacturing, timber, and transport. These facilities have been largely oriented towards the private sector. IDA's Industrial Sector Adjustment Credit has succeeded in further streamlining disbursement procedures by limiting documentation to what is prepared by the commercial banks for trade financing, instead of requiring additional forms. 127. The operation of the foreign exchange auction since September 1986 has important implications for the structure of donor assistance to Ghana. The auction and through it, the achievement of a more realistic and market-determined exchange rate, is the cornerstone of the structural adjustment program. The Government's objective is to channel as many transactions as possible through this mechanism - indeed, this is necessary if the auction is to perform the function intended. Donors should endeavor, to the extent possible, to support this major economic reform by designing program assistance so that funds can be channeled through the auction. In addition to specifying only broad and flexible sector allocations, donors should try to provide untied assistance to the extent possible. Cofinancing existing program operations such as the Second Reconstruction Imports and the Industrial Sector Adjustment Credits and the - 64 - proposed Structural Adjustment Credit, already the intention of some donors, would be one way of supporting the foreign exchange auction. In the case of donors who are traditional exporters to Ghana, even tied program aid can be channeled through the auction with successful bidders allocated funds from external assistance if the traniraction qualifies. The Bank of Ghana already has begun this process. It is important that a strong effort be made to allocate such aid and that Afficient, quick procedures for doing this are finalized without delay. In addition, the foreign exchange auction and the emergence of a more realistic exchange rate lessens the degree of supervisior of procurement which is needed, particularly for the private sector. 128. Program assistance is also an effective way to channel resources to education and health, which need essential supplies and equipment. The Ghanaians have begun a far-reaching reform of the education system in order to make it more consistent with the country's needs and financial resources. The reform requires financial resources to support the objectives of improving facilities and supplies for primary education and reforming the curriculum at both the primary and secondary levels. IDA's recently approved Education Sector Adjustment Credit is proving an effective vehicle for cofinancing, particularly for new donors interested in the social sectors. Similar support is required to meet Ghana's objective of strengthening and expanding access to primary health care and more efficiently providing essential drugs. 129. Although the domestic food supply has continued to improve, Ghana can still use food and commodity aid to supply products which otherwise would be imported, such as wheat, rice, sugar, and powdered milk. Commodity assistance, primarily cotton, has provided the raw material needed to increase capacity utilization in textiles. New food and commodity aid commitments of at least $50-55 million are recommended. Food aid can be used effectively to complement project financing, as the World Food Program is doing in the area of the transport sector, among others. There is scope for a wider application of these food-for-work schemes in Ghana which could be targeted to areas of the country which may not benefit from the first round of structural adjustment reforms, such as farmers in the North, and those workers laid off from the civil service. The schemes could focus on improvements in rural and urban infrastructure, for which the needs are great. The World Food Program and bilateral donors should work with the Government to aid its efforts to minimize the social costs of adjustment. Management would be easier if some food aid is coupled with project financing, as is the case in the port and road rehabilitation projects. 130. The level of project aid commitments (excluding technical assistance which is expected to average $20 million per annum) recommended rises from $275 million in 1987 to $330 million by 1989. This reflects the need to support the planned increase in public investment to rehabilitate economic and social infrastructure. Donors should be guided by the public investment program (1986-1988) which has been prepared by the Government and was described in Chapter III. There are financing gaps in several - 65 - Table 15: OVERALL AID PIPELINE, 1985-1989 (US$ Mlllions) Program/ Food/ Project 1/ Sector Commodity Total 1985 Undisbursed balance 12/31/84 291 140 83 514 New 1985 Commitments 262 196 29 487 Disbursements from pipeline 66 47 23 136 Disbursements from 1985 commitments 37 33 18 88 Total Disbursements 103 80 41 224 Exchange Rate Adjustment -8 1986 Undisbursed balance 12/31/85 446 253 70 769 New 1986 Commitments 217 143 31 391 Disbursements from pipeline 100 130 26 256 Disbursements from 1986 commitments 24 59 18 101 Total Disbursements 124 189 44 357 Exchange Rate Adjustments (est.) +56 1987 Undisbursed balance 12/31/86 577 220 62 859 New 1987 Commitments 295 230 50 575 Disbursements from pipeline 156 112 23 291 Disbursements from 1987 commitments 30 87 20 137 Total Disbursements 186 199 43 428 1988 Undisbursed balance 12/31/87 686 251 69 1,006 New 1988 Commitments 340 235 55 630 Disbursements from pipeline 184 142 28 354 Disbursements from 1988 commitments 35 60 20 115 Total Disbursements 219 202 48 469 1989 Undisbursed balance 12/31/88 807 284 76 1,167 New 1989 Commitments 350 235 55 640 Disbursements from pipeline 216 138 25 379 Disbursements from 1989 commltments 38 50 20 108 Total Disbursements 254 188 45 487 1990 Undisbursed balance 12/31/89 903 331 86 1,320 I/ Includes technical assistance Source: Bank staff estimates OAP/GHCEM1 - 66 - areas of the program (para 79). In particular, additional support is needed for road maintenance and rehabilitation, improvements in supporting services for agriculture, mining rehabilitation, primary health care, and the reforms of the education system. The bulk of these projects focus on rehabilitation and improved use of existing capacity. The document meets a need which has been felt by the donor community and should be a use.'ul vehicle for aid coordination and to help ensure that external assistance meets the country's priorities. Donors should finance a high proportion of total cost, and where possible, recurrent and maintenance costs, particularly in the social sectors. Assistance is also needed to carry out feasibility studies for the large number of projects which have been proposed for the investment program, but have not been included because of a lack of sufficient ir.formation on the potential rate of economic return (para 93). 131. As already stated, the recommended commitment levels and projected disbursement ratios would leave a financing gap averaging $24 million in 1987-89. On its part, the Government shoula try to fill this gap by consolidating and refinancing external arrears. Donors could help by providing debt relief and additional support for the structural adjustment program, for example, by cofinancing IDA'a; Structural Adjustment Credit. Technical Assistance 132. The recent salary adjustments for the professional staff of the civil service have improved morale, but the number of qualified employees is still insufficient to implement the ambitious structural adjustment program. Even though many skills are available among senior staff in Ghana, because of the demands on their time they ar(- not able to be involved in all issues or to supervise effectively and train less experienced staff. Technical assistance ha3 an appropriate role to play in supplementing the available pool of skilled personnel and in training itnior staff. The Government strongly prefers that technical assistance omes from qualified Ghanaians. This reflects an unwillingness to spend, especially from borrowed funds, scarce foreign exchange for technical assistance and the problems posed by the extremely high salaries of foreign consultants, relative to the earnings of Ghanaians. In cases where it is willing to engage foreign consultants, the Government has expressed the desire for "workers" as opposed to "advisors", reflecting the strong demands within the structural adjustment program for tasks such as, tax reforms a'nd improvements in the budgeting process. Pending restoration of a reasonable measure of competitiveness to civil service salaries, so that civ'l servants can once again provide nearly all the skills required to implement Government programs, the skill gaps will be met by a combination of two measures. One, the Government will shortly establish a skills mobilization scheme for Ghanaians (para 61). The scheme would offer financial incentives for civil servants involved in structural adjustment-related tasks, provide for long and short-term consultancies for ron-civil servants also working on these tasks, and encourage Ghanaians living abroad to return to Ghana to take up Government posts. Two, if - 67 - qualified Ghanaians are not available, international consultants will be hired. 133. For technical assistance to be effective, whether from local or international sources, senior Government staff must actively supervise the work of consultants. In addition, counterpart staff need to be identified in order to ensure the transfer of skills. To get the most out of their time, consultants should be provided with adequate logistical support and equipment. Given the increase expected in technical assistance to Ghana from the UNDP, the IDA Structural Adjustment Institutional Support project, and bilateral programs, it is important for the Government to streamline the procedures for approving contracts for consultants. It might be helpful if general guidelines were developed so that only exceptional cases would require approval outside the relevant ministry. Some assistance may also be required to identify qualified personnel, particularly outside Ghana, and to advise on other administrative aspects of hiring external consultants. Aid Coordination 134. Aid coordination both between the Government and the donors and among donors improved during 1986. At the local level, monthly meetings with participation by representatives from the government and donor agencies have encouraged the e.ichange of information and discussion of common issues such as the use of counterpart funds, vse of local consultants, and recent policy measures such as the foreign exchange auction. Periodic status reports provided updates on progress since the November 1985 Consultative Group on: (i) implementation by the Government of further reforms under the Economic Recovery Program and (ii) the actions taken by donors to meet the external financing requirements of the ERP. Information on. the timing and purpose of upcoming visits planned by the staff of donor agencies is distributed monthly. The Government organized a meeting with the donors in Accra in July for an interim review of the reform program and external assistance. Special meetings were held on industry and the socia'. sectors for interested donors. 135. The support providt.d by th:e UNDP to strengthen the International Relations Department (IERD) of the Ministry of Finance and Economic Planning is beginning to show results. Computerization has improved the process of monitoring disbursements and projecting futt:re assistance flows. Donors are also providing IERD with data on actual disbursements as it becomes available. Further wort. is needed to improve the flow of information between implementing agencies and the staff of IERD on the progress of foreign-aided projects and likely disbursement levels. Quarterly reporti.Lg of such information using a simple format for major projects might help in this regard. IERD also needs to ensure that information on aid commitments and disbursements is made available to others in the Ministry and Bank of Ghana staff. There are still problems with lack of data for some bilateral donors without active aid offices in Gha. - 68 - 136. The recently issued public investment program (1986-1988) can be an effective instrument for aid coordination. It also provides a discipline for both donors and the Government. At least on a preliminary basis, the Government has identified its priority investment projects and financing gaps, reflecting careful consideration. Both donors and the Government need to adhere to that program. In order to provide general support to the investment program, donors should cornsider allocating a share of those counterpart funds generated by food and commodity assistance or program aid over which they maintain some control to priority projects (para 92). 137. Co-financing activity in Ghana is fairly high, particularly in several large infrastructure projects such as port rehabilitation and the Northern Grid extension. Progress in this area should continue. IDA has several possible vehicles for cofinancing including the on-going Education Sector Adjustment, Second Reconstruction Import and Industrial Sector Adjustment Credits, all of which already have attracted additional fundng. In addition, there are several projects scheduled to begin in 1987-1988 suitable for cofinancing, including the Structural Adjustment and Institutional Support Credits and several project operations (Cocoa III, Transport Rehabilitation, Mining Rehabilitation, and Telecomunications). The Government should actively encourage cofinancing because it lessens the administrative burden on its officials and line staff. External Debt Management 138. Ghana's medium and long-term external public debt outstanding and disbursed (excluding the IMF) at end 1985 amounted to $1.2 billion, roughly a quarter of GDP. Bilateral creditors account for two-fifths; multilateral sources for over one half (Bank and IDA loans and credits comprised 25 percent of total debt); and suppliers credits for the remaining 10 percent. In spite of the relatively low stock of outstanding debt and its generally concessional terms Ghana's debt service burden has increased in recent years and will remain severe over the medium-term. This is because of 12-month oil credits, obligations to the IMF, and payments to reduce arrears, which are not included in the above figure. The debt service ratio has risen sharply from 14 percent in 1982 to 37 percent in 1986, due mainly to short term oil borrowings. The debt service ratio, inclusive of the IMF and reduction of arrears, was 47 percent in 1986. Ghana's debt service ratio declines over the next several years as dependence on short term oil borrowings lessens. However, once IMF obligations and the payments to reduce external arrears are taken into account, total debt service averages 58 percent during 1987-88, but eases by 1989. 139. It is important that the debt service burden not constrain the implementation and success of the structural adjustment program. External 3oncessional assistance is critical to ensure an adequate amount of import financing in the context of the large payment obligations which face Ghana. Also, to the extent possible, the Government should seek a possible consolidation of arrears and a stretching out of terms in order to avoid the need for cash outlays to reduce the stock of arrears outstanding. - 69 - Table 16: EXTERNAL DEBT SERVICE ON GOVERNMENT AND GOVERNMENT-GUARANTEED DEBT (US$ Millions) 1984 1985 1986 1987 1988 1989 Medium and Long Term Debt Amortization 141 255 259 166 189 185 Long Term 26 25 30 40 45 45 Medium Term 114 223 218 117 133 126 of which : Oil (61) (146) (171) (75) (68) (50) Trust Fund 1 7 11 10 10 10 Interest 53 59 44 53 58 59 Total Debt Service 194 314 303 219 247 244 IMF Obligations Repurchases 4 0 22 161 235 161 Charges 21 44 55 52 50 45 Total IMP Debt Service 25 44 77 213 285 206 Grand Total 219 358 380 432 532 450 Payment Arrears 61 57 4 26 7? 73 Debt Service Ratios (Z) excluding IMF 32.1 46.8 37.0 26.3 27.5 25.0 including IMF 36.3 53.4 46.5 51.9 59.2 46.2 including IMF and arrears 46.4 61.8 46.9 55.0 67.3 53.6 Memorandum item Export of goods and non-factor services 604 671 818 832 898 975 Source: Bank of Ghana (1984-86) and staff estimates (1987-89) EDS/GHCEM1 - 70 - In addition, there may be advantages for the Bank of Ghana to borrow new money if that lengthens the maturity of its liabilities and is on better terms. 140. The Government has decided to consolidate the debt management function at the Ministry of Finance and Economic Planning in the International Economic Relations Division, resolving the previous confusion over the Ministry's and the Bank of Ghana's respective roles. Under IDA's Structural Adjustment Institutional Support Credit, the Government will install the Debt Management and Financial Analysis System (DMFAS) developed by UNCTAD during 1987. The system provides a package of pre-installation training in debt reporting, installation of a program specifically tailored to Ghana's requirements, plus associated hardware, and supervised implementation and training. It is important that the Government work out clear reporting relationships and the allocation of responsibilities among the various Government agencies which have a role in debt reporting and management, especially the Bank of Ghana and the Accountant General. Conclusion 141. Since the last meeting of the Consultative Group for Ghana, the Government has made considerable progress in almost all the areas identified thien as critical to the successful evolution of the program. There is little indication that the Government is suffering from "adjustment fatigue". In fact, Ghana deserves high marks not only for staying the course, but for moving into high gear in the fifth year of the reform program. It has more than lived up to its part of the "compact" and remains at the forefront of economic adjustment in Sub-Saharan Africa. Ghana's persistence and expanded effort deserve support. Without that support, the success of the structural adjustment program will be endangered. Donors, as does the Government, must recognize that structural adjustment takes time and that external assistance is needed throughout in order to sustain that process. Donors should take the opportunity of the implementation of the structural adjustment phase of the reform effort to demonrtrate their commitment and support to Ghana for the medium-term. - 71 - ANNEX A Page 1 SELECTED POLICY CHANGES SINCE 1985 AGRICULTURE Cocoa 1. Effective for the 1985-86 mid-crop which began in late April, the cocoa producer price was raised by 50 percent to 085,000/metric ton. An additional 0500/metric ton is to be paid if the production target for the 1986/87 season of 230,000 metric tons is reached. 2. As of December 1985, some 16,000 workers were retrenched from the Ghana Cocoa Board. An additional 10,000 workers were removed from the payroll as of February 1987. Other Crops 3. The Government also announced new fertilizer prices effective June 30, 1986. Prices were increased on average by about 80 percent, but a subsidy remained to cover distribution and handling costs. Fertilizer Prices (cedis per 50 kg. bag) Type of Fertilizer New Price Nitrogen Phosphate Potash 20 0 0 780 70 20 15 1,370 -Sulphate of Ammonia 490 -Single Superphosphate 503 -Muriate of Potash 756 4. Effective April 1986, the producer price for coffee was increased by 50 percent (from 062,620/ton to 094,095/ton) and for sheanuts by 3 percent (from 027,280/ton to 028,000/ton). THE 1986 BUDGET 5. The following measures were announced in the 1986 budget: - major increases in the tariff rates of some consumer goods; - sharp increases in a variety of registration and licensing fees; and - adjustment of personal income tax rates in order to provide some relief from inflation induced increases in the effective tax burden (see table below). - 72 - ANNEX A Page 2 Effective Income Tax Rate Annual Income Level 1 9 8 5 (%) 1 9 8 6 (%) (cedi) Single Married Single Married 25,000 - 40,000 7.0 - 13.1 6.0 - 12.0 2.8 - 3.5 1.8 - 2.9 40,000 - 60,000 13.1 - 21.4 12.0 - 20.2 3.5 - 5.8 2.9 - 4.5 60,000 - 80,000 21.4 - 28.6 20.2 - 27.6 5.8 - 7.9 4.5 - 6.9 80,G00 - 100,000 28.6 - 34.1 27.6 - 33.2 7.9 - 11.1 6.9 - 9.8 100,000 - 120,000 34.1 - 37.9 33.2 - 37.2 11.1 - 13.8 9.8 - 12.4 '20,000 - 150,000 37.9 - 41.7 37.2 - 41.1 13.8 - 18.6 12.4 - 17.1 150,000 - 180,000 41.7 - 44.3 41.1 - 43.8 18.6 - 22.6 17.1 - 21.3 180,000 - 210,000 44.3 - 46.1 43.8 - 45.7 22.6 - 25.9 21.3 - 24.6 210,000 - 240,000 46.1 - 47.5 45.7 - 47.1 25.9 - 29.2 24.6 - 28.1 THE 1987 BUDGET 6. The following measures were announced in the February 1987 Budget: - Changes in the practice of advance tax payments by corporate bodies and self-employed persons from the beginning of the quarter to the end of each quarter. The corporate tax rate for manufacturing concerns was reduced from 50 percent to 45 percent. - Substantial reductions in import duties especially on imported items which satisfy priority needs of the economy, e.g., all commercial vehicles, motorcycles, bicycles, railway coaches, locomotives, raw materials and capital goods such as pig iron, raw jute, clinker, and cotton and non-luxury consumer goods. The 10 percent special sales tax on goods imported under Special Import Licenses (SIL) was abolished. - Major increases in the special tax on the following goods: cigarettes by 100 percent to 0100 per pack of 20 sticks; beer, stout, cider, perry and ale by 78 percent to 0125 per litre; alcoholic beverages by 83 percent to 0550 per litre; and non-alcoholic beverages from 035 to 060 per litre; and - The merging of excise duties on all locally produced goods, with the exception of petroleum products, tobacco, alcoholic, and non-alcoholic beverages, into sales taxes, and reductions of the sales tax rates on several locally produced inputs for the housing industry, such as cement, roofing sheets and paint. MONEY AND BANKING 7. As part of the Government's policy of trying to maintain positive real interest rates, in August 1986, deposit rates were increased across the board by 2 percentage points, with the exception of 24-month deposit rates which were increased 'y 3 percentage points. The rates on 12-month - 73 - ANNEX A Page 3 time deposits have more than doubled since October 1983 to the present level of 20 percent. Lending rates were increased on average by 2-3 percent by unifying them at the maximum rate of 23 percent. Interest Rate Structure of Banks (% per annum) 4/19/85 9/10/85 10/10/86 3/27/87 to to to to 9/9/85 10/9/86 3/26/87 Present Bank of Ghana Discount Rate 18.00 18.50 20.00 23.00 Advances to Government 18.00 18.50 20.50 23.50 Tr- sury Bill Discount Rate 16.75 17.75 19.75 22.75 Commercial Banks Savings Deposits 15.50 16.50 18.50 21.50 Time or Fixed Deposits Three months 15.75 16.75 18.75 21.75 Six months 16.00 17.00 19.00 22.00 Twelve months 17.00 18.00 20.00 23.00 Twenty-four months 18.00 19.00 22.00 25.00 Lending Rates With Bank of Ghana guarantee 20.00 20.50 - - Without Bank of Ghana guarantee 22.50 23.00 - - Agriculture, Forestry and Fishing (maximum) - - 22.50 23.00 All Other Sectors (maximum) - - 23.00 26.00 PRICES AND INCOMES 8. The Government further adjusted the retail prices of petroleum products in January 1986 when it devalued the cedi. However, in March, in the wake of the sharp fall in oil prices on international markets, the Government marginally reduced fuel prices. The lower import prices were not passed through fully in anticipation of future rise in crude oil prices and to use the savings to cover debt service on petroleum related borrowings. The Government, however, announced on June 30, 1986 its decision to revert petrol and diesel fuel prices to their former levels (January 1986). In February 1987, petroleum product prices were adjusted upward to reflect the unified exchange rate. - 74 - ANNEXA Page 4 Petrolem Product Prics (per bperial Qa tllc Agst 1985 Januay 1986 March 1986 June 1986 Februry 1987 Cedi $Eq Cev Cdi Cedi $Euiv Cedi $Equiv Cedil $Equiv Pradum Gasoline 105.0 1.04 150.0 1.67 140.0 1.56 150.0 1.67 190 1.24 Regula Gasoline 100.0 1.75 145.0 1.61 135.0 1.50 145.0 1.61 180 1.18 Kerosene 55.0 0.96 90.0 1.00 80.0 0.89 80.0 0.89 110 .72 Gas Oil 85.0 1.49 130.0 1.44 115.0 1.28 130.0 1.44 165 1.08 1^a: US$ equivalent amomnts are calculated at official xxchnge rates. Fees 9. Utility tariffs and postal charges were increased significantly in the first four months of 1986 (see table below). The action was motivated by the Government's objective of improving the financial performance of these companies. Utility and Postal Rate Increases (January - April 1986) Service % Change in Rate Water: Domestic (0 - 3,000 gal/mo.) 500 (4 - 10,000 gal/mo.) 750 (over 10,000 gal/mo.) 1,150 Commercial (O - 10,000 gal/mo.) 700 (over 10,000 gal/mo.) 1,000 Unmetered 350 Standpipes 150 Volta River Authority Electricity Corporation of Ghana 170 Mines 170 Electricity Corporation of Ghana Domestic 47 Commercial 80 Industrial 80 Telecommunications Domestic 300 International 70 Postal 600 -75- ANNEX A Page 5 Effective January 12, 1987, tariffs for international telephone, telex, and telegraph services were further increased, as a result of the application of the foreign exchange auction rate. Wages 10. In January 1986, the Government announced an increase in the minimum daily wage from 070 to 090, a wage and salary adjustment aimed at widening the differential between top and bottom pay scales from less than 2 to 1 almost 6 to 1, and higher allowances. 11. The 1987 Budget announced a 25 percent across-the-board increase in wages and salaries for the civil service effective January 1, 1987. The minimum wage also increased by the same percentage. The canteen allowance was raised by 50 percent to 030 per day and the transport allowance by 100 percent with effect from January. Allowances other than a few exceptions and those that are exempted by existing law will be added to the basic salary and taxed. EXTERNAL Exchange Rates 12. On January 10, 1986, the Government adjusted the exchange rate from 060 - US$1 to 090 = US$1. On September 16, 1986, the Government established a second window foreign exchange auction, covering all transactions excluding cocoa, petroleum, debt service for official debt contracted prior to January 1, 1986, and some essential drugs. The last auction rate, before the exchange rate was unified on February 21, 1987, was 0157 - US$1. At the foreign exchange auction of March 23, the exchange rate was 0156 = US$1. In the 1987 budget the Government announced that the Bank of Ghana will authorize licensed dealers to trade foreign exchange. External Payment Arrears 13. During 1986 external arrears on payments and transfers for current international transactions and on debt amortization were further reduced by $4 million to $171 million at end 1986. Trade Policy 14. The retention accounts for non-traditional exports increased from 20 to 35 percent effective February 21, 1987. Major changes were also introduced to import duty tariffs, sales tax and excise duty effective the same date (no. 5). SPC/GEcMl -76 - ANNEX B Page 1 6 H A N As S E C T 9 R A L 6 R O W T H R A t E S O F 6 D P (Continued Refort Case; in 1984 Prices) 1985 1986 1997 1989 1989 199o 1991 1992 1993 1994 1095 ....... .. ... ... ..* .... ".4.. - %*4 -...*%lb% ..ft %-f% "Ilk *%" %.. ... ..... Industrial Sector 16.11 6.4? 13.92 12.81 13.5l 6.21 4.82 5.21 5.2? 5.2? 5.2? mining 12.7? -1.1? 19.02 9.9? 9.1? 9.2? 5.9? 3.9? 3.89 3.8? 3.89 Manuf. 19.0? 7.0? 14.0? 14.0? 15.0? 6.0? 5.0? 5.52 5.5? 5.5? 5.5? Utilities 20.7? 9.9? 12.01 12.0? 13.01 4.01 4.0? 5.0? 5.0? 5.0? 5.0% Construction 9.0? 7.0? 11.0? 11.0? 11.0? 6.0? 4.0? 5.0? 5.0? 5.0? 5.0? Agricultural Sector 0.2? 4.8? 1.8? 2.8? 2.7? 3.5? 3.5? 3.1? 3.1? 3.0? 3.0? Cocoa 13.21 11.2? 0.01 9.0? 8.0? 5.8? 5.5? 2.8? 2.5? 1.9? 1.72 Forestry 0.2? 0.7? 6.0? 10.01 8.0? 6.1? 5.5? 5.0? 5.0? 5.0? 5.0? Other -1.1? 4.5? 1.7? 1.6? 1.61 3.0? 3.01 3.01 3.0? 3.01 3.0? Other Sertors 8.2? 5.4? 6.0? 5.6? 5.3? 4.9? 4.4? 4.6? 4.6? 4.6? 4.6X Transport 6.4? 4.5? 6.0? 5.0? 5.0? 5.0? 5.0? 4.52 4.5? 4.51 4.5? hholesale I Retail 9.1? 6.2? 6.5? 6.2? 5.7? 5.0? 4.5? 4.9? 4.8? 4.8? 4.89 Financial Servicne 9.3? 3.8? 5.5? 5.5? 5.5? 5.0? 4.0? 4.5? 4.5? 4.5? 4.5? Public Adain. 4.i2 1.5? 2.0? 2.0? 2.0? 2.11 2.2? 2-3? 2.41 2.5? 2.6? Other Services 3.89 3.8? 4.0? 4.0? 4.0? 4.0? 4.0? 4.0? 4.0? 4.0? 4.0? Opp Growth Rate 5.1? 5.3? 5.0? 5.3? 5.3? 4.5? 4.1? 4.1? 4.1? 4.0? 4.0? 6 H A N A: S R C TOR A L D I S T R I B U T I o N O F 6 D P (Continued Refore Case; in 1984 Prices) 1984 1985 1996 1987 1988 1989 1990 1991 1992 1993 1994 1995 Industrial Sector 10.61 11.7? 11.9? 12.82 13.7? 14.8? 15.01 15.1? 15.3? 15.5? 15.6? 15.89 Mining 1.2? 1.3? 1.2? 1.4? 1.41 1.5? 1.5? 1.6? 1.6? 1.6? 1.5? 1.52 manuf. 6.4? 7.2? 7.4? 9.0? 6.6? 9.4? 9.6? 9.7? 9.8? 9.9? 10.1? 10.2? Utilities 0.9? 0.9? 1.0? 1.0? 1.1? 1.2? 1.2? 1.2? 1.2? 1.22 1.2? 1.2? Construction 2.2? 2.3? 2.3? 2.4? 2.6? 2.7? 2.7? 2.7 2,9? 2.9? 2.91 2.8? Agricultural Sector 49.2? 46.9? 46.7? 45.3? 44.2S 43.2? 42.9? 42.5? 42.2? 41.8? 41.4? 41.0? Cocoa 4.1? 4.4? 4.7? 4.5? 4.6? 4.7? 4.7% 4.8? 4.89 4.7? 4.6? 4.5? Forestry 3.4? 3.3? 3.1? 3.2? 3.3? 3.4? 3.41 3.5? 3.5? 3.6? 3.61 3.6? Other 41.6? 39.2? 39.9? 37.7? 36.4? 35.1? 34.6? 34.2? 33.91 33.5? 33.21 32.9? Other Sectors 40.3? 41.4? 41.5? 41.9? 42.11 42.1? 42.2? 42.3? 42.5? 42.89 43.0? 43.21 Transport 6.4? 6.5? 6.5? 6.5? 6.5? 6.52 6.5? 6.6? 6.61 6.7? 6.7? 6.7? Wholesale I Retail 28.3? 29.3? 29.6? 30.0? 30.3? 30.4? 30.61 30.7? 30.9? 31.1? 31.4? 31.6? Financial Services 1.7? 1.9? 1.8? 1.8? 1.8? 1.8? 1.8? 1.89 1.8% 1.9? 1.81 1.8? Public Adin. 3.4? 3.3? 3.2? 3.1? 3.0? 2.9? 2.9? 2.8? 2.8? 2.7? 2.7? 2.7? Other Services 0.5? 0.5? 0.5? 0.4? 0.4? 0.4? 0.4? 0.4? 0.4? 0.4? 0.41 0.4? 6DP 100.01 100.0? 100.01 100.0? 100.0? 100.0? 100.0? 100.0? 100.01 100.0? 100.0? 100.01 …-.- - - --------- - - ---------- --------- - -- -- Source: Dank staff estioatn. - 77 - ANNEX B Page 2 6 0A II0 SECTORAL 6ROIITN RATES OF 6DP lAdiustsent Fatigue Case; 1994 Prices) 195 1996 1997 1988 1989 1490 1991 1992 1993 29,94 299 Industrial Sector 16.12 6.42 13.82 5.22 5.1l 3.61 2.32 2.01 2.02 2.02 2.01 lining 12.72 -1.12 19.01 5.02 5.8S 3.92 1.92 l.92 1.91 1.92 1.9S lAnuf. 19.02 7.02 14.02 5.02 5.02 3.91 2.52 2.02 2.02 2.01 2.02 Utilati n 20.71 9.92 12.0t 5.02 5.02 2.02 2.02 2.02 2.02 2.02 2.02 Construction 8.01 7.02 11.01 6.02 5.02 3.82 2.02 2.02 2.02 2.02 2.02 Agricultural Sector 0.22 4.82 1.81 2.02 1.7n 1.52 1.42 1.4t 1.42 2.42 1.42 Cocoa 13.22 11.22 0.02 2.32 2.22 0.02 -0.1 -0.22 -0.12 -0.12 -0.22 Forrestry 0.2S o.7 6.02 7.92 3.02 3.12 2.89 2.52 2.52 2.52 2.52 Other -1.12 4.52 1.72 1.52 1.52 1,52 2.52 2.52 2.52 1.5S 1.52 Other Sectors 9821 5.42 6.02 2.92 2.92 2.92 2.72 2.72 2.52 2.52 2.52 Transport 6.42 4.52 6.0 3.02 3.02 3.02 2.52 2.52 2.52 2.52 2.52 Mhateula 4 Retail 9.12 6.22 6.52 3.02 3.02 3.02 3.02 3.02 2.82 2.92 2.92 Financial Servicn 9.32 3.82 5.52 3.0S 3.02 3.02 3.02 2.82 2.8l 2.8S 2.92 Publ3c Advin. 4.12 1.52 2.02 0.02 0.02 0.02 0.01 0.02 o.ot 0.01 0.02 Other Services 3.62 3.98 4.02 2.02 2.02 2.02 2.02 2.02 2.02 2.01 2.02 &DP 6routb Rate 5.12 5.32 5.02 2.72 2.62 2.32 2.12 2.02 2.02 2.02 2.02 6 A 11 At S E C TIO R a L D I S T R I 8 U T I Oi 1 0 F S D P (djustut Fatigue Case; in 1994 Prices) 1984 1995 1986 1997 1998 1989 1990 1991 1992 1993 199 295 444444 444444 444444 "44 .4 4..4 .444 44444 . 4,4..4. .4 4 4" 4.4 ,44.%, Industrial Sector 10.61 11.72 2l.92 12.89 13.12 13.42 13.62 I3.6Z 13.62 13.62 13.61 13.6t mining 1.22 1.32 1.22 1.42 1.42 1.42 2.5? 1.42 1.45 1.42 2.42 1.42 anu4. 6.42 7.22 7.42 9.02 8.22 8.42 8.52 9.52 8.52 8.5t 8.52 9.52 Utilities 0.92 0.92 1.02 1.02 1.02 1.1 I'll . 1.1 1.12 1.22 1.12 1.12 Construction 2.2t 2.32 2.32 2.42 2.51 2.62 2.62 2.62 2.6U 2.62 2.62 2.6t Agricultural Sector 49.21 46.92 46.72 45.32 45.02 44.62 44.22 43.92 43.7n 43.42 43.22 43.02 Cocoa 4.11 4.42 4.7n 4.52 4.41 4.42 4.32 4.22 4.11 4.12 4.02 3.92 Forrestrv 3.42 3.32 3.12 3.22 3.3S 3.32 3.42 3.42 3.42 3.41 3.42 3.42 Other 41.62 39.21 38.92 37.7S 37.22 36.82 36.52 36.32 36.12 36.02 35.62 35.62 Other SiKtors 40.32 41.42 41.5t 41.92 41.9t 42.0S 42.22 42.52 42.72 43.02 43.22 43.42 Transport 6.41 6.52 6.52 6.52 6.62 6.62 6.62 6.n 6.72 6.72 6.82 6.82 Wholesale I Retail 28.31 29.32 29.62 30.02 30.12 30.22 30.42 30.72 31.02 31.22 31.52 31.72 Financial Services 1. 7l 1.82 1.t 1 2.n 1.82 1.8t 1.52 1.81 1. 1.82 1.92 1.91 Pubhc Adein. 3.41 3.3t 3.22 3.12 3.02 3.02 2.92 2.82 2.82 2.72 2.72 2.62 Other Services 0.57 0.52 0.52 0.41 0.4t 0.42 0.42 0.42 0.42 0.4l 0.42 0.42 GDP 100.01 200.02 100.02 200.02 100.02 100.02 100.02 200.0 100.02 200.01 100.02 200.02 ….… ..…… … - - -- - - . - . - _ - _ - . - _ - .-_-_-_-.-. Source: lank staff estinates. - 78 - ANNEX B Page 3 6 H A N As v L U M E O F E X P O R T S (Continued Refore Case) Product 1984 1985 1986 1987 1998 1999 1990 1991 1992 1993 1994 1995 Cocoa (MT) 164939 191708 214114 214114 231244 249743 264191 278639 296441 293602 298936 303916 Log (CH) 149000 247012 397689 421551 463706 500902 531351 560575 588604 618034 649936 691383 Sold (FOT) 295759 289902 286013 343216 377539 415291 456820 485600 505024 525225 546234 568084 Diasond (Carat) 323000 488699 494075 592890 696566 686566 686566 686566 686566 696566 686566 686566 Manganese (NT) 241000 256665 243832 256267 266518 273447 280557 287571 294760 302129 309692 317424 Oil Residuals (NT) 124445 192990 123449 166657 166657 166657 166657 166657 166657 166657 166657 166657 Electricity (an kwh) 624 1529 2828 3111 3578 3579 3578 3578 3579 3578 3578 3578 Bauxite (NT) 44000 146520 190476 247619 346666 399666 458466 459466 459466 459466 458466 458466 8 H A N A: E X P O R T P R I C E I N D I C E S (Continued Refwor Case) Product 1984 1995 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 Cocoa 100 93 105 96 91 90 90 94 98 102 107 111 Log 100 79 84 89 95 99 104 110 1lS 120 125 131 Gold 100 89 103 106 110 114 119 123 128 134 141 147 Diasand 100 100 115 119 122 126 131 136 143 149 156 163 Mamganese 100 102 102 105 10 114 117 120 176 131 137 144 Oil Residuals 100 92 72 75 77 79 93 93 103 115 129 143 Electricity 100 68 55 15 55 55 55 55 57 59 61 64 Bauxite 100 110 110 115 120 120 125 130 136 143 149 156 G 1 A N A: E X P O R T S I N C U R R E N T P R I C E S (Continued Reforo Case; in Million of USS) Product 1984 1985 1996 1987 1998 1989 1990 1991 1992 1993 1994 1995 - _- - - -- - - - - .I. t"% 1. - * . **"* s "%*. 4 *4s %41* Cocoa 392 412 519 475 490 524 554 609 652 697 739 784 Log 21 29 47 53 62 71 79 B9 96 105 115 126 Gold 103 92 106 131 150 171 195 215 234 254 277 301 Diamond 3 5 5 6 a 8 a 9 9 10 10 10 Manganese a 9 8 9 10 10 11 11 12 13 14 15 Oil Residuals 23 33 16 23 24 24 26 29 32 35 40 44 Electricity 20 33 49 54 63 63 63 63 65 68 70 73 Bauxite 1 4 5 6 9 11 13 14 14 15 16 16 Other 5 17 16 18 30 38 45 60 65 70 76 83 Exports of Su is 566 632 773 777 845 920 992 1096 1179 1267 1357 1453 Non-Factor Services 38 39 45 b5 53 55 55 59 62 66 70 75 Total Exports 604 671 919 932 898 975 1047 1154 1241 1333 1428 1528 Source; Bank staff estioates. - 79 - ANEX B Page 4 6 H A N A: V O L U M E O F E X P OR T S (Adjustomnt Fatigue Case) Product 1904 1985 1986 1987 1998 1999 1990 1991 1992 1993 1994 1995 - - - - -I v' s%%'.4 %A~'% wb%," lb I. 44*"- Coroa (MT) 164839 191708 214114 214114 218997 223879 223979 223655 223431 223209 222984 222761 Log (CH) 148000 247012 397689 421551 454642 468282 482564 495835 508231 520936 533960 547309 Gold (FOT) 285759 288902 286013 343216 360720 383806 399926 408124 416287 424613 433105 441767 Diamond (Carat) 323000 488699 494075 592890 639729 639729 639728 639729 639728 639728 639728 639728 Manganese (MT) 241000 256665 243832 256267 259342 262454 265866 269190 272555 275962 279411 282904 Oil Residual (NT) 12.1445 192890 123449 166657 166657 166657 166657 166657 166657 166657 166657 166657 Electricity (an kwh) 62r 1529 2828 3111 3265 3265 3265 3265 3265 3265 3265 3265 Bauxite (NT) 44000 146520 190476 247619 288947 297946 324165 324165 324165 324165 324165 324165 6 H A N A: E X P O R T P R I C E I N 0 I C E S (Adjustment Fatigue Case) Product 1984 1985 1986 1987 1988 1989 !990 1991 1992 ;993 14 1995 Cocoa 100 93 105 96 99 101 101 105 109 114 119 124 Log 100 79 84 89 93 97 102 108 112 117 123 128 Gold 100 98 103 106 110 114 118 123 129 134 141 147 Diamond 1O0 1O0 115 118 122 126 131 136 143 149 156 163 Nanuanese 100 102 102 105 109 114 117 120 126 131 137 144 Oil Residual 100 92 72 75 77 79 93 93 103 115 128 143 Electricity 100 b8 55 55 55 55 55 55 57 59 61 64 Bauxite 1O0 110 110 115 120 120 125 130 136 142 149 156 6 H A N A: E X P 0 R T S I N C U R k E N T P R I C E S (Adjustsent Fatigue Case) Product 1984 1985 1986 1987 1998 1989 1990 1991 1992 1993 1994 1995 __________._ %"4 %" SA44 4 44 444 4444 % 44.1.-. %%'.lb** %"%lo4 Cocoa 392 412 519 475 505 523 523 544 566 590 614 639 Log 21 28 47 53 60 65 70 76 81 87 93 100 Sold 103 92 106 13; 140 154 167 177 188 2h 215 229 Diaoond 3 5 5 6 8 a p 9 9 10 10 11 Manganese 8 9 8 9 10 11 11 11 12 13 13 14 Oil Residual 23 33 17 23 25 25 27 30 33 37 41 46 Electricity 20 33 49 54 57 57 57 57 60 62 64 67 Bauxite 1 4 5 6 5 5 5 5 5 5 5 5 Other 5 17 16 18 19 19 20 21 22 24 25 26 Exports of 6oods 566 632 773 r77 828 868 899 930 978 1029 1081 1137 Non-Factor Services 38 39 45 55 60 63 65 70 74 79 84 89 ---- -- - ---- -----_ _ _ , .. _..... ---- ---- ---- -- - -----._____ Total Exports 604 671 819 832 888 931 953 1000 1052 1106 1164 1226 Source: Bank staff estimates. - 80 - ANNEX B Page 5 ORAN Ai N as I C E X P E N D 1 T U R E I N D I C A T 0 R S IContinurd Rofore Cau; in 1994 Price) Indicator 1994 1985 1994 1997 1988 1999 1990 1991 1992 1993 1994 1995 1eports/lDP 10.7X 11.1? 11.92 12.72 12.9? 13.02 13.01 12.91 12.8X 12.71 12.5? 12.4? Exportsl6DP 9.0? 9.32 10.12 10.21 10.61 10.89 10.91 11.1l 11.0X 10.92 10.61 10.5X Lonsueption/GDP 95.12 95.3? 92.52 90.91 88.12 96.9% 95.92 85.4? 85.12 84.72 84.42 84.12 Total Investeent/6DP 7.,6 7.32 9.12 11.42 '4.3? 15.5? 16.2? 16.42 16.92 17.22 17.51 17.92 Source: Bank staff estmsates. - 81 - ANNEX B Page 6 6 H a N A: B A S I C E X P E N D I T U R E I N D I C A T 0 R S (Adjustaent Fatigue Case; in 1984 Prices) Indicator 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 loports/6DP 10.71 11.12 11.81 12.71 11.8% 11.71 11.71 11.61 11.52 11.51 11.71 11.5% Exports/GDP 8.0X 9.31 10.1 10.2% 10.3% 10.3% 10.21 10.1% 9.9% 9.8X 9.7% 9.5% Consueption/6DP 95.1% 94.5% 92.5% 90.9% 93.41 93.11 92.9% 92.51 92.4% 92.6% 92.71 92.51 Total Investment/lDP 7.61 7.3% 9.1% 11.6% 8.0% 8.3% 8.bZ 9.0% 9.22 9.1Z 9.31 9.5% Source: Bank staff estioates. - 82 - ANNEX B Page 7 6 H A N B 8 A L A N C E O F P A YM E N T S …._ ------------------------ (Continued Reforo Casi. .lillions of Current US$) Category 1984 1985 1986 1987 1988 1909 1990 1991 1992 1993 1994 1995 - - - -. - - - - - - - - - Exports 604 671 BIB 832 898 975 1047 1154 1241 1333 1429 1528 Merchandise (fob) 566 632 773 777 845 920 992 1096 1179 1267 1357 1453 Non-Factor Services 38 39 45 55 53 55 55 58 62 66 70 75 Ioports 810 876 955 1100 1210 1309 1409 1516 1630 1750 1867 2000 Herchandise 'cif) 681 727 780 891 985 1072 1159 1253 1353 1458 1560 1676 Non-Factor Services 129 149 175 209 225 237 250 263 277 292 307 324 Resource Balance -206 -204 -137 -268 -312 -335 -362 -362 -399 -416 -440 -472 Factor Payoents (Net) -81 -111 -105 -113 -125 -125 -118 -113 -107 -108 -113 -119 of which: Interest -79 -108 -101 -108 -121 -121 -118 -113 -106 -105 -107 -110 Net Transfers 73 32 49 50 80 120 140 150 161 172 194 199 Current Balance -215 -283 -193 -331 -357 -340 -339 -326 -335 -352 -368 -393 Capital Account 94 166 131 439 478 446 401 413 440 440 422 434 Grants 141 93 115 161 157 194 215 213 206 198 192 195 Official MLT 70 32 99 252 235 211 195 191 209 209 206 209 Disbursesents 211 287 358 418 425 396 365 360 363 369 379 394 Amortization -141 -255 -259 -166 -190 -185 -170 -169 -155 -160 -172 -185 Private (Net) 4 5 18 24 38 21 -26 -11 4 12 4 12 Other -121 36 -95 2 48 20 1o 20 21 21 19 18 Overall Balance -121 -117 -56 108 121 106 62 87 105 80 54 41 …-… - ___ - - _ . - ------------------------------…- ------__ ___-__-_-__ ,-_--… _ - _ Source: Bank staff estioates. - 83 - ANNEX C Page 1 A Brief Description of the Flow-of-Funds Model 1. A five sector flow-of-funds model is used to ensure consistency between the current and the capital accounts of the public, monetary and private sectors, the balance of payments, and the national accounts. The approach starts from the sectoral accounts and ends by consolidating these into two flow-of-flunds matrices, one for the current and one for the capital accounts. 2. The public sector is an extended version of the budget. It identifies the foreign financed share of public investment while the budget does not. Grants are included as a financing item. The eacimated costs of the planned retrenchment progr;n for the civil service are identified separately. The treatment of the monetary sector is standard and distinguishes between Net Foreign Assets and Net Domestic Credit to the public and private sectors as counterparts to the Money Supply. It also includes a re-evaluation account which represents the adjustments to Net Foreign Assets following an adjustment in the exchange rate. Treatment of the balance of payments is also standard. However, it differs from the official BOP in one respect. Public transfers are excluded from the Current Account definition and instead included in the Capital Account. The private sector is a residual account. 3. In the public sector account, total revenue and current expenditure represent budgeted values for the next three years. Within the recurrent expenditures, the major component are identified separately. The allowed overall deficit is also known from the resources available to finance it by the other sectors. From this, the model generates the total vdlue of the capital expenditures which are composed of two parts. The first one is the externally financed. Assumptions are made on foreign aid flows for the balance of payments which are reflected in the public sector. The second part is the domestically financed and is the residual in this sector. 4. A cocoa sector module estimates production based on the stock of trees in Ghana, projected replanting rate, and an econometrically estimated cocoa supply function. The function takes into account farmers' response to changes in price and the impact of improved husbandry and disease control. Using this data and taking into account the planned reduction in the costs of the Ghana Cocoa Board, the module also estimates Government receipts from cocoa. 5. For the monetary sector, assumptions are made about the growth rate of money supply. They reflect the remonetization of the economy as well as the increa'e in nominal GDP. The changes in net foreign assets are derived from the balance of payment forecasts and ret domestic credit is a residual. In this model, credit to the public sector is fixed, leaving credit to the private sector as the final residual. - 84 - Page 2 6. The balance of payments is derived frcm projections made in the Bank's Revised Minimum Standard Model (RMSM). it also includes those variables which are needed in other accounts such as exports, imports and transfers for the national accounts. Assumptions on the exchange rate have to be made to convert dollar denominated aid flows into local currency. 7. For the national accounts, the values for GDP growth rates in real terms are supplied by the RMSM, while assumptions are made for GDP deflators. Real investments estimates are again provided by the RMSM, and using public and private investment deflators, nominal investment figures are projected. Since public consumption is derived frotm the public sector account, private consumption becomes a residual. 8. The current account in the private sector is completely residual and includes State-owned Enterprises' accounts. In the capital account some assumptions on loans to the public sector are made. The remaining values are derived from other sectors. ANNEOv C - 85 - Page 3 GHANAs Flow of Funds Framework (Ratio to GDP at Current Market Prices) TABLE 1. PUBLIC SECTOR BUDGET 1984 1985 1986 1987 1988 19H9 TOTAL REVENUE 8.0o. 10.4X 13.6b 16.1. 16.2% 16.5X _____________ Current Receipts 8.0X 10.4. 12.3X 15.4. 15.57. 15.1X Direct Taxes 1.5X 2.1. 2.8X 2.89 3.0X 3.07. Indirect Taxes 5.1% 6.5X 8.12 1 .1X 11.17. 10.7% Cocoa 1.4X 2.47 2.7% 4.3X 4.2X 3.67. Other 3.7X 4.17. 5.4X 6.9X 6.9X 6.97 Other Revenues (income & fees) 1.4Z 1.89 1.57 1.4% 1.4X 1.4X memos current rac. net of cocoa 6.67 8.07 10.97 11.87. 12.0X 12.7X Additional Resources Mobilization 0.07 0.07 1.3X 0.7X 0.7% 1.4% New Measures 0.07 0.0X 1.3% 0.77. 0.7% 1.4X Improvements in Tax Admin. 0.0 0.07 0.0 0.07. 0.07 0.07. TOTAL EXPENDITURES 11.87. 14.17 17.97 22.98 23.6X 24.4X Current Expenditures 8.4X 10.3X 11.9% 12.97 12.7X 12.97. Wages and Salaries 1.9X. 3.92 5.1% 5.5 5.7X 5.8X Other Purchases of SDS 3.92 3.52 2.4% 2.62 2.87. 3.0X Interest Payments 1.3% 1.42 2.2X 2.77 2.37 2.27 To Banking Se'tor 0. X 0.0X 0.07 0.0% 0.07. 0.0% To Non Banking Sector 0.6O 1.2X 1.1X 1.0Z 0.8X 0.7X To Rest of World 0.7X 0.17 1.22 1.7X 1.57 1.57 Subsidies 1.0t 1.1X 1.4X 1.4X 1.57 1.5X Transfers 0.47 0.5X 0.77 0.72 0.57 0.5X Government to Private Capital Expenditures 3.62 3.82 5.92 9.2X 9.9X 10.87 Development Exper.iture 3.17 3.07 3.67 5.57 5.5X 6.67 - Financed from Government and Aid Counterpart Funds (1) 1.67 2.02 1.9% 2.92 2.9X 3.67 - Project Aid Financed 1.42 1.07 1.72 2.67 2.67 3.0Z Project Loans 0.52 0.5 0.92 0.87 0.97 1.07 Project " ints 0.92 0.6b 0.92 1.82 1.7X 2.07 Net Lending 0.67 0.87 2.22 3.7X 4.4X 4.2X Project Aid Financed 0.32 0.37 1.72 2.9X 3.4% 3.27. Other (1) 0.37 0.67. 0.52 0.82 1.07% 1.07. Special Efficiency 0.02 0.07 O.O 0.77 0.97 0.b7 less Funds not included in Budget 0.22 0.07. 0.0 0.07. 0.0 0.0X Current Account Savings (-) -0.4X 0.1X 1.7X 3.2Z. 3.5S 3.6X Overall Deficit (enlarged definition) -4.02 -3.87 -4.12 -6.62 -7.4X -7.9X Overall Deficit (budget definition) (1) -1.52 -2.07 0.17 0.22 -0.47 -0.37 Deficit Financing 4.07 3.82 4.17 6.67 7.42 7.9X of which DOmestic Financing 1.12 1.17 1.07 -0.62 0.47 0.52 Private to Government (net) 0.52 0.32 0.67 0.37 0.47. 0. S Monetary to Gvt (net) 0.77 0.82 0.52 --0.9% 0.07. 0.0 Foreign Financing 2.9% 2.7X 3.1 7.2X 7.0X 7.42 Loans 2.82 3.7 Z S.1X 7.57 8.4X 7.57. Project loans 0.82 0.72 2.52 3.3X 4.0X 3.8X Non-Project loans 2.0w' 2.67 2.62 4.17 4.42 3.72 Concessional 1.3% 1.02 1.62 2.32 3.27 2.72 of which, SAL 0.02 0.02 0.07. 1.57. 2.27 1.4X Non-Concessional (oil) 0.77 1.67 1.02 1.87 1.27 0.97 Srants 1.72 1.02 1.7X 3.52 3.17 3.7X Project grants 0.97 0.62 0.97 2.22 2.07 2.47 Non-Project grants 0.82 0.42 0.87 1.22 1.02 1.47 Repayments to rest of -1.67. -1.62 -3.7X -3.7X -4.44% -3.9X World Note X (1) This corresponds to the present definition which oxcludes Project Aid Financed Expenditures Source: Bank staff estimates. -86- ANNEX C Page 4 GHANAt Flow of Funds Framewrk ______________________________ (Ratio to GOP at Current Market Prices) TABLE 2. PRIVATE SECTOR ACCOUNT (includes State Owned wntsrprises) 1984 1795 1986 1987 1999 19t9 Disposable Income 94.5X 92.12 89.3x 837.5 87.9s 99.12 SOP at factor costs 95.92 94.67. 92.4x 99.72 89.82 89.7X Transfers, Government to Private 0.92 1.7X 1.72 2.4Z 2.2X 1.9% Transfrrs, Foreign to Private. 1.0 0.52 0.92 1.3S 2.02 2.9X - Direct Taxes 2.9s 3.92 4.62 4.42 4.52 4.7X - Nat Factor Payments 0.4% 0.82 1.2% 1.5t t.h% 1.5% Uses of Disposable Income 94.5s 91.4x 99.62 87.12 94.92 87.52 Private Consumption 89.4. 99.42 84.82 81.82 78.2% 74.2X Private Savings 5.12 3S0O 4.92 5.3% 8.72 11.22 Capital Sources 7.92 10.02 t1.4x 16.52 21.0% 2t.0X Private Savings 5.1% 3.02 4.8X 5.3% 8.72 11.22 Compensation for retrenchment 0.0 0.0 0.0% 0.72 0.9X 0.6h Loans, Government to Private 0.6% 0.82 2.2% 3.72 4.4% 4.2% Loans, Monetary to Private 3.82 h.02 3.92 2.4% 2.0% 2.3% of whichs Cocoa 0.62 2.72 0.72 0.8% 0.4% 0.3% Loans, Foreign to Private (net) -1.8x -0.42 -1.0% 3.6% 4.3% 1.92 Direct Fo sign Investment 0.07 0.17. 0.17. 0.22 0.3% 0.5% Other Mos.atary Assets 0.0O 0.52 1.12 0.22 -0.22 -0.52 Capital Grants, Foreign to Private 0.27 0.27 0.32 0.62 O.62 0.72 Capital Uses 7.92 1t0.0X 11.4% 16.5% 21.0% 21.02 Private Investment 4.52 4.3X 6.72 11.4% 15.52 14.1% P + am 3.67 5.62 5.9% 4.5X 4.72 4.3% Loans, Private to Government 0.57 0.3X 0.67 0.32 0.42 0.52 Other -0.62 -0.22 -1.72 0.12 0.3% 0.1% Sources Bank staff estimates. ANN=. C - 87 - Pa1ge 5 GHANAs Flow of Fundg Framework --__-------------------------- (Ratio to GDP at Current Market Prices) TABLE 3. MONETARY SECTOR - CAPITAL ACCOUNT ONLY ------------------------------------------------- FLOWS INs 1994 1995 1996 1987 1989 1909 TOTAL ASSETS 4.1X 5.92 7.3X 4.52 4.7X 4.32 ____________ Not Foreign Assets -1.62 -4.68 -16.02 2.82 3.0% 2.52 Net Domestic Assetts 4.52 7.3X 5.5% 1.82. 2.02 2.3X Loans, Monetary to Government 0.72 0.ex 0.5s -0.92 0.02 0.02 Loans, Monetary to Private 3.82 6.0% 3.92 2.42 2.02 2.3X Cocoa 0.62 2.72 0.72 0.62 0.42 0.3% Non-cocoa 3.32 3.32 3.32 1."2 1.62 2.12 Other items, not 0.02 0.5X 1.42 0.32 0.0% 0.02 Long-term foreign liabilities of development banks 0.02 0.0% -0.32 -0.22 -0.22 -0.52 Revaluation Account 1.22 3.22 17.8 0.0 0.02 0.02 TOTAL LIABILITIES 4.12 5.92 7.32 4.52 4.72 4.32 N + WI 3.62 5.6x 5.9X 4.52 4.72 4.3X SDR allocations 0.62 0.22 1.42 0.02 0.02 0.02 STOCK at cloa of t TOTAL ASSETS 14.22 16.22 19.12 19.9X 21.52 23.32 Not Foreign Assets -11.62 -13.12 -25.62 -17.82 -12.02 -8.22 Net Domestic Assets 14.72 18.02 18.62 16.72 15.92 15.82 Loans, Monetary to Government i 8.92 7.32 5.92 3.82 3.2% 2.82 Loans, Monetary to Private 6.42 10.62 11.72 11.8X 11.92 12.81 Cocoa 1.32 3.62 3.3X 3.42 3.3% 3.12 Non-cocoa 5.12 7.02 8.42 9.42 9.72 9.72 Other items, not -0.62 0.12 1.42 1.52 1.32 1.12 Long-term foreign liabilities of development banks 0.02 0.02 -0.32 -0.42 -0.&2 -1.02 Revaluation Losses 11.12 11.22 26.02 21.0X 17.7X 15.72 TOTAL LIABILITIES 14.2X )6.22 19.12 19.9X 21.51 23.32 M + am 13.02 15.1X 16.9X 18.12 20.0X 22.0X SDR allocationn 1.1% 1.12 2.2X 1.82 1.5S 1.32 Sourcas Bank staff Qetimates. - 88 - ANX C GHANAs Flow of Funds Framework Page 6 (Ratio to GDP at Current Market Prices) _______-______________________ TABLE 4. BALANCE OF PAYMENTS ------------------------------ 1984 1985 1986 1987 1998 1989 Exports of Goods (fob) 7.5X 9.3X 14.97. 20.2Z 20.9% 21.4% Cocoa beans and products 5.1% 6.17 10.0X 12.47 12.1t 12.2X Other exports 2.4X 3.3X 4.9Z 7.9A 9.97 9.2% Imports of Goodd (cif) -9.07 -10.71 -15.1X -23.2X -24.4X -25.07. Oi' -2.17 -2.9X -2.4X -3.9X -3.87 -3.77 Non-os 1 -6.97 -7.8X -12.7Z -19.37 -20.67 -21.3% Trade Balance -1.57 -1.47 -0.17 -3.0. -3.5X -3.67 Non-factor Services -1.27 -1.67 -2.57 -4.0X -4.3X -4.2% Receipts 0.57 0.6X 0.97 1.42 1.37 1.37. Payments 1.77 2.27 3.4X 5.42 5.67 5.5X Resource Balance -2.7X -3.07 -2.67 -7.07 -7.7X -7.87 Net Factor Payments -1.1X -1.6X -2.0Z -2.92 -3.1t -2.9X Interest Payments -1.17 -1.67 -2.0X -2.8X -3.07. -2.ex PuSlic -0.77 -0.97 -0.92 -1.42 -1.57 -1.57 Private -0.12 -0.17 -0.0X -0.17 -0.27 -0.3X Banking -0.37 -0.7X -l.1X -1.3Y -1.3X -1.07 Factor Payments & other -0.07 -0.0X -0.1X -0.1X -0.17 -0.17 Not Private Transfers 1.0. 0.57. 0.9X 1.37 2.07 2.87 SIL 0.07. 0.0X 0.0Z 0.07. 0.0Z 0.0 Current Account Balance - Foreign Savings -2.87 -4.27 -3.7% -9.67. -9.82 -7.979 External Capita) Inflow -0.11 0.67 0.87 7.22 9.07 5.9X Public Foreign Borrowings 0.9X 0.5X 1.9X 6.62 5.82 4.9X NLT net 0.92 0.67 2.17 6.92 6.17 5.27 Gross Inflows 2.87 4.27 6.97 10.92 10.57 9.27 Concessi anal 1.82 2.01 4.7X 6.97 7.7X 6.82 of whichs SALs 0.07 0.0% 0.07 0.32 0.47 0.3XV Non-concessional 1.07 2.22 2.27 3.9X 2.82 2.47. of which: oil 0.7X 1.7? 1.12 1.82 1.27 0.97 Amortization 1.92 3.7X 4.M2 4.02 4.4X 4.07 Trust Fund -0.07 -0.1t -0.2% -0.3X -0.3X -0.3X Private Foreign Borrowing(Net) 0.17. 0.t17 0.3X 0.67 0.97 0.52 Direct Foreign Investment 0.0. 0.17 0.1t 0.27. 0.37. 0.5 Short term Lorrowing(Incl.IDA sp. acct.) -1.17 0.27 -1.67 -0.17 0.97 0.07. Transfers to Government 1.92 1.4X 2.22 4.27 3.9X 4.57 of which s to private (incl. SOEu) 0.22 0.27 0.37 O.62 O.67 0.77 Errors & Omissions -0.57 0.27 -0.42 0.07 0.07. 0.0 Overall Balance -1.67 -1.77 -1.17 2.82 3.0X 2.57 Financing 1.67 1.7. 1t.1 -2.82 -4.37 -2.97 Net use of IMF Resources 2.82 1.82 0.32 -O."7 -2.22 -0.77 Changes in SWR Holdings 0.07 O.O 0.3Z 0.0 0.07. 0.07 Foreign Exchange -0.37 0.2Z 0.3x 0.22 -0.42 -0.57 Payment Arrears a/ -0.82 -0.87 -0.17 -0.77 -1.8. -1.72 SXT Liabilities of SBW aj 0.0% 0.57 0.47 -1.17 0.02 O.O Medium-Term Liabilities of BO 0.07. 0.07 O.OX -0.97. 0.07. 0.0 Bilateral Balances -0.1. 0.1X -0.2X 0.32 O.O 0.0. Residual Financing Sap -0.07 0.07 -0.0X 0.02 1.32 0.47 aI A major portion of arrears may constitute short term liabilities and therefor are intorchangoeablo. Source: Bank staff estimates. -89 - AINNEXC Page 7 GHANA: Flow of Funds Frammwork (Ratio to GDP at Current Market Pricoo) TADLE 5. NATIONAL ACCOUNTS 1984 1985 1986 1987 1980 1989 Real GDP growth 9.61 5.11 5.3X 5.0X a.3X 5.3X GDP deflator 3.51 31.2X 30.21 19.01 12.51 7.51 Nominal GDP growth 12.41 37.91 37.11 23.91 18.51 13.21 GDP, market prices 100.02 100.01 100.01 100.0 100.01 100.01 SUP, factor cost, 95.91 94.6Z 92.4X 99.71 89.89 99.7x Indirect Taxes 5.1X 6.51 9.11 11.71 11.61 11.82 Subsidies (- 1.02 1.1 1.41 1.41 1.5S 1.51 Resource Gap -2.71 -3.01 -2.61 -7.01 -7.71 -7.81 Total ExpenditurGs 102.71 103.01 102.61 107.01 107.7X 107.91 Consumption 95.11 95.71 92.31 89.61 E6.7t 95.01 Public Consumption 5.7X 7.4X 7.6% 9.0o 9.51 9.89 Privato Consumption 89.41 99.41 94.9S 81.98 79.2x 76.21 Investment 7.61 7.31 10.3% 17.11 21.0X 22.v-. Budgetary Capital Expenditures 3.6X 3.8X 5.9X 9.21 9.9X 10.8X Private Investment 4.01 3.41 4.41 7.91 11.1 11.91 National Savings 4.7X 3.1X 6.61 9.51 12.21 14.92 Public Savings -0.4X 0.12 1.71 3.21 3.51 3.62 Private Savings 5.11 3.01 4.8X 5.31 8.71 11.21 Foreign Savings 2.82 4.21 3.7Z 8.61 8.89 7.91 Total Savings 7.61 7.3X 10.31 17.12 21.01 22.91 Sources Bank staff estioates. ANNEX D -90- Page I Ghana: Balance of Paysents (in current US$ million) 1984 1985 1996 1987 1989 1989 Exports of Goods (fob) 566 632 773 777 945 920 Cocoa beans and products 382 412 519 475 490 524 Other exports 184 220 254 302 355 396 loports of Goods (tif) -681 -727 -780 -891 -985 -1073 Oil -161 -200 -125 -148 -153 -158 Non-oil -520 -527 -655 -743 -832 -915 Trade Balance -115 -94 -7 -114 -140 -153 Non-factor Services -91 -110 -130 -154 -172 -182 Receipts 39 39 45 55 53 55 Payments 129 149 175 209 225 237 Resource Balance -206 -204 -137 -268 -312 -335 Net Factor Payments -81 -111 -105 -113 -125 -125 Interest Payments -79 -108 -101 -109 -121 -121 Publit -53 -59 -44 -54 -60 -63 Private -5 -5 -2 -2 -9 -13 Banking -21 -44 -55 -52 -51 -45 Factor Paysents & other -2 -3 -4 -5 -4 -4 Net Private Transfers & SIL 73 32 49 50 80 120 Current Account Balance Foreign Savings -215 -283 -193 -331 -357 -340 External Capital Inflow 132 150 155 439 478 446 Grants 141 93 115 162 157 194 Public Foreign Borrowings 70 31 99 252 235 211 lILT net 71 39 111 264 247 222 Gross Inflows 211 287 359 418 424 396 Concessional 138 134 243 266 312 293 Non-concessional 73 153 115 151 112 103 of which: oil 49 116 59 68 50 40 Asortization 140 248 248 154 178 173 Trust Fund -1 -7 -11 -12 -12 -12 Private Foreign Borrowing(Net) 4 5 1B 24 38 21 Direct Foreign Investeent 2 6 4 6 12 20 Short tern borrowing -85 15 -81 -5 36 0 Errors & Omissions -38 16 -18 0 0 0 Overall Balance -121 -117 -56 108 121 106 Financing Gap 0 0 0 0 56 17 Source: Bank of Ghana and Bank staff estimates. - 91 - ANNEX D Page 2 MERCHANDISE EXPORTS, 1983-89 (US$ million) 1983 1984 1985 1986 1987 1988 1989 COCOA (beans) Volume (MT) 159,280 149,574 171,747 198,335 210,000 224,000 240,000 Unit Value ($/MT) 1,583 2,351 2,189 2,434 2,100 2,000 2,000 Total Value ($ million) 252 352 376 483 441 448 480 COCOA (products) Volume (MT) 15,000 15,-z65 15,966 17,657 20000 2,OOO0 ?0,000 Unit Value (S/MT) 1,573 1,967 2,254 2,06.2 1,700 2#1Cv 2,200 Total Value (S million) 24 30 36 36 34 42 44 COCOA (Total) Volume (MT) 174,280 164,839 187,713 215,992 230,000 244,000 260,000 Unit Value ($/MT) 1,582 2,315 2,195 2,403 2,065 2,008 2,015 Total Value ($ million) 276 382 412 519 475 490 524 GOLD Volume ('000 fine oz.) 278 286 285 288 337 384 434 AGC 250 255 249 290 320 344 SGMC 36 30 39 47 64 90 Unit Value (S/fine oz,) 367 361 319 369 386 390 394 Total Value ($ million) 102 103 91 106 130 150 171 DIAMONDS Volume ('000 carats) 439 425 640 565 678 785 785 Unit Value (US cents/carat) 640 690 860 850 885 890 890 Total Value 3 3 6 5 6 7 7 MANGANESE Volume ('000 MT) 127 248 263 257 270 278 285 Unit Value ($/MT) 39 34 34 32 33 32 35 Total Value (5 million) 5 8 9 8 9 9 10 TIMBER Vclume ('000 cu. meters) 103 126 247 354 375 434 477 Unit Value ($/cu. meter) 142 167 113 135 144 150 155 Toi.al Value 15 21 29 48 54 65 74 RESIDUAL OIL Volume (MT) 112 124 199 204 200 200 200 Unit Value ($/MT) 180 182 168 86 125 125 130 Total Value ($/million) 20 23 33 18 )5 25 26 ELECTRICITY Volume (mn kwh) 624 1,700 2,500 2,750 3,025 3,025 Unit Value ($/mn kwh) 31,971 21,798 19,600 19,636 19,835 19,835 Total Value (S million) 12 20 35 49 54 60 60 OTHER GOODS Volume (Constant 1984 S) 6 17 18 20 33 40 Unit Val'se 100 101 114 118 120 122 Total Value (S million) 8 6 17 20 24 39 48 GRAND TOTAL 440 566 632 773 777 845 920 Source: Bank of Ghana for 1983-R6; World Bank Staff estimates for 1987-89. Exports/GHCEMl - 92 - ANNEX D Page 3 AID COMMITMENTS TO GHANA IN 1985 BY TYPE OF ASSISTANCE AND DONOR (US$ millions) Commodity Program/ Technical Of which Donor Proj ct and Food Sector Assistance Total Grants CG Members Canada 23.7 3.6 5.8 - 33.1 33.1 France - 0.2 12.2 - 12.4 0.2 Germany 3.7 - 9.7 - 13.4 - Italy 13.7 - - 2,1 15.8 2.1 Japan 27.1 3.3 5.7 - 36.1 9.0 Switzerland - - 9.1 - 9.1 9.1 UK - - 9.9 1.4 11.3 11.3 USA 2.2 11.2 - 3.6 17.0 6.0 ADB/ADF 41.0 - 38.0 - 79.0 BADEA - - 9.0 - 9.0 - EEC/EIB 18.9 2.9 - 3.7 25.5 25.5 IFAD - - - - - _ UNDP - - 4.0 4.0 4.0 WFP _ 7.9 - - 7.9 7.9 World Bank 100.0 - 87.0 - 187.0 - Others Australia - - - - Brazil - - - - CDC - - - 0.9 0.9 0.9 China - - - - - Denmark - - 5.0 - 5.0 5.0 India - - - Korea - - - - Kuwait Fund - - - - - - Netherlands - - 4.5 1.0 5.5 5.5 OPEC 6.0 - - - 6.0 - Spain - - - Saudi Fund 8.5 - - - 8.5 NGOs - - - - Total 244.8 29.1 195.9 16.7 486.5 119.6 Bilateral 78.9 18.3 61.9 8.1 157.2 81.3 Multilateral 165.9 10.8 134.0 8.6 319.3 38.3 Source: World Bank staff estimates based on information supplied by Ministry of Finance and Economic Planning and Donors. Commitments/GHCEMl - 93 - ANNEX D Page 4 AID COMMITMENTS TO GHANA IN 1986 BY TYPE OF ASSISTANCE AND DONOR (US$ millions) Commodity Program/ Technical Of which Donor Project and Food Sector Assistance Total Grants CG Members Canada 11.2 a/ 8.3 3.6 - 23.1 18.0 France 24.5 - - - 24.5 - Germany 5.6 - 8.3 9.7 23.6 11.7 Italy - - - 1.0 1.0 1.0 Japan 9.8 - 3.4 0.6 13.8 13.8 Switzerland - - 6.1 - 6.1 6.1 lK - - 23.0 3.3 26.3 26.3 lJSA 1.0 10.3 - - 11.3 4.3 ADB/ADF 29.0 - - - 29.0 - BADEA - - - - - EEC/EIB 47.7 3.5 16.9 - 68.1 14.4 IFAD _- - - - _ UNDP - - 4.0 4.0 4.0 WFP - 9.0 - - 9.0 9.0 World Bank 24.5 - 68.5 - 93.0 - Others Australia - - - - - Brazil - - - - CDC 24.4 - - - 24.4 China _- - - - _ Denmark - - - - - - India -- - - - Korea - - - - - Kuwait Fund - - - - - - Netherlands - - 17.0 1.0 18.0 18.0 OPEC - - - - - Spain - - - - - Saudi Fund 12.8 - - - 12.8 - NGOs 3.0 - - - 3.0 3.0 Total 193.5 31.1 146.8 19.6 391.0 129.6 Bilateral 64.9 18.6 61.4 15.6 160.5 99.2 Multilateral 128.6 12.5 85.4 4.0 230.5 30.4 Source: World Bank staff estimates based on information suppli;,d by Ministry of Finance and Economic Planning and Donors. a/ Includes $6.2 million for Petro-Canada project. Commitments/GHCEM1 - 94 - ANNEX D P&e 5 AID DISBURSEMENTS IN 1985 BY TYPE OF ASSISTANCE AND DONOR (US$ millions) Commodity Program/ Technical Of which Donor Project and Food Sector Assistance Total Grants CG Members Canada 5.8 3.6 5.7 - 15.1 15.1 France - 0.2 - - 0.2 0.2 Germany 14.7 - - 3.7 18.4 4.6 Italy - - - 2.1 2.1 2.1 Japan 8.0 3.3 5.4 - 16.7 8.7 Switzerland - - 3.9 - 3.9 3.9 UK - 3.8 4.3 3.6 11.7 11.7 USA 3.6 13.0 - - 16.6 6.0 ADB/ADF 4.1 - 17.6 - 21.7 - BADEA - - - - - - EEC/EIB 11.3 3.5 - 1.7 16.5 13.1 IFAD 2.0 - - - 2.0 - UNDP - - 4.0 4.0 4.0 WFP - 14.0 - - 14.0 14.0 World Bank 34.2 - 37.5 - 71.7 - Others Australia - - - - Brazil - - - - CDC - - - 0.9 0.9 0.9 China _ _ _ _ _ Denmark - - - - - - India -- - - - Korea - - - - - - Kuwait Fund - Netherlands - - 5.6 1.0 6.6 6.6 OPEC - Spain _- - - Saudi Fund NGOs 2.0 - - - 2.0 Total 85.7 41.4 80.0 17.0 224.1 90.9 Bilateral 32.1 23.9 24.9 10.4 91.3 58.9 Multilateral 53.6 17.5 55.1 6.6 132.8 32.0 Sour_.e: World Bank staff estimates based on information supplied by Ministry of Finance and Economic Planning and Donors. Disbursements/GHCEM1 - 95 - ANNEX D Page 6 AID DISBURSEMENTS IN 1986 BY TYPE OF ASSISTANCE AND DONOR (US$ millions) Commodity Program/ Technical Of which Dornor Project and Food Sector Assistance Total Grants CG Members Canada 6.5 3.6 3.5 - 13.6 13.6 France Germany 16.5 - - 5.8 22.3 5.6 Italy - - 1.0 1.0 1.0 Japan 11.9 3.6 - 0.6 16.1 4.8 Switzerland - - 8.8 - 8.8 8.8 UK 0.9 - 17.4 2.9 21.2 21.2 USA 2.5 10.0 - - 12.5 6.5 ADB/ADF 18.0 - 1.8 0.5 20.3 - BADEA EEC/EIB 17.2 1.8 16.C 0.7 35.7 14.9 IFAD 1.5 - - - 1.5 - UNDP - - 4.0 4.0 4.0 WFP - 25.4 - - 25.4 25.4 World Bank 44.0 - 121.6 - 165.6 - Others Australia - - Brazil - - - CFTC - - - 0.9 0.9 0.9 China - - - Denmark - - - - - India - _ Korea 0.3 - _ _ 0.3 Kuwait Fund - - - Netherlands - - 4.6 0.5 5.1 5.1 OPEC 0.2 - - - 0.2 - Spain _ _- - Saudi Fund - - IWGOs 3.0 - - - 3.0 3.0 Total 122.5 44.4 173.7 16.9 357.5 114.8 Bilateral 38.6 19.0 34.3 10.8 102.7 66.6 Multilateral 83.9 25.4 139.4 6.1 254.8 48.2 Source: World Bank staff estimates based on information supplied by Ministry of Finance and Economic Planning and Donors. Disbursements/GHCEM1 - 96 - GHANA: POLICIES & ISSUES OF STRUCTURAL ADJUSTMENT STATISTICAL APPENDIX 1. Population and Employment 1.01 Population Estimates, 1970-85 1.02 Estimated Population by Age and Sex, 1986 1.03 Population and Density by Regions, 1960, 1970, 1984 1.04 Labor Force Estimates, 1980 2. National Accounts 2.01 National Income Estimates, 1970-85 2.02 GDP, By Kind of Economic Activity, Current 'rices, 1970-85 2.03 GDP, By Kind of Economic Activity, Constant 1975 Prices, 1970-86 2.04 Deflators of GDP, 1970-85 2.05 Expenditure on GNP in Purchasers' Value, Current Prices, 1970-85 2.06 Expenditure on GNP in Purchasers' Value, Constant 1975 Prices, 1970-84 2.07 Capital Transactions, Current Prices, 1970-84 2.08 Gross Capital Formation by Type of Good, Current Prices, 1970-84 3. Balance of Payments 3.01 Summary of Balance of Payments, 1979-86 3.02 Values of Total Exports by Country of Consignment, 1975-82 3.03 Imports by Section, 1970-82 3.04 Values of Imports by Country of Origin, 1975-82 3.05 Petroleum Imports, Exports, and Retail Prices, 1979-86 3.06 Index Numbers of Exports and Imports, 1970-83 4. External Debts 4.01 External Public Debt as of December 31, 1985 4.02 External Public Debt: Projections of Service Payments and Disbursements based on Debt Outstanding as of December 31, 1985 5. Public Finance 5.01 Summary of Central Government Finances, 1974/75-1985 5.02 Summary of Government Revenue and Grants, 1974/75-1985 5.03 Recurrent Expenditures, Functional Classification, 1974/75-1984 5.04 Economic Classification of Government Current Expenditures, 1975/76-1984 - 97 - GHANA: OLICIES & ISSUES OF STRUCTJRAL ADJUSTMENT STATISTICAL APPENDIX 5.05 Developmnnt Expenditures, Functional Classification, 1974/75-1984 5.06 Central Government Debt: Domestic and Foreign, 1975-85 5.07 Central Government Debt: Domestic, 1975-85 6. Money and Credit 6.01 Summary Accounts of the Banking System, 1970-84 6.02 Consolidated Balance Sheet of the Banking System, 1970-85 6.03 Assets and Liabilities of the Bank of Ghana, 1970-85 6.04 Assets and Liabilities of Commercial Banks, 1970-85 6.05 Assets and Liabilities of Secondary Banks, 1975-85 6.06 Purpose-Wise Classification of Loans and Advances, 1970-85 6.07 Money Supply and Liquidity of the Public, 1970-85 6.08 Reserve Requirements: Commercial Banks, 1970-85 6.09 Reserve Requirements: Secondary Banks, 1970-85 6.10 Velocity Ratios, 1970-84 6.11 Interest Rates, 1970-86 7. Agricultural Sector 7.01 Cocoa Beau. Production, Consumption, Prices, Payments to Farmers and Export Receipts, 1974/75-1986/87 7.02 Purchases of Cocoa Beans by Regions, 1974/75-1985/86 7.03 World Production of Cocoa Beans, 1974/75-1984/85 7.04 Production of Important Crops, 1970-86 7.05 Area Under Important Crops, 1970-86 7.06 Yield of Important Crops, 1970-86 7.07 Domestic Catch of Fish, Imports and Consumption, 1970-85 7.08 Production of Timber, Veneer and Plywood, 1970-86 7.09 Distribution of Cocoa Proceeds Between Producer, the Ghana Cocoa Board and the Government, 1974/75-1985/86 7.10 Operations of the Ghana Cocoa Board, 1975/76-1985/86 8. Industrial Sector 8.01 Mineral Production, 1970-86 8.02 Diamond Produc..tion, 1970-86 8.03 Gold Production, 1970-1985 8.04 Production of Some Selected Manufactured Commodities, 1975-85 8.05 Railway Traffic, 1970-85 - 98 - GHANA: POLICIES & ISSUES OF STRUCTURAL ADJUSTMENT STATISTICAL APPENDIX 9. Prices 9.01 Consumer Price Index Numbers, 1978-84 9.02 Monthly Consumer Price Indices, 1982-86 9.03 Wholesale Price Index Numbers, 1978-85 9.04 Index Numbers of Prime Building Costs, 1977-85 9.05 Average Wholesale Prices of Selected Agricultural Commodities, 1970-85 9.06 Average Retail Prices of Selected Commodities in Accra City, 1977-85 9.07 Monthly Earning per Employee in Establishments Employing 10 or More Workers, 1975-83 9.08 Index Numbers of Employees' Earnings, 1970-85 TABLE 1.01: POPULATION ESTMIATES (IN THOUSANDS) 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 …---------------------------------------------------------------------------------------------------------------------------------------------- POPULATION 3559 9760 10020 10280 10550 10820 11100 11390 11690 11990 12206 12620 SOURCES: 1984-85 FROM QUARTERLY DIGEST OP STATISTICS, MARCH 1986 1975-83 IPRM QUARTERLY DIGEST OF STATISTICS, JUNE 1984, PP. 1.74 1970 FROM ECOWNOIC SURVEY 1975-76. PP. 2-3 TABLE 1.02 ESTIMATED POPULATION BY AGE-GROUP AND SEX (MID-YEAR 1986) (IN THOUSANDS) AGE-GROUP MALE FEMALE TOTAL 0- 4 1,180 1,190 2,370 5- 9 1,104 1,095 2,199 10-14 780 740 1,520 15-19 605 575 1,180 20-24 463 569 1,033 25-29 440 518 957 30-34 400 450 850 35-39 336 329 665 40-44 264 266 531 45-49 218 194 413 50-54 181 169 351 55-59 116 100 216 60-64 114 108 222 ° 65-69 72 70 143 0 70-74 64 61 125 75-79 33 31 64 80-84 30 31 61 85-89 15 16 31 90-94 11 11 22 95 14 13 26 TOTAL 6,441 6,537 12,978 SOURCE: STATISTICAL SERVICE, ACCRA TABLE 1.03. POPULATION AND DENSITY BY rEGIONS (POPULATION IN THOUSANDS) 1960 1970 1984 SQUARE NM POP. DENSITY POP. DENSITY POP. DENSITY ALL REGIONS 238533 6726.8 28.2 8559.3 35.9 12205.6 51.2 WESTERN 23921 620.2 26.2 770.1 32.2 1116.9 46.7 CENTRAL 9826 751.4 76.5 890.1 90.6 1145.5 116.6 GREATER ACCRA 3425 541.9 158.2 903.4 263.8 1420.1 414.6 EASTERN 19323 1044.1 54.0 1209.8 62.6 1679.5 86.9 VOLTA 20570 777.3 37.8 947.3 46.1 1201.1 58.4 ASHANTI 24389 1109.1 45.5 1481.7 60.8 2089.7 85.7 0 BRONG AHAFO 39557 587.9 14.9 766.5 19.4 1179.4 29.8 NORTHERN 70384 531.6 7.6 727.6 10.3 1162.6 16.5 UPPER WEST 18476 288.7 15.6 319.9 17.3 439.2 23.8 UPPER EAST 8842 468.6 53.0 542.9 61.4 771.6 87.3 ------------------------------------------------------------------__---------__------------------- SOURCES: 1960, 1970, 1984 CENSUSES OF GHANA JUNE 1986 QUARTERLY DIGEST OF STATISTICS, P. 89. TABLE 1.04: LABOR FORCE ESTIMATES (IN THOLSANDS) 1980 MALE FEMALE TOTAL AGE GROUP 10-14 62 38 100 15-19 280 235 515 20-24 409 252 661 25-44 1078 760 1837 45-54 327 246 573 55-64 182 128 310 65+ 87 50 137 TOTAL 2424 1709 4133 SOURCES: IBRD, ILO Table 2.01: National InCooe Esti ates Killions of Cedis 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 ---------------------------------------------__--------_---------____--------__------_-------------------_---------------------------------------__-------- Natlonal Incoem (M. Cadis) At Current Prvces 2077 4918 6100 10599 20213 27080 41159 70186 83598 178202 262160 349363 At 1975 Prices 4918 4918 4718 4850 5321 5183 5171 4986 4607 4389 4759 - Per Capita National Income (C) At Current Prices 216 493 595 1038 1916 2503 3708 6162 7151 14863 21331 27683 At 1975 Prices 511 493 460 459 504 479 466 438 394 371 393 - CDP #-rket Prices (M. Cedis) At Current Prices 2259 5283 6526 11163 20986 28231 42853 72626 86451 184038 270561 372982 At 1975 Prices 5349 5283 5097 5212 5654 5512 5538 5344 4974 4747 5158 5420 Index of Nationarl Znc At Current Prices 42 100 124 215 411 551 837 1427 1700 3623 5330 7103 At 1975 Prices 100 100 96 99 108 105 105 101 94 89 97 - IndX of Per Cap Nat. Inc. At Current Prices 44 100 121 210 388 507 752 1249 1450 3013 4324 5612 1 At 1975 Prices 104 100 93 93 102 97 94 89 80 75 80 - w Inlda of GDP Market Prices At Current Priees 42 100 124 215 411 551 837 1427 1700 3623 5330 7103 At 1975 Prices 100 100 96 99 108 105 105 101 94 89 97 0 -------------------------------___-----------__-----__------------------__---__-----------__-__-------------------------------------.-----------------__--- Sources: 1978-85 data are provided by Statistical Service, Accra. 1975-77 data are from Quarterly Digest of Statistics, June 1984. 1970 data are from Economic Survey 1972-74, pp. 4-5 oemgiaa from 1968 prices into 1975 prices usifg the 1971 data as basis. Note: Data in 1984 and thereafter are provisional estiates. Table 2.02: Gross Domnstic Products, By KLnd of Economic Activity In Producers' Values (Current Million Cedis) --------------------------------------------------------------__-------------__------------------------------_-----------_------____------_-_____-_------__ 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 A. AGRICULTURE 1051 2518 3300 6274 12742 1692. 24820 38553 49572 109927 133232 153373 Agriculture and Livestock 634 1567 2347 5 °- 10011 12858 19776 33538 44003 92047 110422 118026 Cocoa Prod. Marketing 317 577 494 UZ4 1469 2294 2269 1197 639 10228 11138 18755 Forestry and Logging 74 293 374 440 1002 1301 1805 2135 3235 5609 9300 11350 Fishing 25 81 85 143 260 472 971 1663 1695 2044 2372 5241 S. iNDUSTRY 412 1109 1254 1768 2524 3466 5086 6653 5401 12199 28631 57651 Mining and Quarrying 38 105 87 90 119 238 462 369 285 1944 3214 3739 Manufacturing 258 736 858 1204 1813 2448 3346 4338 3117 7101 17306 40087 Electrlcity and Water 23 33 48 53 74 122 223 456 513 358 2166 4045 Construction 93 236 262 422 517 659 1055 1491 1486 2796 5945 9780 C. SERVSCES 705 1637 2003 3124 5717 7939 13202 27993 32740 62764 109068 162649 Transport, Storage, Comm. 97 206 259 331 553 759 1130 2329 2568 7663 17451 27031 Wholesale, Retail Trade 261 642 856 1294 2786 3994 7327 19074 22951 43120 76544 105944 Fiancwe, Insurance, Business 122 276 314 471 648 1066 1314 1927 2621 3311 4676 7750 Gov't and Other 225 513 574 1029 1731 2121 3430 4663 4601 8670 10398 21i23 SUB-TOTAL 2167 5264 6557 11167 20982 28330 43;08 73199 87712 184890 270931 373672 Less Imputed Bank Charge 11 77 128 188 304 521 651 1207 1802 2259 2865 5476 Import Duti-s 81 96 97 1,.5 308 422 397 634 541 1407 2494 4786 GMP at Market Prices 2259 5283 6526 11163 20986 28231 42853 72626 86451 184038 270561 372982 Percentage distribution A. Agriculture 472 482 511 562 61S 60S 58X 532 572 602 49S 41X Agriculture and Livestock 282 302 362 451 48S 462 462 462 51X 50X 41X 322 Cocoa Production. Marketing 142 11S 82 62 72 82 5 22 12 62 Al 5X Forestry and Logging 3S 63 6S 4X 52 52 42 3S 4X 3X 32 32 Fishing 12 22 1X 12 12 22 22 22 2X 1S 12 12 B. Industry 18S 212 192 16S 122 122 122 92 62 72 112 152 Minlng and (harrying 22 22 12 12 12 12 12 1X 0X 12 1S 1X Manufacturing ill 142 132 lX 9$ 92 8S 62 42 42 62 1ll Electricity and Water 12 12 12 0X 0X 0X 1X 12 12 02 12 1Z Construction 42 42 42 42 22 2X 22 22 22 22 22 32 C. Services 312 312 312 282 272 282 312 392 382 342 402 442 Transport, Stcoag-, Comm. 42 42 42 32 32 32 3S 32 32 42 62 72 Wholesale, Retail Trade 122 122 132 122 132 142 172 26X 27X 232 282 28X Finance, Insurance Business 52 52 5 42 32 42 32 3X 32 22 2X 21 Gov't and Other 102 102 92 92 82 82 82 62 52 52 *2 62 Imputed Bank Charge 0X 1S 22 22 1X 22 22 22 22 12 12 It Import Duties 42 22 1X 22 12 12 12 1X 12 12 1X 1S Sources: 1978-85 data ,re from StatistLceal Service, Accra. 1976-77 data are from QDS, June 1984, p. 75 1975 dat are from Economic Survey 1977-80, pp. 22-24. 1970 data are from Economic Survey 1972-74, pp. 4-5. Notes: 1. 1968 prices were converted into 1975 prices usLng the 1971 data as a basis. 2. Data for 1985 are provisional estimates. Table 2.03: Gross Dmestic Products, By Lind of Economic ctxivity In Producers' Values (Constant 1975 Million Cedis) 1970 1975 1976 1977 1978 1479 1980 1981 1982 1983 198 1985 19S6 A. Agriculture 2712 2518 2477 2343 2789 2894 2957 2881 2724 2534 2780 2802 2951 Agriculture and Livestock 1472 1567 1346 1376 1861 2015 2017 2001 1916 1763 2035 2001 2102 Cocoa Production, Markoting 899 577 747 569 523 498 545 521 432 370 339 384 427 Forestry and Logging 243 293 304 300 308 298 304 266 287 309 313 313 316 Fishing J 81 81 98 6 84 92 93 89 92 9. 104 107 S. Industry 1033 1109 1080 1121 1040 892 895 752 624 550 599 707 752 Minitg and Quarrying 130 105 100 90 84 73 71 66 61 52 59 66 66 Manufacturing 679 736 704 724 701 583 575 464 369 328 370 452 483 glectrieity and Water 16 33 37 37 32 38 43 48 44 41 39 47 51 Construction 208 236 239 270 222 198 206 174 151 129 132 142 152 C. Services 1466 1637 1568 1778 1910 1806 1765 1824 1158 1798 1917 2064 2154 Transport, Storage, CoCD. 156 206 168 191 181 191 166 177 179 192 217 2i8 249 Wholesale, Retail Trade 629 642 595 607 588 609 556 545 489 463 510 557 591 Finance. Insurance Business 302 276 294 330 360 358 372 389 401 415 453 495 514 Gov't and Other 379 513 511 651 781 649 671 713 689 728 737 774 s8o SUB_-OTAL S211 5264 5124 5242 5738 5592 5617 5457 5106 4S81 5296 5573 5857 Less Imputed Bank Charge S8 77 112 137 176 169 160 166 166 177 191 2.6 223 Import Duties 195 96 85 81 92 89 81 53 34 44 53 63 71 GDP Market Priees 5349 5283 5097 5212 5654 5512 5538 5344 4974 4747 5158 5420 5705 Real GMP Growth -12.4S -3 S 2.3X 8.5S -2.5 0.51 -3.51 -6.91 -4.62 8.62 5.11 5.31 - Percentage diatribution A. Agriculture S1S 482 491 452 49S 532 532 54S 552 532 542 522 522 Agriculture and Livestock 282 30S 262 262 332 37X 362 372 392 371 392 371 372 Cocoa Production. Marketing 17X 112 152 11S 92 92 102 101 92 8S 7' 72 372 Forestry and Logging 52 61 62 62 52 52 52 52 62 62 62 62 71 Fishing 1S 22 21 21 22 22 22 21 22 22 22 22 62 B. Industry 192 211 212 222 18S 162 162 142 132 122 122 132 132 Mining and Quarrying 22 22 22 22 11 1S 1S 12 1S 1S 1X 1S 1X Manufacturing 132 142 142 142 122 112 102 92 71 72 72 8X 82 Electricity and Water 0X 12 12 12 2 12 12 1X 12 12 12 12 12 ConstructLon 42 4S 51 52 42 42 42 32 3Z 32 32 32 32 C. Services 27X 312 312 34X 342 332 322 34X 352 382 372 382 381 Transport, Storage, Corn. 3X 42 32 42 32 32 32 3 41 42 *2 4.2 l2 Wholesale. Retail Trade 122 122 122 122 101 112 102 102 102 102 102 102 102 Finance, Insurance- Business 62 52 62 62 6S 62 72 72 82 92 9S 92 92 Gov't And Other 72 102 102 122 142 122 122 132 142 152 142 142 141 Les Imputed Bank Charge 2 12 22 32 3 32 31 31 32 42 42 42 42 Import Duties 4S 22 22 22 22 22 12 I2 12 12 12 12 22 Sources: 1978-86 data are fr Statistical Service, Accrc. 1976-77 data are fr QDS, June 1984, p. 75. 1975 data are frm Economic Survey 1977-80, pp. 22-24. 1970 data are from Economic Survey 1972-74, pp. 4-3. Notes: 1. 1968 prices were converted into 1975 prices using the 1971 data s a basis. 2. Data for 1985 are provisional estimates, and those for 1986 are preliminary. Table 2.04: Deflators of Gross Domestie Product (1975-100) ----------------------------------------------------------__-----------------__---------------------------.,----------------------------__-----------------_ 1970 1975 1976 1977 1978 1979 1980 1981 1982 198. 1984 1985 ----------------------------_.-------------------------------------__--------__------------------------------------------------------------------__--------_ A. Agriculture 39 100 1337 268 4S7 585 839 1338 1820 4339 4793 5476 Agriculture and Livestock 43 100 174 368 538 638 981 1677 2297 5222 5426 5899 Coeoa Production, Marketing 35 100 66 l11 281 461 416 230 148 2762 3285 4887 Forestry and Logging 28 100 123 147 325 437 595 802 1126 1818 2973 3622 Flshing 32 100 106 146 271 560 1055 1789 1902 2219 2559 5049 S. Indus2t- 40 100 116 1S8 243 389 568 885 865 2220 4777 8158 MinIng and Quarrying 29 100 87 99 142 326 652 562 469 3746 5457 5631 Manufacturing 38 100 122 166 259 420 582 935 845 2166 4676 8879 KlectricSty and Water 145 100 129 144 229 32G 520 947 1162 871 5611 8681 Construction *5 100 109 156 233 333 512 857 988 2173 4514 6877 C. Services 48 100 128 176 299 440 748 1535 1863 3491 5690 7880 Transport, Storage, Corm. 62 100 154 173 306 397 682 1316 1435 3991 8060 11348 Vholoasle, Retail Trade 42 100 144 213 474 656 1318 3497 4695 9311 15006 19038 FPirnce Insurance, Business 40 100 107 143 180 298 353 496 653 798 1032 1565 Gov't and Other 59 100 112 158 222 327 511 654 668 1191 1410 2832 Less Iaputed Bank Charge 42 100 128 213 366 507 767 1341 1718 3788 5116 6706 0 Ico-t Duties 19 100 114 137 173 309 *07 727 1085 1274 1497 2532 GDP Market Prices 42 100 114 228 335 476 692 1192 1576 3212 4723 7560 …_-_______________________________________________________________________________________________________________________________________________________ Sources: All figures calculated as the ratio of current to constant values. Notes: Data for 1982 and thereafter have been reviced. Table 2.05: ExpendIture on Gross National Product in Purchasers' Values (Current Killion Cedis) 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1. Private Final Consumption 1665 3873 5171 8655 17473 23464 35953 63333 77619 172140 243972 313262 2. Govt. Final ConsumptLoan 290 689 799 1409 2371 2903 4784 6384 5603 10787 17050 33602 3. Gross Fized Cap. Formation 271 614 641 1032 1355 1899 2613 3430 3053 6922 18542 32689 4. Chage an Stocks 48 59 -62 186 66 -54 -203 -109 -133 -21 65 70 5. Exports of Goods and Sees 523 1023 1025 1171 1754 3170 3628 3454 2886 11238 21583 33185 6. Imports of Goods and Sees 539 974 1047 1289 2033 3150 3923 3866 2578 17028 28914 39826 7. GDP Purchasers' Values: 2259 5283 6526 11163 20986 28231 42853 72626 86451 1840X8 272298 372982 8. Less Factor Income Paid AD 48 42 48 40 48 99 182 222 225 1640 2890 5769 9. Gross National Product: 2212 5241 6418 11123 20938 28132 42670 72404 86226 182398 269408 367213 10. Less DeprciLatLon 134 323 378 525 724 1052 1512 2218 2628 4197 7248 17850 11. Uatlonal Income: 2077 4918 6100 1059 20213 27080 41159 70186 83598 178202 262160 349363 12. Net Current Transfers -2 51 31 67 122 201 219 228 227 2200 5136 7421 13. National Disposable Income 2075 4970 6131 10666 20336 27280 41378 70414 83824 180402 267295 356784 14. Per Cap Nat Inca=e (Cedis) 216 493 595 1038 1916 2503 3708 6162 7151 14863 21331 27683 Percntage DLstribution 1. PrLvate Final Consumption 75S 741 80X 78X 831 832 842 872 902 94X 91S 85S o 2. Gowt. Final Consumption 132 132 122 132 112 lOX lX 9x 62 62 62 92 . 3. Gross Fixed Cap. Formatlon 121 121 102 92 62 72 62 52 42 42 72 92 4. Chang, in Stocks 22 1X -12 22 OX -O0 -O0 -02 -OX -02 OX OX 5. Exports of Goods and Scas 241 20X 16X 1ll 82 II% 92 52 32 6X 8X 91 6. Less Imports of GNPS 241 192 162 122 1OX lX 92 5 3X 92 112 112 7. GDP Purchasers' Values: 102X 1012 1O0X 1002 100l 1OO2 1OO2 1002 1002 1O01 1011 102S 8. Less Factor Income Paid AD 22 it 12 O0 OX OX OX O0 OX 1X 12 22 9. Gross National Product: 1001 1002 1OOX 1002 1002 1002 1002 1002 1002 1002 1OO2 1OO2 10. Less Depreciation 61 62 62 52 3X 42 42 32 3X 22 3X 5X 11. Nationsl Income: 942 942 942 951 972 961 96X 972 972 981 971 952 12. Net Current Transfers -OX 1X O0 11 12 12 12 OX OX 1S 21 22 13. National Disposable Income 942 952 952 96X 97X 972 97X 972 972 991 992 972 Sources : Information provided by the Statistical Service, Accra. Table 2.06: Empenditure on Gross National Product Xn Purchasers Values (Millions of Constant 1975 Cedis) -----------------------------------------------------------------__----------__--------------------------------------__------------------------__ In M11ions 1975 Codis: 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1. Private Final Consumption 3941 3873 3714 3711 4124 4112 4253 3892 3382 3396 3868 2. Govt. Finl Cons.znption 687 689 705 907 1066 876 982 1136 1010 990 1013 3. Gross Flixed Cap Forzmation 643 614 576 691 S85 547 516 456 352 344 391 4. Chung in Stocks 114 59 -46 82 20 -10 -26 -9 -8 -1 1 S. Exports of Goods and Services 1239 1023 1074 806 771 758 655 597 688 486 410 6. Less Ipacrts of GONS 1275 974 926 984 911 770 842 727 449 469 526 7. GOP Pnrech4ers' Values: 5349 5283 5097 5212 5654 5512 5538 5344 4'74 4747 5158 8. LeaS Factor Income Paid AB 113 42 50 28 22 23 54 42 40 30 29 9. Grosa National Product: 5236 5241 5046 5185 5633 5489 5483 5302 4935 4717 5129 10. Leon Depreciation 318 323 328 334 312 306 312 316 328 329 369 11. National Income: 4918 4918 4718 4850 5321 5183 5171 4986 4607 4389 4759 12. met Current Transfers -5 51 32 46 55 49 55 45 40 54 70 13. National Disposable Income 4912 4970 4750 4897 5376 5233 5225 5030 4647 4442 4829 14. Per Cap Eat Incoea (Cedis) 511 493 460 459 504 479 466 438 394 371 393 PercentaGe Distribution 1. Private Final ConsusetLcr 752 742 742 72X 731 75S 782 73X 692 722 752 2. Govt. Final Ccnsutption 132 132 142 171 192 16X 18S 212 202 212 202 O 3. Gross Fixed Cap Forsmtlon 122 122 112 132 10X 102 92 9S 7t 72 8S 4. Change In Stocks 22 1X -12 21 OX -Ox -0 -OS -O0 -02 O0 5. Xuports of Goods nd Services 242 202 212 161 142 142 122 11X 16X 102 8x 6. Loss Imports of GFS 242 192 182 192 16X 146 152 142 9X 102 102 7. COP Purcha&ers' Values: 1022 1012 101X 1012 1002 1001 101X 1012 101X 1012 101S .8. Less Factor In¢coe Paid AB 22 1S 12 12 OX 0 12 1X 12 1X 12 9. Gross National Product: 1002 1002 1002 1002 1002 1002 1002 100X 1OO2 lOX 1102 10. Leas Depreclation 62 62 72 62 6X 6e 62 62 72 72 72 11. National Incao": 94X 942 932 942 942 942 942 942 932 932 932 12. Net Current Transfers -02 12 1X 12 1X 1X 12 12 12 1X 1X 13. National Disposable In¢o 942 952 942 942 952 951 952 952 942 942 942 Sources---------------------------------------------,na----------Stat__------__-------st----------cal-------------Serv----------------ce.--------- Soures: 0 hn Statlsti¢aL Service. Tabli 2.07t Capital Transactions (Current Million Cedis) 19t0 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1. Gross Savin8s 253 731 .540 1126 1216 19C4 2153 2915 3231 1671 13522 2. Depreciation 134 323 378 523 724 l0S2 1512 2218 262S 4197 11206 3. not SaVing 118 408 161 602 492 914 641 697 603 -2526 2316 4. Less Current Traow .tions -67 59 -39 -97 -205 122 -258 -406 3tO -5231 -508S 5. Statitical LDiS¢repancy 0 0 -0 0 0 0 0 0 0 0 a 6. Finance of Gross Cap. Formation 320 672 579 1218 1421 1844 2410 3321 2921 6902 18607 Gross Capital Formation: 7. Iore s. in Stocks 48 59 -62 186 66 -54 -203 -109 -8 -21 65 S. Gross fixae Capital Ponation 271 614 641 1032 1355 1899 2613 3430 2929 6923 18542 9. Gross Capital Pormation 320 672 579 1218 1421 1844 2410 3321 2921 6902 18607 -------------------------------------------------------------------__--------__------------------------------------------------------------------ Sources: QDS JAn 1986, p. 85 for data 1979-84. QDS, match 198. p. U2 for data 1978. Economic Surmvy 1976-76, p. 8 for data 1975 Hotc: Data for 1983 and 1984 are provisional and those for I078-82 are revised. a- Table 2.08: Grosg Capital Formation by Type of Good, 1970-84 (Current Eillon Cedis) 1970 1975 1976 1977 1978 1979 1980 1991 1982 1983 1984 -------------------------------------------------------------------__--------__--------------------_-__-------_--_________----------------------- 1. Buildings 118 296 246 459 593 966 1627 2277 2121 4750 10494 2. Other Construetion Works 35 92 137 208 209 169 216 325 322 349 1027 3. Lan Improvement 2 8 21 17 20 15 18 27 30 32 69 4. Tranport Equipment 24 93 98 122 222 366 349 365 283 871 3465 5. MachLnery Equlpmnt 93 125 140 226 311 382 403 437 297 920 3487 6. Gross Fixed Capita1 Fora tion 271 614 641 1032 1355 1899 2613 3430 3053 6922 18542 7. Change in Stocks 48 59 -62 186 66 -54 -203 -109 -133 -21 65 8. Gross Capital Pormntion 320 672 579 1218 1421 1844 2410 3321 2920 6901 18607 9. Les Depreciation 134 323 378 525 724 1052 1512 2218 2628 4197 11206 10. Net Capital FormitLon: 185 349 201 694 697 792 898 1103 292 2704 7401 Sources: QOS, Ju 1986 p. 86 for data 1979-84. QDS, March 1986, p. 83 for data 1978. Rota: Data for 1983-84 are provisional and those for 1978-82 are reviLed. t TABLE 3.01: GHANA: BALANCE OF PAYMENTS (tUSS Millions) 1979 1980 1981 1982 1983 1984 1985 1986 -------------------------------------------------------------------__--------__------------------------------------ A. Merchandise 184 132 -310 10 -100 -115 -95 -7 Exports (f.o.b.) 1066 1104 711 641 439 566 632 773 Imports (c.i.f.) -882 -972 -1021 -631 -539 -681 -727 -780 B. Non-Factor Services -95 -104 -113 -85 -65 -91 -110 -130 Receipts 82 107 120 105 38 38 39 45 Payments -177 -211 -233 -190 -103 -129 -149 -175 Government (n.l.e.) -79 -84 -85 -66 -43 -39 -31 -70 Travel -27 -33 -34 -26 -10 -12 -10 -11 Other -70 -94 -114 -98 -50 -79 -107 -94 C. Resource Balance (A+B) 89 28 -423 -75 -165 -206 -204 -137 D. Met Factor Income -46 -80 -81 -82 -82 -81 -111 -105 Receipts 2 2 1 2 0 2 2 1 Payments -48 -82 -82 -84 -82 -83 -113 -105 Interest payments -48 -82 -82 -84 -82 -82 -108 -101 E. Private Transfer (net) -3 -3 -4 -1 17 73 33 49 F. Current Account Balance (C+D+E) 40 -55 -508 -158 -230 -215 -283 -193 Financed by: Grants (Official Transfer) 82 83 87 84 72 141 93 115 Official Long Term Loans(net) 108 96 49 16 15 131 108 213 Disbursements 123 120 78 55 84 157 134 243 Amortization -15 -24 -29 -39 -69 -26 -26 -30 Official Medium-Term Loans(ne -14 -13 42 97 13 -42 -70 -102 Disbursements 0 0 49 103 68 54 153 115 Amortization -14 -13 -7 -6 -55 -97 -222 -217 Trust Fund 34 0 0 0 0 -1 -7 -11 Direct Foreign Investment -3 16 16 16 2 2 6 4 Private Capital (net) -5 0 . -13 -5 12 -14 5 18 Dlsbursements 0 0 4 4 42 7 9 24 Amortization -5 0 -17 -9 -30 -21 -5 -6 SDR Allocation 14 14 14 0 0 0 0 0 Capital n.e.s. -26 12 0 13 61 -85 15 -81 Errors and Omissions -105 -141 63 -36 -187 -38 16 -18 G_ Net Capital Account 85 67 258 185 -13 94 165 138 H. Overall Balance (F-G) 125 12 -250 27 -243 -121 -117 -56 I. Monetary Movements -125 -12 2so -27 243 121 117 56 Financing IMF (net) 28 31 -12 -5 259 214 122 17 Purchases - - - - 259 214 122 39 Repurchases - - -12 -5 0 0 0 -22 Changes In SDR hRoldings -5 15 -6 -10 17 2 0 16 Foreign Exchange -68 27 110 -44 0 -24 11 15 Payments Arrears -75 -79 141 35 -34 -61 -24 19 Bilateral Balances -5 -6 17 -3 1 -10 8 -9 Sourc----------------a--------of--------hana-------and------Ban---------__taff_-----------t-----------t------------ Source: Bank of Ghana and Bank staff estimates. TABLE 3.02: Values of Total Exports by Country of Cousignmnat (Percentage distributlon) ITEKS 1975 1976 1977 1978 1979 1980 1981 1982 Africa Nigeria 0.8 0.8 0.6 0.2 0.1 0.1 0.0 0.0 Gambia 0.0 0.0 0.6 0.1 0.0 0.0 0.0 0.0 Togo Republic 0.9 0.4 0.1 0.2 0.5 0.0 1.1 1.6 Senegal 0.0 0.0 0.4 0.0 0.0 0.0 0.0 0.0 Liberia 0.1 0.1 0.3 0.1 0.1 0.1 0.0 0.0 Upper Volta 0.1 0.2 0.1 0.1 0.0 0.0 0.0 0.0 Ivory Coast 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Egypt 0.8 0.3 0.4 0.: 0.2 0.4 0.4 0.3 Congo-Brzzaxi&llo 0.0 0.2 0.0 0.0 0.0 0.0 0.0 0.0 Zaire Republic 0.0 0.1 0.1 0.0 0.0 0.0 0.0 0.0 Total: 3.1 2.4 2.5 1.S 1.0 0.8 1.5 1.9 America Canada 0.7 0.6 0.5 0.2 0.1 0.1 0.0 0.0 Argentina 0.9 0.4 0.0 0.1 0.0 0.0 0.0 0.0 United States 13.9 18.2 16.5 18.4 7.8 8.8 22.3 20.3 Total: 15.5 19.1 17.0 18.8 7.9 8.9 22.3 20.4 Asia CALMa 1.9 1.3 1.7 2.0 1.9 3.1 1.2 2.8 None Kong 0.1 0.0 0.0 0.4 0.3 0.0 0.0 0.0 Malaysia 0.0 0.2 0.1 0.2 0.4 0.7 1.2 0.9 Japan 8.7 7.1 6.8 6.4 9.3 8.4 12.8 7.8 Total: 10.8 8.6 8.7 9.0 12.0 12.2 15.3 11.6 Eurp United tingden 17.7 17.6 19.9 17.4 16.4 19.1 10.7 14.5 3elsigLILunx5*ourg 0.9 1.1 0.9 1.3 0.6 0.3 0.6 0.4 France 0.7 0.8 1.0 0.5 0.9 0.9 0.5 0.5 Italy 2.6 1.8 2.1 1.3 1.7 1.1 0.7 0.3 Yugoslavia 6.1 3.0 2.8 2.5 1.7 0.2 1.6 0.6 Rommais, 0.5 0.3 0.5 0.5 1.3 0.1 0.0 0.4 netherlands 12.5 14.1 15.7 20.2 16.5 16.4 12.7 16.4 Fod Rep Germany 10.1 10.2 9.3 9.5 10.4 6.8 9.0 9.9 Switzerland 10.4 8.7 7.8 6.2 7.9 17.4 18.1 16.8 u.s.S.R. 8.3 11. 11.0 11.1 21.4 15.8 7.0 6.3 Sv*d#.n 0.7 0.8 0.8 0.0 0.2 0.0 0.0 0.0 Total: 70.6 69.9 71.8 70.7 79.1 78.1 61.0 66.2 Orad Total: 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Sources: Quarterly Digest of Statistics, June 1986, pp. 63-64. Quarterly Digest of Statistics, June 1972, pp. 19-20. TABLE 3. 03: Zoert. by Sectlon (MIllin Ca dis) 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 -------------------------------------------------------------------__--------__--------------------------__-__-_--___-------------------_---_----__--------__-------- Total: 419000 445100 393293 525950 943706 909297 991691 1193312 1681777 2344174 310354 3484311 2781632 Food, Lve Aninals 79500 62600 72221 111734 140627 104936 118803 95568 143470 178433 241530 247310 276317 Beverses, Tobacco 3900 4600 2342 4905 7109 6751 11587 11010 22472 27693 43046 29321 11560 Crude raterials, Inedible 9400 12400 13244 22761 28670 27879 34305 45800 42551 48343 56881 63829 29939 Minerals, Fuels, Lubricants 24400 27000 45297 46823 136543 150861 147962 206405 230892 483605 827418 1056169 990693 Anlaals Vegetable Oils, Fats 3800 5200 3800 5200 3217 9933 11578 11305 28633 22452 28388 30796 9153 Cheamcals 66900 71600 63897 91135 123341 126627 155910 159049 242807 377666 482703 413256 305176 Nausfactured Goods Classified 100800 99400 68196 105804 221008 207876 187657 240071 287082 40337 380484 394851 299937 Machinery, Transport Equipment 108100 131500 104294 111287 212380 228072 270638 343232 547562 768775 922818 950476 577511 "iscellaneous Manufactured Articles 16400 19200 11310 14897 27698 28939 32320 40929 50368 62078 64512 120078 134170 Co-od, Transact not Classified 5801 9604 7275 10581 10928 17402 20931 39943 85939 42200 55805 178225 147176 ---------------------------------------------------------------__------------__---------_-----------_--_-__-_____-__------____--_--_--------___------------__-__----- Sources. Quarterly DLgest of Statistics, June 1986. p. 55. Economic Survey 1972-74, p. 33 for data 1970. Table 3.04: Values of Iuports by Country of Origin (Percentage Distribution) ---------------------------------------------------__------------------------__------------------------------------ 3975 1976 1977 1978 1979 1980 1981 1982 -----------------------------------------------------------------.-__--------__------------------------------------ Africa 16.5 14.4 17.4 14.3 18.3 26.8 32.9 40.6 Asia 13.3 11.6 11.7 10.8 8.9 7.5 7.2 5.0 America Canada 2.4 2.8 1.7 2.3 2.7 1.0 1.8 0.9 Jamaica 1.4 1.4 0.4 3.3 2.4 3.2 4.6 2.4 Argentina 0.0 0.3 0.2 0.0 0.3 0.2 0.4 0.5 United States 18.4 17.8 16.4 12.4 11.5 12.9 11.9 16.1 Total: 22.2 21.2 18.7 18.0 16.9 17.3 18.7 19.9 Europe United Kingdom 17.1 18.8 0.0 22.5 21.8 23.3 17.3 14.9 Belgium/Luxembourg 2.0 1.7 0.1 1.3 1.8 1.2 0.9 2.1 France 4.4 4.4 1.5 3.7 3.6 3.3 2.7 2.6 Italy 3.0 2.9 2.9 4.8 4.2 2.5 2.5 2.9 - Yugoslavia 0.9 1.1 1.1 1.2 1.5 1.0 0.2 0.0 Romania 0.2 0.5 0.8 1.1 0.3 0.5 0.0 0.3 Fed Rep GCemany 13.0 16.5 15.4 14.8 14.3 10.1 11.5 7.0 Svitzerland 1.4 1.7 3.0 5.7 3.3 1.2 1.6 1.1 U.S.S.R. 1.2 1.1 2.6 0.5 0.4 0.0 0.0 0.1 Sweden 1.2 1.0 1.0 1.1 0.5 0.6 0.4 0.3 Netherlands 3.1 2.6 2.2 2.9 2.7 3.0 3.4 1.7 Denmark 0.6 0.7 0.6 1.1 0.5 0.4 0.3 0.2 Norvay 3.8 3.2 2.4 1.9 1.0 0.4 0.4 1.3 Total: 51.8 56.2 54.5 62.5 55.9 48.4 41.2 34.5 Grand Total: 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 ----------------------------------------------------------..-----__----------__------------------------------------- Sources: Quarterly Digest of Statistics, June 1986, pp. 61-61. Economic Survey 1972-74, p. 42. TABLE 3.05: PESROLEUM IMPORTS, EXPORTS, AND PRICES 1979 1980 1981 1982 1983 1984 1985 1986 Imports (FOB): Volume ('000 Tons) 1220 1016 870 1189 511 884 949 Value (US$ Millions) 131 227 344 217 204 211 199 123 Exports (FOB): Volume ('000 Tons) 238 237 224 239 112 124 199 204 Value (USS Millions) 21 30 34 34 20 23 33 18 Net Imports (FOB): Volume ('000 Tons) 1082 779 646 950 404 740 710 - Value (US$ Millions) 110 197 310 183 164 160 166 105 Retail Prices(ceditimp. gallon): bt Super Gasoline 7.50 10.50 11.30 12.30 25.00 60.00 105.00 150.000 Regular Gasoline 7.00 10.00 10.30 11.30 21.50 56.00 100.00 145.000 Kerosene 3.50 5.00 5.50 3.00 13.20 35.00 55.00 80.000 Sources: 1. Ghana National Petroleum Comany 2. Ministry of Fuel and Power xoteW. a. tl>rt volu¢es include small quantities of petroleum products imports. b. As of end-year. TABUE 3.06: =NDEX NUEURS OF EXPOMRS AND IMPORTS (1968-100) _______________________________,__________________________________ _______________________________________________________________________-----__-----------_____--------------- 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 Quantity Indices: Exports 128.6 61.3 73.7 66.8 55.1 56.4 59.1 48.7 40.1 38.2 39.5 40.7 46.0 32.6 Imports - 86.1 44.5 53.0 71.5 62.0 59.7 62.0 51.4 39.1 39.9 45.0 25.8 18.4 Unit Value Indices: Exports - 109.3 126.1 176.7 274.1 297.7 286.1 433.7 449.7 536.5 651.9 420.2 319.6 2,013.5 Imports - 134.6 175.8 197.2 272.1 311.1 359.2 419.5 475.3 564.4 686.3 682.2 663.0 4,196.7 Terms of Trade - 81.2 71.7 89.6 100.7 95.5 79.6 103.4 94.6 95.1 95.0 61.6 48.2 48.2 SOURCES: QDS, JUNE 1986, P. 51 FOR DATA 1977-83 ECOKcoC SURVEY 1977-80, PP 282, 290 FOR DATA 1970, 1975-76 0% Table 4.01: GHANA EXTERNAL PUBLIC DEST OUTSTANDING INCLUDING UNDISBURSED AS OF DEC 31, 1985 INCLUDES ONLY DEBT COMMITTED 000000 - DEC 31. 1985 DEBT REPAYABLE IN FOREIGN CURRENCY AND GOODS (IN THOUSANDS OF U.S. DOLLARS) D E 8 t O U T S T A N D I N G I N A R R E A R S DISBURSED : UNDISBURSED : TOTAL PRINCIPAL : INTEREST CREDITOR TYPE . SUPPLIERS CREDITS AUSTRALIA 24 - 24 24 6 BRAZIL 10.035 - 10.635 - - EGYPT. ARAB REPUBLIC OF 72 - 72 72 19 FRANCE 8,205 - 8.205 265 100 GERMANY. FED.REP. OF 44.340 - 44,340 1.478 554 tSRAEL 276 - 276 276 93 ITALY 4,417 - 4,417 1S9 60 JAPAN 10.001 - 10.681 343 131 NETHERLANDS 23.270 - 23,270 776 290 NORWAY 1.33G - 1.356 44 18 UNITED KIGDOM 30,043 - 30,043 996 376 YUGOSLAVIA 7,263 - 7,263 - - TOTAL SUPPLIERS CREDITS 140.582 - 140.582 4.433 1.644 CREDITOR TYPE FINANCIAL INSTITUTIONS INDIA 3,132 978 4,110 1.360 782 TOTAL FINANCIAL INSTITUTIONS 3.132 978 4.110 1.360 782 CREDITOR TYPE MULTILATERAL LOANS AFRICAN DEV. BAKK 26.907 43,061 69,968 380 302 AFRICAN DEV. FUND 33.034 63.280 96,314 - - BADEA/ABEDA 11,866 107 11.973 - - EEC t§0oo0 11.500 26.600 - - EUROPEAN DEV.FUND 19.215 .76 19.91 - 94 EUROPEAN INVEST BANK 1g,121 2.110 21.231 362 806 IRD 122,488 8 122.496 - - IDA 251,459 319.476 570.935 - - IMF TRUST FUND 44,778 - 44.778 - - NIGERIA S67 2.678 3.245 - - OPEC SPECIAL FUND 21,440 - 21.440 195 50 TOTAL MULTILATERAL LOANS S5.87S 442.896 1.008.771 937 1.251 CREDITOR TYPE : BILATERAL LOANS BRAZIL 7,495 - 7,495 - - BULGARIA - 7.000 7,000 - - CANADA 59,457 355 59,812 718 241 CHINA - 1.562 1.562 - - CZECHOSLOVAKIA 8.366 - 8.366 - - DENMARK 2,503 - 2.503 139 - FRANCE 2,550 - 2,550 S01 928 NOTES: (1) ONLY DEBTS WITH AN ORIGINAL OR EXTENDED MATURITY OF OVER ONE YEAR ARE INCLUDED IN THIS TABLE. (2) DEBT OUTSTANDING INCLUDES PRINCIPAL IN ARREARS BUT EXCLUDES INTEREST IN ARREARS Table 4.01: GHANA (continued) EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISBURSED AS OF DEC 31, 1985 INCLUDES ONLY DEBT COMMITTED 000000 - DEC 31, 1985 DEBT REPAYABLE IN FOREIGN CURRENCY AND GOODS (IN THOUSANDS OF U.S. DOLLARS) D E B T O U T S T A N D I N G I N A R R E A R S DISBURSED : UNDISBURSED : TOTAL PRINCIPAL : INTEREST CREDITOR TYPE BILATERAL LOANS GERMANY, FED.REP. OF 122,737 37.i20 i59,857 1.627 1,243 %JAPAN 9.572 i9.797 29.369 - - KUVWAIT 36.279 - 36.279 761 - POLAND 7.303 - 7,303 - - SAUDI ARABIA 23,056 - 23.056 - - UNITED STATES 161,0S 8.131 169,146 1,305 1,782 USSR 20,214 7,500 27.714 - 750 TOTAL BILATERAL LOANS 460,547 81,465 542.012 5.151 4.944 NOTES: (1) ONLY DEBTS WITH AN ORIGINAL OR EXTENDED MATURITY OF OVER ONE YEAR ARE INCLUDED IN THIS TABLE. (2) DEBT OUTSTANDING INCLUDES PRINCIPAL IN ARREARS BUT EXCLUDES INTEREST IN ARREARS Table 4.01: GHANA (continued) EXTERNAL PUBLIC DEBT OUTSTANDING INCLUDING UNDISOURSED AS OF DEC 31, 1985 INCLUDES ONLY DEBT COMMITTED 000000 - DEC 31, 198S DEBT REPAYABLE IN FOREIGN CURRENCY AND GOODS (IN THOUSANDS OF U.S. DOLLARS) D E B T O U T S T A N D I N G I N A R R E A R S DISBURSED : UNDISBURSED : TOTAL PRINCIPAL : INTEREST SUPPLIERS CREUITS 140,582 - 140.582 4,433 1.644 FINANCIAL INSTITUTIONS 3.i32 978 4.110 1.360 782 MULTILATERAL LOANS 565.875 442,896 1,008.771 937 i.251 BILATERAL LOANS 460,547 81.465 542.012 5,151 4.944 TOTAL EXTERNAL DEBT 1.170,136 525.339 1,695,475 11.881 8,621 NOTES: (1) ONLY DEBTS WITH AN ORIGINAL OR EXTENDED MATURITY OF OVER ONE YEAR ARE INCLUDED IN THIS TABLE. (2) DEBT OUTSTANDING INCLUDES PRINCIPAL IN ARREARS BUT EXCLUDES INTEREST IN ARREARS Table 4.02: GHANA SERVICE PAYMENTS. COMMITMENTS. DISBURSEMENTS AND OUTSTANDING AMOUNTS OF EXTERNAL P DEST PROJECTIONS BASED ON DEBT OUTSTANDING INCLUDING UNDISBURSED AS OF DEC 31. 1985 INCLUDES ONLY DEBT COMMITTED 000000 - 198512 DEBT REPAYABLE IN FOREIGN CURRENCY AND GOODS (IN THOUSANDS OF U.S. DOLLARS) * * + TABLE TOTAL * * ' DATE DEBT OUTSTANOING AT T R A N S A C T I O N S D U R I N G P E R I OD OTHER CHANGES END OF PERIOD DISBURSED INCLUDING COMMIT- DISBURSE- S E q V I C E P A Y M E N T S CANCEL- ADJUST- ONLY . UNDISBURSED MENTS MENTS ------- -----------: LATIONS ' - MENT ** PRINCIPAL INTEREST TOTAL (t) (2) (3) (4) (5) (6 : (7) (8) (9) 1980 1,099.467 1.5t3.106 t92,068 i71.072 65,554 28.356 93.9tO 1.157 - 1981 1.11i.312 1t484.218 104,i77 111,842 28.225 24.944 53.169 82 -104.758 1982 1.116,916 1.481,165 92.497 80.406 34.339 27.710 62.079 3.377 -57.804 1983 1.132.176 1.459.156 104.559 123,348 61.041 38.616 99,657 74 -65.453 1984 1.1t2.572 1.455.853 142.769 97.625 56.774 25.720 82.494 92 -89.206 1985 1,170.136 1.695.475 275.288 118.983 57.136 24.650 81.786 1i0.470 129.940 * * * * * * THE FOLLOWING FIGURES ARE PROJECTED . * * 1986 1.266.923 1.617.413 - 174.852 66.185 32.520 98,705 - -11.877 1987 1,333.029 1.550.628 - 132,890 66.780 31,852 98,632 - -5 1988 1.343.876 1.484.998 - 76.481 65.649 31.048 96.697 - 19 1989 1.329.317 1.419.485 - 50.953 65.513 30.045 95.558 - - 1990 1.304.185 1.357.945 - 36,415 61.546 28,705 90.25i - 6 0 1991 1.269.390 1.298,307 - .14,844 59.643 27.098 86.741 - 5 1992 1.227.623 1.240.471 16.066 57.831 25.298 83.129 - -5 1993 1.183.512 t1.87.339 - 9.022 53.138 23.306 76.444 - 6 1994 1.130.452 1.130.896 - 3.383 56,446 2t.411 77.857 - 3 1995 1.072.737 1.072.747 - 435 58.i49 19.443 77.592 - - 1996 1,013.433 1.013.443 - - 59.306 17.500 76.806 - 2 1997 955.014 955.024 - - 58.424 15.689 74.113 - 5 1998 904,592 904.602 - - 50.425 13.985 64.410 - 3 1999 854,843 854.853 - - 49.747 12,51S 62.262 - -2 2000 807,382 807.392 - - 47.458 11.055 58.513 - -3 2001 770.155 770.165 - - 37.224 9.912 47,136 - -3 2002 735.226 735.236 - - 34.924 9.132 44.056 - -S 2003 700,161 700.171 - - 35.064 8.438 43.502 - -1 2004 665.036 665.046 - - 35.121 7.726 42.847 - -4 2005 630,441 630.451 - - 34,590 7.008 41.598 - -5 PROJECTED AMOUNTS IN THIS COLUMN ARE AMOUNTS EXCLUDED FROM PROJECTIONS BECAUSE OF UNKNOWN TERMS. ** THIS COLUMN SHOWS THE AMOUNT FF ARITHMETIC IMBALANCE IN THE AMOUNT OUTSTANDING INCLUDING UNDISBURSED FROM ONE PERIOD TO THE NEXT. THE MOST COMMON CAUSES OF IMBALANCES ARE CHANGES IN EXCHANGE RATES AND TRANSFERS OF DEBTS FROM ONE CATEGORY TO ANOTHER IN THE TABLE. TALI 5. 01t SUM5 RY OF CENMRL COVERM FIAUnS (MILION CEDIS) 1974175 1975176 1976177 1977178 1978179 1979180 1980181 1981182 1982 1983 1984 1985 Total Revene and Grants 811 870 1152 1393 2578 2950 3279 4856 5254 10241 22641 40312 Tax Revenue 728 765 1056 1252 2389 2747 2972 4381 4441 8459 17929 32130 TSaes on Income and Property 165 203 233 304 383 611 856 1341 1506 1780 4125 7993 TSas on dometie goods and services 137 243 354 411 424 832 1555 2127 2147 1689 5562 8373 Teaxs an International transactions 426 319 454 537 1583 1304 561 913 788 4990 8242 15764 Rkntax Renna 83 104 95 141 189 203 262 423 761 1725 3798 6562 Grants 0 0 0 1 0 0 45 52 52 57 914 1620 Expendlture 1162 1439 1945 3018 4094 4672 7719 9529 8846 14755 26694 45765 Recurrent 875 997 1308 2322 3335 4077 6329 8603 8029 13401 22700 38462 NaBs. and Salaries - - - - - - - - - 3800 5055 14524 Development 286 441 637 695 760 595 1390 927 817 1354 3994 7303 Net Lending 126 273 250 276 247 115 267 174 374 420 791 2127 Current Account Deficit -65 -128 -156 -929 -756 -1127 -3050 -3747 -2775 -3160 -59 1850 Overall Sud4t Deficit -477 -842 -1043 1900 -1763 -1837 -4707 -4847 -3966 -4934 -4844 -7580 Flnancing 477 842 1043 1900 1763 1837 4707 4847 3966 4934 4844 7580 Internal Loans 230 1060 941 1904 1045 1470 4225 4211 3718 3964 3028 4058 of whlch Banklng System 183 605 646 1437 419 380 3226 1673 434 2145 2437 3006 External Loans (net) 3 -1 5 -6 -8 290 482 389 215 970 1816 3522 Other Recelpts 244 -218 98 2 726 76 0 247 33 0 0 0 -------------------------------------------------------------------------__--__------------------------------------------------------------------------__ Sources: 1. Ministry of Finance and Economic Planning and staff estimates. 2. Quarterly Digest of Statistics, March 1984, p. 34. TABLE 5. 02: SOURCES OF GOVERNMENT REVEIIUE AND GRANtTS (MIPLLIOM CEDIS) 174175 1975176 1976177 1977178 1978179 1979180 1980181 1981182 1982 1So3 1984 1985 …------------------------------------------------------------------__--------__------------------------------------------------------------_-----__------ Total Revenue 810.5 869.8 1151.6 1392.1 2578.4 2949.9 3234.3 4803.3 5251.2 10184.3 21728.0 38691.0 Tax Revenue: 727.5 765.4 1056.3 1252.0 2389.0 2746.5 2972.1 4380.3 4440.7 8458.6 17931.0 32131.0 Taxes on Income, Profits 160.1 198.1 225.2 298.0 380.7 603.8 849.7 1328.6 1502.3 1777.9 4125.0 7451.0 Cospanies 91.3 114.5 131.5 126.7 168.7 295.9 466.2 655.0 745.2 902.0 2402.0 4368.0 Individuals 68.8 83.6 103.7 171.3 212.0 307.9 383.5 673.6 747.9 864.0 1650.0 3083.0 Payroll Taxes 3.0 2.8 1.9 2.2 1.9 2.1 1.9 1.6 1.2 1.6 1.4 11.0 Taxes on Property 1.9 1.9 6.1 3.4 - - - 0.1 0.1 11.9 0.0 0.0 Property Taxes - 0.2 4.1 1.6 - - - 0.1 0.1 0.0 0.0 0.0 Rental, Capital Gains 1.9 1.7 2.0 1.8 - 5.4 4.2 10.3 9.2 11.8 0.0 0.0 Taxes on Domestic Goods, Services 133.1 237.8 345.8 403.2 416.0 826.0 1548.1 2112.4 2079.9 1628.5 5620.0 8592.0 Sales, Purchase Tax 46.3 52.9 65.3 72.2 86.0 97.9 204.2 219.0 219.7 237.5 441.0 1175.6 Select Excise on Goods 85.0 182.7 276.0 324.0 321.0 720.0 1320.9 1857.4 1860.2 1391.1 5121.0 7197.3 Select Excise on Services 1.8 2.1 3.5 7.0 - - - - - - 53.0 219.4 Taxes on International Trade 426.0 319.3 453.8 537.1 1583.2 1303.6 561.0 912.6 789.4 4939.9 8241.7 15824.0 Import Duties 139.5 131.7 177.3 240.8 3S54.8 361.2 438.9 776.6 685.8 1972.0 3159.0 6591.0 Custom Duties 107.1 96.3 128.0 231.7 354.8 361.2 411.7 516.4 457.2 1481.0 2378.0 4630.0 Other IMport Duties Goods 32.4 35.4 49.3 9.1 . - - 27.2 260.2 228.6 491.0 781.0 1961.0 Export Duties 286.5 187.6 276.5 285.9 1228.4 926.1 27.5 1.4 1.4 2934.3 4973.7 9172.0 Cocoa 279.7 179.8 269.0 278.1 1220.0 920.0 25.7 - - 2800.0 4509.0 8861.0 Cdher Export Duties Goods 6.8 7.8 7.5 7.8 8.4 6.1 1.8 1.4 1.4 134.3 464.7 311.0 Other Taxes International Trade - - - 10.4 0.0 16.3 94.7 134.6 102.2 83.6 109.0 61.0 Miscellaneous Taes 3.5 5.5 7.9 8.1 8.3 5.6 9.8 18.2 2.8 48.8 63.9 41.0 Business, Prof. Licences 0.9 2.7 0.7 1.5 1.0 1.0 4.0 10.8 - 17.6 8.8 - Stamp Taxes 0.7 1.2 1.5 1.5 1.1 0.0 2.7 3.5 2.8 6.2 7.7 41.0 Motor Vehicles 1.S 1.1 5.0 4.2 4.7 3.9 - - - - - - Others 0.4 0.5 0.7 0.9 1.5 0.7 3.1 3.9 65.0 25.0 47.4 - Non-Tax Revenue: 83.0 104.4 95.3 141.1 189.4 203.4 262.2 423.0 760.5 1725.7 3797.0 6560.0 Sale of Goods, Fees. etc. 15.2 11.8 24.2 26.1 26.0 44.4 43 4 55.1 - - Property Income 64.4 86.1 67.2 109.5 158.4 145.0 202.5 - - - 3555.0 4147.2 From Public Enterprises 51.6 78.5 43.4 55.0 156.4 145.0 202.5 - - 3533.2 - Rents, Royalties, Interest 12.8 7.6 23.8 54.0 2.0 0.0 - - - - 17.0 Transfers from OT Level Govt. 0.8 0.0 0.1 1.0 2.0 1.1 - - - - Other Non-Tax Revenue 2.6 6.6 3.8 4.5 5.0 14.0 16.3 - - 24.7 225.0 781.8 Foreign Grants 0.1 - - 1.0 - - 45.0 52.0 52.0 56.6 914.0 1620.0 Total Revenue and Grants: 810.6 869.8 1151.6 1393.1 2578.4 2949.9 3279.3 4855. 5253.2 10241.0 22642.0 40311.0 …______________________________________________________________________________ SOURCES: MINISTRY OF FINANCE AND ECONOMIC PLANNING IMF REPORT SM/831161, JULY 1983, P. 90 WORLD BANK REPORT NO. 3072GC. FEB 1981. P 26 NOTES: DATA FOR 1979180-1981/82, 1982-85 ARE PRELIMINARY ACTUALS TABLE 5.03: RECURRET EXPENDITURES, FUNCTIONAL CLASSIFICATION (MILLION CEDIS) ------------------------------________-----------------------__--------------__------------------------------------------------------------__--- 1974175 197576 1976177 1977178 1978179 1979180 1980181 1981/82 1982 1983 1984 -------------------------------------------------------------------__--------__----------------------------------------------------------------- A. General Services General Administration 101.3 150.0 177.7 314.7 373.7 539.4 1265.1 965.2 1284.9 2829.4 4016.5 Defense 88.6 86.0 80.3 129.3 189.6 124.6 356.6 490.1 438.8 647.9 1458.7 Justice and Police 47.7 54.3 67.6 126.3 162.8 185.7 248.5 320.0 326.5 531.2 1149.2 Total: 237.6 290.3 325.5 570.3 726.1 849.7 1870.2 1775.3 2050.2 4008.5 6624.4 B. Community Services Roads and Waterways 28.7 36.8 19.5 42.0 78.5 81.4 135.8 131.6 123.4 177.8 423.3 Fire Protection, water Supply and Sanitation 8.7 11.5 12.7 22.7 35.1 40.5 71.6 69.4 72.8 189.7 331.0 Other Comnity Services 12.4 14.5 16.4 35.9 31.8 43.7 79.7 85.4 80.5 Total: 49.8 62.8 48.6 100.5 145.4 165.6 287.1 286.3 276.8 367.5 754.3 C. Social Services Education 202.5 254.3 313.7 553.1 836.2 964.9 1253.8 1696.3 1703.7 2883.4 5251.0 Health 77.2 86.9 116.8 203.7 289.8 278.2 429.9 501.4 485.7 586.6 2112.3 Social Security, Welfare 75.9 93.8 78.2 63.1 132.3 242.0 378.2 316.2 738.4 618.3 1111.0 Other Social Services 22.1 28.3 30.9 59.8 54.7 44.8 130.7 82.6 73.5 245.8 515.8 Total: 377.7 463.3 539.6 879.7 1313.1 1529.8 2192.6 2596.6 3001.3 4334.1 5990.1 D. Economic Services Agri. Non-Mineral Resources 53.8 70.1 125.7 343.6 342.9 487.0 721.4 803.1 827.6 1389.3 936.3 Fuel and Power 0.5 0.5 0.6 5.9 2.1 1.8 4.2 2.7 2.7 18.5 32.9 Other Mineral Resources, Manufacturing, Construction 24.2 26.8 27.5 50.9 69.2 82.2 108.0 101.1 104.3 213.4 487.7 Transport, Storage, Comm. 7.6 6.4 18.2 47.4 69.6 79.6 125.2 80.4 98.5 210.7 300.7 Other Economic Services 0.1 4.4 2.2 2.5 4.3 3.2 4.4 4.3 4.1 492.0 360.1 Total: 86.3 108.2 174.3 450,4 488.3 651.7 963.2 1011.5 1037.1 2323.9 2117.7 E. Unallocable Expenditure Gen Transfer to Local Govt. 23.3 31.3 43.6 79.7 112.0 154.4 214.6 274.1 308.7 463.6 708.6 Other 74.1 100.4 176.7 241.5 513.7 725.5 1021.0 1973.3 2168.1 2204.0 3425.0 * Total: 97.4 131.7 220.3 321.3 625.7 880.0 1236.2 2247.4 2476.8 2667.6 4133.6 Statistical Discrepancy 26.6 -58.9 -0.341 -0.035 35.985 -0.003 -219.946 685.469 -812.69 -300.6 79.9 Grand Total: 875.4 997.4 1308.0 2322.2 3334.5 4076.8 6329.3 8602.6 8029.4 13401.0 22700.0 …________________________,___________________________________________________________________________________________- - _____________.___________ SOURCES: MINISTRY OF FINANCE AND ECONOMIC PLANNING QUARTERLY DIGEST OF STATISTICS, JUNE 1986, PP 42-43. NOTES: DATA FOR 1979/80-1981/82, 1982-84 ARE PRELIMINARY ACTUALS TAUSE 5.04: ECOXCMIC CLASSIFICATION OF GOVERNMENT CURRENT ECPUNDITURES OGELLION CED!S) 1975176 1976177 1977178 1978179 1979180 1980181 1981182 1982 1983 1984 ------------------------------------------------------------------__---------__----------------------------------------------------------------- Consaumption 767.3 857.7 1497.2 1806.7 2245.4 3867.8 4237.7 4461.3 7265.4 15631.9 Compensatlon of Emplo7ees 425.2 453.2 823.2 991.2 1249.6 2273.9 2301.1 2302.2 3743.2 5282.2 Other Goods and Services 314.6 364.6 597.9 746.7 930.9 1434.6 1837.7 2103.4 3423.9 10154.4 ContingenciLes - - - - - - - - Military Expenditure 17.8 24.9 12.4 46.1 39.3 122.4 60.2 13.5 19.0 111.3 Rent 9.7 15.0 63.7 22.7 25.6 36.9 38.7 40.2 79.3 84.0 Transfers 288.9 503.0 866.7 1171.5 1926.5 2476.9 3526.3 4A51.6 5816.0 7681.7 Domestic Sectors 184.2 316.9 620.2 679.8 1175.3 1429.1 1524.4 1959.3 3305.1 3891.6 Interest an General Debt 100.0 176.7 241.5 477.1 725.4 1021.6 1973.3 2168.1 2204.0 3425.0 Abroad 4.7 9.4 5.0 14.6 23.8 26.2 28.8 24.2 306.9 365.1 Statistical Discrepency -58.8 -52.7 -41.7 356.3 -95.1 -15.4 838.4 -583.3 319.6 -613.6 Total Current Expenditure "97.4 1308.0 2322.2 3334.5 4076.8 6329.3 8602.6 8029.4 13401.0 22700.0 Sources: 1. 1979180-1984 frue Quarterly Digest of Statistics, arch 1986, pp. 37-38. 2. 1975t76-1979180 fram Economic Survey 1977-80, p. 280. TABLE 5.05: DEVELOPMENT EXPENDITURES, FUNCTI;)NAL CLASSIFICATION (MILLION CEDIS) -------------------------------------------------------------__--------------__------------------------------------------------------------__--- 1974175 1975176 1976/77 1977178 1978179 1979/80 1980181 1981182 1982 1983 1984 -------------------------------------------------------------------__--------__----------------------------------------------------------------- A. General Services General Adinistration 55.6 64.7 89.6 98.5 126.6 116.7 93.2 103.7 38.0 59.7 653.2 Defense 0.5 6.1 32.0 27.6 34.9 50.2 131.5 97.2 25.0 25.0 146.5 Justice and Police 6.0 10.8 13.5 17.3 20.1 5.4 20.1 9.2 10.7 15.4 26.8 Total: 62.1 81.6 135.4 143.4 181.7 172.3 244.9 210.1 73.7 100.1 826.5 B. Comumity Services Roads and Watervays 36.8 74.6 130.1 150.5 123.0 104.4 244.1 209.1 261.3 739.5 1467.4 Fire Protection, Water Supply and Sanitatton 19.2 28.1 39.1 42.3 35.7 34.4 56.8 50.4 27.0 54.2 259.8 Other Comvunity Services 4.6 7.8 13.0 13.1. 18.3 18.4 28.9 14.5 13.9 Total: 60.6 110.5 182.2 205.9 177.0 157.2 329.8 274.1 302.1 793.7 1727.2 C. Social Services Education 33.3 67.4 102.6 107.2 114.6 60.7 65.1 82.3 90.1 130.1 135.9 iealth 18.2 31.1 42.2 53.4 62.6 47.1 62.9 48.1 53.0 60.3 158.1 Social Security, Welfare 3.4 6.4 9.9 9.4 0.8 1.5 6.1 5.2 5.8 10.3 20.3 Other Social Services 24.5 32.3 49.9 44.4 36.6 14.4 38.2 22.1 8.3 14.0 82.3 Total: 79.4 137.2 204.7 214.4 214.5 123.7 172.4 157.7 157.2 214.7 396.8 D. Economic Services Agri. Non-Mfneral Resources 22.4 36.8 66.5 82.8 133.0 84.1 220.2 166.4 134.9 147.3 384.3 Fuel and Power 2.3 2.1 2.1 4.5 9.9 2.7 10.1 11.7 0.6 6.3 60.8 Other Mineral Resources Manufacturing. Construction 4.2 5.8 23.5 11.5 34.1 20.7 55.4 50.5 21.4 .38.2 176.2 Transport, Storage, Com. 5.4 5.2 16.2 16.3 22.0 13.5 119.2 50.9 22.1 35.7 216.0 Other Economic Services 0.1 2.8 6.3 16.1 7.6 6.3 8.0 1.1 0.5 18.4 206.2 Total: 34.4 52.7 114.6 131.1 206.4 129.4 413.0 280.6 179.6 245.9 1043.5 E. Unallocable Expenditure Gen Transfer to Local Govt. - - 0.3 0.7 16.2 12.0 10.0 4.5 4.8 - - Other - - - - - - - - 218.6 - - Total: - - 0.3 0.7 16.2 12.0 10.0 4.5 223.4 Statistical Discrepancy 49.6 59.2 0.0 -0.0 -36.0 -0.0 220.0 -0.1 -119.3 -0.4 -0.0 Grand Total: 286.1 441.2 637.2 695.4 759.8 594.7 1390.0 926.9 816.7 1354.0 3994.0 ---------_-----------------------------------_--------------_____-_--------____--------------------------__----------------------------------__- SOURCES: MINISTRY OF FINANCE AND ECONOMIC PLANNING QUARTERLY DIGEST OF STATISTICS, JUNE 1986, P. 43. NOTES: DATA FOR 1979/80-1981/82, 1982-4 ARE PRELIMINARY ACTUALS TABLE 5.06: CENTRAL GCOERNMENT DEBT: DOMESTIC AND FOREIGN (DOMESTIC DEBT. MILLION CEDIS, END JUNE) (FOREIGN DEBT, USS MILLION, END DECEMBER) 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Domestic Debt 1441.3 2245.6 3160.3 5136.0 6110.7 7621.1 11846.2 17487.7 29315.2 32907.9 36334.3 Monetary Authorities 697.6 1225.7 1868.8 3308.4 3727.6 4080.7 7334.1 9155.6 16747.2 19880.7 21099.6 Deposit Money Banks 104.0 191.4 333.2 561.3 822.9 1410.4 1604.0 3016.2 4894.2 4535.2 4660.4 Soclal Security Fund 324.1 450.0 549.3 649.6 837.0 985.0 1270.0 1480.0 1951.0 2388.0 2522.5 Non-Financial Private Sector 108.8 164.7 185.1 330.7 373.3 600.6 889.4 2551.9 3035.9 3365.1 3453.2 Financial Intennediaries 76.9 106.6 126.9 151.4 219.3 367.0 570.0 1076.6 1763.8 1481.0 3139.1 Public Enterprises 129.9 107.2 97.0 134.7 130.6 177.4 178.7 207.4 923.1 1257.9 1459.5 (Killions of US$, End December) Foreign Debt 688.4 667.4 750.1 819.1 930.4 1099.5 1111.3 1116.9 1132.2 1112.6 1170.1 International Development Instit. 83.2 89.8 119.4 162.5 271.5 341.5 376.5 404.8 425.5 470.2 565.9 Foreign Govt. Otber Institutions 245.6 246.7 301.3 332.1 337.7 535.2 548.9 544.8 554.1 513.4 460.5 Suppliers' Credits 202.0 330.9 329.4 324.5 321.2 222.8 185.9 167.3 152.5 125.9 140.6 ________________________________________________________________________________________________________________________________________________--- Source: Bank of Ghana a' TABLE 5.07: CENTRAL GOVERNMENT DEBT: DOMESTIC (MILLION CEDIS) -------------------------------------------------------------__--------------__------------------------------------------------------------__--- ITEMS 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 -------------------------------------------------------------------__--------__----------------------------------------------------------------- By Holdings: Br'k of Ghana 589.9 1235.0 2255.3 4221.9 4184.2 5607.1 7334.1 9155.6 16747.2 19880.7 21099.6 Ct*mercial Banks 102.8 208.0 4b4.1 532.9 891.2 1320.9 1603.9 3016.2 4894.2 4535.2 4660.4 Secondary Banks 65.1 115.2 167.2 170.5 354.0 479.2 983.9 1763.8 1481.0 3139.1 S.S.N.I.T. 477.1 584.5 723.5 873.0 1081.0 1270.0 1480.0 1951.0 2388.0 2522.5 Private Sector 757.1 320.6 378.9 538.0 577.5 977.5 1159.0 2852.0 3959.0 4623.0 4912.7 Total Domestic Debt: 1267.9 2305.8 3758.0 6183.5 6696.4 9340.5 11846.2 17487.7 29315.2 32907.9 36334.3 By Type: A. Short Term Ways and Means Advances - 50.0 0.0 200.0 270.0 659.5 659.5 613.8 1816.0 1800.0 1800.0 Treasury Bills - 322.7 322.7 434.4 822.7 1110.7 1137.1 1787.0 3475.4 3475.4 3475.4 Govt. Current Account - - - 345.1 33.4 294.2 - - - 859.4 2209.9 Sub-Total: - 372.7 322.7 979.5 1126.1 2064.4 1796.6 2400.8 5291.4 6134.8 7485.3 B. Long Term I Compulsory Stocks - 8.5 8.4 7.9 7.7 7.4 7.4 7.0 5.6 4.5 4.5 Stocks and Bonds - 1888.7 3401.3 5160.5 5527.3 7233.6 10007.1 13786.0 22789.6 25652.4 27741.8 C.M.B. Loans - 20.6 20.6 20.6 20.6 20.6 20.6 20.6 20.6 20.6 20.6 Railway Loan - 8.5 8.5 8.5 8.5 8.5 8.5 8.5 8.5 8.5 8.5 Compensatory Savings - 6.8 6.5 6.5 6.2 6.0 6.0 6.0 6.0 6.0 6.0 Others - - - - - - - - 1193.5 1081.1 1067.6 Sub-Total: - 1933.1 3445.3 5204.0 5570.3 7276.1 10049.6 15086.9 24023.8 26773.1 28849.0 Total Short. Long Term: - 2305.8 3768.0 6183.5 6696.4 9340.5 11846.2 17487.7 29315.2 32907.9 36334.3 SOURCE: BANK OF GHANA, UPDATED DATA. ECONOMIC SURVEY 1977-80, P 216 NOTE: SUBTOTAL IN 1982 INCLUDES ALSO 1258.8 M CEDIS FROM OTHER LOANS. TABLE 6.01 SUN>ARY ACC>UNTS OF THE BANXING SYSTEM (MILLION CEDIS END PERIOD) -----------------------------------------_------------------------__-------_-__------------_-__---------------------------------_-__-----------__ 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 -------------------------------------------------------------------__--------__------------------------------------------------___-_-------____-_ Net Foreign Assets: -S6.5 48.6 -157.0 -149.0 -898.0 -529.0 -358.0 -1159.0 -1023.0 -16676.0 -32903.0 aenking System 44.0 188.2 76.0 111.0 407.0 608.0 477.0 24.0 238.0 4031.0 7683.0 Net rKF Position -47.0 -52.0 -52.0 -54.0 -123.0 -203.0 -119.0 -78.0 -59.0 -8403.0 -23388.0 Post-1972 Payment Arrears - - -75.0 -92.0 -906.0 -713.0 -537.0 -955.0 -1051.0 -10399.0 -15402.0 Pre-1972 Payment Arrears - - -71.0 -69.0 -160.0 -108.0 -75.0 -54.0 -54.0 -335.0 -392.0 Participation Arrears - - -36.0 -46.0 -116.0 -112.0 -104.0 -97.0 -98.0 -1568.0 -1404.0 Not DometLe Assets: 313.7 1559.6 2106.0 3229.0 6056.0 6540.0 8416.0 13329.0 16008.0 22603.0 29843.0 4 Claims on Gowernsent 294.2 902.5 1584.0 2780.0 4500.0 4906.0 6526.0 10655.0 11064.0 21059.0 22818.0 Claims on Public Entities -12.0 100.6 124.0 141.0 234.0 290.0 400.0 441.0 527.0 813.0 676.0 Cocoa FLnaneLnS 97.2 188.3 259.0 271.0 867.0 1340.0 1559.0 2950.0 5533.0 521.0 3484.0 Claims on Non-Bank Fin. 7.2 72.2 77.0 85.0 79.0 74.0 73.0 99.0 129.0 200.0 897.0 CLaims on Private Sector 127.1 865.3 395.0 572.0 751.0 79".0 943.0 1345.0 1362.0 2841.0 6231.0 4 Net Other Assets -97.5 -69.3 -334.0 -619.0 -374.0 -869.0 -1085.0 -2161.0 -2826.0 -2831.0 -4261.0 Revaluation Account 16158.0 34716.0 O Komne and Quasi Money (M2): 347.9 1368.4 1907.0 3038.0 5116.0 5944.0 7951.0 12031.0 14839.0 20497.0 28552.0 1 MOney (MI) 237.1 990.9 1433.0 2386.0 4111.0 4682.0 6087.0 9415.0 11205.0 16411.0 23439.0 Quast-MuOey 110.8 377.5 474.0 651.0 1005.0 1263.0 1864.0 2616.0 3634.0 4086.0 5113.0 SDR Allocation -11.8 41.9 42.0 42.0 42.0 68.0 108.0 146.0 146.0 1588.0 3106.0 _________________________________________________________________________._______________________________________________________________________ SOURCES: BANK OF GEANA IMF REPORTS. 1973-83 NOTES: 1. FOR 1971-75, NET FOREIGN ASSETS VALUED AT 1 CEDI - SDR .71842 2. THE SERIES AFTER SEPTEMBER 1978 IS NOT STRICTLY ComPARABLE wITE THAT OF THE PRECEDING PERIOD BECAUSE PRIOR DATA ON ARREARS PAYMENTS DID NOT INCLUDE ARREARS ON SERVICE PAYMENT. 3. EXCLUDES SECONDARY BANKS 4. INCLUDES MAIZE FINANCING OF 127 MILLION CEDIS. TABLE 6.02: CORSOLIDATED BALANCE S'I OF THE BANKING SYSTEM (MILLION CEDIS AT END PERIOD) -------------------------------------------------------------_----____---_---__----------------------_.-----------------------------------------__--_------_ 19 0 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 -------------------------------------------------------------------__--------__------------------------------------------------------------------__-------- Litabilities: 572.7 1745.3 2462.4 3903.9 6728.6 7766.6 9862.2 15393.0 18929.9 31628.8 39395.8 60589.7 1. Money Supply 305.4 1008.8 1430.2 2386.4 4088.4 4630.8 6058.4 9745.0 11439.5 18770.1 26643.3 43471.1 A. Currency with Public 150.7 485.6 706.9 1154.1 2101.7 2458.5 3521.3 6049.5 6957.2 10036.6 13943.2 21896.1 B. Demand Deposit 154.8 323.2 723.3 1229.2 1986.7 2172.3 2537.1 3695.5 4482.3 8733.5 12700.1 21574.2 2. QuasL-Haney 121.2 377.5 472.0 651.2 1005.0 1262.3 1861.6 2613.5 3632.5 5553.4 7192.6 11565.0 A. Savings Deposits 80.0 263:6 365.6 535.7 888.3 1165.1 1763.5 2547.1 3566.7 4985.9 6020.7 8832.2 B. Time Deposits 41.2 103.9 106.4 115.6 116.7 99.2 98.1 66.5 65.8 567.5 1171.9 2732.8 3. Other Liabilities 146.1 359.0 560.3 866.3 1635.2 1873.5 1942.2 2621.6 3815.6 7305.3 5559.9 5553.6 Assets: 572.7 1745.3 2462.4 3903.9 6728.6 7766.6 9862.2 15393.0 18929.9 65646.1 39395.8 60589.7 1. Net Credit to GOVernment 291.8 938.7 1511.8 2709.8 4407.3 5108.5 6960.4 10949.6 11341.1 21794.1 16319.2 27566.2 A. By Banking System 258.8 964.5 1601.8 2801.4 4455.9 4808.0 6522.2 10499.1 10942.8 22057.9 24100.9 27566.2 1. By Bonk of Ghana 159.9 863.6 1412.4 2461.4 4087.9 4101.1 5452.9 8811.5 8183.9 16195.8 18551.8 20644.7 2. By Coaercial Banks 98.9 100.9 169.4 339.1 368.0 706.9 1069.3 1687.6 2758.9 5862.1 5549.1 6921.5 I B. Net Use of IME Resources 33.0 -25.8 -90.0 -91.7 48.6 300.5 418.2 450.5 398.3 -263.8 -7781.7 - 2. Credit to Rest of Public Sector 93.5 190.2 219.6 240.8 390.6 373.6 482.4 590.7 707.6 1406.7 2221.7 6120.5 r. A. By Bank of Ghana 44.5 78.1 80.8 81.0 153.2 157.2 196.9 175.2 205.8 287.6 1080.1 2797.1 %O B. By Comercial Banks 49.0 112.1 13B.8 159.8 237.4 216.4 385.5 415.5 501.8 1119.1 1141.6 3323.4 1 3. Credit for Cocoa Financing 82.0 185.0 255.4 270.6 820.7 1340.0 1559.0 2949.7 5552.9 523.4 3579.5 14520.1 A. By Benk of Ghana 70.0 85.0 105.0 90.0 560.0 1016.0 1328.6 2162.6 4937.1 115.0 3430.0 12515.6 B. By Ca-rciel Banks 12.0 100.0 150.4 180.6 260.7 324.0 230.4 787.1 615.8 408.4 149.5 2004.5 4. Credit to the Private Sector 126.2 298.0 380.5 552.6 725.4 796.3 939.6 1341.6 1557.4 5248.9 11086.4 19798.6 A. By Bank of Ghana - - - - - - - - - - - - B. By Comercial Banks 126.2 298.0 380.5 552.6 725.4 796.0 939.6 1341.6 1557.4 5248.9 11086.4 19798.6 5. Overseas Assts (Net) -20.8 133.5 95.1 130.1 384.6 148.2 -59.3 -438.6 -229.1 2562.6 6189.0 -7415.7 A. With Banking System 26.7 187.2 76.0 110.9 406.6 564.6 475.6 16.9 172.4 3122.3 6647.1 7127.9 1. With Bank of Ghana 44.7 191.5 83.2 120.4 420.2 592.5 531.8 152.5 327.5 3365.5 7853.3 10398.3 2. With CoDmercial lanka -18.0 -4.3 -7.2 -9.5 -13.6 27.9 -56.2 -135.6 -155.1 -243.2 -1206.2 -3270.4 B. Net Use of XNF Credit -47.5 -53.7 19.1 19.1 -22.0 416.4 -534.9 -455.5 -401.5 -559.7 -458.1 -14543.6 -------------------------------------------------------------__--------------__------------------------------------------------------------__-------------- SOURCE: BANK OF GHANA NOTE: FIGURES FMR NET rMF ACCOUNTs HAVE BEEN REVISED FRCM FEB 1972 TO REFLECT ADJUSTMENT IN THE EXCHANGE RATE OF THE CEDI IN FEB 1972. EXCL8DES SECONDARY BANKS TABLE 6.03: ASSETS AND LIABILITIES OF THE BANK OF GHANA (MILLION CEDIS AT END PERIOD) 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Assets: Foreign Assets: Total 76.4 197.6 120.2 223.8 733.4 802.7 547.8 554.9 576.4 6452.0 19549.8 31703.4 Gold 5.7 7.8 7.8 8.7 13.9 14.7 47.3 132.5 134.2 2175.0 4584.2 2764.5 SDR Holdings - 11.4 10.9 14.7 35.6 48.8 7.9 25.0 51.6 70.0 2.4 1087.9 Foreign Currency Balance with Bank 5.0 113.4 62.1 170.4 587.4 632.5 391.3 336.1 348.0 3911.6 14028.6 26922.4 Foreign Securities 27.2 43.5 32.0 21.7 89.7 56.2 55.5 54.8 27.0 260.0 358.5 482.1 Other 38.5 21.5 7.4 8.3 6.8 50.5 45.8 6.5 9.6 35.5 576.1 446.5 Claims On Government: Total 208.5 902.2 1526.2 2539.8 4221.9 4211.4 5607.2 9369.0 10067.3 16734.2 19880.7 21633.8 Ghana Stocks 71.0 591.1 1075.0 2166.5 3613.9 3755.0 4637.5 7711.6 9167.2 13564.7 16665.8 16631.5 Treasury Bills 13.6 29.6 46.2 100.0 173.1 153.0 153.0 19.1 286.3 1353.6 555.5 14.6 Loans and Advances 84.8 117.7 291.2 293.6 545.1 303.4 953.8 1638.3 613.8 1816.0 2659.4 4987.7 Other 3.9 - - - - - - - - - - - Claims on Public Institutions Total 44.5 90.8 108.6 90.0 627.9 1093.6 1346.5 1191.5 5019.9 222.6 3556.4 12666.1 1 Bills Discounted 70.0 85.0 105.0 90.0 560.0 1016.0 770.0 1151.0 863.0 115.0 3430.0 12170.0 FF Other - 5.8 3.6 _ 67.9 77.6 576.5 1093.1 4156.9 107.6 126.4 496.1 0 Claims on: Coocercial Banks - 3.0 4.5 7.5 9.0 6.0 6.0 22.8 22.7 22.1 23.1 22.1 1 Development Banks 2.1 72.2 77.2 78.0 76.2 73.6 78.0 70.8 100.3 212.1 930.6 2624.5 Other Financial Institutions - - - - - - - - - - - Other Assets: 177.7 241.9 221.0 2204.3 315.4 793.4 599.9 312.4 1642.7 17476.4 21563.4 23434.4 Total: 579.2 1507.7 2057.7 3142.9 5983.9 6980.7 8185.4 12574.0 17423.3 41119.6 65504.0 92084.3 Liabillties: Currency in Circulation: Total 167.0 524.4 753.2 1331.0 2302.4 2624.4 3897.0 6552.0 7488.0 11435.0 16234.4 25326.5 Notes 159.0 510.3 737.2 1313.0 5372.4 2597.1 3857.4 6497.2 7400.0 11356.0 16159.6 24989.8 Coins 8.0 14.1 16.0 18.0 20.0 27.3 39.6 54.R 88.0 79.0 74.8 336.7 Deposits: Total 139.4 622.3 811.5 1092.1 2007.0 2635.9 2576.1 3631.6 6424.0 16341.4 18857.9 20191.9 Commercial Banks 60.8 325.9 452.8 567.9 1109.6 1423.1 1371.1 1989.9 2288.8 1307.4 2047.3 1732.7 Development Banks - 17.7 37.3 58.2 172.1 276.7 391.4 360.7 331.9 510.3 304.5 1725.8 Other Financial Institutions - 0.1 2.8 0.6 0.7 0.6 0.2 -0.4 - - - - Public Institutions 3.8 10.7 4.2 52.1 27.1 22.5 55.5 25.0 102.0 539.0 135.9 784.S Government 45.7 118.2 166.6 149.9 204.6 226.2 271.0 557.4 1884.0 538.0 1328.9 989.1 Special Deposits - 149.7 149.8 263.4 492.9 686.8 486.9 699.0 1817.3 13446.1 15041.3 14959.8 Foreign Liabilities 143.6 6.2 36.9 103.4 312.9 166.8 17.2 400.5 243.0 3910.0 19936.3 35484.7 Capital and Reserves 33.0 168.9 197.4 272.2 416.0 664.0 572.1 117.3 144.8 3943.5 5077.4 6656.9 Other Liabilities 11 125.3 185.9 258.7 244.2 855.6 889.6 1123.0 1872.2 3123.5 5490.3 5398.0 4060.4 Total Liabilities: 579.2 1507.7 2057.7 3142.9 5983.9 6980.7 8185.4 12573.6 17423.3 41120.0 65504.0 92084.4 -------------------------------------------------------------__--------------__------------------------------------------------------------__-------------- Source: Bank of Ghana 11 Include rev luation. TABLE 6.04: ASSETS AND LIABILITIES OF COCO9CIAL BANKS 11 (MILLION CEDIS AT END PERIOD) 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Cash Reserves: Total 87.9 371.5 506.7 710.5 1442.9 1664.0 1850.6 1950.9 3365.9 4341.0 5705.3 10857.5 Ghana Currency 16.4 36.8 46.3 173.9 290.7 165.9 375.7 357.2 531.1 1046.0 1709.2 2778.9 Balance at Bank of Ghana 71.5 332.7 460.4 536.6 1152.2 1498.1 1474.9 1593.7 2834.8 3295.0 3996.1 8078.6 Foreign Assets 0.1 0.2 10.2 7.2 5.7 2.3 2.3 10.7 10.0 917.4 461.9 3208.6 Claims on Government: Sub Total 119.0 158.8 240.1 434.2 555.0 873.4 1300.6 1643.4 3030.3 4863.0 4433.8 5169.3 Stocks and Bonds 67.4 116.0 189.2 322.3 408.2 489.2 711.2 1060.9 2041.1 3874.0 3306.9 3857.0 Treasury Bills 51.6 42.8 50.9 111.9 146.2 384.2 589.4 582.5 989.2 989.0 1126.9 1312.3 Claims on Public Institutions: Bills Discounted: Sub Total 12.1 107.1 154.7 188.0 273.6 324.2 35.0 22.0 419.9 397.6 710.3 3137.0 Cocoa Bills - 99.5 150.0 180.0 260.0 323.4 29.7 9.7 419.9 403.0 - 1594.0 Other Bills - 7.6 4.7 8.0 13.6 0.8 5.3 12.3 - - 0.2 150.3 Claims on Private Sector: 710.1 1392.7 Loans end Advances 175.3 403.0 515.0 729.3 953.1 1012.5 1517.2 1888.1 2281.0 3636.1 5997.3 10496.7 Other Assets 46.4 194.9 208.4 311.2 541.0 1125.6 909.1 1553.5 4060.6 4997.9 10661.9 7298.5 Total Assets: 440.8 1235.5 1635.1 2380.4 3771.3 5002.0 5614.8 7068.6 13167.7 19153.0 27970.5 40167.6 Private Sector Deposits: Total - 711.3 235.1 1350.0 2105.6 2579.3 3635.8 3895.6 6285.9 8416.3 11667.8 18117.5 Denand Deposits 150.9 351.1 479.7 730.8 1126.3 1343.5 1795.9 1688.8 2671.5 4365.1 6563.0 9738.7 Savings Deposits 80.0 260.0 362.6 531.3 886.3 1158.8 1758.4 2118.5 3561.3 3984.9 4777.5 6888.4 Time Deposits 41.4 94.2 92.8 87.9 93.0 77.0 81.5 88.3 53.1 66.3 327.3 1490.4 Public Sector Deposits: Total - 160.8 217.8 406.7 675.4 542.1 305.4 453.7 1392.4 1145.0 2239.0 3526.8 Demand Deposits - 137.5 199.2 388.2 660.5 529.0 294.1 438.9 1377.5 1111.9 2215.1 3501.4 Savings Deposits - 3.6 3.0 4.4 4.7 4.3 5.1 6.0 5.4 3.7 5.1 5.9 Time Deposits - 19.7 15.6 14.1 10.2 8.8 6.2 8.8 9.5 29.4 18.8 19.5 Government Deposits 21.2 57.9 68.7 93.0 185.1 180.0 241.7 304.7 272.9 552.5 601.3 989.4 Foreign Liabilities 0.8 4.4 17.3 16.7 29.2 30.2 58.5 30.4 165.2 255.4 623.3 2298.4 Credit from Bank of Ghana - - - - - - - - - - - Paid-up Capital, Reserves 18.8 56.7 65.9 86.3 127.0 186.9 216.2 151.0 525.0 2085.0 3576.6 2337.8 Other Liabilities 101.6 244.4 330.3 427.2 649.0 1483.5 1157.2 2188.9 4526.3 6698.8 9272.4 12897.7 Total Liabilities: 440.8 1235.5 1635.1 2380.4 3771.3 5002.0 5614.8 7068.6 13167.7 19153.0 27970.5 40167.6 …------------------------------------------------------------__--------------__------------------------------------------------------------__-------------- SOURCE: BANK OF GRANA 1I EXCLUDES SECONDARY BANKS TABLE 6.05: ASSETS AND LIABILITIES OF SECONDARY BANKS (MILLION CEDIS AT END PERIOD) ----------------------------------------------.------------------__----------___-----_--_---------------- 1975 1980 1981 1982 1983 1984 1985 -------------------------------------------------------------------__--------__-------------------------- Assets: Cash on Band 3.6 93.7 104.4 229.6 355.1 2102.9 5316.2 Balance vith Bsnk of ra-na 19.6 435.1 244.9 264.9 267.8 39.7 2524.4 Balances Due By Other Banks 5.5 55.0 64.3 322.8 861.5 426.8 1108,0 Treasury Bills 6.0 157.3 301.2 274.7 376.4 550.1 674.2 Comercial Bills 11.1 0.0 19.1 0.3 4.5 - 40.0 Loans and Advances 201.1 865.6 1355.3 1595.5 2787.3 5464.2 9832.8 Investments: 1. Securities 41.2 200.3 323.5 884.0 1235.1 1267.0 2589.2 2. Enterprises 10.3 30.8 32.7 44.7 53.3 129.7 198.3 Other Assets 56.3 541.5 836.4 1288.2 2661.9 3799.3 2260.4 Total Assets: 354.7 2379.3 3281.8 4904.7 8602.9 13779.8 24543.5 Liabilities: Paid-up Capital and Reserves 56.4 243.8 289.3 357.9 526.5 818.5 1216.0 Balances Due to Other Banks 3.1 100.7 23.0 35.2 164.0 138.9 519.0 Borrovings From Other Banks 83.9 114.2 237.9 306.9 1353.5 2301.3 5467.7 Deposits of Other Banks - - - - - - _ Demand Deposits 52.4 687.3 911.1 1427.1 2733.4 3857.5 7641.7 Savings Deposits 30.4 370.5 386.8 803.1 1003.5 1271.5 1937.9 Time Deposits 54.7 247.3 291.6 398.1 474.6 850.5 1331.6 Other Liabilities 73.8 615.5 942.1 1576.4 2297.4 4541.6 6429.6 Total Liabilities: 354.7 2379.3 3281.8 4904.7 8602.9 13779.8 24543.5 -------------------------------------------------------------__--------------__-----_,-----------..-_____-- SOURCE: BANK OF GHANA QUARTERLY DIGEST OF STATISTICS, MARCH 1984, P 30. TABLE 6.06: CLASSIrICATION OF LOANS AND ADVANCES 11 BY PURPOSE (MILLION CEDIS AT END PERIOD) 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Conmercial Banks: Agriculture, Forestry, Fishing 11.6 32.5 44.8 57.3 80.0 88.2 145.3 323.1 486.7 1105.4 2155.0 2897.4 Mining and Quarrying 4.5 6.0 19.4 44.1 63.6 47.2 49.6 124.8 205.8 238.9 234.0 470.9 Manufacturing 51.4 109.0 135.2 157.4 209.5 265.6 311.6 325.0 357.9 587.1 1366.8 2350.1 Construction 16.2 44.5 58.2 90.9 141.6 160.0 168.4 241.0 309.0 411.5 716.2 959.6 Electricity, Gas and Water 1.2 1.5 1.8 2.1 15.2 2.6 115.2 23.5 40.3 47.8 17.8 31.0 Commere. and FLnance: Import Trade 32.8 33.9 31.7 25.5 46.1 30.0 25.5 40.2 37.0 78.2 275.4 778.8 Export Trade 4.7 19.1 21.0 26.2 23.8 40.0 260.8 336.7 250.1 90.4 187.0 430.9 Other 14.7 75.4 94.2 146.2 194.1 168.9 210.0 262.2 258.3 636.3 954.9 2363.2 Transport and Cozausnications 6.3 42.9 50.2 69.1 87.8 125.5 147.6 188.5 176.1 215.2 345.7 663.9 Services 21.9 19.7 31.0 40.9 54.3 58.4 53.9 93.1 81.8 166.1 306.0 578.4 Miscellaneous 8.4 9.2 16.6 23.7 21.7 22.5 29.1 40.8 27.4 41.5 92.9 212.4 Total: 175.3 393.6 504.1 693.4 938.4 1009.0 1517.2 1999.6 2251.6 3618.5 6651.7 11736.3 Secondary Banks: Agriculture, Forestrv, Fishing 11.5 72.0 89.4 92.0 185.0 219.5 267.1 346.6 615.2 907.5 1624.1 2310.5 Mining and Quarrylng 4.5 7.2 10.6 20.0 24.4 24.1 11.7 26.9 37.2 183.7 263.5 489.3 Manufacturing 51.9 27.2 36.9 61.9 121.0 147.0 171.0 303.7 277.3 781.5 1921.6 3696.3 Construction 16.3 33.1 47.1 48.4 84.6 122.9 113.3 159.0 202.2 383.2 557.7 1058.2 Electricity, Gas and Water 1.2 0.8 0.4 1.3 0.1 0.6 0.8 2.5 1.9 1.8 3.6 6.8 Ccmerce and Finance: Import Trade 32.8 0.6 6.7 2.7 5.3 3.8 4.6 6.0 5.4 29.2 32.3 211.9 Export Trade 4.7 0.0 1.7 1.8 8.7 3.8 8.6 92.9 13.0 8.1 0.4 59.1 Other 14.7 22.4 14.8 20.0 58.7 47.9 42.1 54.2 35.1 47.5 220.1 457.1 Transport and Ccammications 6.3 19.1 25.4 22.8 31.0 57.6 64.2 130.4 122.9 184.2 308.0 490.4 Services 21.9 6.6 12.6 25.8 20.7 27.6 43.6 88.7 93.2 81.6 227.7 646.2 Miscellaneous 8.5 1.4 10.7 22.7 28.3 30.0 49.0 101.4 68.6 85.7 185.0 238.5 Total: 174.3 190.4 256.2 319.3 567.9 684.9 776.3 1312.3 1471.8 2694.0 5344.0 9664.3 ---------------------------------------------------------------__------------__--------------------------------------------------------------__------------ SOURCE: BRAK OF GEUUt QURTERLY DIGEST OF STATISTICS, MPUCE 1984. PP. 31-32. 11 EXCLUDES STAFF LOANS, UPAID INTEST, COCOA MARKEING ADVANCES, AND CONSORTIUM LOANS. TABLE 6.07: M9ONEY SUPPLY AND LIQUIDITY OF THE PUBLIC (MILLION CEDIS AT END PERiOD) -----------------------------------------------------------------------__----__----------------------------------------------------------------------__---- 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 -------------------------------------------------------------------__--------__---------------------------------------------------.--------------__-------- Money Supply: 1. Currency in Non-Bank Sector 150.7 485.6 706.9 1157.1 2101.7 2458.5 3521.3 6049.5 6957.2 11435.0 13943.2 21896.9 2. Demand Deposits 154.7 523.2 723.3 1229.3 1986.7 2172.3 2537.1 3365.6 4482.3 6472.0 12700.1 21374.2 3. Money Supply (1+2) 305.4 1008.8 1430.2 2386.4 4088.4 4630.8 6058.4 9415.1 11439.5 16861.0 26643.3 43471.1 Saving.: Primary Commercial Banks 4. Time Incl. Certificate Deposits 41.2 113.9 106.4 115.6 116.6 99.2 98.1 69.0 71.9 100.4 330.3 1510.9 S. Savings Deposits 80.0 263.6 365.6 535.7 888.3 1163.1 1763.5 2545.6 3560.6 3983.6 4777.5 6894.3 Quasi-Money (4+5) 121.2 377.5 472.0 651.3 1004.9 1262.3 1861.6 2614.6 3632.5 4084.2 5107.8 8405.2 Secondary Banks 6. Time Deposits - - - 80.3 131.0 171.6 240.0 291.6 398.1 474.6 841.6 1221.9 7. Savings Deposits - - - 71.0 138.3 204.3 369.9 586.8 803.1 1003.5 1243.2 1937.9 Deposits: 8. Other Financial Institutions 3.0 7.2 9.6 13.7 19.8 23.7 - u.4 - - - - 9. Total (4+5+6+7+8) 134.8 476.2 601.9 816.3 1294.0 .661.9 2471.5 3493.4 4833.7 5562.1 7192.6 11565.0 Money and Quasi-Money 426.6 1386.3 1902.2 3037.7 5093.3 5893.1 7920.0 12029.7 15072.0 20945.0 31751.1 51876.3 Total (3+9): 440.2 1485.0 2032.1 3202.7 5382.4 6292.7 8529.9 12908.5 16273.2 22423.1 33835.9 55036.1 SOURCE: BANK OF GHANA BANK OF GHANA, FEB 1983. P 2 FOR DATA 1981-82 BANK OF GHANA, JUNE 1981, P 63 FOR DATA 1979-80 BANK OF GHANA, JUNE 1980, P 65 FOR DATA 1977-78 BANK OF GHANA, JUNE 1977, P 55 FOR DATA 1970-75 NOTES: 1. MONEY AND QUASI-MONEY EXCLUDING SECONDARY BANKS 2. QUASI-MONEY INCLUDES ONLY TIME AND SAVINGS DEPOSITS OF PRIMARY CO4MERC'AL BANKS TABLE 6.08: RESEtVE REQUIREMENTS: COHMECIAL BANKS (MILLION CEDIS AT END PERIOD) -------------------------------------------------------------------__--------__------------------------------------------------------------------__-------- 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Reserve Requirements: Cash Reserves 68.2 373.0 477.0 705.0 1400.2 1723.2 2022.7 2563.0 2896.2 3129.6 4306.5 5339.0 Other Liquid Reserves 101.9 151.3 217.6 402.5 448.7 849.3 1254.7 1966.4 3007.4 4850.5 4426.2 4582.2 Total Reserves 170.1 524.3 694.5 1197.6 1848.9 2572.6 3277.4 4529.4 5903.6 7980.1 8732.7 9921.2 Deposits: 291.3 919.5 1203.6 1774.3 2823.8 3239.6 4060.0 5660.3 7638.2 10089.5 13658.8 21219.1 Percentage to Deposits: Cash Reserves: Mininmm Ratio ktequired 30.0 20.0 20.0 42.8 48.0 48.0 42.0 35.0 35.0 30.0 10.0 15.0 Actual Ratio Returned 23.4 40.6 38.8 39.7 49.6 53.2 49.8 45.3 37.9 31.0 31.5 27.8 Other Liquid Reserves: Minis Ratio Required 20.0 20.0 20.0 25.0 40.0 40.0 25.0 25.0 25.0 25.0 35.0 25.0 Actual Returned 35.0 16.4 17.7 22.7 15.9 26.2 30.9 34.7 39.4 48.1 32.4 30.3 Total Reserves: Ratio Required 50.0 40.0 40.0 67.8 88.0 88.0 67.0 60.0 60.0 55.0 45.0 40.0 Actual Ratio Returned 58.4 57.0 56.4 62.4 65.5 79.4 80.7 80.0 77.3 79.1 63.9 58.1 SOURCE: BANK OF GHUMA TABLE 6.09: RESERVE REQUIREX{ENS: SECONDARY BANKS (MILLION CEDIS AT END PERIOD) -----------------------------------------------------------------__----------__----------------------------------------------------------------__---------- 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Reserve Requirements: Cash Reserves - - - 85.6 234.1 370.1 526.9 603.0 635.6 1020.0 1045.1 2330.7 Other Liquid Reserves 290.3 688.5 799.0 143.8 162.5 164.5 324.9 592.2 11._ 1488.3 1984.6 3817.4 Total Reserves 271.4 613.8 640.8 229.4 396.6 534.7 851.8 1195.2 1805.7 2508.3 3029.7 6148.1 Deposits: 48.3 58.5 -62.0 360.0 624.9 331.7 1260.1 2179.4 2812.6 4243.5 6670.7 9986.4 Perceutage to Deposits: Cash Reserve: Minimu Ratio Required 523.2 1022.6 1025.2 20.9 30.0 30.0 25.0 20.0 20.0 10.0 10.0 10.0 Actual Ratio Returned 538.6 973.5 1047.3 23.7 37.5 27.8 41.8 27.7 22.6 24.0 15.7 23.3 Other Liquid Reserves: Minlm- Ratio Required 2259.3 5283.0 6526.2 25.0 40.0 40.0 25.0 25.0 25.0 35.0 35.0 30.0 Actual Ratio Returned 47.8 41.9 48.1 40.0 26.0 12.4 25.8 27.2 41.6 35.1 29.7 38.2 Total Reserves: Ratio Required 2211.5 5241.2 6478.1 45.9 70.0 70.0 50.0 45.0 45.0 45.0 45.0 40.0 Actual Ratio Returned - - - 63.7 63.5 40.2 67.6 54.9 64.2 59.1 45.4 61.5 SOURCE: RANK OF GHANA TABLE 6.10: VELOCITY RATIOS (GDP, M, MI, M2 IN MILLION CEDIS) 1970 1975 1976 1977 1978 1979 1980 19;1 1982 1983 1984 -------------------------------------------------------------------__--------__-------------------------------_----------------------------------- Gross Dagstic Product (M.P.) 2259.3 5283.0 6526.2 11163.3 20986.1 28231.0 42853.0 7262C.0 86451.0 184038.0 270561.0 money (M) 284.0 781.0 1156.0 1736.0 3058.0 3970.0 :9.0 7536.0 9397.0 14738.0 20172.0 Quasi-May 112.0 347.0 426.0 530.0 854.0 1134.0 1644.0 1486.0 3201.0 3827.0 4493.0 NtWy and Quasi-Kocny (M2) 396.0 1138.0 1582.0 2286.0 3912.0 5104.0 7073.0 9022.0 12598.0 18565.0 24665.0 Ratio GDP I Ml 8.0 6.8 5.6 6.4 6.9 7.1 7.9 9.6 9.2 12.3 13.4 Ratio GDP I Hz 5.7 4.6 4.1 4.9 5.4 5.5 6.1 8.0 6.9 9.9 11.0 --------------------------------------------------------------------__-------__------------------------------------------------------------------ Source: Bank of Chana Note: HonY atnd Quasi-money are based on monthly svera$es and exclude secondary banks. L& TABLE 6.11: INTEtEST RATES (IN PERCENT AT END OF PERIOD) ------------------------------------------------------------------__---------__-----------------------------------------------------------___-____---------__-----_--- 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 Bank of Ghana: Rate of Govt. Stocks From 4.0 5.0 5.0 5.0 5.0 5.0 5.0 19.5 5.0 5.0 5.0 5.0 To 6.5 8.0 8.0 8.0 13.5 13.5 13.5 19.5 10.5 19.5 19.5 19.5 - Treasury Bill Rate 4.0 7.8 7.8 7.8 12.0 12.0 12.0 18.5 9.5 13.0 16.8 17.8 19.8 Other Advances 6.5 9.0 9.0 9.0 14.5 14.5 14.5 19.5 10.5 14.5 18.0 18.5 20.5 Bank Bate 5 5 8.0 8.0 8.0 13.5 13.5 13.5 19.5 10.5 14.5 18.0 18.5 20.5 Coamercial Bank Rates: Borrowing Rates: FLied Deposits: 3 Months 7.5 7.6 7.6 7.6 12.1 12.1 12.1 18.3 8.5 11.5 14.8 16.8 - 6 Months 2.8 7.9 7.9 7.9 12.4 12.4 12.4 18.5 8.5 11.5 15.0 17.0 19.0 12 Months 3.5 8.0 8.0 8.0 13.0 13.0 13.0 19.0 9.0 12.5 16.0 18.0 20.0 24 Months - - - - - - - - - - - 19.0 22.0 Savings Deposits 2.5 7.5 7.5 7.5 12.0 12.0 12.0 18.0 8.0 11.0 14.5 16.5 - Bill Discount Rate From. 7.0 7.8 8.5 8.5 14.0 14.0 14.0 25.5 12.0 - - - 18.5 To: 10.0 8.5 8.5 8.5 14.5 14.5 14.5 25.5 12.0 - - 23.0 18.5 Lending Rates: Loans and Advances Secured by: Govervnnt Securities 6.5 10.5 10.5 10.5 16.5 16.5 16.5 25.5 12.0 16.5 16.5 20.5 - Stocks in Trade 7.0 12.5 12.5 12.5 18.5 28.5 18.5 18.5 18.5 19.0 22.5 23.0 Inorvable Property Froa 7,0 11.5 11.5 11.5 17.5 17.5 17.5 17.5 17.5 14.5 16.5 23.0 - To 10.0 12.5 12.5 12.5 18.5 18.5 18.5 18.5 18.5 14.5 16.5 23.0 - Bank of Ghana Guarantees Fron - 11.5 11.5 10.5 15.0 15.0 15.0 15.0 15.0 16.5 20.0 20.5 - To - 12.5 12.5 10.5 15.0 15.0 15.0 15.0 15.0 16.5 20.0 20.5 _ Other Froa 7.0 12.5 11.5 11.5 17.5 17.5 17.5 17.5 17.5 19.0 22.5 23.0 - To 10.0 12.5 12.5 12.5 18.5 18.5 18.5 18.5 18.5 19.0 22.5 23.0 - Unsecured Loans From 7.0 12.5 11.5 11.5 17.5 17.5 17.5 17.5 17.5 19.0 22.5 23.0 - To 10.0 12.5 12.5 12.5 18.5 18.5 18.5 18.5 18.5 19.0 22.5 23.0 - First Ghana Building Society: Saviags Rates Frao 8.5 5.0 5.0 5.0 5.0 8.0 8.0 8.0 6.0 6.0 8.0 _ _ To 8.5 5.5 5.5 5.5 5.5 8.5 8.5 8.5 6.0 6.0 8.0 - - Lending Rate From 9.0 10.0 10.0 10.0 10.0 14.0 14.0 14.0 10.0 10.0 15.0 23.0 22.5 To - - - - - - - - - - - 23.0 …--------------------------------------------______-------------------__---_-__----------_----------------------------_--------------------______---__-----__-------- Source: Bank of Ghana TABLE ?.01: COCOKA BEAN PRODUCTION, CONSUMPTION, PRICES, PAYMENTS TO FARMERS AND EXPORT RECEIPTS (QUANTITY IN THOUSAND TONS, VALUES IN MILLION CEDIS) --------------------------------------------------------------__-------------__-------------------------------------------------------------__-------------__------- 1974t75 1975176 1976177 1977/78 1978179 1979180 1980181 1981182 1982/83 1983184 1984185 1985186 1986187 ---------------------------------------------------------------__------------__--------------------------------------------------------------__------------__------- Production: Main Crop 365 382 305 263 250 282 255 216 177 154 165 205 - Mid Crop 8 12 14 8 1S 15 3 8 2 5 9 14 - Total 373 394 319 271 265 296 258 224 179 159 174 219 230 Consumption: Domestic It - - - - - 35 26 31 25 15 20 25 30 Export 334 342 270 233 221 253 240 201 160 148 162 193 210 Export Receipts - - - 2423 2649 2541 1123 950 4828 12391 17628 40225 52869 met Payments to Farmers 209 237 242 362 727 1186 1132 269" 2192 3230 5477 12876 21590 Prices In Cedis Per Ton: From Exports 1688 1526 2596 10399 11986 10043 4679 4726 30175 83723 96077 183676 229865 To Farmer 2/ 561 602 758 1333 2743 4000 4000 120D0 12 20000 30000 56600 85500 Remainder 1127 924 1838 9066 9243 6043 679 -7274 30163 63723 66077 127076 144365 -------------------------------------------------------------------__ --------__ ------------------------------------------------------------------__ --------__ ------- Sources: Ghana Cocoa Board. 1985186 Data are provisional and those of 1986/87 are estimates. Data for 1977178-1882183 are from Table 3 of Paper on Cocoa Sector. Notes: 1. Includes changes ln stocks 2. 1982/83-87/87 include only main crop. TABLE 7.02: Purchases of Cocoa Beans by Re.ons (Ouantities in Thousand Tons, Values in Million Cedis) ---___.-------------------------------------------------------__-------------__-------------------------------------------------------------__------------- 1974175 1975176 1976177 1977178 1978179 1979180 1980181 1981182 1982183 1983184 1984185 1985186 --------------------------------------------------------------__-------------__------------------------------------------_------------------__------------- 1. Ashanti Main Crop :Q. 106 120 99 87 82 98 91 69 55 46 43 52 Values 59 72 74 116 218 392 363 826 660 920 1290 2948 Mid Crop: Q. 2 2 4 38 32 35 26 31 1 1 - - Values 1 2 4 4 20 9 3 24 6 30 - - Sub-Total. : Q. 108 122 103 125 114 133 117 100 56 47 - - Values 60 73 78 119 238 401 366 849 666 950 - - 2. DonogAhaafo Main Crop :Q. 79 85 75 68 468 73 47 49 35 29 28 35 Values 44 51 56 91 129 292 188 584 420 580 840 2003 Mid Crop .Q. 1 2 2 1 2 2 1 1 0 1 - - :Values 1 1 2 2 8 8 2 13 0 30 - - Sub-Total : Q. 80 87 77 70 50 75 48 S0 35 30 - - Values 45 52 58 93 137 300 190 597 420 610 - - 3. Eastern Main Crop :Q. 69 65 48 39 47 41 46 34 31 25 27 32 Values 39 39 36 53 125 165 184 410 372 500 810 1798 Mid Crop :Q. 2 3 4 2 3 4 1 3 0 1 _ _ :Values 1 2 4 2 14 15 3 33 0 30 - - Sub-Total : Q. 71 68 53 41 50 45 47 37 31 26 - - Values 40 41 40 55 138 180 187 443 372 530 - - 4. Central Main Crop :Q. 58 57 37 21 24 16 25 21 17 13 18 26 Values 33 34 28 28 65 65 100 249 204 260 540 1453 Mid Crop :Q. 2 3 1 1 1 3 1 1 0 0 - - :Values 1 2 1 1 5 11 2 16 0 0 - - Sub-Total :Q. 60 59 38 22 26 19 26 22 17 13 - - Values 33 36 29 29 70 76 102 265 204 260 - - 5. Western Main Crop :Q. 39 42 37 41 44 49 45 42 35 38 48 60 Values 22 25 28 54 116 195 179 504 420 760 1440 3371 Mid Crop :Q. 2 2 3 1 2 4 0 2 1 1 - - : Values 1 1 3 2 9 15 2 20 96 30 - - Sub-Total Q. 40 44 40 42 46 52 45 44 36 39 - - Values 23 27 30 56 125 209 ll 524 516 790 - - Continued ... TABLE 7.02: Purwchass of Cocoa Bonm by ReSians (Quantities in Thousand Ton, Values in Millian C*d0s) 1974/75 1975176 1976177 1977178 1978179 1979180 1980181 1981182 1982183 1983184 1984/85 1985186 6. Volta Main Crop :Q. 13 13 9 7 5 5 1 1 4 3 1 1 :Values 7 8 6 10 13 18 6 15 48 52 26 57 Kid Cop tQ. 0 1 1 0 1 0 0 0 0 0 - - *Values 0 0 1 0 4 1 0 5 0 0 Sub-Total :Q. 14 13 9 7 6 S 1 2 4 3 - - :Values 8 8 7 10 17 19 6 20 48 52 - - TOTAL r'ain Crop Q. 365 382 305 263 250 282 255 216 177 154 165 205 ValuCs 204 228 227 351 667 1127 1020 2588 2124 3072 4950 11603 urchase Price: Cedis/Ton 1 1 1 1 3 4 4 12 12 20 30000 56600 Mid Crop :Q. 8 12 14 8 15 15 3 8 2 5 9 14 Values 5 9 14 11 60 59 12 110 102 120 509 1190 Purchase Price: CedslsTon 1 1 1 1 4 4 4 14 51 24 56600 85000 Total Q. 373 394 319 271 265 296 258 225 179 159 174 219 I- Values 209 237 242 362 727 1186 1032 2699 2226 3192 5459 12793 Purchase Price: Cedis/Ton 561 602 758 1180 2743 4000 4000 12000 12000 20234 31376 58416 Sources: Ghana Cocoa Board. notes: No values siven for 1973174 crop because of frequent changes in producers' prices. TABLE 7.03: WORLD PRODUCTION OF COCOA BEANS (THOUSAND TONS) -------------------------------------------------------------__--------------__------------------------------------------------------------__----- 1974175 1975/76 1976177 1977/78 1978/79 1979180 1980/81 1981/82 1982/83 1983/84 1984185 -------------------------------------------------------------__--------------__------------------------------------------------------------__----- 1. Caemroon 118.0 96.0 82.0 108.0 106.0 122.0 115.0 123.0 107.0 109.0 12D.0 2. Ghana 382.0 401.0 329.0 271.0 265.0 296.0 258.0 223.0 178.0 159.0 175.0 3. Ivory Coast 242.0 231.0 230.0 304.0 312.0 373.0 352.0 457.0 355.0 411.0 552.0 4. Nigeria 214.0 216.0 165.0 205.0 137.0 169.0 165.0 181.0 156.0 118.0 150.0 S. Other African Countries 55.0 59.0 49.0 54.0 51.0 60.0 59.0 8.0 8.0 60.0 59.0 All African Countries 1011.0 1003.0 855.0 942.0 871.0 1020.0 949.0 994.0 804.0 857.0 1056.0 6. Brazll 273.0 243.0 234.0 283.0 314.0 294.0 350.0 314.0 336.0 303.0 406.0 7. Ecuador 78.0 63.0 72.0 75.0 90.0 98.0 75.0 83.0 55.0 39.0 85.0 8. Oth-r American Countries 88.0 86.0 86.0 100.0 105.0 108.0 97.0 78.0 78.0 78.0 80.0 9. West Indies 41.0 42.0 42.0 42.0 47.0 35.0 37.0 50.0 52.0 50.0 56.0 10. Asia 60.0 63.0 60.0 64.0 69.0 77.0 79.0 113.0 116.0 148.0 188.0 World Production: 1551.0 1500.0 1349.0 1506.0 1496.0 1632.0 1587.0 1634.0 1441.0 1475.0 1871.0 , Ghana's Production in X 24.6X 26.71 24.4X 18.01 17.71 18.1X 16.3X 13.8X 12.41 10.81 9.41 .8 Sources: International Cocoa Organization (ICCO), for data 1983184 and 1984185, February 5, 1986. Gill and Duffus, and Ghana Cocoa Board. Econmic Survey 1977-80, p. 43 for data 1971/72-1980/81. Economic Survey 1972-74, p. 80 for data 1969170-1970/71. Note: Data for 1984-85 are eatinates. TABLE 7.04: PRODUCTION OF IMPORTANT CROPS (TUOUSAND TONS) 1970 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 -------------------------------------------------------------------__--------__------------------------------------------------------------------__--------__------- 1. Cereals 858 890 672 689 639 540 780 674 725 544 308 955 780 905 maize 482 486 343 286 274 218 380 382 378 346 172 574 395 495 Rice 49 73 71 70 109 108 93 78 97 36 40 66 80 80 Millet 141 154 122 144 125 93 149 82 119 76 40 139 120 140 Guinea Corn 186 177 135 189 131 121 158 132 131 86 56 176 185 190 2. Starchy Staples 6077 7990 5452 4423 3995 4105 3927 4349 4114 4431 3649 6150 4891 NA Cassava 2388 3606 2398 1819 1811 1895 1759 2322 2063 2470 1721 4065 3075 3040 Cocoyam 1136 1510 1099 773 722 726 749 643 631 628 720 600 580 KA Yam 909 S50 709 575 535 544 602 650 591 588 866 725 560 660 Plantain 1644 2024 1246 1256 927 940 817 734 829 749 342 760 676 OA 3. Pulses and nuts 1113 1397 1339 1260 986 1188 1287 - - - - - - Groundnuts 102 157 111 113 81 83 107 - - - - - - Coconut 302 307 311 229 152 159 159 - - - _ _ Oil Palm 696 917 901 901 739 935 1012 - - - - - - Seens and Peas 13 17 16 17 14 11 9 - - - - - - 4. Vegetables 299 534 396 347 283 287 339 - - - - - Tocntoes 93 105 90 100 103 104 125 - - - - - - - Pepper 95 148 118 113 76 78 92 - - - - - Okro 102 252 160 108 92 93 110 - - - - Garden Eggs 10 29 29 26 12 12 12 - - - _ - S. Otsers 285 364 378 276 286 302 293 - - - - - _ Sugar Cane 112 171 205 190 258 272 272 - - - - - Orange 129 150 150 52 19 21 11 - - - - - - - Pineapple 29 35 16 25 5 5 3 - - - - _ _ San-n 16 8 7 9 4 4 7- - - - Sources: Ministry of Agriculture. Quartely Digest of Statistics, June 1984, pp 4-5 for data 1976-83. Note: Data for 1981, 1982, 1983 are forecast estimates. TABLE 7.05: AREA UNDER IMPORTANT CROPS (THOUSAND HECTARES) 1970 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1. Cereals 999 960 805 843 768 645 924 854 911 822 83S 1,275 964 1,060 Noise 452 425 320 273 256 205 358 355 440 373 400 724 405 450 Rlce 55 67 79 77 129 123 105 99 116 61 40 69 87 90 killet 249 222 199 243 208 157 250 139 157 172 175 231 222 240 Guinea Corn 243 246 208 249 175 160 211 261 198 216 220 251 250 280 2. Starchy Staples 1,070 1,148 897 728 636 646 621 688 686 736 742 - - Cassava 351 389 285 250 232 235 219 315 308 339 339 436 356 375 Cocayrn 259 284 20S 167 147 155 158 137 134 145 147 - - _ ye 172 133 177 lO 89 95 105 113 116 111 113 223 111 120 Plantain 288 343 230 211 168 161 139 123 128 141 143 - - - 3.Puls aand puts 398 443 430 426 373 359 391 0 0 0 0 0 0 0 Crocalduts 98 111 102 91 85 71 92 - - - - - coconut 36 38 se 28 23 21 21 - - - - 0o1 Paln 111 146 144 144 10 149 157 - - - - - Boom cd Pe" 133 149 147 163 157 118 121 - - - - - B 4. Vsgetables 78 136 98 93 74 72 86 0 0 0 0 0 0 0 Talst.e. 19 23 19 22 16 22 27 - - -- - - Pepper 28 53 40 39 28 26 31 - - - S t - - Ok"r 28 51 32 23 24 20 24 - - - - - Carden E88s 4 10 7 9 6 4 4 _ _ _ 5. Othrs 41 44 42 21 14 14 14 0 0 0 0 0 0 0 SugoxC ne 4 6 6 6 7 8 8 - - - - - - Or-nWe 20 23 27 8 3 3 2 - - - - Pineapple 9 11 5 3 2 2 1 - - - - - - - Banana 8 5 4 5 3 2 4 - - - SoUrces: inLsttry of Agriculture Quarterly Digest of Statistics, June 1986, P. 5 for data 1978-84 Note: Data for 1981-86 are estUimtes. TABLE 7.06: YTIE OF IKPORTANT CRPS (Ka. PE RHA.) 1970 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1. Cereals 858 927 834 818 832 837 844 718 860 661 369 --- matte 1,065 1,143 1.074 1,047 1,070 1,063 1L06 1.080 1.016 928 430 790 1,000 1,100 lice 887 1,096 906 909 845 878 886 788 836 590 1,000 1,100 920 890 MLIllet 567 695 613 592 601 592 596 610 758 442 229 600 540 S80 Guinea Corn 766 718 650 758 749 756 749 506 662 394 255 700 740 680 2. Starchy Staples 5,680 6.961 6,078 6.078 6,281 6,354 6,324 6,321 5,997 6,020 4,918 - - Cassava 6,813 9,282 0,429 7,276 7,806 8,064 8,032 7,420 4.700 7,286 5.100 5,000 8,600 8,100 Cocoys- 4,379 5,323 5,358 4,629 4,912 4,684 4,741 4,693 4,709 4,331 4,898 4.400 4,700 - YOM 5,275 6,402 3,998 5,767 6,011 5,726 5,733 5,752 5,095 5,297 7,664 3,250 5.000 5,500 Plantain 5,714 5,905 5,418 3,953 5,518 5,839 5,878 5,967 6,477 5,310 2,392 5,390 5,820 - 3. Pulses and Nuts 2,799 3,151 3,113 2,959 2,643 3,309 3,292 - - - - - -- Groumdn,jts 1,040 1,411 1,087 1,236 953 1,169 1,163 - - - - --- Coconut 8,291 8,162 8,269 8,297 6,609 7,571 7,571 - - - - - - - Oli Palm 6,276 6,273 6.272 6,257 6,843 6,275 6,446 - - - - - - - U Beans and Peas 88 112 110 104 89 93 74 - - - - - - - 4. VPegtables 3,810 3,912 4,027 3,747 3,824 3,986 3,942 - - - - - - Tmmtoes 4,973 4,612 4,758 4,525 6,438 4,727 4,630 - - - - - Pepper 3,387 2,800 2,970 2,935 2,714 3,000 2,968 - - - - Okro 3,642 4,941 4,923 4,635 3,833 4,650 4,583 - - - - - - - Garden 585s 2,525 2,938 3,904 2,989 2,000 3,000 3,000 - - - - - - 5. Others 6, 983 8,270 9,053 13,143 20,429 21,571 20,347 - - - Sugar cone 27,950 31,073 35,328 33,929 36,857 36,267 36,267 - - - - - - Orange 6,515 6,511 5,550 6,582 6,333 7,000 5,789 - - - - - - - Pineapple 3,065 3,286 3,327 10.000 3,667 2,000 3,000 - - - - Banana 2,026 1,653 1,700 1,800 1,600 2,000 1,750 - - - - - - Sources: Ministry of Agriculture Qularterly Digest of Statistics, Juno 1984, pp. 4-5 for data 1976-79 note: Data for 1981-86 are forecast estimates. TABLE 7.07: DOMESTIC CATCH OF FISH, IMPORTS AND CONSUMPTION (QUANTITIES IN THOUSAND TONS, VALUES IN MILLION CEDIS) 1970 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Quantities: Imports 30 22 17 43 16 3 10 5 0 1 4 3 5 Domestic Catch 1. Marine 158 182 213 196 226 222 188 184 200 199 205 231 235 2. Volta Lake 40 37 42 39 35 A0 40 40 40 42 43 41 43 Sub-Total: 198 219 255 235 261 262 228 224 240 241 248 272 278 Landings Foreign Vessels 22 5 1 1 1 18 1 1 2 1 - 2 _ Tun sold locally 0 1 3 3 3 2 2 4 9 - - Total: 250 247 276 282 281 285 241 234 251 - - - Values in Million Cedis: Imports 14 17 15 18 14 8 9 5 0 3 75 57 250 Domestic Catch 1. Marine 27 61 103 110 161 302 503 1,058 1,888 950 2,576 5,592 12,750 2. Volta Lake 9 12 13 12 35 70 80 80 90 84 86 1,230 2,580 _ Sub-Total: 36 73 115 122 196 372 583 1,138 1,978 1,034 2,662 6,822 15,330 S Landings Foreign Vessels 3 2 0 0 1 10 1 1 2 2 - 22 - 0' Tuna sold locally 0 0 1 1 1 1 2 5 0 - - - Total: 53 92 131 141 212 391 595 1,149 1,980 - - - - …---------------------------------------------.--------------------------__--__------------------------------------------------------------------------__-- Sources: Ministry of Agriculture Economic Survey 1977-80, p. 73 for data 1976-80 Economic Survey 1975-76, p. 84 for data 1972-75 Economic Survey 1972-74, p. 89 for data 1970-71 Note: Data for 1983-85 are estimates. TASL 7.08: PRODUCTION OF TIMOER, VEEER ASD PLYWOOD (Quantities in MUllions of Cubic Meters) 1970 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 -------------------------------------------------------------------__--------__--------------------------_-_----------_--------------------------------------------- SuOntities:(in millIois of cubic meters) Logs: Recorded Exports 0.601 0.43 0.43 0.34 0.40 0.38 0.19 0.12 0.05 0.05 0.06 0.07 0.14 0.22 Sa%MtL Intake 0.876 0.a5 0.77 0.85 0.54 0.53 0.28 0.34 0.35 0.26 0.28 0.26 0.32 0.40 Veneer/Plywood Intake 0.076 0.13 0.11 0.19 0.10 0.06 0.02 0.02 0.12 0.09 0.13 0.13 0.08 0.12 Unrecorded Use/Stocks 0.10 0.12 0.08 0.16 Total Output: 1.560 1.42 1.31 1.38 1.04 0.99 0.48 0.55 0.55 0.41 0.56 0.58 0.62 0.89 Sawn Timber Recorded Exports 0.24 0.17 0.16 0.14 0.10 0.17 0.08 0.07 0.05 0.04 0.05 0.06 0.09 0.11 Local Sales 0-09 0.20 0.23 0.22 0.40 0.16 0.!0 0.05 0.10 0.09 0.09 0.07 0.12 3.09 Own Use (Hills, Mines) 0.03 0.03 D.03 0.08 0.0 0.07 0.03 0.02 0.01 0.09 0.02 0.03 0.02 0.03 Addition to Stocks -0.01 0.05 -0.03 0.01 0.03 -0.08 0.03 0.01 0.03 -0.07 0.02 0.03 -0.00 0.01 Total Output: 0.36 0.45 0.39 0.45 0.58 0.32 0.24 0.15 0.19 0.15 0.19 0.18 0.22 0.23 Veneer: Exports 0.42 8.70 7.40 2.00 0.50 27 10 5.50 7.30 6.00 5.00 9.00 0.01 0.01 0.01 Local Sales 0.03 0.10 0.00 0.00 0.70 0.30 0.50 0.20 0.10 0.10 0.60 0.00 0.00 0.00 Own Use 0.00 0.10 0.10 9.00 0.30 16.00 12.20 16.00 17.00 17.00 12.00 0.01 0.01 0.01 Addition to Stocks -0.01 9.40 7.60 3.10 11.00 -6.80 -1.S0 -1.20 -3.00 -1.00 2.50 0.00 0.00 0.00 Total Output: 0.46 18.30 15.10 14.10 12.50 36.60 16.70 22.20 20.00 21.00 24.20 0.02 0.22 0.02 PLyvoo4d Ezports 21.71 18.50 17.50 17.30 36.30 18.00 2.00 2.00 0.20 0.30 0.20 0.00 0.00 0.00 Local Sales 7.99 12.50 12.40 46.10 53.40 20.20 33.50 47.50 60.00 39.30 31.90 0.02 0.02 0.02 Own Use 0.12 2.10 0.30 0.60 2.60 2.70 3.10 0.50 1.00 0.40 1.60 0.00 0.00 0.00 Addition to Stocks 1.50 25.30 9.70 -7.00 -34.30 -0.90 -0.30 1.20 2.00 -1.23 3.00 0.00 0.00 0.00 Total Output: 31.32 58.40 39.90 57.00 58.00 40.00 38.00 48.00 63.00 39.00 36.70 0.02 0.02 0.02 Values in Million Cedis Exports of Loss 19.88 63.90 49.10 47.50 62.70 53.50 51.10 37.30 26.80 9.50 130.90 5.30 - - Sawn Timber: Recorded Exports 17.09 33.90 28.20 27.10 27.60 30.80 56.40 47.30 33.60 18.30 269.00 9.80 _ _ Local Sales 4.50 31.50 40.30 42.50 67.40 45.20 34.90 48.70 39.20 41.10 874.30 - - - Own Use (Mills, Mines) 1.20 3.90 15.30 14.20 11.00 19.80 10.50 19.50 50.40 41.10 134.50 - - - Addition to Stocks -0.30 7.50 -4.60 1.50 16.90 -22.70 10.40 6.70 -39.20 -36.50 -67.30 - - - Total Values: 22.71 77.50 69.20 85.30 123.00 73.10 112.20 122.20 84.40 64.00 1361.40 - - - Total Values (Logs + Savn) 42.59 141.40 118.30 132.80 185.70 126.60 163.30 159.30 111.20 73.50 1512.30 - - Veneer: Exports 0.08 1.96 1.26 0.40 0.20 1.50 6.40 7.80 5.90 2.70 38.80 - - - Local SaLes 0.00 0.01 0.00 0.00 0.20 0.80 0.50 0.20 0.00 0.10 18.90 - - - Own Use 0.00 0.01 0.02 0.90 0.10 5.30 14.30 17.40 14.10 9.06 r6.70 - - - Addition to Stocks 0.00 1.00 1.09 0.60 3.60 -2.20 -1.70 -1.30 -0.80 0.70 -0.90 - - _ Total Values: 0.08 2.98 2.37 2.90 4.10 5.40 19.50 24.10 19.20 12.60 103.5 - - - -------------------------------------------------------------------------__--__------------------------------------------------------------------------__--__------- Continued ... TABUL 7.08: PRODUCTION OF TIMM, VMEUR AJND PLYWOOD (Quantities in Millions of Cubic Meters) 1970 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 -------------------------------------------------------------------__--------__-----------------------------------------------------------__________________________ Plywood: Exports 3.04 6.29 5.18 4.90 2.00 3.20 1.60 1.10 0.20 0.10 1.10 - - Local Sales 1.99 2.45 3.09 13.10 13.40 74.40 29.30 33.90 63.80 16.80 133.40 - - Own Use 0.01 0.42 0.07 0.10 0.50 5.50 2.70 0.40 0.70 0.10 1.40 - -- Addltion to Stocks 0.16 4.97 2.09 -2.00 0.40 -1.90 -0.20 0.80 -0.20 -0.50 -0.10 - - - Total Values: 5.20 14.14 10.42 16.10 16.30 81.10 33.30 36.20 64.50 16.50 135.80 - - -------------------------------------------------------------------------__--__------------------------------------------------------------------------__--__------- Sources: Ministry of Agriculture Economic Survey 1977-80, pp 62, 68 for data 1976-80 Economic Survey 1975-76, pp 86, 89-92 for data 1972-75 Econmic Survey 1972-74, pp. 91-94 for data 1970-71 t TABU 7.09t DISTURUITM OF CXXX2i PROCEEDS JEINK W PXUCER SSE COCOA MAKEorM£ BOARD AXD SEB OOVXRWXMT8 1974175 1975176 1976177 1977178 1978179 1979180 1960/81 19B1J82 1982a83 1#3/84 1984185 1985In 6 COMA PSsCED ('000 T) 376.0 398.0 320.0 271.0 265.0 281.0 258.0 224 0 179.0 159.0 174.0 219.0 In CEDZS M Toot AV9UFA 1.0.B. EF PRICR 1686.0 1326.0 2594.0 3942.0 10396.0 10290.0 5407.0 4648.0 5056.0 86389.0 114027.0 203771.7 -inn PRMOC 1/ 548.8 56S.4 731.7 1333.3 2666.7 4000.0 4000.0 12000.0 12000.0 20000.0 30000.0 56600.0 COMTS C0 NPUaTINC BOARD 314.0 397.0 336.0 1071.0 1492.0 5253.0 5477.0 15799.0 16652.0 43940.0 72862.0 116644.0 COCOA EXPO DRTY 825.2 543.6 1528.3 1537.7 6237.3 2972.0 233.0 0.0 7279.0 37954.0 49812.0 54557.0 EP3ORT DMT AS 2 T.O.B. PR5CE 48.9 35.6 58.9 39.0 60.0 28.9 4.2 0.0 143.9 43.9 43.7 26.8 SWRCE: GRASA COcOA BOARD 21 WAIW CROP. TABLE 7.10: OPERATIONS OP THE G8ANA COCOA BOARD (1) (IN MILLION CEDIS) --------------------------------------------------------------__-------------__-------------------------------------------------------------__---- 1975/76 1976177 1977/78 1978/79 1979/80 1980/81 1981/82 1982/83 1983184 1984185 1985/86 1. Revenue: 551.9 754.9 1181.4 2297.7 2211.3 1444.4 1236.8 5090.1 15136.6 20976.9 47186.7 1.1 Exports 515.8 700.3 1028.0 2021.8 1933.9 1218.5 1116.2 4828.2 12828.9 18483.9 41416.5 1.2 Local Deltveries 33.3 51.l 149.4 270.6 266.7 207.4 87.4 242.2 598.5 1983.3 4799.0 1.3 Miscellaneous 2.8 3.5 4.0 5.3 10.7 18.5 33.2 19.7 17n9.2 509.7 971.2 2. Cost,: 393.6 353.1 547.7 1059.3 1556.8 1412.6 2539.i 3468.6 6932.5 12739.9 25545.7 2.1 Ploducer Proceeds 236.4 245.8 351.2 618.8 957.7 801.1 2448.1 2157.8 3109.5 5292.5 12518.0 2.2 Li-ensed Buying Agent 29.5 23.2 44.9 105.5 193.8 265.1 301.0 456.7 109.7 1872.4 2.3 Use of Stocks 2.8 - - - - - - - - 2.4 Freight, etc. 8.9 15.0 9.8 17.1 38.6 47.2 92.6 58.6 109.3 6.8 2.5 Finance Costs (2) 8.2 5.8 9.5 79.7 188.1 132.9 474.0 500.0 327.5 727.6 1542.6 2.6 Administration, etc. (3) 19.9 36.9 63.5 67.5 101.6 113.9 144.9 184.3 414.2 445.4 2.7 Cocoa Div. Grants, etc. (4) 87.8 26.4 68.8 170.7 77.0 52.4 78.5 111.2 2862.0 3894.2 3. Profits/Losses Before Taxes 158.3 401.8 633.7 1238.4 654.5 31.8 -2302.3 1621.5 8204.1 8237.0 4. Duties Paid 266.2 433.3 586.4 1334.4 846.7 52.5 0.0 1300.0 5636.3 8074.6 11948.0 0 5. Profits/Losses After Taxes -107.9 -31.5 47.3 -96.0 -192.2 -20.7 -2302.3 321.5 2567.8 162.4 Memo Items (000's Tons): Purchases 396.0 319.0 268.5 245.0 296.4 257.9 224.0 178.6 158.4 174.8 217.0 Shipments: 376.3 300.8 271.0 239.0 284.9 225.7 209.4 174.6 163.6 182.3 218.1 Exports 338.0 269.8 231.7 207.5 246.9 200.2 204.4 158.0 148.5 162.1 193.1 Local Deliveries 38.3 31.0 39.3 31.5 37.0 25.5 5.0 16.6 15.1 20.2 25.0 Value in Cedis Per Metric Ton: Exports 1526.0 2595.6 4436.8 9743.6 7832.7 6086.4 5460.9 30558.2 86389.9 114027.8 214482.1 Producer Proceeds 597.0 770.5 1308.0 2525.7 3231.1 3106.2 10929.0 12081.7 19630.7 30277.5 57686.6 Total Costs 993.9 1106.9 2039.9 4323.7 5252.4 5477.3 15799.6 19421.1 43765.8 72882.7 117722.1 Duties Paid 787.6 1606.0 2530.9 6430.8 3429.3 262.2 0.0 8227.8 37954.9 49812.5 61874.7 …------------------------------------------------------------__--------------__------------------------------------------------------------__----- SOURCE: GHANA COCOA BOARD IMF REPORT JULY 23, 1975, P 85 FOR DATA 1969170-1973/74 WORLD BANK REPORT. FEB 19, 1981. P 99 FOR DATA 1974/75-1978179. 1984/85 DATA REFLECTS THE BUDGET NOTES: 1. CROP YEAR ENDED SEPTEMBER 2. MAINLY DISCOUNTED CHARGES ON BILL DRAWN TO FINANCE THE PURCHASE OF COCOA, EXPORT DUTY, AND OPERATIONS ON THE BOARD. 3. INCLUDES PROVISION FOR DOUBTFUL DEBTS AND DEPRECIATION. 4. INCLUDES GRANTS TO THE COCOA DIVISION FOR PRODUCE INSPECTION, RESEARCH, CONSTRUCTION OF FEEDER ROADS, AND SUBSIDIES FOR INSECTICIDES AND SPRAYING. TABLE 8.01: Mineral Production 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 Production: Cold (kg) 19935.0 16494.0 16561.8 14957.2 12304.8 11093.8 10981.0 10595.3 10280.3 8601.1 8923.0 9311.2 8941.0 Diamond ('000 carats) 2549.5 2336.2 2282.9 1946.6 1422.9 1225.5 1149.3 836.1 684.2 339.0 346.0 636.0 556.0 Bauxite ('000 tons) 336.6 325.2 271.6 275.2 327.9 235.3 225.1 181.2 63.5 70.4 49.0 169.5 204.0 Mangemeso ('000 tons) 392.3 415.3 316.8 292.4 316.7 253.8 249.9 223.1 159.9 173.0 267.0 357.0 332.0 Index of Production: Gold 122.5 100.0 101.6 91.8 76.7 68.1 67.4 65.0 63.1 52.8 54.0 56.0 54.2 Diamond 1091 100.0 9?.7 83.3 60.9 52.5 49.2 35.8 29.4 14.0 15.0 27.0 23.8 Bauxite 103.5 100.0 83.5 84.6 100.8 72.4 69.2 55.7 20.0 21.0 15.0 52.0 62.7 Manganese 94.5 100.0 76.3 70.4 76.3 61.1 60.2 53.7 39.1 42.4 65.0 87.0 81.0 Overall Index 0.0 100.0 96.8 87.4 75.7 65.3 64.4 60.0 54.4 45.6 50.0 58.0 S5.0 Export Volume Cold (kg) - - 16416.0 15208.0 9747.0 11818.0 10820.0 10765.0 9386.0 8621.0 8880.0 8648.0 8941.0 1 Dimwnd ('000 carats) - - 2308.0 2079.0 1476.0 1007.0 897.0 944.0 688.0 605.0 425.0 643.0 565.0 Bauxite ('000 tons) - - 219.0 250.0 293.0 206.0 195.0 151.0 36.0 81.0 44.0 125.0 226.5 MangAnese t('00 tons) - - 360.0 321.0 287.0 223.0 163.0 182.0 136.0 138.0 241.0 252.0 257.0 Export Unit Values: Gold ($1 fine ounce) - - - - - - 546.0 459.0 373.0 366.0 361.0 319.0 369.0 Diamond (S/ carat) - - - - - - 11.0 9.0 7.0 6.0 7.0 9.0 9.0 Bauxite - - - - - - 14.0 17.0 19.0 20.0 20.0 20.0 20.0 Manganese ($1 MT) - - - - - 53.0 56.0 39.0 39.0 34.0 34.0 32.0 Sources: Statistieal Service, Accra Chief Irspector of Mines Quarterly Digest of Statistics, June 1984, pp 6-9 Economic Survey 1975-76, p. 81 Quarterly Digest of Statistics, June 1972, pp 7-9 for Data 1970. TABLE 8.02: Diamond Production 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 Total in 000 Carats 2549.5 2336.2 2282.9 1946.8 1422.9 1225.6 1149.2 836.4 684.0 339.0 346.0 636.0 556.0 Companies: 000 Carats 2542.6 2251.4 2269.'3 1940.1 1421.5 1225.6 1148.7 836.1 682.0 337.0 342.0 633.0 - 000 Cubic Meters Tieated 2913.0 1607.6 1573.1 997.1 0.0 841.7 755.3 755.0 496.0 340.0 356.0 543.0 - Carats Per Cubic Meter 0.9 1.5 1.4 1.2 1.4 1.5 1.5 1.3 1.0 1.0 1.0 1.0 - Afrlcan Diggers (000 C) 7.9 84.8 13.1 6.7 1.3 2.0 0.5 0.2 2.0 3.0 4.0 3.0 - ________________________________________________________________________________________________________________________________________________________ Sources: Quarterly Digest of Statistics, June 1984 and 1986, p. 7. Quarterly Digest of Statistics, June 1972, p. 8 for data 1970-71. Lf TABLE 8 03: Cold Production 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 Total in KS 19955.0 16295.1 16494.2 14957.0 12504.8 11093.8 10981.0 10395.3 10280.3 8601.1 8923.0 9311.0 Quartz Reefs: Tens Crushed 1044.0 1445.0 1345.0 1253.0 976.0 926.0 981.0 960.0 896.6 765.3 887.0 1087.0 KGS won 1771.0 14124.1 13558.0 1320).5 10821.4 9744.6 9561.5 9378.7 9194.2 8000.6 8382.0 8804.0 DVT Per Ton 11.900 6.300 6.500 6.800 7.100 6.800 6.300 6.300 6.600 6./00 6.000 5.000 BDnket Roefs: Tons Crusbed 319.3 299.6 360.9 287.4 273.1 221.8 212.8 175.2 151.5 89.0 103.0 99.0 RaS won 1293.0 1788.5 2637.6 1750.2 1647.9 1219.7 1213.0 1011.7 969.9 502.4 449.0 417.0 DOT Per Ton 2.860 3.800 4.700 3.900 3.900 3.500 3.700 3.700 4.100 3.600 3.000 3.000 Alluvial: Cubic Metors Treated 7007.0 2566.0 1629.0 56.0 220.0 980.0 1519.0 1762.0 1486.1 770.1 918.0 893.0 IGS Won 958.3 373.2 311.0 6.5 35.3 129.4 206.5 204.9 116.2 98.2 92.0 90.0 DWV Per Cubic Meter 0.096 0.072 0.123 0.074 0.09 0.08S 0.087 0.075 0.050 0.089 0.064 0.065 1 Sources: Quarterly Digest of Statistics, June 1984 and 1986, p. 6. Quarterly Digest of Statistics, June 1972, p. 7 for data 1970. TA3LE 8.04: Production of Soam Selected Manufactured Commodities ----------------------------------------------------__-----------------------__---------------------------------------------------__.---------- 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 -------------------------------------------------------------------__--------__---------------------------------------------------------------- Milk Reconst (X Liters) 37.8 51.8 40.1 39.9 34.4 13.4 15.9 7.6 10.0 11.0 14.6 Ice Cream (000 Liters) 927.0 1466.0 2580.0 2905.0 2101.0 2053.0 2106.0 628.0 444.0 746.0 115.2 Milo (Ton.) 1425.0 2026.0 2776.0 1747.0 1845.0 1211.0 969.0 741.0 0.0 0.0 0.0 Wheat Flour (Tons) 63204.0 67626.0 74177.0 81594.0 92960.0 89608.0 73245.0 25401.0 17981.0 39590.0 45306.0 Sugar (Tons) 11347.0 12140.0 11772.0 6966.0 5787.0 4014.0 1542.0 56.0 0.0 0.0 0.0 Cocoa Butt-r (Tons) 17610.0 19368.0 17027.0 13994.0 10560.0 10985.0 9928.0 8764.0 8818.0 3866.0 7674.0 Cocoa Liquor (K Liters) 3368.0 3202.0 3325.0 3860.0 3784.0 2257.0 2776.0 2765.0 1558.0 1163.0 3000.0 Cocoa Cake (Tons) 22325.0 22798.0 19890.0 15463.0 10241.0 12613.0 10775.0 10178.0 11321.0 4633.0 9178.0 Beer (M Liters) 63.3 77.5 71.8 49.6 45.1 44.5 52.7 33.9 31.0 45.0 42.9 Soft Drinks (000 Crate) 2167.0 2811.0 1814.0 2229.0 1847.0 1362.0 1459.1 802.0 382.0 553.0 718.0 Cigarettes (Millions) 2339.0 3121.0 3219.0 2095.0 1666.0 2028.0 1611.0 1208.0 1074.0 2008.0 1942.0 Cloth (N metors) 121.3 102.9 94.4 88.1 66.0 36.5 30.5 7.1 7.1 10.0 12.6 Jute Bass (000) 3700.0 3686.0 3920.0 2495.0 0.0 3228.0 3097.0 1723.0 1697.0 2059.0 2431.0 Margarine (Tons) 2613.0 3298.0 1399.0 1284.0 766.0 935.0 1271.0 732.0 275.0 527.0 941.0 1 Guardian Soap (Tons) 0.0 0.0 4369.0 3138.0 4516.0 6666.0 8358.0 4199.0 2699.0 4383.0 10005.0 I Toilet Soap (Tons) 2746.0 2581.0 2109.0 1050.0 1319.0 1059.0 1019.0 504.0 448.0 1082.0 1893.0 Ln Tooth Paste (Tona) 236.0 279.0 275.0 89.0 181.0 98.0 227.0 70.0 27.0 12.0 122.0 4- Petrol (000 Tons) 252.8 260.0 264.3 268.7 227.6 245.7 252.6 244.0 155.0 172.0 216.0 1 Rerosene (000 Tons) 99.6 98.1 111.3 126.3 123.6 119.5 130.7 133.0 77.0 86.0 120.0 Diesel, Gas Oil (000 Tons) 345.6 353.3 322.9 311.8 283.1 283.2 296.2 287.0 164.0 218.0 278.0 Cement (000 Tons) 666.3 678.5 565.1 489.1 247.8 294.3 396.0 252.0 278.0 235.0 356.0 Iron Rods (Tons) 2865.0 6148.0 7280.0 2863.0 3757.0 5378.0 5084.0 2247.0 1535.0 1914.0 3360.0 ---------------------------------------------------------------__------------__-----------------------------.--------------------------------__ Sources: Quarterly Digest of Statistics, June 1984 and 1986. p. 13 for data 1975-85. Economic Survey 1975-76 Economic Survey, 1972-74 TABLE 8.05: RAILWAY TRAFFIC 1970 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 FREIGHT: (O000 TONS) COCOA 225.2 117.3 123.6 93.7 68.5 75.8 94.8 71.8 66.1 46.8 16.3 33.2 T711ER 445.2 223.4 231.0 176.0 115.6 71.6 53.8 63.9 83.1 61.0 23.0 35.0 BAUXITE - 324.9 267.3 285.6 272.3 223.5 191.4 183.3 73.3 59.2 52.0 134.5 MANGANESE 428.1 323.0 326.9 352.0 334.2 245.5 238.1 260.6 174.7 137.8 252.4 269.0 OTES 546.5 178.7 188.2 52.8 134.2 38.2 63.4 113.2 72.2 51.6 30.5 38.8 TOTAL: 1645.0 1167.3 1137.0 960.1 924.8 654.6 643.5 692.8 469.4 356.4 374.3 510.6 (MILLION TONIXA) TOTAL: 304.0 205.4 192.2 191.5 148.5 109.5 106.4 91.9 74.0 61.0 43.5 - PASSENGER: PASSENGER JOURNEYS ('000) 7956.0 6816.0 6063.0 6176.0 5987.0 5331.0 5543.0 3693.0 3114.0 3394.0 2180.5 2104.6 in PASSENGER KILOMETERS (MXM) 539.5 488.8 471.7 568.8 422.4 415.3 459.6 313.5 290.0 380.0 157.4 - SOURCES: 1984-85 DATE ARE STAFF ESTIMATES. 1980-83 DATA FROM QDS JUNE 1983, PP. 17-18. 1970-71 DATA FROM QDS JUNE 1982, P. 40. NOTE: MREIGHT FOR BAUXITE FOR ?ERIOD 1970-74 IS INCLUDED IN 'OTHER*. TABLH 9.01: CONSUMER PRICE INDME NUMS (1977-100) ANNUAL AVERAGE 1978 1979 1980 1981 1982 1983 1984 1985 N AT I O N A L: 100.0 Combine Index 17S.1 267.3 401.2 868.6 1062.4 2357.4 3304.2 3647.2 49.2 Food 159.4 257.7 392.5 828.5 1125.4 2754.6 3058.5 2717.7 6.2 Beverage and Tobacco 241.1 317.8 514.3 1178.8 1059.2 2302.8 3907.2 4801.5 19.2 Clothing and Footwear 191.7 283.8 398.6 926.7 1049.0 2085.5 3604.3 4643.7 6.8 Rent, ue1l, Power 147.7 185.3 297.8 643.2 691.0 1721.9 3142.7 3372.8 5.1 Furniture, Furnishings 19S.1 287.2 471.8 1207.0 1256.4 2429.1 4765.2 5404.0 1.8 MedLca1 Care, Health 168.6 280.8 435.8 727.1 995.5 1991.6 3143.8 4100.2 4.3 Transport, CnmicatLon 159.3 247.0 398.8 789.0 796.7 1608.4 3081.4 4741.5 5.5 Recreation, EnterteirAiet 173.0 315.1 404.4 744.2 1019.6 1406.6 2660.6 4435.3 1.9 Misc. Cood and Servlces 181.7 320.7 431.1 890.2 1167.0 2255.1 3919.7 4987.1 U R B A I: 100.0 Combired Index 171.5 256.5 363.0 800.4 977.6 2102.6 2959.7 3329.2 48.0 Food 163.8 248.7 342.2 755.2 1059.5 2645.9 2932.4 2496.1 0% 5.5 Beverage and Tobacco 235.1 320.7 493.9 1194.3 957.5 1992.3 3916.2 5132.6 1 16.4 Clothing ad Footwear 188.5 271.9 378.6 873.7 950.0 1874.7 2062.1 4129.3 9.6 Rent, Fuel, Poer 138.9 177.4 266.5 480.0 563.0 1022.0 1735.5 2313.3 4.8 Furniture, Furnirhings 189.6 278.2 441.2 1209.2 1228.4 2108.1 4389.8 4979.9 1.2 Medical Care, Health 146.7 261.7 396.8 683.5 937.6 1483.9 2339.8 3528.7 5.4 Transport, Coamnlcations 155.4 230.5 399.9 833.5 897.0 1470.1 3139.2 5100.9 6.0 Recreation, Entertanment 183.2 327.0 393.7 .97.2 1063.9 1453.9 2689.8 4341.9 1.7 Misc. Goods, Services 174.8 311.0 399.1 799.5 1039.0 1927.8 3613.5 4864.0 R R A L: 100.0 OCbined Index 174.7 278.2 448.2 938.5 1149.7 2639.6 3652.4 3973.6 49.8 Food 155.0 266.8 442.7 903.3 1212.8 2863.2 3178.4 2939.4 6.9 Beverage and Tobacco 246.1 315.5 530.9 1166.3 1141.7 2537.5 3899.8 4531.7 22.2 Clothing, Footwear 194.2 292.9 413.7 970.4 1118.6 2301.2 4016.7 5034.9 4.0 Rent, Fuel, Power 169.2 262.8 375.1 1048.6 1006.7 3456.1 6631.7 5992.1 5.3 Furniture, Furnishings 200.4 295.6 500.7 1205.0 1288.0 2862.2 5120.7 5809.6 2.4 Medical Care, Health 179.9 290.4 455.6 749.1 1109.1 2163.2 3550.6 4389.4 3.2 Transport, Coa mications 170.7 275.8 385.6 714.8 623.3 1849.4 2956.2 4051.4 4.2 Recreation, Entertairment 155.8 295.4 412.3 655.5 945.4 1320.8 2599.7 4591.5 2.0 Mlsc. Goods, Services 187.7 328.3 460.7 968.3 1301.7 2538.6 4099.2 5090.8 C--------------------------------------------------------------__------------__---------------------------- ContLnued.. TABLE 9.01: COSSUElR PRICE IINDE NUMBERS: VEW SERIES (ARIUAL AVERAGE. 1977 - .20) 1978 1979 1980 1981 19P9 1983 1984 1986 A C C R A: Weight: 100.0 Combned Index 169.9 276.4 377.8 772.4 990.8 1877.5 2729.8 3282.7 48.3 Food 163.5 283.7 359.4 686.4 1011.3 2358.8 2629.4 2407.3 5 6 BevraS and Tobecco 234.3 333.1 508.5 1209.2 941.3 1701.8 4095.2 5147.1 13.7 Clothing and Footwear 165.5 266.7 356.9 903.3 952.2 1441.1 2605.9 3839.2 11.2 Rent, Fucl. Pouer 134.6 167.9 251.9 411.3 532.9 863.8 1364.7 1947.5 4.8 FuzuLture, Furnishbngs 209.0 388.6 475.7 1172.8 1499.8 1847.8 4400.6 4877.7 0.3 Medical Cars, Health 169.8 323.1 524.0 1011.0 1538.1 1837.- 2512.5 4465.2 6.7 Transport, Communications 161.1 271.5 312.4 1012.3 1144.6 1747.7 3768.4 6577.1 7.2 Rocreation, Cultural Svcs. 211.0 364.5 408.6 833.6 1070.4 1467.6 2531.5 4211.5 1.7 Kisc. Goods, Servicos 295.8 338.9 428.9 837.9 1038.3 1492.0 2618.4 3781.5 SOuRCES: STATISTICAL NES LER, sTATISTICAL SEmICE, ACORA. -J TABLE 9.02: NMTBY LcoNSUXER PRICE INDICES: N A T 1 0 N A L (1977 - 100) ----------------------------------------------------------------------__-----__----------------------------.-_--------------- CG43IUED POOD 3R37l1CE CLOTHING RlET.PUL FURBSH MZDICAL TRANSPOtT RECREA MISCEL IThIS TOBAcCO FOOTWEAR POWF R 2IG HEALTH 0001083NIC TION LANEOUS DEOUEDtBR 1982 1264.1 1407.8 1204.7 1241.3 744.4 1360.2 1249.9 777.6 1033.0 1377.4 DEC0715 1983 3064.4 3206.6 3139.8 2972.8 2813.2 3695.8 2918.3 2674.7 2075.1 3201.9 JANUARY 1984 3136.8 3303.6 3219.4 3044.3 3019.6 3862.8 2894.5 2256.5 2119.0 3351.2 FEBARS 3357.4 3468.7 3592.7 3406.0 3128.0 4317.1 3046.5 2280.6 2188.7 3642.1 MARCH 3459.9 3583.7 3674.3 3475.7 3220.1 4549.1 3052.6 2404.5 2257.0 3644.1 APRIL 3S52.3 3624.9 3810.3 3559.2 3220.0 4777.8 3001.8 3163.2 2302.2 3734.8 MAY 3606.8 3651.8 3859.7 3693.2 3174.6 4935.8 3056.4 3231.0 2336.0 3831.8 JUNE 3491.2 3349.8 4139.4 3724.5 3138.0 5010.0 3107.9 3304.9 2396.8 3875.2 JULY 3352.1 3078.8 4183.2 3662.6 3198.8 5013.8 3075.2 3221.0 2402.8 3983.3 AUGUST 3132.0 2702.8 4047.3 3610.2 3117.3 4682.8 3222.4 3244.6 2436.8 4053.8 SEPTE17 R 3106.5 2547.1 4026.2 3639.2 3058.5 4902.6 3242.6 3291.1 3066.3 4176.4 OCTOBER 3105.1 2469.0 4060.9 3695.1 3878.9 5041.7 3259.5 3387.8 3304.9 4218.8 g307361 3102.1 2414.8 4054.3 3755.9 3093.2 5104.4 3296.1 3361.2 3413.1 4233.0 1 DECUSHBR 3247.9 2507.3 4210.3 3985.9 3266.1 4984.1 3490.1 3850.2 3685.7 4291.5 JANUARY 1985 3488.3 2645.7 4200.0 4193.3 3312.7 5070.3 3648.8 4224.2 4060.5 4602.3 co FlRUARTY 3495.4 2745.6 4388.9 4255.2 3230.1 5210.6 3769.9 4351.3 4126.6 4698.9 1 MARCH 3575.9 2819.2 4538.8 4390.1 3190.0 5227.6 3842.1 4421.8 4226.1 4745.2 APRIL 3613.5 2803.3 4829.3 4423.6 3309.3 5292.4 3944.4 4525.6 4272.1 4786.1 KAY 3647.9 2831.1 48S9.7 4474.4 3390.9 5311.2 3959.6 4612.7 4223.9 4839.9 JUNE 3728.0 2871.0 4857.7 4698.5 3334.8 5421.7 4047.3 4831.9 4278.3 4960.7 JULY 3693.4 2726.7 4941.2 4764.6 3327.2 5523.9 4180.2 4884.4 4402.9 5078.6 AUGUST 3665.1 2630.7 4922.9 4816.0 3367.0 5503.4 4223.3 4986.1 4433.9 5106.1 SEPTEMBER 3648.2 2548.8 4925.8 4872.1 3414.0 5421.4 4304.6 4997.4 4629.3 5141.8 OCTOSER 3672.1 2560.4 5003.4 4843.4 3461.7 5494.8 4347.7 5010.1 4811.6 5174.9 n307361 3737.0 2633.3 5026.0 4904.4 3515.8 5605.8 4447.5 5018.4 4848.2 5299.2 DECU3ER 3881.2 2797.1 5124.0 5088.8 3619.9 5762.4 4496.1 5034.6 4909.7 5412.0 JANUlARY 1986 4047.2 2928.6 5571.7 5172.2 3797.0 5919.1 455.6 5776.4 4947.7 5537.0 FEBRUARY 4179.4 3050.9 5832.0 5246.0 4035.5 6133.2 4630.4 5886.7 5062.1 5656.9 MARCH 4301.5 3162.2 5973.2 5335.6 4302.1 6290.5 4699.0 6096.4 5119.3 5750.3 APJRL 4394.1 3228.2 6073.8 5393.5 4627.8 6477.7 4722.8 6233.6 5170.5 5801.5 MAY 4499.2 3337.1 6178.8 5505.9 4783.0 6615.4 4728.9 6262.9 5253.1 5852.4 JUNE 4590.9 3399.1 6288.7 5631.6 4969.4 6763.2 4744.9 6380.3 S327:8 5880.5 JULY 4575.2 3309.3 6395.1 5654.5 5024.3 6848.7 4748.9 6526.5 5274.0 5904.6 SEPT2E3ER 4517.8 3237.8 6433.5 5636.0 5030.5 6858.4 4743.6 6545.0 5391.8 5949.5 OCTOBER 4734.9 3287.4 6819.4 6153.3 5203.9 7276.1 4844.3 6612.5 5468.9 6102.2 NOV3MBER 4959.8 3468.3 7114.0 6518.3 5354.2 7749.1 4894.0 6701.1 5579.3 6232.8 ---O-----CES:--------TATI------TIC------------E---S---LETTER---__-----STATISTI_----------AL----S-------ICE-----------CR------ SOURCES: STATISTICAL NEWS LETTER, STATISTICAL SERVICE, ACCRA. TAULS 9.02: FxurLY CONSUMER PR5CE INDICES: U R B A N (1977 - 100) ----------------------------------------------------------------------__-----__---------------------------------------------- OOCSInED PO0D NEYA2LE CLOTINUG RENT.FUEL PURNISH MEDICAL TRANSPoST RsCIKA NISCEL TOBACOO FOOTNEAR POSOER IO EALTH COOKWtNIC TIMH LANEOUS DEXi5iER 1982 1131.9 1299.8 1000.0 1080.0 599.9 1235.8 1052.2 854.0 1086.6 1039.3 DOEICBgR 1983 2639.5 2930.0 5.0 2691.9 2472.1 1384.8 3356.3 1684.4 2673.2 2080.9 JANUARY 1984 2752.9 3136.0 3111.4 2672.5 1351.4 3568.7 1780.0 3.0 2033.6 3043.3 FlUIRARY 2918.4 3212.0 3675.0 2853.6 1483.4 4109.3 2047.3 2169.5 2221.8 3226.0 )4ARM 3052.1 3433.7 3784.0 2876.0 1579.2 4051.7 2057.3 2184.5 2329.6 3319.8 APRIL 3232.9 3573.4 3821.5 3036.6 1612.4 4401.0 2152.9 3248.2 2397.7 3398.2 MAY 3286.3 3617.4 3918.2 3076.4 1704.2 4477.9 2175.3 3286.8 2445.3 3516.0 JUnE 3144.0 3299.7 4198.2 3147.5 1724.8 4611.8 2353.3 3383.4 2479.7 3508.2 JULY 3131.7 3132.5 4301.3 3136.5 1945.9 4700.8 2397.7 3387.7 2513.0 3722.3 AUGUST 2826.2 2596.7 3967.2 3088.3 1883.3 4430.3 2484.2 3389.5 2476.0 3815.5 SEFNTB@BSR 2757.8 2369.4 3951.6 3045.2 1815.1 4574.0 2530.3 3495.9 2075.0 3974.6 OCTOBER 2756.2 2280.5 4002.6 3119.0 1867.9 4737.5 2568.5 3493.9 2075.0 3974.6 NOVDER 2738.9 2230.0 3965.9 3152.1 1909.4 4495.3 2617.2 3535.2 3390.6 3980.7 DECEJR 2919.5 2308.0 4297.8 3541.3 1949.4 4511.4 2913.0 4206.1 3615.8 4060.3 JANUARY 1985 3024.5 2396.0 4326.7 3574.9 1960.2 4576.6 3046.0 4602.4 3988.9 4365.9 FEBRUARY 3099.1 2442.8 4573.4 3696.2 1970.1 4736.6 3211.6 4630.9 4010.3 4493.1 KMUUUC 3230.5 2590.4 4744.5 3886.8 2039.2 4775.3 3179.9 4708.5 4093.0 4579.4 APRIL 3305.4 2559.0 5289.9 4028.6 2257.8 4884.7 3319.9 4818.0 4166.6 4649.2 MAY 3350.3 2590.? 5327.0 4139.6 2320.1 4884.1 3378.2 4944.3 4089.6 4729.3 JUNE 3372.0 2588.2 5227.6 4162.3 2286.6 4910.3 3518.4 5223. 4168.6 4816.1 JULY 3374.3 2502.0 5322.1 4212.6 2351.6 5060.0 3643.7 5246.6 4366.0 5005.5 AUGUST 3359.1 2416.4 5292.8 4284.4 2398.9 5020.4 3674.4 5392.3 4395.3 5034.2 SEPTlCER 3355.5 2348.7 5294.0 4349.1 2462.6 5011.3 3779.0 5399.9 4557.7 5048.8 OCTOUER 3399.1 2405.7 5315.3 4295.1 2507.9 5161.7 3791.9 5410.9 4712.8 5086.0 NOVUER 3473.4 2496.9 5351.6 4351.6 2557.2 5317.9 3855.3 5417.2 4758.2 5222.8 DEcEMBER 3606.1 2615.4 5525.5 4570.2 2647.3 5519.9 3944.8 5424.1 4833.3 5537.1 JAN11RY 1986 S792.4 2709.8 6293.2 4660.7 2835.1 5747.2 3979.0 6413.0 4855.9 5450.9 FEBRUARY 3928.4 2829.5 6562.4 4726.7 3067.2 6028.0 4058.5 6559.8 4946.4 5536.1 MAUCH 4046.9 2936.5 6677.3 4803.0 3364.3 6152.0 4089.8 6722.3 4976.4 5650.2 APRIL 4135.1 2995.4 6788.0 4860.8 3669.5 6S19.2 4104.3 6815.0 .993.1 5673.6 MAY 4213.0 3057.3 6914.5 4966.1 3793.8 6437.7 4111.2 6869.5 5035.4 5673.8 JUNE 4306.1 3124.2 7033.0 5098.2 3953.8 6577.2 4163.5 7006.5 5063.0 5703.7 JUfLY 4289.4 3002.3 7099.6 5161.0 4022.8 6739.3 4164.2 719S.8 5119.1 5711.9 AUGUST 4253.9 2934.0 7133.3 5119.6 4033.7 673S.8 4159.8 7216.9 5125.8 5721.5 SEPIEMER 4243.3 2884.5 7139.0 5158.1 4052.8 6789.5 4152.2 7221.9 5155.3 5735.2 OCTOBER 4440.1 2991.6 7539.8 5647.1 4198.9 7181.7 4237.7 7295.1 5194.7 5857.0 00VEMBSER 4664.2 3171.3 7897.2 6031.6 4353.7 7643.6 4304.2 7404.9 5304.8 6014.4 SOURCES:-----------ST----T---------CAL------NE----S---LETT-----__-----STAT---__-STIC-------L---S-----VICE.---------------A--- SOURbCES. STATISTICAL KME LaNrrER, STATSTSiCAL SERICE, ACCRAt. TABLE 9.02: MONTHLY CONSUMER PRICE INDICES: R U R A L (1977 - 100) COMBINED FOOD BEVBRAGE CLOTHING RENT.FUEL FURNISH MEDICAL TRANSPORT RECREA MISCEL ITEKS TOBACCO FOOTWEAR POWER ING MEALTH COOIO(UNIC TION LANEOUS DECEMBER 1982 1400.0 1515.8 1371.1 1363.9 1101.5 1477.8 1350.0 644.8 948.9 1621.3 DECEtER 1983 3501.3 3482.7 3284.8 3353.6 6344.5 4016.8 3542.7 2677.2 2065.5 3584.7 JANUARY 1984 3531.6 3471.1 3307.4 3377.1 7143.7 4140.8 3428.2 2644.2 2100.7 3793.1 FEBRUARY 3808.9 3725.3 3525.6 3826.2 7193.8 4513.5 3552.1 2474.0 2133.4 3999.5 MARCH 3879.3 3733.6 3584.9 3931.8 7276.9 5019.5 3556.3 2787.3 2135.4 3922.6 APRIL 3880.7 3676.4 3801.1 3956.6 7194.4 5134.0 3431.4 3015.2 2142.4 4023.8 MAY 3936.5 3686.2 3812.0 4162.3 6809.7 5368.8 3502.2 3133.8 2153.0 4102.9 JUNE 3777.2 3325.4 4091.5 4163.4 6631.8 5386.5 3489.8 3168.2 2258.0 4190.4 JULY 3578.8 3025.1 4087.0 4062.7 6296.3 5309.5 3418.1 2931.8 2264.5 3207.4 AUGUST 3446.5 2808.8 4112.6 4007.1 6167.9 4921.6 3596.0 2992.6 2371.3 4258.5 SEPTEMBER 3464.4 2724.8 4087.0 4090.9 6132.4 5213.3 3603.0 2938.3 3051.7 4349.7 OCTOKBER 3464.0 2657.5 4123.0 4133.2 6072.9 5329.4 3609.2 3099.4 3344.1 4404.0 NOVEMBER 3475.6 2599.6 4126.3 4215.2 6019.2 5680.4 3639.7 3058.4 3439.1 4449.6 DECEMBER 3585.7 2706.5 4139.0 4324.1 6521.3 5431.0 3781.7 3230.9 3802.7 4490.0 1 JANUARY 1985 3803.0 2895.4 4096.7 4663.6 6656.3 5537.1 3953.4 3566.1 4244.0 4885.3 Ol FEBRUARY 3902.9 3048.4 4238.5 4680.3 6345.2 5658.8 4038.9 3085.5 4321.0 4875.6 ° MARCH 3931.1 3048.0 4371.2 4772.0 6035.1 5655.3 4177.2 3936.8 4448.9 4881.5 1 APRIL 3930.3 3046.7 4454.0 4724.0 5908.8 5753.5 4260.4 4017.0 4448.6 4983.6 MAY 3953.9 3071.5 4478.9 4729.1 6038.1 5794.6 4253.8 4035.7 4448.6 4934.9 JUNE 4094.1 3153.8 4556.2 5106.4 5926.3 5905.3 4316.0 4150.6 4461.8 5084.9 JULY 4021.6 2951.3 4630.8 5184.4 5739.2 6019.2 4450.2 4254.3 4464.7 5121.4 AUGUST 3978.1 2844.9 4621.4 5220.4 5760.2 5960.1 4501.0 4279.4 4498.5 5167.9 SEPTEMBER 3947.8 2748.9 4625.7 5270.3 5766.0 5809.2 4570.6 4297.2 4749.1 5222.0 OCTOBER 3951.5 2715.0 4749.6 5260.4 5819.7 5809.7 4628.9 4312.8 4976.9 5251.3 NOVEMBER 4006.. 2769.6 4760.' 5324.9 5885.6 5878.0 4747.2 4324.6 4998.9 5364.8 DECEMBER 4162.4 2978.8 4796.8 5483.3 6024.4 5934.9 47?5.0 4356.9 5037.5 5476.4 JANUARY 1986 4307.4 3147.4 4983.7 5561.3 6174.9 6081.6 4847.4 4669.0 5101.3 5611.0 FEBRUARY 4435.7 3272.3 5236.8 5641.0 6429.4 6232.7 4919.8 4715.8 5255.8 5760.7 MARCH 4561.5 3387.9 5399.4 5740.7 6620.7 6421.4 5007.2 5007.4 5358.5 5836.3 APRIL 4655.6 3460.9 5491.9 5807.5 6996.8 6627.5 5035.7 5127.2 5467.3 5911.4 MAY 4792.0 3616.9 5579.2 5916.5 7228.5 6783.5 5041.4 5207.0 5617.5 6005.7 JUNE 4873.8 3673.9 5682.1 6037.3 7480.2 6939.1 5039.1 5290.9 5770.9 6032.4 JULY 4867.4 3616.3 5821.0 6029.8 7500.3 6952.1 5044.7 5362.2 5800.7 6070.0 AUGUST 4837.2 3541.7 5863.2 6028.8 7494.8 6974.4 5039.0 5376.2 5837.1 6145.2 SEPTEMBER 4798.4 3453.2 5889.9 6031.7 7528.7 69"2.5 5079.1 5368.0 5830.6 6146.5 OCTOBER 5036.4 3583.2 6232.3 6538.4 7688.6 7365.4 5151.3 5424.9 5927.9 6312.8 NOVnMBER 5262.1 3765.4 6475.7 6888.4 7825.1 7848.8 5192.5 5476.5 6038.7 6420.4 -------------S-----STATIS--------IC---------------S---LET-----ER_-----STATISTICAL--------------SER-----ICE,--------------A--- SOURCES: STATISTICAL NEWs LETTEgR, sTATIsTICAL SERVCE, AgcnRA. TABLE 9.02: MONTHLY CONSUMER PRICE INDICES: A C C R A (1977 = 100) ----------------------------------------------------------------------__-----__---------------------------------------------- COMBINED FOOD BEVERAGE CLOTHING RENT.FUEL FURNISH MEDICAL TRANSPORT RECREA MISCEL ITEMS TOBACCO FOOTWEAR POWER ING HEALTH COOMMUNIC TION LANEOUS ----------------------------------------------------------------__-----------__---------------------------------------------- DECEMBER 1982 1196.8 1421.5 987.9 1057.0 524.4 1441.2 1647.4 1049.8 1154.5 911.2 DECEMBER 1983 2207.5 2319.9 2601.3 1947.7 1076.6 2933.7 1180.3 3642.2 1768.4 1897.9 JANUARY 1984 2228.5 2487.7 2607.4 2142.2 1078.0 3036.3 1180.3 2238.1 1768.4 2016.8 FEBRUARY 2505.7 2626.9 3872.1 2374.7 1335.6 3979.8 2125.5 2238.1 2075.3 2220.9 MARCH 2607.4 2727.0 4107.0 2561.7 1335.6 3980.8 2125.5 2238.1 2248.9 2338.4 APRIL 3051.9 3269.7 4107.0 2772.0 1335.6 4493.8 2312.1 3967.9 2379.5 2463.0 MAY 3098.0 3307.4 4318.4 2868.0 1347.3 4498.5 2312.1 3967.9 2379.5 2546.2 JUNE 3144.0 3299.7 4501.4 2919.9 1354.2 4919.6 2568.3 3967.9 2508.5 2546.2 JULY 3125.9 3163.1 4684.6 2966.4 1354.2 5063.7 2830.8 4181.9 2508.5 3015.0 AUGUST 2687.3 2380.8 4682.0 2709.1 1354.2 4610.9 2830.8 4181.9 1438.4 3092.4 SEPTEMBER 2531.2 2132.1 3732.2 2513.8 1405.7 4649.6 2830.8 4253.6 2887.3 3050.3 OCTOBER 2507.9 1989.3 3732.2 2717.1 1405.7 4816.9 2830.8 4325.3 2957.2 3050.3 NOVEMBER 2486.6 2009.1 3732.2 2717.1 1405.7 4816.9 2830.8 4325.3 2957.2 3050.3 DFC=BER 2783.1 2159.5 4415.4 3109.7 1610.7 4419.7 3372.5 5334.3 3269.3 3039.0 JANUARY 1985 3015.2 2375.0 4489.5 3298.8 1610.7 4501.9 3757.3 6060.5 3843.8 3257.6 FFBRUARY 3040.9 2380.7 4489.5 3307.0 1625.4 4730.7 3757.3 6060.5 3919.8 3474.0 MARCH 3198.2 2456.9 4489.5 3676.1 1625.4 4730.7 3757.3 6060.5 3919.8 3474.0 APRIL 3298.1 2549.4 5482.2 3760.1 2021.9 4745.0 4015.1 6203.9 3925.8 3528.6 KAY 3343.0 2585.7 5486.2 3839.0 2049.7 4749.9 4310.5 6347.3 3925.8 3583.3 JUNE 3343.3 2551.0 5278.3 3860.8 1906.6 4840.9 4668.9 6768.3 3984.1 3712.7 JULZ 3290.3 2336.5 5287.3 3988.6 1965.7 4866.4 4855.5 6765.4 4264.2 3900.3 AUGUST 3287.3 2292.9 5271.6 4018.2 1977.0 4857.6 4797.1 6951.8 4292.7 3900.7 SEPTEMBER 3285.6 2207.0 5297.2 4081.7 2060.8 4861.3 4913.9 6951.8 4558.3 3900.7 OCTOBER 3336.5 2299.6 5321.1 4022.9 2122.0 4990.8 4913.9 6929.0 4550.6 4018.4 NOVEMBER 3403.8 2380.4 5367.2 4078.1 2158.3 5154.5 4913.9 6912.9 4605.8 4207.8 DECEMBER 3549.9 2472.3 5505.7 4378.4 2246.9 5503.0 4913.9 6912.9 4747.4 4419.7 JANUAitY 1986 3768.8 2585.6 6558.2 4514.5 2457.8 5642.7 4939.5 7913.6 4724.0 4599.6 FEBRUARY 3903.8 2726.9 6699.2 4555.7 2619.2 5811.2 5042.0 8129.7 4854.6 4739.8 KARCH 4061.5 2907.7 6733.3 4627.2 2984.9 5954.3 5042.0 8229.8 4865.1 4960.0 APRIL 4156.4 2912.5 6750.5 4717.9 3220.7 6087.0 5042.0 8309.7 4876.1 5004.8 MAY 4192.3 2967.6 6788.2 4880.5 3344.4 6127.4 5042.0 8386.3 4919.5 5004.8 JUNE 4297.3 3039.5 6903.4 5049.0 3483.3 6273.6 5158.8 8595.7 4960.3 5021.3 JULY 4292.8 2858.7 7089.4 5192.2 3578.5 6622.8 5158.8 8799.2 5112.3 5066.7 AUGUST 4259.0 2769.7 7141.5 5191.0 3588.0 6651.3 5158.8 8821.8 5137.9 5102.0 SEPTEMBER 4258.1 2714.9 7141.5 5285.5 3628.8 6714.4 5158.8 8832.3 5182 9 5140.4 OCTOBER 4444.3 2821.0 7614.2 5799.9 3736.3 7107.3 5241.4 8882.8 5188.9 5325.2 NOVEMBER 4640.7 2981.7 8022.2 6103.9 3870.0 7600.3 5266.1 8935.3 5317.2 5478.3 DECEMBER 48?8.6 3172.2 8455.4 6551.7 4057.2 8103.1 5284.3 9052.0 5410.8 ''- 4 SOURCE: STATISTICAL SERVICE. NEWS LETTERS. TABLE 9.03: IWOLEqALE PRICE INDEX NUMBERS (1977-100) ----------------------------------------------------------__----.------------__---------------------------- (ANNUAL AVERAGE) 1978 1979 1980 1981 1982 1983 1984 1985 -------------------------------------------------------------------__--------__---------------------------- Weight: 100.0 Combined Index 147.7 244.6 349.5 523.7 712.2 1630.3 2958.6 4624.9 55.0 I. Agric, Forestry, Fishla 146.2 236.8 355.4 474.3 773.3 1758.6 2675.6 3514.4 41.7 A. Agric, Livestock Pro 147.9 230.5 336.9 527.4 894.8 2009.0 2580.6 3117.5 10.0 S. Forestry, Logging Pr 124.8 244.0 335.5 302.5 230.5 831.1 2881.8 4208.2 3.3 C. Fish 185.9 291.0 397.5 659.7 882.6 1404.4 3040.8 6383.7 16.0 II. Mining, Quarrying Prod. 186.7 338.0 449.7 754.2 897.3 1195.8 2078.0 5854.5 41.4 III. Manufaeturers 148.5 255.8 347.1 546.4 632.8 1538.6 3371.7 6161.8 14.7 A. Food, Drink, Tobacco 156.0 260.3 376.5 620.1 736.2 1549.1 3028.2 5344.5 7.3 B. Textiles, Wearing Ap 151.9 220.5 303.0 581.6 669.1 1462.7 3588.4 7124.9 4.0 C. Wood and Furniture 159.4 206.3 206.4 699.4 715.7 774.8 787.9 3072.9 9.0 D. Chemials 127.7 224.5 378.4 575.5 609.2 1526.7 3332.3 6497.7 1.8 E. Non-Metallic Product 174.1 331.6 428.4 569.2 662.7 3668.3 5619.3 7830.0 3.8 F. Basie Metal Products 183.4 363.5 353.7 438.8 445.9 1778.8 4555.3 9772.8 4.4 G. Fabricated Machinery 119.2 243.4 231.1 249.7 250.3 661.6 2361.6 2643.8 2.0 IV. Electricity, Gas, Water 132.5 159.2 174.2 427.4 519.2 590.8 3159.6 4389.6 31.3 V. Esports 150.6 297.1 376.4 439.3 798.0 1144.4 2734.0 4558.7 0% SOURCES: STATISTICAL NEWS IElTTER, STATISTICAL SERVICE, ACCRA. PUUAERLY DIGEST OF STATISTICS, JUNE 1984, PP 49-50 NEWSLETTER OF CBS NO 4183 TAMLE 9.04: XIDU MEDURS OF PRIME WUILDIE COSTS (AUWUAL AVERAZE) 197Pt 1979 1980 1981 1982 1983 1984 198S V.lsht: 100.0 Cblned ladoe 155.7 242.0 371.6 636.9 744.0 1784.8 3835.2 5998.1 13.8 Unakilled Labor 141.0 166.3 244.4 407.4 410.3 558.2 1039.1 229.7 20.2 SkLIled Labor 133.1 164.4 245.6 353.5 357.0 483.6 874.6 1849.2 4.8 Sand 201.8 315.1 431.8 814.0 118.5 1999.4 3993.6 7776.0 3.5 Sten- 166.6 304.4 379.8 607.7 786.0 1797.6 4891.4 6407.5 8.9 Timber 178.5 396.3 637.9 2740.4 1987.9 4329.2 7011.1 8900.0 12.3 Cement 182.8 293.3 433.2 602.7 679.3 2204.6 5064.6 7624.1 3.4 Steel Katerialn 133.3 231.2 153.4 510.2 789.5 2794.8 5694.7 7894.7 4.6 RAofIn Materlals 162.0 312.2 323.9 673.5 827.8 1918.1 7002.3 4879.9 28.5 Ksace1aneoua 152.6 232.9 423.4 602.2 720.3 2143.1 4876.5 7630.0 SOURCES: STATISTICAL SERVICE, AccRA. 0w TABLE 9.05: AVERAGE WHOLESALE PRICES OF SELECTED AGlUCULTURAL CMMDITIES (IN CEDIS PER UNIT) 1970 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 * Unit: Maize 220 lbs 7.5 12.8 15.5 20.6 50.3 118.7 121.1 171.9 413.3 773.6 797.5 3857.6 2337.8 2037.9 Millet 204 lbs 8.6 16.6 21.4 21.2 47.7 159.5 185.7 222.8 656.8 878.2 1252.4 4531.2 4435.9 2958.4 Guinea Corn 204 lbs 9.3 1S.5 20.6 24.7 49.5 163.5 178.8 216.0 630.8 884.1 1213.9 5774.4 4402.5 2694.1 Rice 180 lbs 7.5 10.0 15.1 29.6 40.3 182.5 248.0 282.3 763.9 1102.0 2043.8 6155.0 6710.0 5206.7 Yams 100 Tubers 35.0 45.4 48.2 53.4 95.5 286.9 471.6 584.9 875.3 1544.9 2156.3 7019.5 7868.8 6813.2 Cocoyams 200 lbs 6.2 10.6 12.7 13.1 20.3 84.5 101.6 125.7 193.4 403.4 565.4 2806.7 2038.3 1040.7 Cassava 200 lbs 4.1 3.2 6.4 10.3 16.7 59.5 55.4 64.6 138.3 339.8 382.5 1496.9 846.0 -94.6 Plantain 25 lbs 0.4 2.0 1.3 1.1 2.9 9.0 13.9 14.9 21.9 33.8 47.0 200.3 222.3 195.6 Cowpeas 204 lbs 9.3 16.2 20.5 25.6 38.7 189.9 240.2 459.0 802.7 1976.5 2262.1 6494.5 6281.3 5884.7 Tomatoes 112 lbs 5.8 9.5 10.5 12.8 18.8 47.8 61.5 114.3 161.6 303.2 405.9 901.6 1316.6 894.0 > Groundnuts 180 lbs 11.3 26.5 41.9 51.4 56.7 193.2 320.9 474.1 690.1 1486.0 2371.3 5915.5 5721.3 5942.0 SOURCES: MISISTRY OF AZICULTURE, ACCRA Estimated TABLE 9.06: AVERAGE RETAIL PRICES OF SELECTED C(OMMDITIES IN ACCRA (IN CEDIS PER UNIT) 1977 1978 1979 1980 1981 1982 1983 1984 1985 Unit: Corn - Shelled Ks. 1.1 1.9 3.0 4.1 8.3 8.5 19.5 18.8 19.1 Rice kg. 1.3 3.8 10.3 19.0 21.5 - 96.3 94.5 90.4 Kenkey RK. 0.4 0.6 1.8 3.1 5.3 6.8 16.3 16.6 21.9 Broad K8. 1.6 2.4 4.2 6.0 ;4.6 22.9 - - 108.6 Cassava (Fresh) Kg. 0.4 0.7 1.2 1.7 5.9 5.5 24.9 13.8 9.9 Plantain Kg. 0.6 1.3 2.4 e.4 5.9 11.9 50.4 32.1 25.2 Yam Kg. 0.7 1.5 2.6 3.6 7.6 11.6 52.4 39.4 30.6 Cassava - Garn Kg. 1.1 2.5 3.4 4.5 11.9 14.4 54.9 33.9 22.2 Small Beasn K4. 1.2 2.9 10.6 18.1 33.4 58.1 101.3 90.1 81.5 Gromndnut Shelled Kg. 1 2 3.3 13.5 23.8 24.9 48.9 99.5 84.4 73.1 Palm Nut Kg. 0.5 0.9 2.4 3.9 6.4 13.3 64.0 24.8 23.4 Palm Oil Beer Btle 3.6 7.4 10.9 14.5 21.4 41.3 111.3 125.6 103.3 Banann Xs. 0.5 1.1 1.9 2.8 4.7 8.1 19.0 31.4 17.2 Cocoyam Leaves KR. 1.1 1.4 2.5 3.2 6.4 10.1 16.9 25.0 17.0 Tomatoes - MKedium KR. 1.3 1.8 6.7 11.3 12.6 21.2 49.9 54.2 29.5 I Beef - Dearer Cut Rg. 3.3 8.5 20.9 38.4 49.2 86.4 135.8 239.0 276.6 Egg One 0.4 0.6 1.1 1.5 2.7 3.1 8.6 10.4 11.0 0% Milk Evaporated Tin 0.4 1.2 1.5 4.4 8.7 2.8 - 18.2 33.0 Derrings Sioked K4. 2.4 8.3 22.3 37.1 42.7 63.2 112.7 183.7 147.0 Sugar Granulated Kg. 1.7 4.1 7.2 12.8 15.2 - - 90.3 Coca Cola Bottle 0.4 0.9P 0.9 1.1 5.5 1.8 7.6 18.2 39.2 Beer (Club or Star) Bottle 1.4 3.4 4.8 7.0 16.7 11.9 20.4 62.2 78.0 Cigarette - Embassy Packet 0.9 3.1 7.5 10.7 21.9 16.0 25.0 45.0 64.4 Cotton Prints Yard 4.9 7.3 9.1 40.2 64.6 133.7 - - 300.0 GLrls School Uniform One 10.5 12.1 15.4 48.2 93.3 72.7 80.6 160.7 199.7 Rubber Sandals Pair 3.2 5.9 8.3 10.1 15.9 16.5 100.0 100.0 119.4 Kerosene Beer Btls 0.2 0.3 0.8 0.8 1.6 1.5 4.7 12.2 16.2 Charcoal 45.4 kgs. 10.4 20.6 41.4 56.9 111.9 126.7 271.7 455.6 485.9 Guardian Soap One 0.4 0.9 1.0 4.5 6.2 1.3 - - 30.5 Katches Box 0.1 0.3 1.0 2.0 5.4 2.3 4.5 7.0 15.6 Anti-Malaria Tablet 10 1.0 1.0 1.9 2.0 3.6 - 5.0 5.0 11.5 Petrol - Super Gallon 1.4 2.2 5.1 7.3 12.2 13.0 26.1 53.5 196.3 Omnibus Services Min.Dist.Cost 0.1 0.1 0.2 0.2 0.6 1.0 1.8 3.0 5.0 Mammy Truck - Trotro Min.Dist.Cost 0.1 0.3 0.4 0.6 1.5 1 S 1.3 5.1 5.5 60-Page School Book One 3.4 5.4 6.0 7.5 9.7 9.2 10.8 22.6 45.5 …------------------------------------------------------------------__--------__---------------------------------------- SOURCES: GHANA STATISTICAL SERVICE, ACCRA QUARTERLY DIGEST OF STATISTICS, MARCH 1983. P. 53 AND JUNE 1986, P. 57. TABU. 9.07: KD2MlY EIAINGS Pm EMPLOYER IN ESTABLISBlUMES EXLOYING 10 R NGRE MMWORKERS -----------------------------------------------------------------.__---------__------------------------------------- 1975 1976 1977 1978 1979 1980 1981 1982 1983 --------------------------------------------------------------------__-------__------------------------------------- PUBLIC SECTOR: 95.9 108.8 211.5 214.5 269.3 441.0 579.0 607.0 1071.0 ACRICULTUREI FOTRESRY FISHINi 66.6 71.1 154.8 171.4 182.1 322.0 490.0 543.0 833.0 MINIZO, CUA8RRYIN 116.4 131.2 296.2 305.6 373.9 612.0 862.0 863.0 2214.0 MAFACTURIS 116.8 122.2 293.0 229.1 311.3 527.0 631.0 709.0 1256.0 SLECTmIC , WATER, GAS 108.9 103.6 214.9 222.8 291.4 526.0 703.0 744.0 860.0 CC1o StRUCTION 73.1 77.8 158.4 188.4 221.5 328.0 516.0 518.0 891.0 WULESAX., RETAIL TRADES, SSTA. 89.3 97.3 213.1 2-a...8 259.7 417.0 481.0 577.0 859.0 TRANSPR, STORAGE, aCfU SCATION 113.5 239.6 190.6 238.3 315.6 530.0 614.0 714.0 1014.0 FINANCE, INS. REAL ESTATE, BUS. 1.4 125.0 277.9 364.3 348.0 520.0 640.0 720.0 1211.0 COIUONIY, SOCIL, PEuS. SERVICES 103.1 109.5 235.7 225.2 272.5 448.0 553.0 562.0 940.0 PRIATE SECTOR: 119 131 232 292 369 581 - 868 1301 AGRICULTURE, FORESTRY, FISIING 67 79 153 194 237 416 688 734 1173 MINIGC, QUARRYING 142 158 152 181 185 676 785 1616 2109 AMWWACTURI1C 119 125 209 313 374 567 713 841 1345 CLECTRICITY, ATER GAS - - - - - - - - - CONSTRUCTION 71 91 140 169 202 522 - 533 840 a WHOLESALE. RETAIL TRADES, RLESTA. 140 220 434 362 561 803 - 1197 1529 ° TRANSPORT, STORAGE, COMICATI0N 138 198 353 347 360 603 955 999 1701 S FINA , INS., REAL ESTATE, BUS. 200 169 298 314 373 715 972 1469 1266 COISITY, SOCIAL. PERS. SERVICES 131 120 213 230 305 449 538 775 957 PUBLIC AND PRrIVAZE SECTORS: 102 114 215 226 286 461 - 645 1110 AGRICULTURE, FOESTRY, FISING 67 72 155 172 186 329 503 559 886 MINING, QJARRYING 117 133 293 304 373 613 859 870 2205 MANUFACTUING 118 125 223 306 356 552 689 787 1312 ELECTRICITY, WATER, GAS 109 104 215 223 291 526 703 744 860 CONSTRUCTINII 72 85 153 185 217 356 - 521 S83 WROLESALE, RITAIL TRADES, RESTA. 112 154 281 284 372 553 - 767 1101 TRANSPORT, STORAGE, C0IUNICATION 115 237 197 247 318 534 624 721 1119 FINANCE, INS., DEAL ESTATE, US. 139 137 283 352 353 545 701 852 1217 cWwiTY, SOCIL, PIS. sERvIcEs 106 110 235 225 274 448 553 582 941 SOURCES: GHANA STATISTICAL SERCE QUARTERLY DIGEST OF STATISTICS, JUNE 1984, P44 TABLE 9.08: INDEX NUMBERS OF EMPLOYEES' £ARNINGS (1977 - 100) 1970 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 198A 1985 Minim=m Wage: Cedis Ptr Day 0.a 1.0 ..0 2.0 2.0 2.0 3.0 4.0 4.0 5.3 12.0 12.0 25.0 1J 35.0 21 70.0 Index Nonlnal WaSe 25.0 33.3 33.3 66.7 66.7 66.7 100.0 133.3 233..' 177.7 400.0 400.0 725.0 - - Index Real Wage 183.4 203.3 173.0 292.3 225.4 144.2 100.0 77.0 49.c 44.3 46.1 38.0 31.6 _ Average Monthly Earnings; Index Nominal Earnings (1977-100) 43 0 50.2 57.0 78.7 84.3 94.5 100.0 288.2 237.8 352.0 538.6 Iadex Real Earnings (1977 - 100) 315.3 306.1 295.8 345.3 284.9 204.3 100.0 108.7 89.0 87.7 62.0 - - SOURCESX GBMA STATISTICAL SERVICE 11 FROK APRIL 1983 2/ FROM APRIL 1984 -J IBRD 18112R1 sjaJy Av Vl~~~~~~f. ) - (rb, -, ~ O.OATNGA UPPER - E A S T - 9\ V . . , t~~~~~R E G1 I 0 R . 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