From 1980-2000: economic recovery, adjustments and reassertion of regional development
The period from 1980-2000 saw the triumph of neoliberalism and the reassertion of regional development policy. Neoliberal ideas of Economic Recovery and Structural Adjustment Programs (ERP-SAP) were precipitated by a severe economic downturn from the 1980s through the 1990s. The ERP targeted the export components of Ghana’s economy—namely, cocoa, timber and minerals—for investments to boost exports. To attract investments, SAP liberalized, deregulated and privatized the economy. Technically, these changes addressed the macro-economy rather than regional development. However, because the resources of target industries occurred at specific locations, the ERP-SAP had indirect effects on regional development. Investment such as feeder roads and rail rehabilitation went to regions where the target industries were located. These were in the old Golden Triangle (Songsore, 2011). The Free Zone Act of 1995 channeled industrial investment into the free zones that had been established in Accra-Tema, Kumasi, and Sekondi-Takoradi. Songsore (2011) reports that about 80 percent of all new projects that were listed in 1994-1998 were in Greater
Accra, with the Ashanti Region accounting for just 8 percent, and the rest of the regions sharing the remaining 12 percent. In particular, the Northern Regions, which account for 40 percent of the country’s land area and about 20 percent of its population had just 1 percent of the projects. At the same time, the withdrawal of government subsidies and support for inputs such as fertilizers affected farmers and caused a decline in their productive capacities and incomes.
The ERP-SAP also created opportunities for more participation in the economy not only for large city dwellers but also for those from small towns. For example, most of the retrenched government workers in large cities sought new opportunities in retail and small-scale activities, leading to the explosion of the informal sector. Rural dwellers able to use mobile communication to connect with the urban areas and beyond, migrated in droves to the cities (Yeboah, 2000).
In 1991, the impacts of ERP-SAP caused the government to embark on a new comprehensive development plan that would transform Ghana from a poor country to a vibrant middle-income country in one generation (Ofei-Aboagye, 2016). The plan, known as Vision 2020, targeted four areas: human development, economic growth, rural development and urban development. The first phase kicked off in 1996-2000, but as reported by Ofei-Aboagye (2016), the plan failed to garner support from the people. As a result, when a new government came to power, Vision 2020 was abandoned and replaced by a new program, the Ghana Poverty Reduction Strategy (see next section).
Apart from the ERP-SAP and Vision 2020, it was also a period when democratic movements, good governance and local government reforms were sweeping across Africa. In Ghana, there had been some past attempts to foster regional development through decentralization. These attempts were often not serious. In 1988, however, a more sinister step was taken by the PNDC/NDC government toward a comprehensive local government reform. In that year, the Local Government Reform Act was passed. The Act expanded the country’s 65 administrative districts to 110 and classified them into Metropolitan, Municipal and District Assemblies. These districts were commissioned with the promotion of development in their respective areas (Songsore 2011; Akudugu, 2018). However, on the premise that the 1988 Act was inadequate to deal with the changes brought about by the ERP-SAP, the government passed a series of new legislations in the early 1990s. These included the Local Government Act of 1993 (Act 462), the National Development Planning Commission (NDPC) Act of 1994, the National Development Planning System (NDPS) (Act 480) of 1994, and the Environmental Protection Agency (EPA) Act of 1994 (Fuseini and Kemp, 2015). The Local Government Act defined the roles of metropolitan, municipal and district assemblies as development, approval and implementation of development plans at their respective districts through participatory planning processes. These were elaborated by the NDPS Act, which
Regional development policy in Qhana 101 created a new four-tier national development planning authorities system for the country - the District Planning Authorities, Regional Coordinating Councils, Ministries, Departments, and Agencies, and the National Development Planning Council (NDPC). Under these new provisions District Assemblies were authorized to initiate and prepare district development plans; to conduct studies of development-related matters - such as economic, social, environmental; to integrate and ensure that their plans are compatible with national goals; to monitor and evaluate development policies, programs and projects in their districts, and to provide data and information as required by the NDPC.
The impact of all this legislation on regional development was minimal for a number of reasons. First, the Assemblies did not have any power and resources to function as they were intended. Second, many of the members did not have adequate education backgrounds and skills to prepare plans. Many of them were elected officials instead of appointees selected on merit and expertise. Third, the decentralization effort appeared to be on paper only because the planning process started and ended with the NDPC. Thus, the NDPC issued guidelines for district plans and the district plans had to be acceptable to the NDPC. Under such a structure, the assemblies really did not have the freedom to put together their own plans, but instead they had to conform to what is dictated by the NDPC. Finally, too many new governmental structures were created that had no mechanism for coordination. This created confusion and disjointed and inefficient efforts.