The district is endowed with both mineral and forest resources, one of the best terrains for agriculture in the entire country and a congenial climate for farming too. Various species of timber such as mahogany, emire, odum and wawa are widely available in the district’s expansive forest areas.
Diamonds occur in the district within a triangle that has Akwatia, Wenchi and Topremang at the apexes, though these precious minerals also occur in pockets elsewhere in the district. Gold deposits also exist around Takyimang, Apinamang and Dokyi.Alluvial gold is won in the diamond mines as a by-product. Clay deposits exist in economic quantities at Abaam and Asuom.
The district produces a wide variety of both cash and food crops. These include crops such as cocoa, cola, oil palm and citrus. Food crops grown include plantain, cocoyam, cassava and cereals, as well as vegetables.Animal husbandry is also practised on a small-scale.
The main industrial activities in the local economy are agro-based. Small-scale oil palm processing mills abound in the district. These are at Kusi, Wenchi, Kade and Takorowase.
The district boasts of arguably the largest oil palm mill in West Africa at Kwae, operated by the Ghana Oil Palm Plantation Development Company Limited. In addition, there is the Ghana Consolidated Diamonds Limited at Akwatia and small-scale mining concerns at Akwatia, Takyimang and Apinamang.There are four small-scale timber-milling plants at Kade, Boadua and Adankrono, in addition to small-scale metal works.
The role of resources, especially human resources, in generating growth and development cannot be over-looked in any development scheme. It is for this reason that this section seeks to assess the nature and level of dependency as it relates to the economic development of the district.
Primary information gathered from socio-economic surveys gave an economic dependency ratio of 1:1.14, which shows that an employed person takes care of a person who is unemployed in addition to him or herself. The situation is not bad but should not be allowed to again further currency in the light of low per capita incomes and high per capita consumption expenditures.Rural-Urban Split
Information available indicates that about 70.1% of the district’s population resides in rural settlements, with the rest in urban settlements like Kade, Akwatia. Asuom. Abaam and Takrowase. At current growth rates, it is expected that settlements like Apinamang, Abaam, Wenchi, Takyiman Nkwantanang, Otumi and Boadua will assume urban status in the near future.
This is a welcomed development as it provides an opportunity for concentrating investments at this centers and making them growth poles with the expected trickle-down effects to neighboring settlements.Employment
The predominant occupation in the district is Agriculture, which engages 76.8% of the economically active labour force. The next after agriculture is Commerce, which accounts for 11%. Industry and Services employ 8.5% and 3.7% respectively. The table 1.4 below shows the occupational distribution as per the sampled population.
Table 1.4 - Occupational Distribution
Source: 2000 population and housing censusMicro/District Economy
Production and Gainful Employment
- Low Internally Generated Funds
- Low income levels
- Low Productivity in all Sector
- Inadequate Access to Credit
- Low savings/ Low capital formation
- Delay in the release of Common Fund
- Inadequate Revenue collectors
- Illiterate revenue collectors
- Inadequate storage facilities
- High post harvest loses
- Low price for agric. Produce
- Unfavourable Land Tenure System
- High cost of farm inputs
- Over dependence on rain fed agriculture
- Lack of irrigation schemes
- Degradation of forest
- Land degradation due to mining
- Bad nature of roads
- Low level of modern Agriculture technology
- Inadequate marketing opportunities m. Inadequate private sector Investment
1.38 Micro/District Economy
Economic development is a function of all production activities pursued by people. If the
Various economic and production activities prove successful there is spontaneous growth within the economy which stimulates other economic activities.
Major economic activities included, Agriculture Industry and Commerce.
Most industries in Kwaebibirem District can be classified under small-scale industries, i.e. Industries that have a total workforce of up to 30 persons each.
The industrial activities in this district are diversified, ranging from sawmill where high technology equipment are used to handicrafts and other craftworks which are produced using simple tools. Statistics on the exact number of these Industries are sketchy, but can be grouped into the following:
i) Micro/Small-Scale Industries
ii) Small/Medium Scale Manufacturing
iii) Small-Scale Mining
iv) Large Scale Processing
These are manufacturing activities carried out in or near the home. In this industry, family labour is used with the objective of providing basic needs and augmenting the family income. The production methods are labour intensive, and there is usually no division of labour. Included in this category of industries are palm and kernels oil extraction, cassava processing, handicrafts, and modern craft and basket weaving.
Palm oil production and cassava processing are the most organized household industries in the district. Some producers have formed co-operatives and some private individuals have acquired extraction plants, and individual oil extractors send their palm fruits and kernels to be extracted for a fee.
These industries are located district wide. Most settlements have either cassava processing or palm/kernel oil extracting industry or both. While these industries are boosting the economic wealth of the district, their environmental aspect should be looked at carefully so as to ensure proper disposal of waste.
The locations of these small-scale industries do not conform to the present spatial classification in the district. Most of these industries are located in residential areas and other areas not earmarked for industries, and they produce such nuisances as noise, dust, fumes, and unpleasant odour in the communities where they are located.
In addition to the environmental nuisances that these industries generate, they are known to have adverse effect on services such as water and electricity i.e. there is general over load on various energy transformers that feed the various sections of the district. In view of this, light industrial estates are proposed for the urban settlements.
The purpose of these estates, among other is to:
- Bring about sanity in the use of land in the communities;
- Bring about efficiency in the use of infrastructure such as electricity and water;
- Reduce constructional and service costs;
- Minimize environmental degradation and pollution;
- Bring about an effective identification and collection of related taxes;
- Promotes a forward and backward linkage between various levels of industries; and services
- Promote/create employment opportunities for the youth who have hitherto been drifting to the cities.
Small/Medium Scale Manufacturing
This category of industries is capital intensive, with each industry employing between 5 and 30 people. These industries use modern production methods and produce both traditional and modern products. The industries in Kwaebibirem district include the following:
i) Food processing
ii) Distilling and blending alcohol
iv) Furniture and fixtures
It is not unexpected to find small-scale mining activities at mining areas of which Kwaebibirem District is of no exception. The activities of these miners have been encourage by the GCD, which allots its already mined plots or fields to some of these small-scale miners to re-mine them through a system known as the “Tributor System”. These activities present serious environmental problems, as large tracts of mined areas remain unreclaimed.
Large Scale Processing
The two most eminent large scale processing firms in the district are the Ghana Consolidated Diamonds Limited and the Ghana Oil Palm Development Company for the processing of diamonds and oil palm respectively.
The Ghana Consolidated Diamonds Limited is located at Akwatia about 7km from the district capital, Kade. The Ghana Oil Palm Development Company has about 11,000 hectares. As a result of large volumes of fruits obtained, a number of processing units have been set up in the district. The sizes of these processing units are so small that large amounts of fruits produced are lost.
INCOME, EXPENDITURE AND POVERTY LEVEL
Source of Income
The main sources of household incomes in the district are from crop farming livestock farming, business/trading, salaries, manufacturing, food processing and remittances. The main source of income of households in the district comes predominantly from farmers.
The expenditure pattern revealed that households spend as much as 47.8% of their incomes on food. This was followed by expenditure on clothing, which took 6.4% of household income. Also, households spend 6.4% and 5.9% of their disposable incomes on education and transport respectively.
Expenditure on business activity ranked third on household expenditure though only 38.5% of households were involved in such activity. This reveals a strong desire by a third of the population to increase household income by putting back some money into their business to ensure expansion and subsequent increase in income.
Social events involving funerals and donations accounted for 3.5% of household expenditure. This shows the increasing concern for societal problems and the need to help.
Repayments of credit accounted for 0.7% of total household expenditure. This could mean a high default in the payment of loans or a severe shortage of credit. Further analysis is needed in this area.
The average household expenditure per year is GH¢238.85. In the absence of any reliable data on income, as usual, from the household survey, the expenditure figure will be used as proxy for income.
Savings and Use of Saving
Response from the socio-economic survey as evident reveals that about 73.8% of households do not save.
On the use of savings from incomes, 51.7% went into investment in income generating activities. This shows the level of importance households attach to establishing and expanding small/medium scale enterprises.
Housing ranked second. This indicates the need of households in maintaining and building houses for both social and economic reasons.
Analysis of the household expenditure pattern and the use of savings reveal that there are a lot of activities in commerce and housing construction. All these activities involve capital. Demand for credit in the district revolves around 44.6% of households. About 63.7% of credit was intended to address issues in farming and business expansion. Of those who demanded for credit, about 38.6% did get it principally from formal sources and 53.3% from friends and relatives.
On the inability to obtain credit, the predominant reason was the perceived inability of households to pay back the loan, probably due to low incomes, and lack of collateral for the loan.
In the district, property ownership by households is seen as an indicator of the standard of living of the people. Results of GLSS 2003 survey indicate that 41.4% of households have a radio/radio cassette whilst 13.6% have sofa set. Though figures are not available from previous surveys, there is indication of a moderate standard of living, if household property is anything to go by.
Inequality in the distribution of income is very much evident from the Lorenz curve of the district (figure). Though the average annual household income is around GH¢238.86 the distribution is very skewed in favour of the rich. About 60% of the districts income is in the hands of the top 20% of the population.
Based on the method used by the Ghana Statistical Service for the study of Poverty in Ghana, the poverty lines and hard-core poverty line identified representing two-thirds and one-third of the value of the districts average living standards (per capita income) respectively. These give us GH¢159.23 as the poverty line and GH ¢79.61 as the hard-core poverty line, defining the very poor. This indicate that about 60% of the population of the district earn below GH ¢159.23 per annum. Out of this, about 67% are within the hard core poverty range.
Incidence of Poverty
The incidence of poverty in the district is not as endemic as in most rural districts in the country.
With the current district population of 212,632 (Projected from 2000 Population Census, and with 60% of the population earning less than GH ¢159.24, the population which fall below the poverty line is estimated at 127,579 with the incidence of poverty at 0.60% or 60%.
Market infrastructure, comprising the physical space, the stores, stalls; storage sheds, delivery bays and access roads form an important component of development of rural economics. Markets have served as the meeting point for producers and consumers giving rise to an exchange of goods and services with its accompanying benefits to the District Assembly in the form of tolls, taxes, licences and permits.
In terms of frequency of trading activity, four types of markets can be identified in the district. These are daily markets where trading takes place every day of the week, and periodic markets where trading takes on selected days of the week, usually twice a week. The periodic markets provide the day-to-day marketing needs of the residents’ whiles the periodic market provides opportunities for sellers and buyers within and outside the district. Traders from as far as Tamale and Takoradi bring in manufactured goods.
The development of the district necessitates the exchange of goods between urban areas on one hand and rural areas on the other. There is also the need for the exchange of goods between the district and other districts in the country.
Endogenous Inflows and Outflows
Endogenous inflows and outflows refer to exchange of commodities between markets and settlements located within the district. Commodities ranging from agricultural to manufactured goods flow into and out of the markets. The agricultural produce forms the greater part of the endogenous inflows and outflows. This means that agricultural produce is the major commodity of trade between the markets and settlements within the district. These include eggs, grains and cereals, legumes, fruits and vegetables, roots and tubers, oil, fish and meat. Other minor commodities of trade in the district include processed food, hardware/metal products, clothing, footwear, plastics, cosmetics/toiletries, leather products and jewelry.
Exogenous inflows and outflows are commodities that originate from markets outside the district and are transported to the district and those that flow from the district to areas outside the district. Some of these areas are Tamale, Kumasi, New Abirem, Takoradi, Asamankese and Accra.
The main exogenous inflows are in the manufactured category and include processed food, hardware, and clothing/footwear, cosmetics, plastics, and jewelry and leather products.
Other exogenous inflows are eggs, cereals, legumes, fish and meat. The exogenous outflows are mainly agricultural products like citrus, palm fruits, cocoa, cola, plantain and cassava. The main manufactured goods which forms a small proportion of the exogenous outflows is palm oil.
Tourism, as an economic activity, is virtually undeveloped in the district. This is so in spite of the numerous tourism potentials the district has. The mysterious rocks of Bempong near Nkwantanang, sheltering in bosom of its natural habitat, embrace one of the wonders of Ghana. It is unexposed because it has been shrouded in customary secrecy-open only to the Chief, his elders and Fetish Priests once a year.
At a spot on River Subikese is located the Bempong rocks that constitute the household compound of departed Ekuona Chiefs of Nkwantanang and Subikese. Exposed only during the dry season, the mysterious rocks display various artifacts alleged to have been carved by the Ekuona Ancestors.
The Kwaebibirem District has the potential to develop its agricultural, industrial and tourism bases for sustainable growth and development, given its immense resource base. Agriculture employs the majority of the working population in the district. Nevertheless, a number of problems hinder the socio-economic development of the district, especially in agriculture. Any significant improvement in the standard of living of the people should therefore give priority to improvement in agriculture, and micro to small-scale industries and household industries.
Other income generating activities like bee keeping, snail and mushroom farming should be encouraged to augment income of the people. The district needs to develop and increase capacity so as to ensure sustainability of development interventions.
District Assembly Finances
This section examines the revenue and expenditure pattern of the District Assembly between 2006 and 2009.Kwaebibirem District Assembly has been charged by law to mobilize its own funds to implement its programmes and projects. There are two main sources of funds to the district i.e. Internally Generated Funds and External Sources. The internally generated sources are Rate, Lands, Fees and Fines Licenses, Investment and Rent from Assembly buildings. The external sources include District Assembly Common Fund, Government of Ghana Grants DANIDA Grants through Community Water And Sanitation Agency, Ghana Aids Commission and funds from NGOs.
A look at the revenue table and graph above reveals that external sources i.e. Grants from Central Government constitute the major sources of revenue.
For example between 2006 and 2009 grants contributed about 80.34% on the average to the revenue of the District and it is increasing steadily whilst the contrary is true for internal revenue.
Variations between Estimated and Actual Revenues
Analysis of the table indicates that actual revenue values deviated from the estimated revenue values.
The difference between estimated and actual revenue is ascertained using variance analysis. The essence of this analysis is to ascertain the extent to which the actual revenue values deviated from the estimated revenue values.
The average variation as percentage of the estimated figure of (24.27) % implies a 75.73% revenue achievement rate. This situation raises serious concerns about the quality of estimated revenue figures in the light of unavailable and unrealistic data on revenue as well as non-payments and unproductive revenue collection methods.
Comparison of Revenue and Expenditure
An assessment of the total revenue and expenditure for the period 2006 to 2009 showed a position of alternating deficit and surplus. The overall financial picture depicts surplus budgeting. An examination of the financial statement indicates that, the years when surpluses were recorded, grants were released in the last month of the year and could therefore not be utilized before the end of the year.
In 2009 for example stool lands amounting to GH¢9,257.55, and HIPC drawing account receipt amounting to GH¢25,000.00 was realized in December, 2009. In November, of the same year, a stool land revenue of GH¢99,000.00 was received.
Otherwise it would have been difficult to be understood why in a district where there is an increasing competing demand from all sectors of the district economy for scarce financial resources to have large sums of money unused as budget surplus.
The following are the major findings of the district analysis:
- revenue from the external sources were always greater than those from internal sources; indicating low internally generated revenue
- of the internal sources items, land and fees & fines contribute most;
- revenue performance is improving over the years in nominal terms;
- capital expenditure took the major proportion of the total revenue over the years
Internally Generated Revenue (IGF)
The success of good governance of the District depends to a large extent on the availability of funds to run the District and how these available funds are managed.
The following measures have been adopted to address leakage in local revenue generation.
i. That all expenditures are based on approved budgets
ii. Control and supervision of all expenditures
iii. Regular accounting and auditing to curb misappropriation and misapplication of funds
iv. Weekly returns on revenue and expenditures to the District Chief Executive and
v. Regular discussion of the trial balance by the Finance and Administration Sub-Committee of the District Assembly.
vi. Task forces are occasionally engaged to collect revenue, this is to enable the Assembly compare actual revenue collection with that of the regular collectors and address bottlenecks.
Matching Revenue and Expenditure
The following measures are adopted
i. monthly review of revenue and expenditure
ii. preparation of supplementary budgets
i. All expenditures are approved and authorized by the District Chief Executive and
District Co-ordinating Director
ii. Expenditure are based on approved budgets
iii. Monies collected are lodged at banks daily.
Disbursements are done according to laid down regulations by applying the following
a. Financial Administration Act (654)
b. Procurement Act (Act 663)
c. Internal Audit Act (658)
d. Local Government Act (463)
Application of these regulations are regularly checked by internal auditors and recommendations made to correct deviations.
In the matter of the Common Fund guidelines as received from the Ministry of Local Government and Rural Development are applied. Statutory demands for sectors and other programmes as requested are made and are applied on capital expenditure.
Stock of District Assembly Debt
About 90% of debts are due to capital expenditures resulting from pre-financing of contracts.
This is so because it has been the practice of the District Assembly to finance capital projects solely from the Common Fund and the delays in its release put the Assembly into debt.
The District Economy has the potential to develop. However the following problems hinder its development.
• Low production and productivity all sectors
• Low savings/low capital formation
• Inadequate access to credit
• Low income levels
• Low internally generated funds (IGF)
• Delay in the release of the Common Fund
• Poor financial management practices
• Inadequate revenue personnel
• Illiterate commission collectors