The strategy to improve production and generate gainful employment is based on creating an enabling environment to stimulate private sector activities. This will involve improvement of the capacity of the private sector to adopt an entrepreneurial approach to increase productivity and generate employment. The Private Sector competitiveness considered under the GPRS II seeks to promote output under the sector of the economy (Agriculture, Industry and Service) and promote employment.
Structure of the Economy
The structure of the Ejura- Sekyedumase District economy remains an agrarian one.
1) Primary Production (Agric)-68.2%
This shows that the agriculture sector dominates in terms of employment. The structure of the economy of the district has been considered under contribution of the sector to employment, income level of the incidence of poverty in the district.
Contribution of the Sectors to Employment
The sectors of the economy (agriculture, industry and service) each contribute to employment. It is in these sectors that people are engaged in production and service in the district. There is therefore the need to consider the proportion of people employed by each of these sectors of the economy in order to ascertain the sector that contributes greatest to employment in the district. Based on the outcome of this analysis, valid deductions could be made for planning decisions. Below is a distribution of the contribution of the sectors to employment in the district.
Agriculture is the leading employer of the working population employing 68.2% of the people whilst the industrial sector is the least employer of the working population employing 8.0% of the populace in the district. The service sector also employs 23.8% of the population. It could therefore be said that, there is less emphasis on diversification in the district since there is a great percentage difference between the leading employer of the population and the other sectors. Thus, if diversification was been emphasized on, the percentage difference between the leading employer and the next in order would not have been so wide. It could further be said that, there is availability of fertile soil in the district which attracts most of the people into that sector. Further, it could be said that, the industrial sector has received little attention in terms of it ability to contribute high to employment.
Income Distribution of the Sectors
Another component of the structure of the economy that was looked at is the income distribution of the sectors. There is the need to look at each sector’s contribution to income by the sectors in order to come out with the sector that contributes highest to the economy in the district and they know the sector that is highly lucrative in the district. It is on these bases that income distribution of the sectors was considered.
A look at the income distribution table shown above depicts that, it is the service sector that contributes highest to the income in the district giving ¢564,613 per month whiles the agricultural sector is the least contributor to the economy giving ¢455,825 per month. Even though most of the people within the district are engaged in agriculture, its contribution to income is very low thus contributing to the low living standards of the people. The service sector can therefore be used in the fight against poverty in the district if it is boosted.
District Financial Management
District fiscal management covers a wide range of issues embracing revenue mobilization and expenditure administration/transactions. This is a critical concern of the District as the DA can not survive without finance. The current decentralization process calls on District Assemblies to be responsible for their financial management. This however poses considerable challenges in view of the limited capacity of most districts.
District Revenue and Expenditure Pattern - Sources of Revenue
The major sources of revenue available to the Ejura-Sekyedumase District Assembly can be grouped into two:
• Generated / Traditional (IGF) and
• Locally Central Government Transfers (CGT)
Internally Generated Funds comprises Rates, Lands, Fees, Licenses, Trading Services and Miscellaneous Sources. Central Government Transfers are derived from; Grants, District Assembly Common Fund (DACF) and HIPC Funds.
Revenue Performance from 2002-2004
Performance in revenue generation is generally measured by the gap between the estimated and the actual revenue collected assuming the Assembly is highly dependant. Revenue performance can also be termed as the rate of achievement in collection. The revenue performance of the District is shown on the table below.It has been realized that the Assembly has estimation problems. This can be attributed to poor forecasting or forecasting errors and inadequate database for budgeting to meet current demands. There was an increase of 27.7% in revenue than estimated in 2004. Between the two major sources, IGF has consistently been the least contributor to the District overall revenue. From 2002 to 2004, the Assembly has not been able to generate up to twenty-five percent (50%) of total revenue from its internal sources of revenue. The percentage contribution of IGF to total revenue has also been on a steady decline. IGF however increased by 15.9% between 2002/03 and as high as 143% between 2003/04 financial years. This increment could be attributed to increments in fee fixing resolutions or an improvement in revenue collection and reporting systems in 2004. Rates and miscellaneous increased significantly between 2003/04.
Reasons for Low Revenue Trend
The following were identified as reasons accounting for the low level of the IGF
• Unwillingness on the part of the people to pay. It was revealed that some community members in the District often take cover in the forest as a way of dodging revenue collectors.
• Poor reporting and accounting system was also identified as another reason. The Assembly lacks the machinery to ensure proper accounting from revenue collectors.
• The high illiteracy level of the commission collectors also came to the fore as another factor accounting for the low IGF in the District. It was revealed that some of the revenue collectors could not even write properly on the revenue tickets.
• Finally, it was identified that the relatively low level of economic activities in the District serves as a barrier to any effort aimed at increasing revenue mobilization in the District.
The low IGF implies that the District is over dependent on external sources for the financing of most its development projects. This high degree of dependence could affect the autonomy of the Assembly and undermine its decision-making system.
Structure of Central Government Transfers
The Central Government transfers (CGT) funds to the Assembly for the financing of development. The DACF is for financing development expenditure. These Transfers contribute more than 50% to the Assembly’s revenue over the years under review.
Leakages in Revenue Collection
The process of collecting monies not ending in the coffers of the Assembly is referred to as leakage. Leakages could also be said to be a process whereby value books for revenue collection find their way out of the strong room into private hands for collection of revenue which is not accounted for by the collectors. These leakages although difficult to quantify, constitute large loopholes in the revenue generation system of the Assembly. Measures for improving Fiscal Management/Revenue Generation
• Quarterly Review of targeted revenue to check whether targets are being met or not.
• Joint operation of revenue collectors on Ejura market days to enhance revenue collection
• Formation of Task Force to help revenue collectors
• The Valuation Board at Mampong has been tasked to undertake valuation of the properties in the district. This will help determine the appropriate property rate to charge property owners.
• Regular change in operational areas of revenue collectors
The main expenditure items are personal emoluments, Travel and Transport, General Expenditure, Repairs, Maintenance and Renewal, Miscellaneous and Capital expenditure. The various components of expenditure that the district uses its revenue to finance are tabulated in the table below.
Income and Expenditure Trend Compared
It is necessary to compare the expenditure and revenue of the District so as to determine the percentage of deficit or surplus the Assembly is making. The Assembly should therefore always match the revenue with expenditure in the implementation of the budget by referring to the approved budget before effecting payments. The income and expenditure trend of the district is compared in the table below. The Assembly recorded a budget deficit of ¢188,530,637 (6.9%) and ¢ 488,911,230 (3.6%) in 2002 and 2004 respectively and a surplus of ¢505,316,884 (%) in 2003.
Capital and Recurrent Expenditure
The recurrent expenditure is financed through IGF, grants and ceded revenue whilst the capital budget is financed mainly by transfers from the central government through the DACF. By implication, the development of the district is dependant upon transfers. This situation is due to the weak revenue mobilization system of the assembly. The table below presents the capital and recurrent expenditure trend of the district. From table 1.27, it is clear that more than half of the IGF’s expenditure is recurrent in 2002 and 2003. This means that the Assembly could not have the capacity to embark on any meaningful investment drive. The expenditure of the Assembly is financed mainly from its generated revenue; both internal and external
Recurrent Expenditure and IGF
The table below presents the strength of the IGF in terms of its ability to finance recurrent expenditure. From the table above, it is evident that the Assembly’s IGF was less than their recurrent expenditure in 2002 and 2003. This means that part of the Central Government Transfers is used to finance recurrent expenditure. This reduces expenditure on capital investment.
Financing of District’s Expenditure
The following processes are involved in financing the district expenditure.
• Preparation of the District’s annual budget with its monthly components by the District Budget Officer;
• Approval of budget
• Release of funds to finance budget
The financial administration and management of the Assembly is undertaken by the District Chief Executive, the District Co-ordinating Director, District Finance Officer, District Budget Officer, a representative from the Finance and Administration Sub-Committee, the Internal Auditor and the Local Government Inspectorate.
Incidence of Poverty
Poverty can put into categories. Those considered not poor and those considered poor. To be classified as not poor means one must earn annual income above ¢900,000. To be considered poor means the annual income is below ¢900,000. From the table, it could be deduced it is in the agricultural sector that majority of the people (37%) earn income below ¢ 900,000 per annum. This shows that, the agriculturalists in the district are poorer than those in the service and industrial sectors. Those who are considered not poor (thus earning annual income above ¢ 900,000) are mostly the service sector employers, constituting 82%. This shows that the service sector is the most gainful employer among all the sectors of the economy.
Proportion of People Employed and Unemployed
This shows the percentage of people employed and unemployed in the district. The proportion of the people employed and unemployed in the Ejura Sekyedumase District has been depicted below: From the table, an economic dependency ratio of 1:0.9 could be deduced as the existing ratio of economic dependency. This low economic dependency ratio has an implication for planning which is low pressure on the employed population in the district and hence an ability to meet basic needs and make savings for future investments.
Gender and Employment
Gender and employment make comparism between the male and female ratio employed in the district. By this analysis, it could be deduced pictorially the number of males who are employed as against the number of females who are employed for planning implications to be drawn for development. Table 1.19 shows the employment situation by gender in the district. Table 1.31 shows a high female unemployment rate of 62.5% as against a male unemployment rate of 37.5%. It could therefore be said that, there is the existence of female vulnerability since the number of females who are unemployed far exceed the number of males who are unemployed. Planning efforts could therefore be made in line with the GPRS theme of reducing women vulnerability.
Household Income Levels
The household incomes of the people of the Ejura- Sekyedumase District have also been identified. The incomes per month give an understanding of the purchasing power of the people and their ability to meet / satisfy their basic needs. By these income levels, the incidence of poverty in the district could also be known in order to know the prevailing conditions of poverty in the district. Thus, outlining the number of the people earning between specific ranges of income. The household income levels of the district are given in a tabular and pictorial form below: The average household income for the people of Ejura-Sekyedumase District is ¢387,709 per month.
Household Expenditure Pattern
The household expenditure pattern per annum for the Ejura-Sekyedumase District is given below: From Table 1.33, households in the district spent more of their income on food than on any other item. The least expenditure item is on shelter. The reason is that, most of the houses in the district are inhabited by the owners themselves and therefore do not pay any rent.
Investment And Business Potential
The topography of the district, which is gently undulating with hills, is particularly good for mechanised farming. Farming is one of the major occupations in the Ejura Sekyedumasi District and the major crops grown are maize, yam, vegetables, cowpea, rice, mangoes and cassava. Already, there are several large-scale agricultural ventures operating in the district.
These are Ejura Farms Limited, Leaf Development Company Limited and Ghana Food Distribution Corporation. The most outstanding investment potential on offer in the district revolves around agriculture and agro-processing. In the area of crop farming, the Ejura-Sekyedumasi District stands out as one of the most fertile areas in the Ashanti Region.Particularly it is good and lucrative for investors in the agricultural sector who are in crop farming in maize, cashew and cowpea. Also, the establishment of agro-processing industries should be of immense interest to investors. Here, the processing of mangoes and maize would be very profitable to investors, because of ready supply of the raw materials and the existence of a strong and vibrant market in the Ashanti Region and beyond.
Livestock and poultry farming are also highly recommended to investors. Here again, the topography of the district favours this activity, alongside ready access to the needed raw materials such as animal feed. Importantly, there are infrastructural facilities in place in the district that would greatly enhance the efficiency of productive sector investment.These include the availability of electricity, telecommunications and postal services in the larger communities of the district. Besides this, there is a large pool of labour, both skilled and unskilled in the district, available for productive use by investors, especially in the agricultural sector.
These advantages are further supplemented by the wide availability of economic natural resources all around the district. These can be used widely, particularly in the construction and pottery industries. Sand is found at Ejura, Anyinasu, Frante, Adiembra and Teacherkrom.
Gravel is found at Anyinasu, Frante, Babaso, Kobiriti and Drobon. Stones can be obtained at Kropo, Dukukro, Anyinasu, Bonyon and Sekyeduamsi. Clay deposits exist at Frante, Nkwanta, Aframso and Teacherkwaso
The need for the establishment of financial institutions in every district cannot be overemphasized. They provide both financial assistance in the form of loans and financial advice. They do not focus only on commercial banking but also provide merchant banking facilities. The Ejura Sekyedumase District can also boast of the existence of the under listed financial institutions:
The Ghana Commercial Bank (GCB). It is located in the Ejura town. Its main functions are to accept and give out loans to individuals who meet specific requirements. It also gives farmers/entrepreneurs financial advice.
The Agricultural Development Bank (ADB). It is also located in Ejura, the district capital. Its main roles are to give out credit facilities to farmers and traders in the district.
Sekyedumase Rural Bank. It is located in the Sekyedumase Township and has a branch at Ejura. It functions as providing loan schemes to farmers to help in increasing the size of their farms. It also helps in development projects in the district.
Kasei- Amantin Rural Bank. This bank is located in Ejura. It is also engaged in the provision of loan schemes to entrepreneurs.
Otuasekan Rural Bank. It is located in Ejura. It gives out credit facilities to farmers. It further assists in community development projects.
The mission of these financial institutions in the district is to help increase production and boost morale of entrepreneurs, and thus, giving out of loans, and financial advice. The functions of these institutions are meant to ensure the growth of the district as a whole.
Contribution of Banks to Credits
Each of the financial institutions located in the district has a proportion of credits it contributes to development in the district. It has a proportion it contributes to farmers, small and medium scale industries and to large scale enterprises. These are all geared towards attaining a higher level of development in the district. The proportions of loans paid to the enterprises are 12%, 43%, 36% and 9% to the Sekyedumase Rural Bank, the Ghana Commercial Bank, Agric Development Bank and Amantin-Kasei Community Bank respectively. This clearly shows that it is the Agriculture Development Bank that contributes highest in terms of credit facilities.
The Amantin-Kasei Rural Bank is the least contributor to credits in the district. Proportions of loans received shows that farmers receive 57%, small and medium scale enterprises receive 17% and large scale enterprises receive 26% of the overall credit facilities. Thus, farmers are the group of people who receive most of the loan facilities in the district with large scale and small and medium scale enterprises in that order.
Date Created : 11/18/2017 6:00:40 AM