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Agenda for Growth & Prosperity

Author(s):
International Monetary Fund
Published Date:
March 2003
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1. INTRODUCTION

The Ghana Poverty Reduction Strategy (GPRS) represents a comprehensive set of policies to support growth and poverty reduction over a three-year period and beyond. It is informed by the conviction of the current government that the economy of Ghana needs to be managed effectively to enable the creation of wealth and reduction of poverty.

The goal of the Government of Ghana is to transform the nature of the economy to achieve growth, accelerated poverty reduction, and the protection of the vulnerable and excluded within a decentralised, democratic environment. To this end, the GPRS has identified policies, programmes, and projects that seek to realise the following objectives:

  • Sound economic management for accelerated growth;
  • Increased production and the promotion of sustainable livelihoods;
  • Enhanced development of human resources and the provision of basic services;
  • Intensification of the provision of special programmes to support the vulnerable and the excluded;
  • Good governance and increased capacity of the public sector; and
  • Effective promotion and stimulation of the private sector as the main engine of growth and as partners in nation building.

Implementation of the programmes and projects for realising the above objectives has associated costs. Estimating the costs of the programmes and projects is necessary for ascertaining the feasibility of the strategies proposed in realising the objectives of the GPRS. This Volume II of the Ghana Poverty Reduction Strategy (GPRS) presents the costing of the programmes and projects developed in Volume I. It spells out the assumptions, methodology, and the process used in costing the programmes and projects. It also describes the financing of the programmes and projects.

2. COSTING THE GHANA POVERTY REDUCTION STRATEGY

The GPRS consists of programmes, and projects, which have associated activities to be performed by lead Ministries, Departments, and Agencies (MDAs) and in some cases by the private sector or with other collaborating agencies. Each activity has corresponding output(s) and input(s) with related costs. The costs associated with the activities are what it will take to implement programmes for achieving the targets and objectives of the GPRS. Costing there fore provides the major link between programme design and programme implementation.

The cost of implementing the programmes and projects of the entire GPRS is currently estimated to be US$5,283 Million. Eight percent of this total is allocated for programmes geared towards ensuring macroeconomic stability, 27% for enhancing production and gainful employment, 58% for enhancing human resource development and the efficient and equitable provision of basic social services, 3% for developing special programmes for the vulnerable and excluded, and 4% for pursuing and supporting activities and institutional reforms that enhance good governance.

Due to resource and absorptive capacity constraints, not all programmes and projects proposed under the GPRS can be implemented in the first 3 years. As such, through further consultation, a determination of priority areas for the medium term (2003-2005) has been made. The cost of programmes and projects identified as priorities for the medium term is estimated at US$2,515.22 million. The costing methodology and the underlying assumptions are outlined below.

3. The Costing Methodology and Underlying Assumptions

3.1. Methodology

The costs of the GPRS programmes and projects were estimated using the Medium Term Expenditure Framework (MTEF) methodology.

3.2 Assumptions

The total cost of implementing the GPRS consists of costs for both new and on-going programmes and projects necessary for meeting poverty reduction and growth targets. The detailed composition of programmes and projects included and the quantum of resources allocated to them have been influenced by several factors. Salient among them are that:

  • The activities costed consist mainly of capital expenditures associated with programmes and projects identified in the GPRS. Personnel and administration cost associated with these programmes are considered to be within the normal budgetary resources and are not included in the cost of the GPRS. Exception to this was the treatment of the costing of educational programmes where recurrent expenditures such as the salaries of new teachers and attendants were included in the costs.
  • The implementation of the GPRS is based on a series of activities that may be carried out by the public sector alone, or by the private sector in partnership with the public sector. In cases of the latter, only the public sector resource requirements or what the public sector is expected to do in order to stimulate private sector participation to accelerate poverty reduction directly or indirectly is included in the costs. An example is in the policy area of providing safe and sanitary shelter. Government expenditures include the cost of acquiring land, developing land banks, the training of artisans in construction skills, capacity building to support the housing sector, and the cost of promoting small-scale entrepreneurship in the production of local building materials. It is expected that developing housing units for rental or for private ownership will be undertaken by the private sector and is not included in the cost estimates presented here. In this regard what are included in the cost of the GPRS are the resources needed by Government to provide the requisite supporting infrastructure to encourage private sector participation. The cost of private sector components of such programmes is not included in the GPRS cost estimates. The estimated cost of the private sector components of programmes is shown separately in Appendix D.
  • Fully implementing the GPRS requires carrying out a significant number of proposed programmes and activities. As a result of the interactive process that characterized the preparation of the GPRS, a consensus emerged that although all identified activities were germane to poverty reduction and growth stimulation, they could not all be undertaken within the specified period 2003-2005. This influenced the quantum of resources provided for the 3-year programme. There are some projects, for example in the energy sector, which may require implementation periods beyond 2005.
  • Even with the above considerations, the costing for programmes and projects cannot be definitive. The precise measurement of the cost of activities will be a continuous task. Specific activities that are not easily predetermined would need to be included later based on the monitoring outcomes of 2003 and 2004.

3.3 GPRS Costing Process

The costing process began with the translation of the GPRS objectives and targets into programmes and projects. MDAs developed profiles of each activity under the selected programmes and projects. The critical steps of identifying inputs for activities and carrying out financial programming to achieve desired objectives and targets were the result of interactive processes.

4. Costing the GPRS Programmes and Projects

The matrix in Appendix A presents the detailed costing of all the programmes and projects of the GPRS. The programmes and projects are categorized under the 5 main thematic areas identified in Volume 1 of the GPRS:

  • -Macroeconomic stability
  • -Production and gainful employment,
  • -Human resource development and provision of basic services,
  • -Special programmes for the Vulnerable and the Excluded; and
  • -Governance.

As shown in appendix A the entire GPRS programmes and projects will cost $5,283 Million. The cost of programmes and projects required for ensuring macro-economic stability is estimated at $416 Million. The programmes and projects for enhancing production and gainful employment is estimated at $1,428 Million while $3,043 Million is the estimated cost for the programmes and projects for human resources development and the provision of basic services. The special programmes and projects for the vulnerable and the excluded is estimated to cost $168 Million and the programmes for good governance will cost $228 Million.

The 58% percent of the total cost attributed to human resource development and the provision of basic services is in recognition of the need to close the gap, in favour of the poor, in terms of access and utilization of basic services, particularly with regards to education, health, HIV/AIDS, population control, water, and sanitation.

About 27% of the cost is associated with production and employment programmes and projects crucial to Ghana’s development efforts. Redirecting the nature of economic activities, stimulating linkages between the formal and informal sectors of the economy, encouraging and improving the capacity of the private sector to adopt entrepreneurial business approaches to increasing productivity and generating employment pose challenges to public policy making.

About 8% of the total cost will be spent to ensure macro-economic stability. Policy actions include measures to promote increased investment, promote exports, reform public financial management and to strengthen administrative capacities of the revenue agencies. These actions are intended to enhance internal resource mobilization, encourage growth, and minimize distortions which otherwise would have adverse consequences on economic activity and exacerbate the incidence of poverty.

The 3% of total cost attributed to special programmes for the vulnerable and the excluded recognizes that for a variety of reasons, some group of citizens face special developmental constraints. The physically challenged, the aged, children in difficult circumstances, and victims of harmful traditional practices belong to this category.

The cost associated with good governance is related to achieving changes in the attitudes and behaviours of the actors of the government machinery in the conduct of business. These processes, for the most part, have little or no financial costs. Programmes and projects associated with good governance is about 4% of the total cost of the GPRS.

5. The Medium Term Priority Programmes And Projects

As indicated in volume 1, there was the need to prioritise the programmes and projects considering the magnitude of funding required to implement the entire GPRS. The prioritisation also became necessary to ensure that both physical and human resources are not stretched thinly and that good progress could be made toward meeting the major poverty reducing targets set out in the GPRS.

Government spending patterns over the past three years indicate a low capacity of the economy to absorb such a high level of funding. This not only reinforces the need for prioritisation, but also calls for the need to re-engineer government machinery to enhance its ability to absorb higher levels of spending and implement the required activities while ensuring efficiency, value-for-money and quality. The capacity constraint also suggests the need to make the GPRS a scalable and living strategy to provide the ability to step up implementation as needs change and capacity grows.

Programmes have been carefully prioritised 1 and costed to provide a balance between growth and direct pro-poor objectives. The process of selecting programmes and projects for the priority list was guided by four main factors:

  • The results of the analytical and consultative work undertaken during the preparation of the GPRS which for instance stressed the importance of infrastructural development to the poor;
  • The need to continue current on-going programmes and projects which are fully funded;
  • The relative importance of programmes to overall poverty reduction; and
  • The vision of the government.

5.1. Cost of the Medium Term Priority Programmes and Projects

The total cost of the medium-term priority programmes and projects is US$2,515.2 million over the 3-year period (2003-2005) and beyond as per the matrix in Appendix B which spells out the Medium Term Priority Programmes and Projects and their associated costs. The programmes and projects are described in more details in the following section.

5.1.1 Macro-economic Stability Programmes and Projects

The focus in the medium-term is to ensure prudent fiscal and monetary policy management that will deliver stable and lower inflation, lower interest rates, a less volatile exchange rate environment, and reduce the debt burden and the associated fiscal and financial crowding out effect. Government is also committed to improvements in public financial management. The key initiatives are geared towards streamlining public procurement practices, improving budgeting and cash forecasting, strengthening the revenue collecting institutions, enhancing controls and strengthening transparency and accountability in the area of public financial management. The cost of the programmes and actions is estimated at $148.9 million over the plan period.

5.1.2 Increased Production and Gainful Employment

In the medium term, several programmes will be put in place to increase production and enhance gainful employment. These programmes include the modernisation of agriculture based on rural development; promoting the development of agro-processing industries; increasing environmental protection through re-afforestation; enhancing infrastructure development to facilitate internal commerce, intra-regional trade, and access to ports; and strengthening the private sector. The cost associated with these efforts is estimated to be $1,413 million for the period. Details of proposed programme and activity costs follow.

5.1.2.1 Modernised agriculture based on rural development

For the period, the cost of programmes and projects for modernising agriculture and promoting agro-processing based on rural development is estimated at $80.2 million. These programmes include the promotion of farm mechanization, provision of irrigation facilities, rehabilitation of fish hatcheries, improving inputs for livestock and crop production, and promoting the production of high value crops and agro-processing. The programmes and projects are in response to the existing structural rigidities of the Ghanaian economy, which have to be addressed to stimulate growth and reduce poverty. The results of the consultative processes undertaken in the preparation of the GPRS and those of the Ghana Living Standards Survey (GLSS 4) showed that food crop farmers benefited least from the gains made in poverty reduction during the nineties. Agriculture is Ghana’s traditional core competency and the move to grow the economy is inextricably linked to improvements in the agricultural sector. Rural poverty is largely attributed to poorly functioning markets for agricultural outputs and to low productivity because of the reliance on rudimentary technology, farming practices and low utilization of low-yielding inputs.

The intention of government is to put in place measures to encourage farmers to shift from a concentration on subsistence agriculture to market-oriented production, to shift from low to high-yielding inputs, to the use of simple but relatively more advanced technologies, and to encourage non-farm activities such as processing. It is expected that agro processing activities will move the rural dwellers from low to higher income generating activities. The introduction of new technologies and innovations in farming practices should reduce the drudgery of rural women who form the bulk of food crop farmers.

Specific investments will be made during the period to develop agri-business zones as a means of vigorously promoting processing to enable entrepreneurs add value to agricultural produce. Skills training to enable rural dwellers, with a special emphasis on rural women, will be undertaken in collaboration with NGOs operating in these areas. An enabling environment to support cooperatives will be provided to assist communities pool resources for small-scale equipment purchases to enable them process their agricultural produce for greater value-added. Women’s groups in particular will be targeted for this intervention.

Crops such as cashews, soya and sunflower, which are highly suitable to the ecology and with potential markets at the domestic and international levels, will also be promoted to increase and stabilise rural incomes.

Support will be provided within the medium term programme for performance-based extension and research services (with strong regard to the needs of women farmers), for vigorous promotion of mainly small-scale irrigation, which communities and districts can easily construct and maintain, and for the provision of credit to farmers at crucial stages of the production process. The issue of land acquisition, which in the past has been a bottleneck to expansion of farms and establishment of commercially oriented agriculture, are part of the activities to be tackled under this core priority area. Women’s access to credit and to land in particular will be a focus of attention in the medium term.

5.1.2.2. Environmental Protection Through Afforestation

Government will provide material and financial support for re-afforestation of degraded forests, abandoned mining areas and along the banks of major rivers to slow down the Sahelian drought and prevent our major rivers from drying out. Programmes to increase environmental protection through afforestation are estimated to cost $9.7 million over the three-year period.

5.1.2.3. Strengthening the Private Sector

The Government recognises the role of the private sector as the engine for growth and poverty reduction. In recognition of this role the Government will work towards reducing the bottlenecks to private sector development, promote entrepreneurship in agro-business and improve access to credit at affordable rates. Programmes associated with these efforts are estimated to cost $11.0 million over the three-year period.

5.1.2.4. Infrastructure Development

For sustained growth and poverty reduction to occur, certain infrastructure needs to be put in place. In the medium term three major highways, ten regional roads and several feeder roads will be rehabilitated or constructed to increase spatial access to markets. There will be an improvement in the supply of electricity to boost industrial production and increase supply to the rural communities. In addition, there will be enhanced access to information and communication technology generally, and increased access to telephones in the rural communities in particular. The total cost of enhancing infrastructure development is estimated at $1,274 million over the period. This is broken down as follows:

Road Networks

A well functioning road network, especially, farm-to-market roads is key. This is to improve access to markets, open up the country for investment, expand productivity and increase job creation. In the medium term, investment will be made in the feeder road network in major production areas to support marketing. At least one road linking rural producing areas to urban markets in each region has been earmarked for rehabilitation or development. Investments will be made in the construction of three major highways to support exports from the agricultural and industrial sectors. The three major highways, the major trunk roads in each region, and the network of feeder roads are estimated to cost $926 million over the period.

Energy Supply

Significant public interventions in the energy sector are needed in the medium term in order to improve the living conditions of Ghanaians, especially in the rural areas. The development of energy will not only boost production, but will also enhance job creation, ensure the proper functioning of district hospitals, some of which are without any means of power which hampers their effective performance. Rural energy production to facilitate the processing of agricultural produce will also benefit from these investments. Although the government will work hard to interest private sector investors in the energy sector, the focus of the medium term is on preventing further difficulties in the sector which would have devastating consequences on various facets of the economy and, in particular, on poverty in the rural areas. Investments will be made in the West Africa Gas Pipeline, the expansion of the thermal plant at Takoradi and in the increased use of solar energy with combined public and private sector participation. While some of the programmes and projects envisaged in the energy sector cannot be completed in the planned period it estimated that the total cost of the various phases that can be completed by 2005 is $348.6 million.

5.1.3 Human Resources Development and Provision of Basic Services

The programmes for human resources development and the provision of basic services in the medium term will cost $749.69 million. The programmes include activities geared towards enhancing access to education; reducing gender disparities in education; improving skills through training; enhancing access to and delivery of health services; enhancing access by women to reproductive health services; and increasing access to potable drinking water and improving sanitation.

5.1.3.1. Enhanced access to education

The education system will be reformed to ensure uninterrupted education from pre-school to age 17 as a means of reducing poverty and creating the conditions for human development. Government proposes to mainstream preschool education for all schools in Ghana in order to ensure a smooth transition from the home to school, ensure adequate care for children of working parents and also to free up women’s time for production. The cost of mainstreaming pre-school education is estimated at $50.23 million over 2003-2005 period. This initiative will also go to improve on children’s cognitive skills and as studies 2 have shown, reduce the gender gaps in enrolment, which is one of the prime objectives of Government in the education sector. At the primary level, measures will be intensified to ensure the continued improvement in school and retention of girls at that level and even beyond. Programmes to support increase in girls’ enrolment, rehabilitation of existing dilapidated schools and development of new ones will cost $121 million over the plan period. The national functional literacy programme will be pursued in earnest to ensure adult access to basic literacy. This programme is estimated to cost $33.6 million over the period

Access and equity issues, especially in the deprived areas of the country and female enrolments, will receive primary considerations within the education sector. Transition rates from the basic level to the senior secondary level are currently below 50% due to a number of factors, not least of which is the poor quality of teaching and learning facilities in the rural areas and deprived districts. For each district, a school will be rehabilitated and developed as a model Senior Secondary School (SSS) over the medium term. This is estimated to cost $16.1 Million over the period. In some cases, the intervention will only involve a minimal upgrading of an already adequate facility through the provision of a science laboratory, a school library or equipment such as computers. The development and promotion of ICT in schools will enhance the skills of the SSS graduates, improve their employability, and help the country readily integrate into the global economy. This programme is estimated to cost $24 Million over the period.

5.1.3.2 Improved Vocational and Technical Skills Training

Support will be provided during the period for vocational and technical skills training to support the requirements of the job market. Wherever possible, the government will seek collaborative approaches with the private sector and NGOs, given their interests in this area. Government support will be through developing policy, regulating the sector, and facilitating credit flows for private sector activities. Government will also periodically provide short-term training for the unemployed youth using the traditional apprenticeship approach. It is estimated that the total cost of these programmes and projects between 2003 and 2005 will be $22.3 million.

Attention will be given to the provision of special education to persons with disabilities (PWDs) to enable them enhance their development, reduce their exclusion within society, and contribute to national development. Wherever possible, PWDs will be encouraged to participate in mainstream education, In this regard, school facilities will be developed taking into account the needs of the physically challenged.

5.1.3.3 Enhanced Delivery and Access to Health Care

To ensure enhanced delivery and increased access to health services by the poor, model health centres will be developed in every district in the country. In addition, the Government will phase out the existing ‘cash-and-carry’ system by increasing the fee exemption coverage and introducing a national health insurance scheme. The prevention of HIV/AIDS and water borne diseases will receive high priority in recognition of their high incidence among the poor. The cost of enhancing health delivery and access is estimated to be $132.0 Million over the 3-year period.

Furthermore a major priority off the GPRS is to ensure that the health status of the population is improved while reducing the geographical, socio-economic and gender inequalities in health outcomes. In this regard the health sector programme support project will be implemented with the full vigour to enhance health system performance, fight communicable diseases, improve child health and population and reproductive health services over the period. It is estimated that the capital expenditure for the programme will be about $236.63 million over a f-year period.

5.1.3.4 Enhance Women’s Access to Productive Work

To enhance women’s access to and control of productive resources, the Government would promote and strengthen women’s access to credit, promote and strengthen women’s micro-enterprises. It is estimated that the cost of programmes for enhancing women’s access to productive work will be $9.0 million over a 3-year period.

5.1.3.5 Increased Access to Potable Drinking Water

Increased access to safe drinking water, a priority for the medium term has several implications for poverty reduction and growth. It is estimated that programmes and projects for increasing access to potable drinking water will cost $90.8 million over the period. The availability of water for domestic use also affects many gender aspects of development. The intervention will go a long way towards enhancing the attainment of good health, and reducing under-five mortality and the incidence of water-borne diseases such as guinea worm. The interventions will also support increased girls’ enrolment and retention, free up time for women’s productive work, increase their productivity and make available agriculture labour time.

5.1.4 Programmes for the Vulnerable and the Excluded

The attainment of social justice, equity and respect for human rights would ensure that no Ghanaian is left out in the pursuit of freedom and happiness. The Government will increase resources for the protection of the rights of women, children and other vulnerable groups in the society. The capacity of child-care workers will be enhanced and disabled youth will be provided with employable skills. Care will be provided to people living with HIV/AIDS, and support provided for orphans, vulnerable children, the physically challenged and the aged. Programmes for the vulnerable and the excluded are estimated to cost $133.9 million over the 3-year period.

5.1.5 Good Governance

To realize the above priority goals and to lay the foundation for further sustained growth and poverty reduction, the issue of good governance, both in the political and economic realms, is receiving due attention. Government will uphold the rule of law, respect for human rights and the attainment of social justice and equity by strengthening the executive, the judiciary, and the legislature. Programmes for ensuring good governance are estimated to cost $62 million over the period.

5.1.5.1 Ensuring the rule of Law, respect for human rights and attainment of social justice and equity

A major priority of government is to ensure that the Police Force is strengthened to give maximum security to the citizenry. This objective will be achieved by increasing the size of the Police Force and providing them with necessary logistics and training. The capacity of the Attorney General’s Department and the judiciary will be strengthened in terms of numbers and resource provision to uphold the rule of law. It is estimated that these programmes will cost $45 million in the 3-year period.

5.1.5.2 improving Efficiency and Effectiveness of the Civil Service.

The civil service will be restructured with vigour in order to ensure its improved efficiency and effectiveness. Attention will be paid to ensuring accelerated decentralization to strengthen the administrative capacity of District Assemblies and deepen District Assemblies’ association with civil society. It is estimated that the programmes for implementing the decentralization process will cost $17.0 Million over the 3-year period.

5.2 Monitoring and Evaluation (M&E)

Monitoring the implementation of the GPRS will consist of the use of the national M&E system and existing poverty monitoring systems to track key indicators over projected periods to determine the effectiveness of policies and programmes on beneficiaries. A system has been designed to track expenditures made with savings from the HIPC initiative. Estimated costs of these efforts are put at $7.7 million over the period.

6. Financing the Medium Term Priority Projects and Programmes

The total public sector capital expenditure for 2003 is estimated at 5,731 Billion cedis ($674 Million), which constitutes about 9.4% of the GDP. It is projected to be 9.9% and 9.7% of the GDP in 2004 and 2005 respectively. Consistent with the projected capital expenditure framework, the Medium Term Priority programmes of the GPRS, is estimated to cost $465,788 Million in 2003 representing 69% of total public sector capital expenditure. As shown in Appendix B, total resources amounting to $443.687 million have been earmarked for the Medium Term Priority Programmes in the current budget estimates. This amount consists of $43.972 million from GOG sources and $399.715 million from donor sources. The resources from donors may be broken down further to $70.115 million for on-going projects and $392.6 million for new projects.

It is to be noted that the amount of $443.687 million earmarked for the priority programmes and projects under the 2003 budget does not include HIPC savings. The expected savings from the HIPC relief is estimated to be $100 million. Assuming that all the HIPC savings are used to finance the priority programmes including reducing the domestic debt, which it should, the total amount of resources available for financing the Medium Term Priority programmes and projects will be $544 million leaving a zero financing gap.

However, there are other programmes and projects as per appendix C that could be implemented more fully if additional funds can be secured. These programmes with a total cost of $50 million include the modernization of agriculture, which requires $27 million but only 0.63 million could be made available. Other projects include the development of the National Identification System estimated to cost $10million in 2003; the provision of employable skills for the disabled which is estimated to cost $5 million in 2003; and providing information communication technology access to schools estimated to cost $8million in 2003.

APPENDIX A: MATRIX OF THE COST OF ALL GPRS POLICY ACTIONS AND PROGRAMMES
SUMMARY
In Millions of USD
200320042005Total% OF TOTALREMARKS
THEMATIC AREAS/Total Cost1,3651,8722,0465,283100
A. Macro Economic Stability1101501564168
B. Production And Gainful Employment4344915031,42827
C. Human Development & Provision of Basic Services6801,0941,2693,04358
D. Special Programmes For The Vulnerable And Excluded6661401683
E. Governance7575772284

GHANA POVERTY REDUCTION STRATEGY MATRIX OF COSTED POLICY ACTIONS AND PROGRAMMES

I. MACROECONOMIC STABILITY

PROGRAMME OBJECTIVESESTIMATED COST(Mill. $)
200320042005TotalIMPLEMENTING AGENCYCOLLABORATING AGENCIES
A. Macro Economic Stability109.55150.16156.30416.01
A.1FISCAL POLICY MANAGEMENT83.5073.0479.04235.58
1.0Promoting Effective Debt Management20.526.527.574.50
1.1Restructuring the Domestic Debt stock0.50.50.51.5
1.2Reducing the Stock of Domestic Debt20262773
2.0Improving Public Expenditure Management3321.5421.5476.08
2.1Improving forecasting and monitoring of commitments and cash transactions3321.5421.5476.08
2.0Improving Fiscal Resource Mobilization30.0025.0030.0085.00
3.3Strengthening the revenue collecting institutions30253085
A.2MONETARY POLICY MANAGEMENT16.5070.5071.70158.70
1.0Deepening capital markets1.001.00
2.0Improving Institutional, Legal & Regulatory Framework For Monetary Management
3.0Managing External And Internal Shocks-27.5028.1055.60
3.1Establishing an Emergency Shock Fund (ESF)-27.5028.1055.60
4.0Deepening Capital Markets15.515.515.546.5
4.1Implementing schemes to increase long-term savings/funds0.50.50.51.5
4.2Developing a National Identification System15151545
A.3PROMOTING INTERNATIONAL TRADE9.556.625.5621.21
1.0Improving Export Competitiveness9.036.095.0320.15
1.2Improving the Import/Export Regime9.036.095.0320.15
2.0Diversifying Export Base0.520.530.531.58
2.2Taking full advantage of Preferential Access to Markets (AGOA, EU-ACP)0.520.530.531.58

II. PRODUCTION AND GAINFUL EMPLOYMENT

PROGRAMME OBJECTIVESESTIMATED COST(Mill. $)IMPLEMENTING AGENCIESRemarks
200320042005TotalLEADCOLLABORATING
B. Production And Gainful Employment433.86491.29503.271,428.42
B.1THE RURAL ENVIRONMENT AS A CATALYST FOR ECONOMIC TRANSFORMATION52.4757.3359.90169.70MOFA
1.0Policy Area: Increasing Agricultural Yields Through Infrastructure, Market and Extension Service Provision52.4757.3359.90169.70
1.1Modernization of Agriculture23.126.530.680.2MOFA
1.2Increasing physical or spatial access to markets through feeder roads20.42621.87420.75563.055MORH
1.3Providing storage facilities to reduce post harvest losses.0.7390.7380.7052.182MOFA
1.4Improving market access to agricultural producers0.7390.7390.7052.183MOFA
1.5Increasing access to inputs and services for production5.8565.8605.59017.306MOFA
2.1Promoting the establishment of agri-businesses1.6141.6151.5414.771MOTIMOFA
B.2PRODUCTION AND EMPLOYMENT IN AGRO-PROCESSING101.186101.187101.088303.461
1.0Policy Area: Increasing Production and Employment by Promoting Agro-processing1.0471.0480.9993.094
1.1Providing spatial and locational legality, facilities and services for small businesses0.9480.9490.9062.803MOTIGIPC/MOPSP
1.2Supporting the development/establishment of agro-processing industries0.0980.0980.0940.291MOTIGIPC/MOPSP
2.0Policy Area: Improving Productivity In The Industrial And Service Sectors100.139100.139100.089300.367
2.1Creating an effective institutional support structure for improving productivity0.1390.1390.090.367MOPSD
2.2Adding value to natural resources100100100300
B.3ENERGY SUPPLY149.957150,008150.000449.965
1.0Improving Energy Provision for Production.149.957150,008150.000449.965MOE
1.1Increasing targeted supply to the poor.67.12667.17725.070159.373MOE
1.2Ensuring the maximum use of energy made available to the poor0.0310.0310.0300.092MOE
1.3Overall energy programmes82.80082.800124.900290.500MOEVRA, ECG, NED
Estimates based on $3 billion projected for 20 years
1.0Policy Area: Improving Environmental and Natural Resource Management for Health, and Increased and Sustainable Production21.59921.31419.92062.832MOSE
1.1Implementing existing laws and regulations and programmes on natural resource utilisation and environmental protection6.5566.5616.26019.377MOSE
1.2Enhancing resource-based enterprise development1.6891,6901.6124.992MOPSD
1.3Encouraging private sector investments in rural natural resource enterprises0.7490.7500.7152.214MOPSD
1.4Enhancing access to land and providing security of tenure.1.3901.3911.3274.107MOL&F
1.5Undertaking the reforestation of degraded forests, woodlands and abandoned mining areas0.4460.4470.4261.319MOL&F
1.6Formulating and/or implementing relevant policies on natural resources and the environment.0.5990.6000.5031.703MOS&E
1.7Maximising the value added from natural resources.6.9957.0016.67920.675
1.8Increasing environmental protection through re-afforestation1.6731.6751.5984.945MOL&FMOS&E
1.9Reforestation of major rivers in Brong-Ahafo1.5001.2000.8003.500MOL&F
1.0Policy Area: Increasing the Production and Exports of Non-Traditianal Exports92.927151.029161.584405.539
1.1Creating an enabling environment for NTE production and exports28.49128.51327.20184.205MOFTI/MOPSDIncluding credit support for the private sector
1.2Targeting Production And Export Marketing By Young Graduates From Tertiary Institutions0.0270.0270.0260.079MOEMD/
1.3Supporting crafts villages in Upper East Region to produce leather and straw products and pottery for exports0.6850.6860.6542.026GEPC
1.4Making investments in trade support infrastructure
1.5Open up country and link with trans-ECOWAS highway Project63121.1133317.1MORH
1.6Overcoming existing barriers to regional trade.0.7230.7030.7032.129MEPRC
1.0Policy Area: Increasing employment opportunities for poverty reduction.15.71410.42910.78136.925MOMPD
1.1Formulating a Manpower Development Plan.14.9319.60410.23634.771MOMPD
0.4990.5250.2921.316MOMPD
0.1320.1070.1070.346MOMPD
0.0600.0930.1290.281
0.0930.1000.0170.210

III. Support for Human Resource Development & Basic Services

PROGRAMME OBJECTIVESESTIMATED COST(Mill. $)IMPLEMENTING AGENCIESRemarks
200320042005TotalLEADCOLLABORATING
C. Thematic Area: Support For Human Resource Development & Basic Services680.001,094.471,268.803,043.27
C.1EDUCATION228.47260.81293.50782.79MOEGES
1.0Policy Area: Increasing Access to Education and Training213.44243.04272.34728.83MOE
1.1Undertaking school improvements at all levels with priority for most deprived Districts.149.07158.93174.21482.21MOE
1.2Establish one model SSS in each district244254120
1.3Mainstream pre-school28.328.328.384.9MOE
1.4Ensuring teacher development, deployment and supervision at the basic level6.146.797.5720.50MOE
1.5Ensuring reformed management of the education sector4.435.296.0415.76MOE
1.6Establishing special partnership programmes with non-state actors.1.501.742.215.46
2.0Policy Area: Providing Skills And Entrepreneurial Development For Youth.15.0317.7721.1653.96
2.1Increasing the relevance and coverage of vocational and technical training6.777.438.1422.34MOMPD/MOE
2.2Establishing community based vocational apprenticeship schemes3.604.335.8613.79MOMPD/MOE
2.3Providing entrepreneurial development among the youth and expanding the traditional apprenticeship system4.666.017.1617.83MOMPD/MOE
C.2HIV/AIDS61.0967.2063.84192.13GACMOH
1.0Policy Area: Preventing And Providing Quality Care For PLWHA61.0967.2063.84192.13GAC
1.1Preventing new transmissions, including awareness creation, direct service delivery and supporting high-risk groups6.837.527.1421.49GAC
1.2Providing support for the PLW HIV/AIDS and their families.32.0435.2533.48100.77MOHIncluding Antiretroviral cost
1.3Laying an effective institutional foundation22.2224.4423.2169.87MOH
C.3POPULATION MANAGEMENT13.4013.3013.1039.80NPCMOH
1.0Policy Area: Increasing Effective Population Management Services13.4013.3013.1039.80
1.1Improving the market and distribution system for service delivery9.009.009.0027.00MOH
1.2Instituting a major national campaign on fertility regulation2.602.602.507.70MOH
1.3To ensure effective coordination of the implementation of the papulation management service1.801.701.605.10MOHM & E, RH figures (Added by NPC)
C.4HEALTH CARE164.14199.75221.36585.26MOH
1.0Policy Area: Increasing The Extent And Quality Of Health Care164.14199.75221.36585.26MOH
1.1Bridging equity gaps in access to quality health and nutrition services32.5535.8134.02102.38MOH
1.2Ensuring sustainable financing arrangements that protect the poor38.6242.4840.36121.46MOH
1.3.One model Health center in all Districts4872100220MOH
1.4Enhancing efficiency in service delivery44.9749.4646.99141.42MOH
C.5SAFE WATER AND ENVIRONMENTAL HEALTH103.9353.4477934.3MWH, MLG
1.0Policy Area: Increasing access to potable drinking water64.6292.2410.4767.2MWH, MLG
1.1Accelerating provision of safe water in rural Districts475672175MWHCWSA, GWC DA.$26,55m provided in 2002 budget with $25m donor contribution.
1.2Ensuring Safe liquid and solid waste management6.86.38.121.2MWHMWH handles Liquid Some Waste
1.3Ensure effective management of urban systems10.8229.9330.3571MWH
2.0Policy Area: Increasing Access to Safe Sanitation39.361.266.6167.1
2.1Ensuring safe Liquid and Solid waste management29.945.251.2126.3MLGMOLG - Solid Waste Management
2.2Develop capacity building for environmental health9.41615.440.8MOH
C.6SAFE SHELTER109200200509MWH
1.0Policy Area: Providing safe and sanitary shelter to Ghanaians109200200509MWH
1.1To make Shelter Programs more accessible to the poor109200200509MWH109.9m Initial and initiated fund sourced. Mostly for mortgage and private sector credit support

IV. Special Programmes for the Vulnerable and the Excluded

PROGRAMME OBJECTIVESESTIMATED COST(Mill. $)IMPLEMENTING AGENCIES
200320042005TotalLEADCOLLABORATING
D. Thematic Area: Special Programmes For The Vulnerable And Excluded66.4560.9640.38167.79
1.0 Policy Area: Expanding Essential Basic Services To The Vulnerable And Excluded58.2553.1632.48143.89
1.1 Expanding the coverage and effectiveness of essential service for poorest groups and geographical areas.55.0950.3429,57135.00MOH/MOE
1.2 Preventing Disaster and Mitigating their impact on the poor2.682.332.437.44MOINADMO
1.3 Developing systems that enforce rights of protection, especially for women and children0.050.050.050.15AGSMOWA
1.4 Supporting capacity for coordinated service delivery0.440.430.431.30AGS/MOI
2.0 Attainment of Social Justice & Equity and respect for Human Rights3.202.802.908.90MOPSD
2.1. Rights of Protection for Women and Children3.22.82.98.9MOWA
3.0 IMPROVE THE QUALITY OF LIFE OF THE PHYSICALLY CHALLENGED55515.0
3.1 Strengthen the Department of social welfare and community development and provide capacity of childcare providers, equip the disabled with employable skills55515MMDE

V. Governance

PROGRAMME OBJECTIVESProgramme ActivitiesESTIMATED COST(Mill. $)IMPLEMENTING AGENCIES
200320042005TotalLEADCOLLABORATING
GOVERNANCE74.91275.25977.401227.573
E.1 PUBLIC POLICY MANAGEMENT56.35255.14655.579167.077
1.0 Policy Area: Deepening effective political involvement in support of poverty reduction and growth.40.08640.09440.103120.282
1.1 Strengthening the leadership and oversight functions of Cabinet and Parliament in support of poverty reduction and growth.0.0160.0170.0190.052MOPA
1.2 Establishing permanent dialogue between Government and Traditional Authority In support of poverty reduction and growth at national level.0.0520.0580.0630.173MEPRC
1.3 Establishing effective independent control of measures to achieve zero tolerance of corruption.0.0170.0190.0210.057MOPA
1.4. Establishing a comprehensive M&E System for Monitoring GPRS40.00040.00040.000120.000NDPC/MEPRC
2.0 Policy Area: Increasing the capacity of the public service13.85714.24214.66742.766
2.1 Establishing an appropriately recruited, sized and adequately compensated public service3.8574.2424.66712.766PSC
2.1.1 Equipping the police, Strengthening Parliament and the AG’s10101030MOI/AGS/PARLIAMENT
3.0 Policy Area: Rationalising and defining of structures roles and procedures for institutions responsible for poverty reduction, growth and development2.4100.8100.8104.029
3.1 Clearly identifying roles and responsibilities for CMA, and for forward planning and economic and financial management at national level.0.0100.0100.0100.029EMT
3.2 Strengthening capacity of institutions at national and local level responsible for coordinating the implementation of the GPRS.2.4000.8000.8004.000MEPRC/NDPC
4.0 Policy Area: Rationalizing the role of the state
4.1 Coordinating the planning and delivery of donor programmes and projects.MEPRC
E.2 DECENTRALIZATION18.55320.10621.81360.472
1.0 Policy Area: Strengthening leadership and capacity of District Assemblies.12.73714.01015.41142.158
1.1 Full implementation of decentralization11.34312.47713.72537.545MLGRD
1.2 Expanding and strengthening District Assemblies financial management role.0.0140.0160.0170.047MLGRD
1.3 Establishing training and refresher programmes for District level staff.1.2931.4231.5654.281MLGRD
1.4 Rationalising the roles and responsibilities of District Assembly departments and offices0.0860.0950.1040.285MLGRD
2.0 Policy Area: Deepening District Assemblies association with civil society5.8176.0956.40218.314
2.1 Developing a working partnership with NGOs0.0010.0010.0010.002MOPSD
2.2 Developing a working relationship with the private sector0.0050.0060.0070.018MOPSD
2.3 Institutionalising community participation as an integral part of the development planning process0.3380.3720.4091.120MEPRC
2.4 Extending the traditional role of District Assemblies as.1.3991.5391.6934.632MLGRD
2.5 Accelerate Rural/Urban development3.033.033.039.090MLGRD
2.6 Strengthening and expeditiously executing financial management reforms1.041.151.263.45EMT/MOF
2.7 Promoting a system of accounting to record the utilization of financial resources in detail
E.3 TRANSPARENCY AND ACCOUNTABILITY0.0070.0080.0090.024
1.0 Policy Area: Institutionalising public access to matters of Government business.0.0070.0080.0090.024
APPENDIX B: MATRIX OF COSTED MEDIUM TERM PRIORITY PROGRAMMES

GHANA POVERTY REDUCTION STRATEGY

SUMMARY
THEMATIC AREA/COSTIN MILLIONS OF DOLLARS
2003200420052006 and BeyondTotal% of Total
IMacro-economic Stability33.543.4247.5224.46148.95.91998282
IIProduction and Gainful Employment315.17355.54372.95369.34141356.1782118
IIIHuman Resources Development and Provision of Basic Services157.12186.56187.26218.75749.6929.8062587
IVSpecial Programmes for the Vulnerable and the Excluded16.117.820.479.5133.865.32202083
VGovernance2220200622.46500292
VIMonitoring and Evaluation0.232.52.52.537.760.30852295
TOTAL544.12625.82650.63694.582515.21100
DETAILED MATRIX OF COSTED MEDIUM TERM PRIORITY PROGRAMMES
FINANCING FOR 2003 - MILL. $IMPLEMENTING AGENCIES
ESTIMATED COSTDOMESTICEXTERNAL
THEMATIC AREAPROGRAMME OBJECTIVESPROGRAMME ACTIVITIES2003200420052006 and BeyondTOTALGOGHIPC*ONGOINGNEWTOTALGAP**LEADOTHER
I. MACRO-ECONOMIC STABILITYREDUCING & RESTRUCTURING THE DOMESTIC DEBTPAYING DOWN DOMESTIC DEBTS & DEVELOPING MEDIUM & LONG TERM INSTRUMENTS20262773020.9MOF
IMPROVING PUBLIC EXPENDITURE MANAGEMENT1. REVIEW AND REFINANCE MTEF & PUFMARP13.517.4220.5224.4675.91.6811.913.580MOF
SUB-TOTAL33.543.4247.5224.46148.91.680011.913.5820.9
II. PRODUCTION AND GAINFUL EMPLOYMENTMODERNIZING AGRICULTURE BASED ON RURAL DEVELOPMENT1. MECHANIZATION

2. IRRIGATION

3. RELEASE LAND FOR COMMERCIAL FARM

4. FISHING HATCHERIES
0.63723.126.530.623.180.20.1870.40.050.6370.0AESD GIDA

------

FISHERI ES
PROMOTE THE DEVELOPMENT OF AGRO- PROCESSINGpromote the development of agri-business zones255122.0MIST
INCREASE ENVIRONMENTAL PROTECTION THROUGH RE-AFORRESTATIONPROVIDE MATERIAL AND FINANCIAL SUPPORT FOR AFFORESTATION OF DEGRADED FORESTS, ABANDONED MINING AREAS AND MAJOR RIVER BANKS3.63.32.89.73.6MOLF;

MOM
STRENGTHENING THE PRIVATE SECTOR1. MICROFINANCE

2. REDUCING BOTTLENECKS TO PRIVATE SECTOR DEVELOPMENT

3. PROMOTION OF ENTREPRENEURSHIP
533115.0MOPSD
ENHANCED INFRASTRUCTURAL DEVELOPMENTMAJOR HIGHWAYS CONSTRUCTION:

1. ACCRA-KUMASI

2. ACCRA-YAMORANSA

3. ACCRA-AFLAO NOEPE
83.72108127.212330.927.676.1183.720.0MORT
IMPROVE SPATIAL ACCESS TO URBAN MARKETS BY CONSTRUCTING OR REHABILITATION: ONE GOOD ROAD LINKING RURAL-URBAN MARKETS IN EVERY REGION62636662.2253.262620.0MORT
INCREASE SPATIAL ACCESS TO MARKET THROUGH IMPROVEMENTS IN FARM ROADS TO MARKET THROUGH RE-GRAVELLING, SPOT IMPROVEMENT AND UPGRADING OF FEEDER ROADS98.8590.1464.3589.04342.3898.8598.850.0MRT
ENERGY PROVISION TO BOOST INDUSTRIAL PRODUCTION:

1. TAKORADI THERMAL PLANT

2. SOLAR ENERGY

3. WEST AFRICA PIPELINE

4. BUI DAM

5. SHEP 3 & 4
5051.664183348.67,41132.5940.00110.0MOE
DEVELOPING NATIONAL INDENTIFICATION SYSTEM105102510.0MEPRC
SUB-TOTAL315.17355.54372.95369.34141315.198032.99237.01285.20830.6
III. HUMAN DEVELOPMENT AND PROVISION OF BASIC SERVICESENHANCED SOCIAL SERVICES: EDUCATIONPROVIDING MODEL SENIOR SECONDARY SCHOOL IN ALL DISTRICTS WITH EMPHASIS ON DEPRIVED AREAS5.55.55.116.16.25*------6.25-0.8MOE
MAINSTREAMING PRESCHOOL IN DEPRIVED AREAS13.217.020.00.050.2313.186------13.1860.0MOENGOS, DAS
INCREASE GIRLS GROSS ENROLLMENT FROM 72% TO 74%

3 2. REHABILITATION AND CONSTRUCTION OF CLASSROOMS WITH EMPHASIS ON DEPRIVED AREAS
37.1242420121.1237.12537.120.0MOE
National Functional literacy Programme17.616033.61.61617.60.0MOE
COMMUNICATIONS:

1. PROVIDING ICT FOR SCHOOLS

2. INCREASED TELEPHONE ACCESS
888240.320.327.7MOEMOCT
Provide support to vocational and technical schools3.7884.895.767.922.3383.788----3.7880.0
SUPPORT COMMUNITY-BASED VOCATIONAL APPRENTICESHIP3.64.35.913.8------------03.6MMDE/NVTTICCES/OIC
ENHANCED SOCIAL SERVICES: HEALTHPROVIDING MODEL HEALTH CENTER IN EVERY DISTRICT345921043.0MOH
PHASING OUT CASH AND CARRY23419282.0MOH
Health Sector Programme SupportHealth System performance; Fighting communicable diseases Child health, Productive health39.8548.1648.7799.85236.633.236.639.850.0
PROMOTING WOMEN’S ACCESS TO MICROCREDITPROMOTE WOMEN’S ACESS TO CREDIT, PROMOTE AND STRENGTHEN WOMEN’S MICRO ENTERPRISE33393.0MOWA
ENHANCED SOCIAL SERVICES: SANITATIONINCREASED ACCESS TO SAFEWATER IN RURAL AREAS20.4930.739.69090.884.4920.49160.0MOWH
SUB-TOTAL157.13186.56187.26218.75749.726.584037.12573.09134.11418.5
IV. PROGRAMMES FOR THE VULNERABLE & THE EXCLUDEDATTAINMENT OF SOCIAL JUSTICE & EQUITY AND RESPECT FOR HUMAN RIGHTSRIGHTS OF PROTECTION FOR WOMEN AND CHILDREN3.22.82.98.9------------03.2MMDE/DWSMWCA
PREVENTING THE SPREAD OF HIV & PROVIDING CARE FOR PEOPLE LIVING WITH HIV/AIDS (PLW HIV/AIDS)AWARENESS CREATION AND SUPPORT FOR PLWHIV/AIDS7.91012.5679.5109.960.447.447.880.0MOHDWS
IMPROVE THE QUALITY OF LIFE OF THE PHYSICALLY HANDICAPPEDSTRENGHTEN THE WORK OF THE DEPARTMENT OF SOCIAL WELFARE AND COMMUNITY DEVELOPMENT, THE CAPACUTIY OF CHILD CARE PROVIDES, EQUIP THE DISABLED WITH EMPLOYABLE SKILLS, PROVIDE CARE AND SUPPORT FOR THE “KAYA YEI”555155.0MMDE
SUB-TOTAL16.117.820.4679.5133.860.44007.447.888.2
V. GOVERNANCEPROVISION OF SECURTIY AND STRENGHTENING THE RULE OF LAWEQUIPPING & TRAINING THE POLICE STRENGTHENING THE CAPACITY OF THE ATTORNEY GENERAL’S OFFICE ENHANCING SUPPORT FOR PARLIAMENT151515450.194*--------0.19414.8MMDE/DSW
ACCELERATE THE IMPLEMENTATION OF DECENT RALIZATI ONSTRENGTHEN THE CAPACITY OF THE DA AND DEEPEN DA ASSOCIATION WITH CIVIL SOCIETY7551707MLGRD
SUB-TOTAL22202006200000.19421.8
MONITORING AND EVALUATION0.232.52.52.537.760.070.160.230MEPRC
TOTAL544.13625.82650.69694.582515.243.97210070.115329.6443.687100.0

HIPC FUNDS PROJECTED TO BE $100 MILLION TO BE ALLOCATED LATER

HIPC FUNDS PROJECTED TO BE $100 MILLION TO BE ALLOCATED LATER

APPENDIX C: MATRIX OF SUPPLEMENTARY PRIORITY PROGRAMMES
MILLIONS OF DOLLARS
THEMATIC AREAPROGRAMME OBJECTIVESPROGRAMME ACTIVITIES200320042005TOTAL
PRODUCTION AND GAINFUL EMPLOYMENT1. MODERNIZED AGRICULTURE1. Mechanization

2. Irrigation

3. Fishing hatcheries etc
2726.530.684.1
2. NATIONAL IDENTIFICATION SYSTEMDeveloping database for unique identification105520
HUMAN RESOURCES DEVELOPMENT AND BASIC SERVICES3. PROVISION OF EMPLOYABLE SKILLS TO THE DISABLEDTraining in handicrafts, weaving, typing55515
4. INFORMATION COMMUNICATION TECHNOLOGY FOR SCHOOLSProvision of computers and internet facilities to schools in local communities88824
TOTAL5044.543.6143.1
APPENDIX D: MATRIX OF THE COST OF PRIVATE SECTOR COMPONENTS OF PROGRAMMES
Programme/Objective200220032004TOTALREMARKS
$MILLION$MILLION$MILLION$MILLION
1. Textiles and Garment Manufacturing for Exports.0.6940.6740.6742.042
2. Large scale cassava Processing660.3470.34766.694
2. Ensuring effective management of urban liquid and solid waste Systems213.5314.5528
3. Home ownership schemes4042603801044
4. Increasing productivity in the industrial and service sector300300300900GHANA INVESTMENT FUND
TOTAL770.694774.521995.5212540.736
1The prioritised programmes and projects are referred to as the “Medium Term Priority Programmes and Projects” in the text.
2Studies show that gender disparities in enrolment hardly exist at the pre-school level. Inclusion of this level as part of basic education therefore is likely to improve girl child enrolments.

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