Transcript Experiences with Ex-ante Poverty Impact Assessments of

Experiences with Ex-ante Poverty Impact
Assessments of Macroeconomic Policies in Ghana
March 13-16, 2006
Washington DC
Nicholas Adamtey
Centre for Budget Advocacy -ISODEC
Ghana
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A country in West Africa
Size 92,100 square miles
Gained Political Independence in 1957
Population 20.5 million (est. 2003)
GDP per capita between US $300 - $400
Faced economic downturn in the 70s and
early 80s
Ghana and SAP
• Ghana adopted a Structural Adjustment Program
(SAP) in 1983,
• trade liberalization,
• public sector reforms (downsizing),
• removal of subsidies on food, petroleum products
and social services as well as increased taxes,
• privatization,
• the adoption of a flexible foreign exchange regime
and the devaluation of the local currency
• Growth rate above 4 per cent
PAMSCAD and SAPRI
• Program of Action to Mitigate the Social Costs of
Adjustments (PAMSCAD)-which tried to address
the negative impact of the Structural Adjustment
Program of the 1980s
• The World Bank sponsored Structural Adjustment
Program Review Initiative (SAPRI) -tried to
consider the impact of macroeconomic policies in
Ghana especially the structural adjustment policies
among a number of selected countries
• there is no comprehensive tool for ex-ante poverty
impact assessments of macroeconomic policies for
Ghana
HIPC and GPRS
• Ghana had opted for debt relief under the Heavily
Indebted Poor Country (HIPC) Initiative and the
subsequent preparation of the Ghana Poverty
Reduction Strategy (GPRS), the need for PSIA
became more compelling
• As part of the monitoring and evaluation system of
the GPRS, the government (with financial support
from some donors) commissioned a number of
PSIAs to ensure that the implementation of the
policies, programs and projects in the GPRS do
not negatively impact the poor and the vulnerable
but also a donor requirement
PSIAs in Ghana
• PSIA on Tackling Vulnerability and Exclusion In
Ghana
• PSIA on Energy Sector Reform In Ghana:
Electricity Tariffs
• PSIA on Enhancing Capacity for Pro-Poor
Decentralization
• PSIA on Economic Transformation of the
Agricultural Sector
• PSIA on Energy Sector Reforms: Assessing the
Distributional Impact and Effects of Ghana’s
Petroleum Pricing Policy
Ghana Statistical Service and Data
• Population and Housing census
• Ghana Living Standards Survey (GLSS),
• the Core Welfare Indicators Questionnaire
(CWIQ)
• the Ghana Demographic and Health Survey
(GDHS)
• the Ghana SAM for 1993 (with some consultants)
• GTZ, MLGRD, NDPC and the NPRP/SIF have
embarked on a project to prepare participatory
poverty profiles and poverty maps in all the 110
districts as contribution towards a more effective
pro-poor targeting of development initiatives
Models of the Ghanaian Economy
• Most of the partial equilibrium models focused on
macroeconomic polices
• Most CGE models focused macroeconomic
policies with few extending to poverty issues
• Those that touched on Poverty complained of the
inadequacy of data desegregation in the GLSS
• Ghana itself has not been able to develop
comprehensive tools that can be used to carry out
the policy task of ex ante poverty and social
impact assessments in the country
Tools
• The general perception is that the currently
available tools such as partial equilibrium
analyses, general equilibrium simulations, macro
econometric and other systemic models and
verifications from monitoring systems, are
adequate for undertaking ex ante poverty and
social impact assessments in Ghana
• PSIA revealed the diversity in institutional
behaviour and needs when it comes to poverty
impact assessment. The assumptions and levels of
aggregation of the relevant institutions must relate
to the reality
Capacity
• There are some individuals and institutions that
have capacity to use develop and use ex-ante PSIA
tools
• Donors have assisted government institutions to
build capacity on modelling though not ex-ante
PSIA.
• NGOs developing ex-ante PSIA -currently ongoing project
• To address the problem of capacity local partners
link up with foreign partners on issue of PSIA.
Participation
• Most respondents were of the opinion that the IFIs
and bilateral donors influenced policy makers’
decisions in macroeconomic policy far more than
local politicians and other stakeholders
• The role of researchers and organized groups or
unions in influencing policy-making was rated
very low
• Policy makers listen when there is so much
pressure from within or without
Recommendations
• Focus on poverty - Household Welfare and
Livelihood, Vulnerability and Coping Mechanisms
• Institutions –role of government (politics)
-modelling the private/informal sector further
desegregation
-households further desegregation
• Models –combination of CGE and econometric
models which would be combined with most
widespread indicators used in poverty and income
distribution analysis – density functions, Lorenz
curves, dominance analyses, Atkinson and Gini
inequality indicators, FGT poverty indices, etc