How a PRSP is produced – The case of Ghana

Between ownership and donorship

With debts totalling 6.6 billion US dollars, Ghana is one of the most heavily indebted countries in Subsaharan Africa. Even so, the poverty situation in Ghana is less acute than elsewhere. At the beginning of the PRS process, the percentage of poor in the country had dropped from 52% (1992) to 40% (1999) of the population. At the same time, though, access to health services, basic schooling and drinking water had worsened and social inequality had increased.


The process of preparing the PRSP

Since the 1980s, Ghana's economic development has been shaped by the structural adjustment programmes of the World Bank and IMF, with familiar consequences for its social system. As a model IMF student, the government formed by the National Democratic Congress (NDC) had no doubts from the outset about participating in the HIPC initiative. It submitted an Interim PRSP as early as June 2000. Prepared under the aegis of the finance ministry, but without civil society participation, the meagre document can be seen more as an admission ticket to the political roundabout of qualification and receipt of debt relief. Not analysing the causes of poverty, it is merely a promise of a poverty reduction strategy to come. (1)

After the change of government in January 2001, the National Development and Planning Commission (NDPC) set up a task force to produce the Full PRSP. At the same time, however, the new ruling party led by President John Kufuor (New Patriotic Party) questioned Ghana's participation in the HIPC initiative. For Ghana faced a choice: it had to weigh up whether it wanted to turn its back on a major donor like Japan – which refused new credits to countries that signed up to HIPC – or whether, as a country 75% indebted to the World Bank and IMF, it wanted to jeopardise access to IDA loans. The decision to join the debt relief initiative, taken in March 2001, was viewed by critical observers as an non-free decision underlining the contradiction inherent in the principle of "ownership as a donor condition".


Consultation and participation in the process

The NDPC unit appointed five "core teams" to analyse the causes of poverty and develop approaches for poverty reduction. The findings reported by the groups, in which representatives of government, civil society and the donor community worked together, were incorporated into the two drafts of the Full PRSP (June 2001 and February 2002). They also formed a basis for the public consultation proceedings between the donor community and selected representatives of civil society. These "harmonization workshops", partly financed by GTZ, were staged from March 2001 onwards in the capital Accra. NGOs, however, complained that the forums were too large (up to 100 participants), the invitation procedures were opaque and the choice of speakers was not representative of socially disadvantaged groups.

Another debate ignited over the way macroeconomic decisions were taken, because alongside the relatively open participation process, negotiations with the IMF about the financing framework for the strategy were held in camera. NGO representatives criticised the dominant and not particularly pro-poverty belt-tightening policy for the IMF Poverty Reduction Growth Facility and also railed against the subordination of the GPRS to the budget plan (Medium Term Expenditure Framework).(2)


The Ghana Poverty Reduction Strategy (GPRS)

The final document shows that a PRSP subordinate to the financing framework is not a suitable tool for promoting extensive poverty reduction. The principal goal cited is "equitable economic growth accelerating the reduction of poverty within a framework of enduring democracy"(3) This means stabilising macroeconomic parameters for rapid growth, creating jobs by increasing agricultural and industrial production (mainly through capital investment and use of modern technologies). In one shift in emphasis away from the draft documents – which seem to accept the paradigm of copycat development and industrialisation – the final version embraces the goal of pro-poor growth. This is to be attained mainly by boosting agricultural production, onward processing and exports. (4)

Although the Ghanaian government seems to be committed more to promoting the private sector and the productivity of the poor than to augmenting their legal and social opportunities, the GPRS contains differentiated analyses of the poverty and social development of the country. With the support of donors (including GTZ), participative poverty studies were conducted in selected districts. As a result of these, the strategy came to be based on a broader understanding of poverty, one which also embraces rightlessness and defencelessness. Declarations of intent on cross-sectional development policy tasks such as decentralisation, good governance and gender equity were also incorporated.(5) However, neither concrete strategies nor verifiable indicators were developed for these fields of policy.

The process of preparing the Ghanaian PRSP came at a time of political change. For parts of civil society, and also for some donors, the process fuelled hopes that broad-fronted participation would help dismantle the corporatist structures of the Rawlings regime. The media debate on Ghana joining the HIPC initiative brought a first-ever degree of transparency to government actions. Also, the PRSP led to capacity building and new networking in Ghanaian civil society. But neither process nor paper are marked by country ownership. Nor has a new development policy agenda been developed. For the implementation phase, non-governmental organisations are explicitly required as watchdogs. It will be interesting to see if they accept this role or if they refuse it because it means legitimising a government product.

1) Ministry of Finance of Ghana (2000): Interim Poverty Reduction Strategy Paper 2000-2002. Accra
2) Ch. Abugre, T. Killick (2001): Poverty-Reducing Institutional Change and PRSP Processes: The Ghana Case. Accra/London
4) Government of Ghana (2003): Ghana Poverty Reduction Strategy 2003-2005. An Agenda for Growth and Prosperity
4) W. Eberlei, Th. Siebold (2002): Armutsbekämpfung in Afrika: Neue Ansätze oder alte Konzepte? (Fighting Poverty in Africa: New Approaches or Old Concepts?) INEF Report 64, P. 23 ff.
5) Birte Rodenberg (2001): Zur Integration von Gender in nationale Strategien der Armutsbekämpfung: Das Beispiel Ghana. (Integrating Gender into National Poverty Reduction Strategies: The Case of Ghana) Bonn, DIE