District Economy

A formidable micro economy of the District is vital for the reduction of extreme poverty.  This section is therefore devoted to the analysis of the structure of the District’s economy, household income and expenditure patterns as well as revenue and expenditure status, economic infrastructure and commodity export. 

Structure of the Local Economy

The economy of the District is dominated by agriculture followed by commerce and industrial sectors.  Agriculture accounts for about 90% of the District labour force, commerce and industry sectors accounting for about 10%.

Commerce and Industry 

This sector employs about 10% of the District’s labour force.  The sector is least developed and dominated by petty traders, kiosk owners, and transport owners.     Commercial activities are enhanced by periodic markets that are scattered all over the District. Notable among these are the Kpandai, Kumdi, Kitare, Katiejeli, and Jamboai among others.   These market centres constitute the major sources of revenue to the District Assembly. 

However the market infrastructure are poorly developed.  Only few of the markets have stalls or stores and activities are largely conducted under trees and in temporally structures.  Due to the importance of the markets in the District’s economy steps need to be taken to facilitate their development through the provision of adequate support infrastructure. Also trustworthy and qualified market revenue collectors need to be employed to ensure effective and efficient revenue mobilization.

Industrial activities are largely on small scale and characterized by over reliance on indigenous knowledge and resources.  Family ownership and use of labour intensive technology are some of the basic features of this sector.  Major small scale industrial activities engaged in by the people include carpentry and cassava processing, as well as tailoring.

Starting Capital 

The major source of starting capital for commerce and industry come from own savings (about 80%), the remaining 20% is ascertained to be coming from loans of friends, and relatives.  The contribution of Banks as a source of starting capital is very negligible.

Supply of Raw Materials 

Mostly the business owners get their supply from the local markets (mostly throughout the year). This means that for most of the businesses there could be uninterrupted supply of services throughout the year.  Those that receive their supply of raw materials occasionally always make provision for enough reserve that can take them for reasonable period of time.   

 General Problems of Small Scale Industries
•    Inadequate working capital 
•    Unreliable energy supply
•    High cost of inputs
•    Lack of organized unions 
•    Inadequate avenue for credit facilities 
•    Lack of communal spirit

Analysis of Household Income 

House Income and Expenditure

The annual average household income for a sampled population of 900 households is GH¢650.00. The average per capita income was realized to be GH¢54.17. Most of the people draw their income from food crop farming (61%) and other businesses 39% as shown in the table below.  With this high dominance of food crop farming as a major source of household income in the district, coupled with rain fed agriculture, there is the need for the development of irrigation facilities that will constantly supply water to reduce the degree of vulnerability associated with rain failures.

Savings 

Saving is an important part of the District’s economy since it is the mechanism for accumulating capital for investment.   The District 2008 socio-economic survey revealed that about 90% of the people do not save in the banks. This could be attributed to the absence of financial institutions in the District with the exception of Kpandai Credit Union.

Levels of poverty

The District adopted a World Bank definition of poverty for this analysis.  By this, two lines of poverty were identified.  
The ‘poverty line’ which defines the population earning less than two thirds of the average income for the District
The ‘Hard Core’ line which defines the population earning less than one third of the average income.

According to this definition, it can be said that, the population within the poverty lines is deprived of their basic needs and demand special attention, those within the hard core line however require urgent attention.  In estimating average income, the District adopted the median as a measure of average due to the skewed nature of income distribution in the District. 

With the district’s average annual household income standing at GH¢650.00, the two lines of poverty based on the calculation of the annual household income stands at GH¢216.67 (hard core poverty) and GH¢433.33 (for poverty line).  Depending on these estimates the level of poverty and hard core poverty is estimated at 66.67 per cent and 33.33 percent of the district respectively.  

District Food Security 

Food is available and affordable during harvesting period that is between September -February and scarce during lean season, which is between March to August.  Middlemen and women take advantage of the situation to purchase food stuffs at cheaper prizes. The leftovers are kept in barns and sacks against the lean season.

Causes of Food Insecurity

The main cause of food insecurity in the District are due to food wastage during funerals, weddings, out-doorings and other festivities, inability to access loan to increase production hence majority of the farmers practice subsistence farming. Other causes are high cost of labour, farm inputs, bush fires, theft,, grazing of farms by animals and erratic rainfall pattern due to bad cultivation practices.

Effect of Food Insecurity 

Parents cannot adequately feed their family. The most affected people in the communities are the aged, physically challenged, children and women. Women have to manage with what is available to take them through the hard period, children and pregnant mothers do not get balance diet (malnutrition) that affect their growth and development.

Also parents cannot pay for medical bills, school fees and other social obligations. The consequences of food insecurity are broken homes, divorce, youth migration to urban centres, school drop outs, child delinquencies and abject poverty leading to poor standard of living of the people.