Micro/District Economy

Economic development is a function of all production activities pursued by people. If the Various economic and production activities prove successful there is spontaneous growth within the economy which stimulates other economic activities. Major economic activities included, Agriculture Industry and Commerce. Most industries in Kwaebibirem District can be classified under small-scale industries, ie. Industries that have a total workforce of up to 30 persons each.

The industrial activities in this district are diversified, ranging from sawmill where high technology equipment are used to handicrafts and other craftworks which are produced using simple tools. Statistics on the exact number of these Industries are sketchy, but can be grouped into the following:

• Micro/Small-Scale Industries
• Small/Medium Scale Manufacturing
• Small-Scale Mining
• Large Scale Processing

Micro/Small-Scale Industries

These are manufacturing activities carried out in or near the home. In this industry. family labour is used with the objective of providing basic needs and augmenting the family income. The production methods are labour intensive, and there is usually no division of labour. Included in this category of industries are palm and kernels oil extraction, cassava processing, handicrafts, and modern craft and basket weaving. Palm oil production and cassava processing are the most organized household industries in the district. 

Some producers have formed co-operatives and some private individuals have acquired extraction plants, and individual oil extractors send their palm fruits and kernels to be extracted for a fee. These industries are located district wide. Most settlements have either cassava processing or palm/kernel oil extracting industry or both. While these industries are boosting the economic wealth of the district, their environmental aspect should be looked at carefully so as to ensure proper disposal of waste.

The locations of these small-scale industries do not conform to the present spatial classification in the district. Most of these industries are located in residential areas and other areas not earmarked for industries, and they produce such nuisances as noise, dust. fumes, and unpleasant odour in the communities where they are located. In addition to the environmental nuisances that these industries generate, they are known to have adverse effect on services such as water and electricity i.e. there is general over load on various energy transformers that feed the various sections of the district. In view of this. light industrial estates are proposed for the urban settlements.

The purpose of these estates, among other is to:

1. Bring about sanity in the use of land in the communities;
2. Bring about efficiency in the use of infrastructure such as electricity and water;
3. Reduce constructional and service costs;
4. Minimize environmental degradation and pollution;
5. Bring about an effective identification and collection of related taxes;
6. Promotes   a  forward   and  backward   linkage   between   various   levels   of  industries; and services
7. Promote/create employment opportunities for the youth who have hitherto been drifting to the cities.

Small/Medium Scale Manufacturing

This category of industries is capital intensive, with each industry employing between 5 and 30 people. These industries use modern production methods and produce both traditional and modern products. The industries in Kwaebibirem district include the following:

• Food processing
• Distilling and blending alcohol
• Sawmill
• Furniture and fixtures

Small-Scale Mining

It is not unexpected to find small-scale mining activities at mining areas of which Kwaebibirem District is of no exception. The activities of these miners have been encourage by the GCD, which allots its already mined plots or fields to some of these small-scale miners to re-mine them through a system known as the "Tributor System". These activities present serious environmental problems, as large tracts of mined areas remain unreclaimed.

Large Scale Processing

The two most eminent large scale processing firms in the district are the Ghana Consolidated Diamonds Limited and the Ghana Oil Palm Development Company for the processing of diamonds and oil palm respectively.

The Ghana Consolidated Diamonds Limited is located at Akwatia about 7km from the district capital, Kade. The Ghana Oil Palm Development Company has about 11,000 hectares. As a result of large volumes of fruits obtained, a number of processing units have been set up in the district. The sizes of these processing units are so small that large amounts of fruits produced are lost.

Source of Income

The main sources of household incomes in the district are from crop farming livestock farming, business/trading, salaries, manufacturing, food processing and remittances. The main source of income of households in the district comes predominantly from farmers.

Expenditure Pattern

The expenditure pattern revealed that households spend as much as 47.8% of their incomes on food. This was followed by expenditure on clothing, which took 6.4%o of household income. Also, households spend 6.4% and 5.9% of their disposable incomes on education and transport respectively. Expenditure on business activity ranked third on household expenditure though only 38.5%) of households were involved in such activity. 

This reveals a strong desire b> a third of the population to increase household income by putting back some money into their business to ensure expansion and subsequent increase in income. Social  events  involving funerals and donations  accounted  for 3.5% of household expenditure.

This shows the increasing concern for societal problems and the need to help. Repayments of credit accounted for 0.7%) of total household expenditure.This could mean a high default in the payment of loans or a severe shortage of credit. Further analysis is needed in this area. The average household expenditure per year is 02,388,554. In the absence of any reliable data on income, as usual, from the  household survey, the expenditure figure will be used as proxy for income.

Savings, Credit

Response from the socio-economic survey as evident reveals that about 73.8% of households do not save. On the use of savings from incomes, 51.7% went into investment in income generating activities. This shows the level of importance households attach to establishing and expanding small/medium scale enterprises. Housing ranked second. This indicates the need of households in maintaining and building houses for both social and economic reasons.

Credit

Analysis of the household expenditure pattern and the use of savings reveal that there are a lot of activities in commerce and housing construction. All these activities involve capital. Demand for credit in the district revolves around 44.6% of households. About 63.7%) of credit was intended to address issues in farming and business expansion.  

Of those who demanded for credit, about 38.6%o did get it principally from formal sources and 53.3%o from friends and relatives. On the inability to obtain credit, the predominant reason was the perceived inability of households to pay back the loan, probably due to low incomes, and lack of collateral for the loan.

Poverty Level

In the district, property ownership by households is seen as an indicator of the standard of living of the people. Results of GLSS 2003 survey indicate that 41.4% of households have a radio/radio cassette whilst 13.6% have sofa set. Though figures are not available from previous surveys, there is indication of a moderate standard of living, if household property is anything to go by. Inequality in the distribution of income is very much evident from the Lorenz curve of the district (figure). 

Though the average annual household income is around 02,388,554 the distribution is very skewed in favour of the rich. About 60% of the districts income is in the hands of the top 20% of the population. Based on the method used by the Ghana Statistical Service for the study of Poverty in Ghana, the poverty lines and hard-core poverty line identified representing two-thirds and one-third of the value of the districts average living standards (per capita income) respectively. These give us 01,592,369 as the poverty line and 0796184 as the hard-core poverty line, defining the very poor. This indicate that about 60%o of the population of the district earn below 01,592,369 per annum. Out of this, about 67% are within the hard core poverty range.

Incidence of Poverty

With the current district population of 196,992 (Projected from 2000 Population Census) and with 60%o of the population earning less than 01,592,369 the population which fall below the poverty line is estimated at 118,195 with the incidence of poverty at 0.60% or 60%.

Markets

Market infrastructure, comprising the physical space, the stores, stalls; storage sheds, delivery bays and access roads form an important component of development of rural economics. Markets have served as the meeting point for producers and consumers giving rise to an exchange of goods and services with its accompanying benefits to the District Assembly in the form of tolls, taxes, licences and permits.

In terms of frequency of trading activity, four types of markets can be identified in the district. These are daily markets where trading takes place every day of the week, and periodic markets where trading takes on selected days of the week, usually twice a week. The periodic markets provide the day-to-day marketing needs of the residents’ whiles the periodic market provides opportunities for sellers and buyers within and outside the district. Traders from as far as Tamale and Takoradi bring in manufactured goods.

In terms of frequency of trading activity, four types of markets can be identified in the district. These are daily markets where trading takes place every day of the week, and periodic markets where trading takes on selected days of the week, usually twice a week. The periodic markets provide the day-to-day marketing needs of the residents’ whiles the periodic market provides opportunities for sellers and buyers within and outside the district. Traders from as far as Tamale and Takoradi bring in manufactured goods.

TABLE 1.15 - MARKETS AND ACTIVITY DAYS

Source: DPCU    2006

Commodity Flows

The development of the district necessitates the exchange of goods between urban areas on one hand and rural areas on the other. There is also the need for the exchange of goods between the district and other districts in the country.

Endogenous Inflows and Outflows

Endogenous inflows and outflows refer to exchange of commodities between markets and settlements located within the district. Commodities ranging from agricultural to manufactured goods flow into and out of the markets. The agricultural produce forms the greater part of the endogenous inflows and outflows. 

This means that agricultural produce is the major commodity of trade between the markets and settlements within the district. These include eggs, grains and cereals, legumes, fruits and vegetables, roots and tubers, oil, fish and meat. Other minor commodities of trade in the district include processed food, hardware/metal products, clothing, footwear, plastics, cosmetics/toiletries, leather products and jewelry.

Exogenous Inflows and Outflows

Exogenous inflows and outflows are commodities that originate from markets outside the district and are transported to the district .and those that flow from the district to areas outside the district. Some of these areas are Tamale, Kumasi, New Abirem, Takoradi, Asamankese and Accra.

The main exogenous inflows are in the manufactured category and include processed food, hardware, and clothing/footwear, cosmetics, plastics, and jewelry and leather products.

Other exogenous inflows are eggs, cereals, legumes, fish and meat. The exogenous outflows are mainly agricultural products like citrus, palm fruits, cocoa, cola, plantain and cassava. The main manufactured goods which forms a small proportion of the exogenous outflows is palm oil.

INDUSTRY

1. Ghana Consolidated Diamonds (GCD)
2. Ghana Oil palm Development Company (GOPDC) 
3. Oil palm research institute 
4. University of Ghana Agric Research Station 
5. Fam sawmills 
6. Nti sawmills 
7. Med mining company
8. Obooma Farms