Enhancing Business Opportunities in a limited Resource Rural Economy: A case study of Northern Ghana

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Enhancing Business Opportunities
in a limited Resource Rural EconomyA case
study of Northern Ghana.John Bosco
AzigweDipM ACIM UKMSc Marketingjozigwe_at_yahoo.c
o.ukHead of MarketingBolga PolytechnicJuly
2005
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Northern Ghana
Northern Ghana

• Upper East
• Bolgatanga

• Upper West
• Wa

• Northern region
• Tamale

Study Area
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In this Presentation

• Introduction
• Purpose and Objectives
• Background of northern Ghana
• Methods
• Findings
• Conclusions

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IntroductionGhana is one of the more advanced
in Sub-Saharan Africa with a per capita income of
US290 (2002) But she is still a low-income
country dogged by problems of food
insecurity.Not withstanding that Ghana
produced the first developmental plan between
1919-1926 in the Guggisberg era (Vordzorgbe
2000) IntroductionGhana is one of the more
advanced in Sub-Saharan Africa with a per capita
income of US290 (2002) But she is still a
low-income country dogged by problems of food
insecurity.Not withstanding that Ghana
produced the first developmental plan between
1919-1926 in the Guggisberg era (Vordzorgbe
2000)

• Introduction
• Ghanas Development history has been chequered.
• At independence at par with the south east
  Asians.
• But by 2002per capita income of US290 as
  compared to South Korea, Malaysia US 7000.
• Classified as Africas star economic performer by
  the World Bank, IMF and other donor countries
  (Gyan-Baffour 2002)
• Ghana produced its first developmental plan
  between 1919-1926 in the Guggisberg
• era (Vordzorgbe 2000)

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• After independence in 1957
• Many other developmental plans, what results?
• The Medium term developmental plan (1964-1970)
• The Economic Recovery Program (1982-1992)
• Structural Adjustment Programs (1992)
• The Ghana Poverty Reduction Strategy (1995)
• Highly Indebted Poor Country (HIPC) (2001)

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2001 to the present

• There has been efforts to grow the private
  sector under the golden age of business
  initiatives
• Ministry for private sector development
• Economic reforms to enable entrepreneurship
• Removal of price controls and taxes
• Reduced inflation
• Reduced interest rates

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What Impact?

• still a low-income country dogged by problems of
  food insecurity.
• The poverty situation is crippling in the north
• the three northern regions have rather
  experienced a decline in living standards in the
  past decade.(Africa Region Working Paper 2003).

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A new approach?The Ghana Poverty Reduction
Strategy

• The GPRS 2004-2008 seeks to improve
• Agriculture for food security
• Private sector development
• Human Resources Development
• Infrastructure
• Tourism as a foreign exchange earner

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The Poverty levels are still high

• No major economic activity half of the year
• poverty levels highest in the country
• 88 Upper East
• 84 Upper West
• 69 Northern
• (IFAD (2003).

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• Objectives
• Contribute to enhancing business opportunities
  in tourism for poverty reduction
• Identifying shortfalls in the business
  environment
• Understanding entrepreneurial skills gaps
• Prioritizing needs (Start up capital and skill
  development-which first?)

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Background of the North

• Northern region-Tamale
• Upper East-Bolgatanga
• Upper West Region-Wa

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• Poor rainfall
• located in the Guinea Savannah
• agro ecological zone
• with a monomodal rainy season
• annual rainfall 900 and 1100 mm April-September
  (Tsigbey et al, 2002)
• Half year (oct-May) no activity

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The Result of poverty

• A labour reserve and a source of under-valued
  agricultural commodities to southern Ghana
  (Kasanga 1995).
• Migration of youth including mostly young women
  to the big cities the Kayaye syndrome
• Gyan-Baffour (2002) estimates as many as 10,000
  youth
• High incidence of disease

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So Reduce poverty though Tourism Tourist
attractions in the Northern Ghana can be
developed to bring about the much needed jobs.
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Research methods

• Qualitative methods
• In-depth interviews
• Focus group discussions
• Case studies
• I5 entrepreneurs from the small hotel and
  restaurant sector

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The Area and sample

• fifteen best performers- small hotel and
  restaurant sector
• Owners
• Tamale is representative of northern Ghana
  because it is the most developed
• Regional and international commercial
  significance with an airport

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Findings (a) Shortfalls in Business Environment

• The PESTLE/C Model
• Political - Numerous chieftaincy
  conflicts
• Economic - Lack of start up capital,
  high cost of borrowing, illiteracy
• Social - Cultural believes, the
  extended family systems
• Technology - Bad roads, inadequate
  telecommunications facilities
• Legal - Land litigations, Government and
  district level laws are not understood
• Environment - Land degradation
• Competition - Lack of innovation
  leading to duplication of products

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Findings (b) Skill gaps

• Inadequate management skills
• Recruiting, organizing, motivating
  monitoring and evaluation
• Inadequate marketing skills
• New product Development, customer care and
  retention and care
• Financial management
• Record keeping, PL accounting, bank
  reconciliation

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Findings (c ) Start up capital and skill
development-which first?)

• Consensus
• Whiles inadequate funding facilities hampers
  entrepreneurial growth skill development should
  precede the business start up process.
• Funding packages should include a component for
  skill development at both management and worker
  levels.

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Recommendations and conclusions

• There are potentials in tourism in the north
• Government should work with stakeholders to
  provide the necessary infrastructure for tourism
  development in the north.
• The traditional approach to micro finance where
  money was considered as most critical has won
  thin.
• Business development should therefore start from
  the strengthening of entrepreneurial
  capabilities in financial, technical, managerial
  and marketing skills.
• In so doing poverty may be reduced in northern
  Ghana.