Spatial Integration, Adjustment, and Structural Transformation in Sub-Saharan Africa: Some Linkage Pattern Changes in Ghana

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Abstract

In 1983, Ghana embarked on a program of structural adjustment under the auspices of the World Bank and the International Monetary Fund, to resuscitate the economy and to foster development. This paper utilizes the Lagos Plan of Action, a comprehensive, continent-wide effort and African-led policy strategy for the economic development of the African continent, to examine the contribution of adjustment to the development of an integrated economy in Ghana. Adjustment is examined as a form of structural transformation, as evidenced by the emergent intranational (intra- and inter-sectoral) and international linkages in the formal wood processing industry, a key sector with tremendous potential for such linkages. Intranationally, this study shows that, as in the pre-adjustment years, inter-sectoral linkages, although important, were not dynamic enough to play a significantly galvanizing role in the nation's economic development. However, intra-sectorally, a dramatic expansion in lumber exports led to an unprecedented constriction in the traditional forward linkage between sawmills and downstream processors. This forced the latter to depend on the informal sector for inputs. Internationally, Ghanaian firms operated as subcontractors of convenience for firms overseas (particularly in Europe) via an expanded forward linkage, reflecting a new “colonial relationship” under the program.

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