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Ghana Belgium

Ghana Belgium

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A Development Case Study on Ghana and Belgium
A Development Case Study on Ghana and Belgium

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Published by: alexiazj on Apr 04, 2009
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06/16/2009

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Jablonski & Venugopal

What’s Belgium Ghana do?

Issues regarding development: A comparative study of Belgium and Ghana
While some countries enjoy a high level of economic wealth and superior living standards, many others do not have the same level of economic development. To analyze this disparity, two countries will be examined: Belgium, a powerful MEDC in Western Europe with an HDI of 0.946 (13th in the world), and one of the wealthiest LEDCs in Africa, Ghana, which has an HDI of 0.553 (135th in the world) (UNDP, 2008). This case study will evaluate the economic wealth, trade and debt, education, health care, equality and environmental status in both countries.

In general, the GDP reflects the economic wealth of the country. This is evidently true for Belgium, which has a real GDP per capita of $36,500, and for Ghana, where the average inhabitant has a much lower income of $1,400 (CIA, 2008). With more money to spend, Belgians can afford a better quality of life than their Ghanaian counterparts, with the ability to cover all their basic needs such as clothing and shelter, and to indulge in certain luxuries such as world-famous Belgian chocolates. In Ghana, such material amenities are simply unaffordable. Often, adequate shelter is inaccessible, especially for many rural to urban migrants who live in shanty settlements (Levy, 1999). Belgium’s higher GDP and relative economic prosperity is due to several factors, one of them being the diversity of its industries: the production of engineering and metal products, transportation equipment, scientific instruments, and processed food and beverages are only some of its many industries (CIA, 2008). With a diverse economy, it is less vulnerable to the fluctuations in prices on the world market. Despite this diversity, some of Belgium’s industries – particularly heavy industries – are stagnating due to decline in

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demand (Elliot & Pateman, 2006). Ghana, on the other hand, has less diversity in its industries: mining, lumbering, cement and light manufacturing are its main industries (CIA, 2008). Another important factor to consider is the composition of each country’s workforce. Belgium is more industrialized with an urban population: 73 percent of the labor force works in services, 25 percent in industry and only 2 percent in agriculture (CIA, 2008). Ghana’s population is still mostly rural, meaning that its economy is agriculturally based: 56 percent of the workforce is in agriculture, 15 percent is in industry and 29 percent is in services (CIA, 2008). Therefore, Ghana relies on

subsistence farming, which brings in few profits compared to services and industry.

Belgium has few natural resources, so it imports large quantities of primary products and exports secondary (manufactured) products (Elliot & Pateman, 2006). Inversely, resource-rich Ghana exports many raw materials, such as cocoa and gold, and imports manufactured goods and food. Interestingly, 5.2 percent of Ghana’s exports go to Belgium, and 4.7 percent of its imports come from Belgium (CIA, 2008). This

dependence on trade is problematic since both countries’ economies could be negatively affected by international events. Both Belgium and Ghana have serious debt: the former has 86.1 percent of its GDP as public debt, and the latter owes $3.387 billion in external debt (CIA, 2008). Belgium’s debt comes largely from the costs of its generous services. Consequently, the government has imposed high taxes, which has resulted in high rates of tax evasion (Elliot & Pateman, 2006). Ghana is in debt towards the IMF and MEDCs because of previous international loans to finance projects, which in the long term failed to meet expectations (Levy, 1999). Since much of the government’s income goes

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towards paying off the debt, it has less money to spend on services, which has greatly hampered the standards of living of the population. Ghana’s receives about one billion dollars in aid every year, which accounts for 10 percent of its GDP. As helpful as this money has been in reducing debt, it makes Ghana dependent on foreign nations without providing a long-term solution to the economic deficit (BBC, 2006). Belgium provides $1.978 billion in aid to foreign countries every year, which only adds to its economic deficit (CIA, 2008).

Education is a significant factor of economic development; a more thoroughly educated population is able to pursue higher-level employment, and thus to stimulate the economy. With an adult literacy rate of 99 percent, the majority of Belgians are well educated. Ghana’s lower rate of 57.9 percent indicates that a large percentage of its inhabitants do not receive the education necessary to prosper economically (CIA, 2008). The level of education received by the population can be traced back to primary schooling. Elementary schooling is free and mandatory in Belgium and Ghana between the ages of 6 and 12 (Levy, 1999). However, Belgium’s education system is superior to Ghana’s, with better facilities and more qualified teachers, as well as kindergarten education for children aged 3 to 6 (Elliot & Pateman, 2006). The greatest difference in education begins in secondary schools. In Belgium, schooling is paid by the government and mandatory until the age of eighteen. High schools are specialized, so that students can take more courses in the areas in which they show the most proficiency (Elliot & Pateman, 2006). This has the benefit of making students ready for specific careers in the future. In Ghana, high school education is optional and it costs a fee. Since school fees

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are too expensive for some families to afford, about 25% of students drop out of school by the time of high school. Most of these students have no option but to get married early, work on their family’s farm or find low-paying employment (Levy, 1999).

The health status of a country’s population is an indicator of its development: good health care results in a larger and more prosperous workforce. Belgium high life

expectancy at birth of 79.07 years indicates that it has a superior healthcare system to Ghana’s, which has a life expectancy of 59.49 years (CIA, 2008). Belgian’s excellent health care is largely due to its funding of health expenses; in fact, public health insurance for pays 95 percent of all medical bills (Burgan, 2000). In Ghana, much of the health care is primitive, with rural areas having little access to hospitals and physicians (Levy, 1999). The limited access to potable water is a problem; only one third of the rural population has access to safe drinking water, and 89 percent has inadequate sanitation (UNICEF, 2006). The prevalence of infectious diseases such bacterial and protozoal diarrhea, hepatitis A, typhoid fever and malaria is high (CIA, 2008). Furthermore, malnutrition, especially among poor subsistence farmers, is common, with 11 percent of the population being chronically malnourished (PPI, 2007). This is

problematic since much of the working population is lost to disease and hunger, thus reducing the country’s economic output. In Belgium, there is an issue with the aging

population; 17.5 percent of the population is aged 65 and older, which means that the government must expend much of its revenue on supporting the elderly.

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Both countries have a democratic form of government; Belgium is a federal parliamentary democracy under a constitutional monarchy, and Ghana is a constitutional democracy. Both countries have a constitution ensuring equal human and democratic rights (CIA, 2008). This is an indicator of development because equal rights enhance a population’s standards of living and productivity. Despite their constitutional rights, women have a lower status in Ghana than in Belgium. Particularly in rural areas, Ghanaian women are subject to more heavy labor, and women’s education is viewed as less important than men’s education (Levy, 1999). This hampers economic development because fewer women have the opportunities and skills necessary to pursue more advanced employment. In both countries, there is a disparity between the living

standards of the rich and the poor; the Gini index (a measure of the distribution of family income) is 28 in Belgium, and a more severe 39.4 in Ghana (CIA, 2008). These figures imply that both countries might have some level of embezzlement or corruption, and that many inhabitants live in relatively poor conditions.

Developed countries use more resources to sustain their industries and infrastructure. Belgium has high rates of resource consumption compared to Ghana; the former uses 591,000 barrels of oil per day, while the latter uses 47,000 barrels (CIA, 2008). In Belgium every year, the per capita energy consumption rate is 76134.68 kilowatt hours and the average carbon dioxide emission is 13.66 tons per capita. The figures are much smaller in Ghana: the energy consumption rate is 1758.25 kilowatt hours per capita and the average carbon dioxide emission is 0.26 tons per capita (IAEA, 2006). Therefore, Belgians can afford better standards of living because of their resource usage, yet they are

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more wasteful and destructive to the environment than most Ghanaians. The Belgian environment has been damaged by air and water pollution, past deforestation and intense urbanization (CIA, 2008). Environmental destruction can be harmful to development for future generations. Thus, the government is undertaking measures to limit its

environmental impact, such as extensive recycling programs and eco taxes on appliances. Belgium is highly dependent on nuclear power, which does not emit carbon dioxide but is dangerous and produces toxic nuclear waste. In order to reduce environmental risks, the government has agreed to stop using nuclear power by 2025, and has started to depend more on renewable energy sources such as solar and wind power (Elliot & Pateman, 2006). Ghana has its own environmental problems; the rainforest is disappearing at a rapid rate due to clear cutting for subsistence farming. This has led to other problems, such as droughts, soil erosion and bushfires. In response, the government has set up more national parks, reduced lumber exports and initiated forest replanting projects (Butler, 2006).

It is evident that both Belgium and Ghana have weaknesses and strengths in terms of level of economic development. Although quite different, they even share some similar concerns. In the future, their ability to resolve their problems and to expand on their positive features will determine how much they will develop.

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