Abstract:
Prior to the 1980s, Ghana witnessed an alternating cycle of boom and scarcity, culminating in the introduction of structural adjustment policies in the early 1980s. This paper uses data from the Ghana Forestry Services, Ministry of Food and Agriculture, FAO Yearbook of Forestry Products, Ghana Timber Marketing Board, Quarterly Digest of the Ghana Statistical Service, World Debt Tables, Bank of Ghana, IMF, COCOBOD and Ministry of Finance to examine the impact of SAP on deforestation in Ghana. The paper reveals a negative impact of structural adjustment on deforestation in Ghana through both direct and indirect channels. The most important channel of the effect of SAP on deforestation resulted from the conversion of forestland to crop farming, particularly cocoa farming, during the post-adjustment period. Even though wood extraction exhibited a negative impact on deforestation, the impact seemed relatively weaker than that of agricultural land use. In addition, while in the long run, deforestation tended to be more responsive to logging than agriculture, in the short run the elasticity of deforestation with respect to agriculture tended to be greater than that with respect to logging. Finally, agriculture was relatively more important in causing deforestation.