The impact of microcredit on smallholder livestock production in Wa Municipality: a case of the livestock development project

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Though livestock production is widespread in almost every part of Ghana, its output is just about 8 percent of GDP compared to about 75 percent in many countries particularly the developed nations. It is estimated that US $100 million is used on the import of livestock and livestock products annually in Ghana. In an attempt to close the gap between demand and supply of livestock products in the country, MoFA granted credits to livestock farmers in Wa Municipality under the Livestock Development Project (LDP). Meanwhile, over the years, government microcredit schemes in Ghana suffered high rate of default and seems not to be making the desired impact. This study sets out to describe the nature of operation of the credit component of the LDP; assess how smallholder livestock farmers utilized the credit received; assess the impact of the microcredit on smallholder livestock production; and identify the challenges and constraints confronting smallholder livestock. The ‘after only’ research design was used because there was no base-line studies. Respondents were selected using stratified random sampling, simple random sampling and purposive sampling. Questionnaire and field observation were used to collect data which were analysed using both descriptive and inferential statistics. The findings show that: the credit in cash component of the project suffered a high default rate represented by 53.8 percent of the total amount expected from the recovery; 47.5 percent of the credit in cash beneficiaries diverted the credit either in part or in full from purchasing livestock into other activities; livestock production was constrained by high mortality rate, limited supply of feed, limited veterinary services and the type of livestock breed; and all the research hypotheses were significant at 10 percent significance level. In view of these findings, it was recommended that smallholder livestock farmers should be trained on fodder preparation, veterinary training institutions should be expanded and all veterinarians should be directly employed by Government, monitoring should be extended to cover every aspect of future projects, and demonstration should be carried out in future projects. Generally, the LDP made a positive impact on smallholder livestock production in the Municipality despite some challenges it encountered
A thesis submitted to the School of Graduate Studies, Kwame Nkrumah University of Science and Technology, Kumasi, in partial fulfilment of the requirements for the degree of Master of Science Development Policy and Planning, 2012