If your only exposure to Africa is through the main news media, you probably imagine the continent as being populated with lots of charismatic megafauna (think elephants, giraffes and rhinos) and a few inspirational individuals who managed to climb out of the poverty and war that is rampant across the continent. But what if I told you that income inequality in Ghana was similar to that in the United States?
Gini Coefficient as a Measure of Inequality
The Gini coefficient is a number, between 0 and 100, that measures the distribution of income among individuals in a given country. A score of 0 represents total equality, while 100 represents total inequality. The most recent Gini coefficient for Ghana is 42.8, while the United States’ Gini coefficient is 40.8.
While gross amounts of income in each country are significantly different, so too are the costs of living in each country. As an example, I was able to cook a full meal of burritos with all the fixings for eight people for the equivalent of just more than $10 (if I took out the cost of the cheese, the total cost would fall to about $4). Which is why the Gini coefficient can be a useful tool in comparing the economic situation of various countries.
Economic Growth in Ghana
Things in Ghana have been improving over the last couple of decades. This could be attributed to a lot of the development progress made in Ghana, such as a sustained Gross Domestic Product growth of at least more than 4 percent since 1992, extreme poverty was cut in half by 2015 (achieving one of the Millennium Development Goals), institution of a universal health care scheme and increasing primary school enrollment. There’s also been a growing middle class in Ghana, with an estimated $15 billion spending power in 2010 that was estimated to double by 2020.
However, in addition to wealth growing among the middle class, the elite rich of Ghana have only gotten richer. The Gini coefficient since the establishment of the Fourth Republic (the fourth constitution since independence) has actually risen. There is no national data around unemployment here, and a majority of employment is in the informal economy. This makes the poverty and inequality here more visible than it may be in the US.
My point in exploring this is to challenge the idea of an African country being poor. Many of the issue that those in poverty here in Ghana face are similar to the problems of the poor in the United States. Income inequality is a harsh truth in both of these countries and it is leaving some people behind.