Sustainable land use finance for self-reliance in Ghana

This study conducted a comprehensive cost-benefit analysis (CBA) to assess the financial and economic returns of sustainable land-use practices promoted by the USAID-funded SLUF project, evaluating their adoption by farmers and associated benefits. The study focused on maize and soybean cultivation in Ghana's Northern and North East regions, which due in part to their semi-aridity and fragile ecosystems are highly susceptible to ecological and climate change. The CBA combined insights on greenhouse gas (GHG) emissions with socioeconomic data to calculate financial returns for smallholder farmers, investees, and investors. Additionally, the study estimated society-wide economic returns by valuing the GHG impacts of new technologies.

The study drew on primary and secondary data to assess the incremental financial and economic returns from adopting the improved technology packages provided by the investees. The study also considered enhanced tree planting (ETP) and soybean-maize crop rotation (CR) as technology options. Three additional scenarios were analyzed in which assumptions related to technology adoption rates, crop productivity, and climate risk were varied. Costs and benefits under all scenarios were estimated using data from farmer surveys and key informant interviews, estimates of greenhouse gas emissions from models of projected yields under climate change, carbon sequestration estimates from allometric models of tree growth, and secondary data from administrative sources. The study’s key findings suggest that evaluations of agricultural technologies should consider not only their financial implications but also societal benefits and costs, especially their GHG mitigation potential.