ASSESSING THE LEVEL OF SUSTAINABLE DEVELOPMENT IN THE REGION OF WEST AFRICA THROUGH THE COMPOSITE INDICATOR

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1 ASSESSING THE LEVEL OF SUSTAINABLE DEVELOPMENT IN THE REGION OF WEST AFRICA THROUGH THE COMPOSITE INDICATOR Kateřina Pochobradská Abstract: The aim of the analysis is the creation of composite indicator and its subsequent interpretation for the West African region. Literature research explains the concepts of sustainable development as its pillars. It also describes the characteristics of a general methodology for the construction of a composite indicator. Custom work includes statistical solution of the problem. It refers to the problematic and powerful states in the region. The output consists of graphical and tabular presentation of the results. Keywords: composite indicator, sustainable development, z-scores, aggregation, statistical analysis 1. Introduction The concept of sustainable development is the result of the gradual crystallization, which lies in the fact that the basis for sustainability is based on three pillars. It can be stated that sustainable development is three-dimensional and must meet three criteria are environmental, economic and social (Moldan, 2001). It also means a balance between countries (developed versus developing world), different social groups, present and future, etc. Many countries and communities therefore seek to apply the principles of sustainable development, notably through a variety of strategies (Brundtland, 1991). The sustainability of the environment must be based on the flows of materials and energy in three conditions (Daly, 1991): - intensity of use of renewable resources should not exceed the rate of regeneration, - intensity of use of non-renewable resources should not exceed the rate at which they are developed to their sustainable renewable substitute, - pollution intensity shall not exceed the assimilative capacity of the environment. Sustainability in the economic pillar relates mainly to economic activity in the monitored area, most notably the state. When economic activity is an emphasis on preserving capital which is based on the need to use only produced profits. It can be said that the economic pillar seeks ways to achieve continuous growth in the wealth of society, without being destabilized the economy or was harming the environment. The persistent social sustainability must be a combination of population, capital and technology in society connected so that the standard of living of every individual was adequate and safe. (Jeníček, Foltýn, 2010). The basic goals of sustainable development include quality of life and development of human society. Range of social sustainability can be expressed as social cohesion (UUR, 2010). 55

2 2. Methodology - Construction of the second composite indicator Before we tackle the analysis itself, we will focus on the definition of terms. Hammond et al. (1995), describes as a process indicator summarizing and simplifying information in a manner which promotes understanding of the topic. Sub-indicator evaluates the region in many ways and these are often very controversial, so it is advisable to construct a composite indicator. Creating a composite indicator is becoming increasingly popular, mainly based on the above. The construction of a composite indicator is composed of several stages of decision-making. In each stage there is a subjective decision, which is influenced by all the result of the formation. Due to anchor these activities within the construction of a composite indicator will be briefly sketched the basic steps recommended (Nardo, 2008). For the construction of a composite indicator is a structure defined as follows: 1. Theoretical framework - forms a clear understanding of the reporting problems and possibilities of measurement. It constitutes the basis for the selection of a suitable combination of variables into meaningful summary indicator (Nardo, 2008). 2. Choosing sub-indicators - defining the theoretical framework can proceed to the selection of indicators themselves into the aggregate. The selection of sub - indicators largely affects the strengths and weaknesses of composite indicators. Choice of variables should therefore be established on the basis of their relevance, accuracy, availability and reliability (Nardo, 2008). 3. Missing data - When selecting indicators can be a problem of missing data for a particular unit. To these units may not be excluded from the analysis, it is important to fill in the missing data, using appropriately chosen method (Nardo, 2008). Another way points to the possibility of completing missing data using an algorithm, that is, replace it frequently occurring value or computed value (Minařík, 2013). 4. Multivariate Data Analysis - This preliminary step is useful for evaluating the overall suitability of the data set and subsequently leads to an understanding of methodological options, such as weighting and aggregation, which are the basis for the next phase of the composite indicator. 5. Data normalization - normalization process is carried out mainly due to the possibility to transform the values of the indicators into dimensionless and therefore easily aggregation variables (Minařík, 2013). 6. Determination of weights and aggregation - After the above steps, is another essential phase assigning weights to individual sub- indicators. Scales the selected data set is usually chosen arbitrarily, and the very structure of matter in the whole extent to the author. Scales should ideally be expressed the importance of sub- indicator is a composite indicator (Nardo, 2008). 7. Robustness testing and sensitivity analysis - Jamison, Sandby (2001) describe the analysis of uncertainty as more advanced analysis, which verifies both sources of uncertainty acting on their own final value of the composite indicator. Sensitivity analysis analyzes the contrary, what degree each source of uncertainty contributes to the value of variance and the resulting sequence. 8. Decomposition - Decomposition indicator serves as a starting point for further analysis. Although they were designed as a whole, may be re- distributed to the subindicators analysis to help extend the weaknesses or strengths of individual areas. 9. Reference to other indicators - relevant information on composite indicators allow analysis of relationships with other indicators. The basis for analysis may not only be a composite indicator, but even a simple indicator. 10. Presentation and interpretation of results 56

3 3. Analysis The main objective of this analysis is to create an aggregate measure that will sufficiently accurately reflect the rate of progress in the direction of the country to sustainable development based on generally available data for a selected number of countries that allow comparison of their maturity. According to the African Development Bank Group defined the following 15 countries - Benin, Burkina Faso, Cape Verde, Ivory Coast, Gambia, Ghana, Guinea, Guinea - Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, Togo. Overall, the evaluation included 15 indicators in three areas, which are presented three pillars. The environmental pillar is representing the forest area, the consumption of harmful substances, carbon dioxide emissions, protected areas and access to improved sources of drinking water. The area of forest is one of the indicators that ensures environmental sustainability and in its promotion is possible to prevent the loss of environmental resources and contribute to sustainable development. The second indicator in the environmental pillar is focused on the consumption of ozone depleting substances. Demonstrate the progress made in implementing the commitments in the countries that have ratified the 1987 Montreal Protocol on substances that deplete the ozone layer. Emissions of CO 2 are an indicator that tracks the efforts of developing countries in the process of reducing or increasing CO 2 emissions. Terrestrial and marine protected areas represent an indicator that includes terrestrial protected areas, and marine protected areas in coastal waters (up to 12 nautical miles from the coast). Access to sufficient water is not only a basic need but also a human right. Access to water resources is also significant health and economic benefits for both households and individuals. Constitute essential to the health and eradicating extreme poverty and hunger The economic pillar is represented by foreign direct investment, development aid, total debt service, the gross domestic product (GDP) and the share of employment This pillar refers to economic development, debt and economic efficiency. Gross domestic product expresses the total monetary value of goods and services newly produced in a given period and a given territory. Employment of population 15 + is used to assess the ability of the economy to create jobs and is the best measure of the labour market. Direct foreign investment reflects the intention resident in one economy to acquire a permanent participation in an entity resident in an economy other than the economy of the investor (direct investment). Official development assistance is characterized by the flow of capital or of any government having the form of loans or grants to any country that meets the two criteria. The capital has, from the perspective of donors commercial use. In the case of loans in terms of capital it is provided on concessional terms. The interest rate and repayment period for the loan stock should be granted on more favourable terms than the normal situation (Halaxa, 2003). Total debt service is characterized as the sum of principal repayments and interest actually paid in the currency, goods, or services on long-term debt, interest paid on short-term debt, and repayment (WorldBank, 2014). The social pillar is represented by malnutrition, access to improved sanitation, women's representation in parliament, the number of Internet users and life expectancy. Malnutrition refers not only to health care and health status of the population, but is perceived as a pathological condition caused primarily by a lack of essential nutrients. Representation of women in parliament is an indicator that shows the inequality generates a representation of its position in selected countries. Life expectancy (also life expectancy) expresses the number of years that an average person lived with presumption and provided that all the time her next life will not change the order of 57

4 extinction, observed life table created for that calendar year. Access to improved hygiene equipment as well as access to drinking water is a very important indicator of sustainable development. In the absence of this facility is to infectious diseases that can be fatal. The social pillar is further represented by Internet users who point to the availability of education, to the development or information. 3.1 Basic statistical characteristics Basic numerical analysis, which is carried out in the initial phase of work, was used as a basic date for the calculation of characteristics. Characteristics of the level represents the arithmetic average of variability represents the variance, standard deviation and coefficient of variation. A further characteristic of kurtosis is minimum and maximum. An important step in the comparison and evaluation of indicators is to use the correlation matrix. The correlation coefficient presents the values ranging from -1 to +1. In the case of positive correlation, the values of both variables increase. With a negative correlation, the value of one variable increases and the second decreases. Based on the correlation matrix, was among the indicators CO 2 emissions, gross domestic product and the users of the Internet dependence was found higher than The necessity is therefore to reduce the values of these indicators, given that their weight in relation to other sub- indicators was doubled. 3.2 Normalization of data There are several methods by which we can normalize this, for these analyses were chosen method of standardized variables. Among the best known method of standardization is one method of standardized variables. This converts the values of the indicators to a common scale in a way that transforms dimensional type indicator max dimensionless with zero mean and unit variance and standard deviation of the first type indicator min passes through the following transformation, where the numerator in the formula will change the order of variables. The resulting normalized values are easily aggregated. Due to the linear relationship remains after normalization relative differences between the values retained. (Nardo, 2008) 3.3 Determination of weights and aggregation After the above steps, the next necessary stage assigning weights to individual subindicators. Scales to a selected were chosen arbitrarily. The selected method is based on assigning equal weights to all sub- indicators. In this procedure, each indicator has given equal importance. The advantage lies in the ease of interpretation allows minimizing the impact indicators, which show the necessary concurrence with other sub - indicators and increases the reliability of the target composite indicator. On the basis of the weighted sum of the resulting sequence was determined under the pillars of a composite indicator. 4. Results 4.1 Economic pillar First place in the economic pillar occupies Liberia. Its position is mainly affected by development assistance and foreign direct investment in recent years, helping to stable political system, which has been in previous years, torn by civil war. Liberia is one of the West African countries with the highest proportion of donor assistance (187 USD / person). This donor assistance annually exceeds the Liberian state budget. With the deletion of debt, Liberia is one of the countries with the lowest total debt service in West Africa. Second place is occupied by Cape Verde. They are economically beyond 58

5 the West African standards. It is one of many countries that have the status of middleincome countries. Relatively significant GDP growth points to the political and economic stability of the country despite the fact that the country showed the effects of the European debt crisis. It can be stated that the position of Cape Verde in the economic pillar reflects the ability of the country to diversify its economic ties with Europe. The third position belongs to Burkina Faso a position to maintain the third position despite the fact that its economy suffered significant economic losses depend on the political crisis that caused the looting, destruction of state buildings, investment restrictions, and the disappointing results of agricultural production, which in times of crisis were managed in a timely manner. The state budget, even as most West African countries is dependent on development assistance. Tourist potential is not fully exploited, which is largely due to the infrastructure. On the contrary, the last place ranks group of countries Gambia, Nigeria and Ivory Coast. The untapped tourism potential, badly neglected infrastructure takes this country back on the rails economic pillar. The whole situation is not helped by development aid that is channelled into the country. 4.2 Environmental pillar In this pillar, the first place in Guinea- Bissau. Despite its small area of Guinea - Bissau has extensive natural resources. If we focus on better access to sources of drinking water, the main force responsible for increasing pressure on water resources, economic activity and population growth, which is needed in an effort to minimize conflicts and to harmonize economic and social development. Gambia occupies the second place. We evaluate the Gambia as a country endowed with rich water resources. These water sources provide the potential to sustain life and promote socio- economic development that the country sorely needs. Third place goes to Ghana, which is one of the strongest economies in sub-saharan Africa, due to a number of natural resources. However, use of these resources, along with an overall lack of awareness of the environment leads to the devastation of the country's forests. During the last decade, Ghana has lost about 5 percent of forest cover. As populations grow and continue growing consumption as well as her interest in agriculture or firewood, which has devastating effects on the landscape. At the last place ranks Niger, Togo and Nigeria. Niger faces a high population growth rate and thus creates pressure on the remaining forest areas. Since the nineties, until about 2005, the country lost 35 percent forest cover. Countries suffer from climate change, loss of biodiversity, depletion of resources and lack of ground water. The penultimate place belongs to Togo. The area of forest that used to cover much of the country, is now mainly along river valleys. The causes of forest depletion based on the demand for firewood. The soils are generally poor, requiring intensive fertilization and cultivation, to be productive. Soil and water are therefore vulnerable to pesticides and artificial fertilizers. Nigeria occupies the last place a fifteenth. It has one of the worst environmental indicators from West Africa but also in the world. Earth has undergone several social and environmental problems resulting from oil operations in the Niger River Delta. The question is whether full conservation of these forests, it is necessary to mitigate global climate change and ensure environmental stability in Africa? 4.3 Social pillar First place in this pillar occupy Cape Verde. Despite uneven progress among the islands, which is based on improved infrastructure and tourism differentiated on the poor and wealthier areas of the country ranked at the forefront of social development. In comparison with other countries, Cape Verde ranks above average in relation to other countries of West Africa. The second place is taken by Senegal. The data D malnutrition indicates that the fluctuating nature. Despite this, we can say that malnutrition small 59

6 steps decreases. Access to improved sanitation is closely related to malnutrition, according to the order is the third best in West Africa reaching 51, 4 percent of total populace. Parity sex compared to other West African countries is very favourable. The proportion of seats occupied by women is 2011 was only 22.7 percent of the total number of seats. Thirteenth place went to Liberia. It is in the area of human development ranks in last place. Sierra Leone has the second highest indicator of malnutrition in West Africa. Despite these problems, the life expectancy is relatively high and is 60 years. Based on result in social pillar Ivory Coast occupied fourteen positions among countries. This country is in the area of social development put on the back walls. Improved access to sanitation is allowed 23.9 percent of the population. About this indicator is unwound and the other is malnutrition, which takes in West Africa and the third highest value of 20.2 percent. These negative indicators add life expectancy, which reaches only 50 years old. Sierra Leone was evaluated as the worst position of a country in West Africa and so occupies the fifteenth place. Its social indicators are among the lowest in the world. According to the Human Development Index, Sierra Leone is below the regional average (0.359). Similarly other social indicators are below regional levels, such as life expectancy at birth, which is 45 years. This may explain poor health and poor access to clean water and sanitation CI Rank Economic pillar Rank Tab. Rank in sustainable development and pillars Environmental pillar Rank Social pillar Benin 1,14 7 0,32 6 0,74 5 0,08 6 Burkina Faso 0,80 8 1,62 3 0,49 6-1,31 11 Cape Verde 9,90 1 2,77 2-0, ,22 1 Gambia 2,23 4-1, ,46 2 1,53 3 Ghana 1,59 6 0,06 7 1,08 3 0,45 5 Guinea 0,22 9-1, ,02 4 0,64 4 Guinea-Bissau 2,66 3 0,06 8 3,57 1-0,96 10 Ivory Coast -5, , , ,73 14 Liberia 1,92 5 3,71 1 0,15 9-1,94 13 Mali -2, , , ,44 8 Niger -3, ,64 9-2, ,46 9 Nigeria -5, , , ,11 7 Senegal 3,11 2-1, ,27 8 4,06 2 Sierra Leone -3, ,57 5 0,42 7-4,44 15 Togo -3, ,21 4-2, ,60 12 Rank 4.4 The position of countries within the composite indicator The classification of countries into groups according to the evaluation of sustainable development is largely similar, as in the case of sub- pillars. The first rails occupy Cape Verde, Senegal and Guinea Bissau follow by Gambia, Liberia and Ghana. As we can see from these other countries vary considerably. They have a distinct advantage in all pillars and the likelihood of sustainable development and growth is highest here. Very similar to each other are Benin and Burkina Faso. These countries have a relatively balanced state of individual pillars and can say that towards sustainable development has potential. The last place ranks Niger, Mali, Sierra Leone, Ivory Coast and Nigeria. Despite the fact that the country's potential is not fully exploited, which is to a large extent depend on the economic situation. Clearly the order of results is shown in the table below. 60

7 From left to right: sustainable development economic pillar, environmental pillar, social pillar. Figure 1: Composite indicator 5. Conclusion The aim of this analysis was to create a composite indicator of sustainable development, based on three pillars (economic, environmental and social) for the region of West Africa. Based on 15 selected sub-indicators to assess their sustainability. In the theoretical section summarizes the general methodology for the construction of composite indicator pillars of sustainable development. The analytical part is based on the general methodology, a composite indicator of sustainable development. Selected data was observed, which included the identification of the characteristic properties of the file transfer indicators on the appropriate unit of measurement, evaluation measures of association between variables and missing data. On the basis of this examination was to choose an appropriate method of normalization which selected sample transformed into a dimensionless quantity. In this case, the method chosen standard variable whose characteristic is that it does not eliminate extreme outlier values. At this step follows the weights indicators. Determination of weights significantly affects the overall result of the analysis is a necessary step to approach this with caution. All components are selected in this file set equal importance. The advantage is ease of interpretation and to avoid subsequent courts. Further minimizes the impact indicators and increase the reliability of composite indicators. The resulting sequence was generated for each pillar separately and shown a final order within the composite indicator. Composite indicator points out how different situation and climatic conditions vary greatly by country. Not always the country that shows good results in one sphere must necessarily work well in another. The position of countries has created a composite indicator set descending order, and it is as follows: Cape Verde, Senegal, Guinea - Bissau, Gambia, Liberia, Ghana, Benin, Burkina Faso, Guinea, Mali, Togo, Niger, Sierra Leone, Ivory Coast, Nigeria. 61

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