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15.12.2004 Feature Article

Building a “Property-Owning Democracy”

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A Task for Ghana's Re-elected President. Last Tuesday's peaceful elections in Ghana will go down as a success story of one of Africa's passionate believer in the ballot box rather than the barrel of the gun. Ghana is one of the very few on the continent to have held four consecutive incident-free general elections since embracing multi-party democracy in 1992.

Even though four political parties sought the mandate of the electorate, three of them, all in opposition, had a social democratic agenda whilst the incumbent and re-elected, a liberal democratic party, believed it was practicing a “property-owning democracy”. However, campaign messages of all the parties were quite vitriolic even if they were issue centred.

Without taking away the confidence reposed in the current administration, it would appear many Ghanaians were still haunted by the over blown repressive incidents under the previous admistration of the major opposition party. Plus many argued a single tenure in office was too short to undo the 'damage unleashed' in the two decades the major opposition party presided over national affairs.

But what future portends for Ghana under the re-elected government? With a per capita income of a little under US$400, the government's single biggest decision was accessing IMF's Highly Indebted Poor Country Initiative (HIPC). These had brought benefits, many infrastructural, but many of them temporal and sustaining them means reliance on more donor funds. The government looks set to continue with IMF and World Bank policies with fluctuating earnings from its major foreign exchange earners being cocoa and gold. There is particularly, going to be a renewed faith in Ghana's Poverty Reduction Strategy Paper that argues that “the role of government makes considerable case for the government to intervene directly in the economy” and recommends foreign aid and its appendages to 'finance' our poverty. Many will continue to be urged to look up to government for survival. In fact, many do. But running an economy that will absolve the individual from government largesse is the greatest bulwark against poverty.

One of the finest institutions that have the propensity to bolster a country's economy is property rights. Irrespective of the many forms of property over which rights could be exercised, Ghanaians and for that matter Africans were better off in the interim, concentrating on the tangible or material which is land and all physical attachments to it. Thankfully Ghana's re-elected government professes a “property owning democracy”. This is noble as it is an important first step to realizing the potential of a property. However, current land legislation has seen little reform. Thousands of litigations, bureaucracy and corruption are the order of the day. The close to 60,000 land cases in our snail-paced courts are capital representations of “wishes of the dead”. Outstanding value of government compensations on compulsorily acquired lands alone amounts to some US$9 billion, six times the GDP of Ghana.

While alternate dispute resolution mechanisms must be sought in dealing with many of the land cases to establish true titles, people's attitude to property must also change. Many of our illiterate folk erroneously believe property registration is means to tax them so it is difficult to get a standardized property register. Hopefully Ghana's Land Administration Project to create standardized property register would not be swallowed by bureaucracy and cronyism.

Establishing title of property is not only for ownership purposes, but the ability to use it for transactions so that its conception of capital is fully borne. A better way to secure this voluntary exchange is to enforce contractual agreements by an unbiased Judiciary. Most importantly, the government must wage a war against itself by lowering entry barriers to business start-ups and reducing transaction costs in doing business in Ghana. Ghana has been cited in this year's World Bank report as one of the places where businesses regulations are complex and unpredictable.

If there is one thing many Ghanaians praise the current government for, it is its unwavering commitment to free speech. But free speech ought to translate into free enterprise. Unleashing the potential created in property ownership into capital formation, combined with ease of transactions through very minimum taxation, will be helping to deepen the meaning of a property-owning democracy. These combined with decentralized decision-making, the rule of law and an open trade, free of vested interests and artificial barriers will earn Ghana several notches up on the democratic ladder. The government may well try this jigsaw to see if it helps solve the poverty puzzle. Franklin Cudjoe is founder of Imani: The Centre for Humane Education in Ghana Views expressed by the author(s) do not necessarily reflect those of GhanaHomePage.

Franklin Cudjoe
Franklin Cudjoe, © 2004

The author has 118 publications published on Modern Ghana. Column Page: FranklinCudjoe

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