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12.01.2006 Feature Article

Mojo Odyssey: Costly Presidential Mistakes

Mojo Odyssey: Costly Presidential Mistakes
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The story of Ghana is the all-too-familiar narrative of seemingly good intentions gone awry. Today, one of the more pertinent questions that dwell in the minds of all Ghanaians is, "Where did it all go wrong", or "how did today's desperate circumstances come to pass?” Ghana's history is a dismal one, and there are many who would rather not hear it, for they fear blame, or believe this history to be irrelevant. “Ghana is already a lost cause. What good is it," some might wonder, "to talk about the past, when tomorrow is uncertain, and times are hard today?" In this case, because the success of any policy is measured! by how it is implemented and its effect, our attention will turn to those actions by Ghana's leaders that have compromised even the best of intentions, giving these leaders the benefit of doubt that their intentions were, in fact, good.

The Divorce between NDC and Dr Obed Asamoah, finalized January 5 2006, though tantalizing, will not feature, or be the focus of this piece.

Our suspicious nature is so well embedded in our body politic that we tend to ignore genuine attempts by compatriots who draw attention to the mistakes of our rulers. Furthermore, we typically tend to ascribe ill-motives as the rationale for such attempts. However, when foreigners speak, it becomes a different matter. It appears their foreignness imbues them with the appearance of truth, and we tend to listen more than we condemn in those circumstances.

With that in mind, perhaps it is proper at the outset of this piece to refer to World Bank Country Director, Mr. Mat Karlsson's advice on "human gold", (Ghana's potent human capital), and Agriculture as one of the avenues for the alleviation of poverty, as the greatest gift one man can give a whole nation. Ayekoo, Mr. Karlsson!

The CULTURE OF INTOLERANCE to criticism for the erring ways of current leaders by their rabid supporters is amazing. Sorry to disappoint them this time: They would have to vent their spleen on a non-Ghanaian who dissect! s their kingpin's foibles. It would be a surprise if they actually do not pour invectives on folks who bring Karlsson's message to them! Mr. Kufuor has till 2008 to undo the serious damage he has done to his own reputation and for disappointing Ghanaians.

Thayer Watkins of Silicon Valley USA looked into Kwame Nkrumah's closet and aired out some 'dirty laundry'. Edgar Cooke, an economist, peeked at Jerry John Rawlings umbrella and got wet on a dry day, and Mat Karlsson, World Bank Country Director, like a Zoo Keeper, raised the elephant's tail and got splashed with an unpleasant mess.

Our task here is simple. We intend to observe what! these people saw and follow up with our own random thoughts. We will peek into 'hidden boxes' of our prominent leaders opened by Thayer Watkins, Edgar Cooke and Mats Karlsson to see whether we agree with their conclusions. We keep mulling why Ghana has fallen behind other nations who won independence just around the same time as Ghana's? Has it not been easy to blame military coups as cause for our economic instability? Has it not been easy to blame the Colonialist, the white man and Dear God, for our seeming perpetual state of poverty? Has it not been difficult for us to be honest about disastrous decisions fostered on us as a nation by people we entrusted our destinies with? Analyzing the errant ways of our leaders that caused significant mistakes and seeing what could have been done differently, would help future leaders make better choices.

We will focus on some of the failings of those three past and present leaders who have been Presidents of Ghana for five or more years. Measure their failure by each drop of fresh water from the Volta and other rivers that flow wastefully through un-irrigated arable lands into the Atlantic Ocean. Measure their success by how they have dealt with or attempted to deal with, resources and opportunities to turn the Accra Plains/Afram Plains into the bread basket of Africa…..before PRAISE or CONDEMNATION!

3 past and present leaders who have been Presidents of Ghana for 5 or more years fea! ture in our discussion on some of their failings. Some random thoughts: Measure their failure by each drop of fresh water from the Volta and other rivers that flow wastefully through un-irrigated arable lands into the Atlantic Ocean. Measure their success by how they have dealt with or attempted to deal with, resources and opportunities to turn the Accra Plains, Afram Plains into the bread basket of Africa…..before PRAISE or CONDEMNATION!


Thayer Watkins' essay, faulted Kwame Nkrumah for the following economic fumbles:

"A sugar plant at Asuts! uare was built without a water system and remained idle for a year before this flaw was corrected. A tomato and mango canning plant was built at Wenchi with a capacity to process 5,000 tons of tomatoes and 7,000 tons of mangoes each year. After it was built at a cost 80 percent above budget and ready to begin operations the authorities discovered there were hardly any mango trees in the area of the plant and it would take seven years for newly planted mango trees to start bearing.

There was to be a cattle hide-leather-shoe complex. The slaughter house was sited in the Upper Region at Bolgatanga, a not unreasonable decision since the north is the cattle-raising area of Ghana. However the markets for cattle in pre-Nkrumah times were not in the north, probably for good reason.

A tannery for turning the hides into leather was sited in the south at Aveyime. The plant in the north could not supply enough hides so the tannery had to import hides. The leather to be produced at Aveyime was to go to a footwear factory in Kumasi. After the excessive transporting of the raw materials and final product around the country the Ghanaian consumers were not willing to buy because they turned up to be shoddy products."

Dear Nkrumahists, can you Defend NKRUMAH? Was Nkrumah sabotaged by the West who disliked his romance with the Eastern Bloc? The little I can say for the great African Pioneer is this: His main goal was f! or Africa to Unite. His mantra was 'Seek ye first the political kingdom and all other things shall be added". Our Ghanaian tradition is to be capable of taking responsibility for a household before you set one up. Did we need to be economically viable with our 'economic kingdom' before setting up our 'political Kingdom'? Or, should it be the other way round? The chicken and the egg, which comes first? In setting up all these factories, Nkrumah might have wanted to get people to work, place Ghana one step ahead of other newly emerging independent states, and bring in raw materials from other African States to the extent Ghana could not produce them herself. Mangoes abound in Sierra Leone and The Gambia, Cows spread across Mali, Burkina Faso etc. When Valco was set up, Kaiser transported aluminum ingots from Tema! to Jamaica where they had their plant. Why couldn't Nkrumah transport raw materials from other countries into Wenchi to foster inter-African Trade?

One troubling note on the tannery: Did Nkrumah factor in the Ghanaian palatal love for "Wele" (burnt cow skin) in Okro stew? "Wele" Cow Skin, not'gracing' the cooking pot that contains pea-nut butter soup is certainly an object of traditional artifacts, which at times cause war between tribes! So which other cow-skin was Nkrumah counting on to feed a shoe factory? Probably, from outside the shores of Ghana! Nkrumah ought to have ensured he had trade agreements with other nations to feed those factories with raw materials, if Ghana herself could not.


"TO WHOM MUCH IS GIVEN, MUCH IS EXPECTED" says the Good Book. Between 2001 and present, Ghana, under John Kufuor, has received a significant amount of money from international sources, with not much to show for it. In real dollar terms, Kufuor has received from "development partner's inflows from more than $600 million in 2002 and projected to! hit $1.2 billion by the end of next year", according to the World Bank Country Director, Mr. Mats Karlsson. The World Bank says John Kufuor has no reason to complain about economic difficulties because Ghana has all the resources for accelerated development at its disposal. "I think we are at a stage where there are no excuses for Ghana. You've got your debt relief, you've got HIPC and you've got a double of development partner inflows over the past three years."

The hydra-headed nation-killer, CORRUPTION and INEFFICIENCY, have been identified as the causes of Kufuor's economic distress. "It is part of the corruption issue and I don't want to mince words on this: ! it is still a real issue," Mr. Karlsson laments. This leaves Mr. Kufuor with mud on his face in rejecting charges that there is corruption in his administration. He has at his disposal, the awesome machinery of state investigatory powers, the Police CID, SFO, BNI, CHRAG, and yet he wants ordinary folks to investigate myriad cases on corruption and present him with dossiers.

The question of Kufuor's inefficiency relates "to whether the projects for which development partner's monies were being released were actually being seen on the ground". "If every school is supposed to have a set of textbooks, go to the schools and check whether they have the textbooks. What could be the answer?" intones Mat Karlsson. Karlsson says the same questions could go for the other sectors such as roads, health and agriculture, adding that even when the investments had been well impleme! nted, "Are they being maintained and managed?"

As Ghanaians, we have the right to ask the President why he ignores local Ghanaian entrepreneurs in favor of chasing around for various loans and grants. While these might be important, the President has shown that he does not have faith in Ghana's most precious resource- her people. More than gold, more than cocoa, it is the people of Ghana themselves who contain the hope for the future, and their abandonment in favor of short-term gas deals and like is deplorable. Clive Crook, the former deputy editor of the Economist writes:

"A! fter the debt myth comes the myth of the missing (especially African) entrepreneur. The idea that the Third World lacks the spirit of enterprise is laughable. Peasant farmers who switch to another crop in response to a change in their government's marketing arrangements are entrepreneurs. So are the unregistered taxi and minibus operators who keep most Third World cities moving. So are street vendors, perambulating water vendors, money changers, and informal credit brokers. So are the growers of illegal crops such as coca, who in many countries are denied the opportunity of making a decent living by legal means. So are the smugglers of just about anything that do such a roaring trade across Africa's borders, profiting from the massive price distortions that government policies create."

"Entrepreneurship admittedly is partly a matter of skills—in choice of technique, in management, in finance, in the ability to read the label on a bag of fertilizer. Skills have to be learned, and in many developing countries they are in short supply. But this supply is not fixed. The success of the green revolution in India and elsewhere shows that farmers are willing to learn new skills when they can see an advantage in doing so. (The green revolution involved the introduction of high-yielding crop varieties that required different methods and more sophisticated inputs such as fertilizer and an assured water supply.)"

Karlsson observes that development partners could not go beyond making financial ! resources available since the responsibility of strategizing, implementing and monitoring were functions of the country receiving the funds; else the bank and other development partners would be seen as stepping beyond bounds. Clive Crook also concurs on this point, arguing, "There is no lack of entrepreneurship in the Third World. To release this huge potential, governments first need to do much less. Above all, they must stop trying to micromanage the process of industrialization, whether through trade policy, industrial licensing, or direct control of state-owned enterprises. But they also need to do more. They must strive to keep public borrowing and inflation in check, while investing adequately in physical and nonphysical infrastructure."

Meanwhile, over in the land of "who are you fooling", the NPP administration released the premature 20! 06 budget, the so-called "Budget of Hope". This budget, in all truth, is a sham. It lacks innovation, and one essential aspect, namely, the truth. For instance, the 2006 budget reports, "In 2006, the total resource envelope [revenue] for the budget is projected at ¢38,972.8 billion", an approximately ¢3 billion increase from the 2005 figure of ¢35,672.5 billion. However, this same budget notes, "An amount of ¢38,972.8 billion, is programmed for total payments (expenditure) in 2006", also an approximately ¢3 billion increase from the 2005 figure of ¢35,672.5 billion. This leads to a giant misleading in the minister's line of thinking. If expenditures are going to stay the same, while revenues might either stay the same or even decline, (because of the decision not to change the level of taxation), how will the government finance the growing deficit? Unless foreign investors step up more significantly than they have in the past ten years, it is clear the government ! is planning on deficit financing i.e. printing money. This would be fine in the 2006 fantasy budget except for the fact that excessive growth in the money supply (by printing money) erodes a currency's value. That is called inflation. And yet, at the same time, the government claims that inflation will decrease in 2006. The economy doesn't work like that. The budget is a sham, and it is a shame.

Dear Kukrudu Kufuorites, can you defend KUFUOR? Tell us what he WILL do as a lame duck president to remove the doubts of the voters and World Bank Country Director. Kufuor has till 2008 to make history and Kufuorites should not insult Mr. Mat Karlsson, for, "Methinks, He Doth Speaketh Truth"!

The overarching problem is that Ghanaians are electing leaders who are either unable or unwilling to lead. And when they do show initiative, it is often of the wrong sort, or the case of too little, too late. In order to win elections, Ghana's politicians are unwilling to rock the boat and do the right, but politically unpopular thing. To some extent, the Ghanaian public also shares some of the blame, because they expect things to get better without a great deal of sacrifice, and elect the politician who promises the most. But, in essence, the arrow of causality points at Ghana's politicians, who cannot exercise themselves to tackle the major problems that afflict the nation. These people present themselves as false prophets who will solve all of Ghana's pro! blems within 100 days. Yet, they are content to attend piece-meal inaugurations, travel to foreign conferences, and the like. In all seriousness, what is Kufuor doing about corruption, and land reform, two very serious aspects of economic development?

Take for example, the street vendors and market women who trade in violation of the Accra Metropolitan Assembly (AMA). They are always being removed from their trading spots, and yet they always come back. It's all a giant charade, and in truth, it is not really the fault of these traders. The fault, and the root of the problem, lies in the enforcement of laws of the land. This rigmarole also essentially is about property rights– the right to earn a living, and the right of the public to an unencumbered public space. However, it is not enough to clamor for ! the protection of property rights; we need to hold our governments responsible for making laws that accommodate everyone and laws that make the formal market place easily accessible to all people. The informal or "black" market is not the problem; it is the symptom of the problem. And the problem is that Ghana has laws that are not enforced, and that few respect, including those that made them in the first place. So the AMA keeps removing these traders, and they keep coming back. And this will continue because you can't destroy these practices by demolishing infrastructure, they are nurtured in the very mind of all Ghanaians.


Edgar Cooke, an Economist, dissects JJ Rawlings' administration thus: "The Financial Sector had its fair share of scandals and bank closures. The Bank for Housing and Construction was liquidated. Ghana Cooperative Bank and Meridian BIAO (1) were likewise liquidated. National Investment Bank had cases of embezzlement to the tune of millions of Cedis. One such case reported in the press had the Accountant and a Deputy Managing Director dismissed.

A scandal in January 1997 at Ghana Commercial Bank (GCB) involved the Managing Director of A-Life supermarket chain, who owns 4% of GCB, and put to test and raised suspicions about the Bank of Ghan! a's regulatory capacity. The scandal involved the use of a generous overdraft facility and cheque cashing privileges to cash over 75 billion Cedis of GCB and two other banks.

Interest rates were high. These high interest rates were attributed to excessive government borrowing from the public. These rates fell from their 1990 high in 1991 but started climbing again in 1994 peaking at an all time high in 1997. In 2000, the prime rate stood at 45%, 91 day Treasury bill rates was 42.72% and that of the 182 day Treasury Bills and 1 year notes were 37.70% and 42.80% respectively.…… manufacturing and domestic trade, used up 47% of the total loans and advances (excluding cocoa marketing). Since 2001, the Manufacturing Sector's share has decreased from 31% to 25% while that of domestic trade has increased from 11% to 23%. The falling share of the manufacturing sector! is of great concern and which is amplified in the performance of the industry sector in GDP. The increased lending to domestic trade and its unproductiveness affected the industrial sector. The BOG failed to mop up excess liquidity in the system. Currency outside the banks increased from its 1990 figure of 20% to 41% in 2001."

Dear Akatamansonians, can you defend RAWLINGS? Perhaps in his "dotage" , Rawlings gave free pass to Yaw Osafo Maafo, the current NPP Minister who allegedly has Presidential aspirations, and who, as the Managing Director of Bank for housing and Construction, oversaw its collapse, all prior to wading into politics. It is unfathomable to think that in the early days of the Revolution, an A Life executive would dream of abusing banking privileges when Rawlings' own mentor Rear Admiral Amedume had been executed for borrowing 50, 000 Cedis from! a bank! Where had the Eagle flown to, when greedy businessmen and corrupt public officers like the Mamponghene's wife splashed egg on Rawlings' face? Rawlings, the Civilian President was not the same Rawlings, the Revolution Chairman. Thieves and vagabonds do now as they please, to the detriment of Ghana.

Rawlings is not faulted for adapting to the universal truth: 'For a country to develop it has to industrialize.' Rawlings defenders can point to the fact that he resuscitated the manufacturing sector, which was the largest user of loans and advances, followed closely by domestic trade. Rawlings defenders can surely attest to the fact that there was an increase in manufacturing during his administration from 1990 to 2001 e.g., Aluminum Factory Products, Toilet Rolls, Paper Products, Chocolate ! Products, Textile Products etc.

Mojo Odyssey pondering what might have been for Ghana. Views expressed by the author(s) do not necessarily reflect those of GhanaHomePage.

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