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10.12.2007 Business & Finance

Government asked to learn from oil producing nations

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Government was on Wednesday urged to learn from oil extracting countries to avoid mistakes they committed during their initial extraction periods.

Mr. Ian Gary, Senior Policy Advisor, Extractive Industries, Oxfam America, who made the appeal at a day's workshop in Accra on "Oil and Gas", said Ghana had a number of countries that it could easily learn from so as to avoid mistakes that would lead to an "Oil Curse".

"The oil find in a number of developing countries led to crises such as civil wars, political instability, increases in corruption, mismanagement, and worsening instances of poverty among the citizens.

"Ghana should avoid all discrepancies, by collaborating and learning from countries such as Nigeria and Angola, so that the right negotiations would be done with the oil companies," Mr. Gary said.

He said Oil Boom often raised the expectations of the people thereby increasing their appetite for spending.

"Foreign debt for such oil countries grows faster meaning those countries mortgage their future based on the oil backed loans," Mr Gary said.

He said the US government was targeting the Gulf of Guinea area for at least 18 percent of its oil supply presently and would soon increase such requirement to 25 per cent with more oil finds in places like Ghana.

Mr Gary urged civil society and the Media to put the government on its toes to be opened in its negotiations to avoid secrecies in the oil industry.

Mr Yaw Opoku, Associate Chief Executive Officer, Centre for Labour Rights and Community Service, urged Parliament to review some aspect of the Minerals and Mining Law, Act 703 of 2006, which he described as "worrisome"

He said the law did allow nationals to be in control of the resources on their land, but rather gave benefits to "outsiders who were not citizens".

According to him, section two of the Act says the government could acquire land for mining, but it could also authorise a mining company to enter that land and mine.

"Because of the word "authorise", many mining companies enter the land and mine without first paying compensation for the land to the disadvantage of the people working on the land.

"This is against the Constitutional provision that guarantees individual's right to property," Mr Opoku said.

He appealed to parliament to review the Act in order to make the individual citizen gain more.