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26.02.2009 Business & Finance

Ghana's oil can erode democratic accountability

By Masahudu Ankiilu Kunateh - Ghanaian Chronicle

The much anticipated onset of Ghana's oil wealth in 2010 and beyond could erode democratic accountability and institutions in the country.

Already, incipient tensions are on the rise in the Western Region, where fishing communities are concerned about continued access to the ocean's resources and District Assemblies are jockeying for prime positions as the “most affected” area.

The civil society groups also expressed concern that key information was not being disclosed, while important policy discussions would be made behind closed doors.

In addition to this, the promised broad and inclusive process for the development of a fundamental policy and master plan for the oil and gas sector had been more closed than open to the Ghanaian public.

At the launch of the Integrated Social Development Centre (ISODEC) and Oxfam America report, entitled 'Ghana's big test: Oil's challenge to democratic development' in Accra, Mr. Ian Gary, a Senior Policy Advisor on Extractive Industries of Oxfam America, stressed that the needed institutions, regulations, and transparency measures should be in place early enough, to avoid the corrosive and corrupting effects of oil booms seen elsewhere in Africa.

As the Jubilee field is in development process, the government does need to move at deliberative speed to be able to manage this large project.

At the same time, Ghana needs to be careful to control the pace of the development of the petroleum sector to avoid letting commercial developments outstrip the capacity of the government and society as a whole to meet the challenges, Mr. Gary advised.

Ghana should set its own timetable for further development of the petroleum industry. By moving quickly, the country could make mistakes that could decrease its take from the sector and undermine accountable management of the resource.

For instance, the government would need to sequence tasks in developing the laws, regulations and institutions for the sector, rather than negotiating many deals at once. The government could learn from experience and negotiate better deals over time.

Also, allowing for civic participation takes time but will benefit the country in the long run through better policy decisions and greater ownership of these decisions.

On transparency, Mr. Gary called on the government and Ghana National Petroleum Corporation (GNPC) to provide regular publication of all materials on Oil and Gas payments received, as well as making all disclosed information free of charge and available on government Web sites.

The government should enact a moratorium on new exploration licenses to allow Ghana's legal and regulatory framework development process to catch up with the well-known best practices.

This would ensure that the oil wealth benefit the people of Ghana.