[Foundation News] Emerging Opportunities And The Amber Warning Light

Message of F L B to THE MFANTSIPIM FOUNDATION
Central Hall, London, 15 November 2009

The ‘Development Business’ continues to grow; and the volume of material on policy analysis goes on expanding. From 1960, which the international community rightly christened the Africa year because colonialism was beginning to give way to independence, there was a flood of advice into sub-Saharan Africa. By 2007, the flood was turning into a deluge. 

 

The over-riding issue as we move into the second decade of the new century is how to distinguish ‘good’ from ‘bad’ advice and present it in a form that will help decision-makers to do the right thing by their countries.  The task involved requires the presence, in key national strategic places, citizens in sufficient numbers who are not only clear-headed and well-informed about prevailing contending policy advisory directions but are also in touch with external sources of new knowledge in their fields of competence and are thereby equipped to create, out of external as well as internal information, new knowledge for the development of their changing environment.  Below are examples of the kind of advice we should be looking for.

 

In 1961, African Ministers of Education met in Conference for the first time at Addis Ababa. Ghana’s Minister of Education, Dowuona Hammond, was the President of the Conference. Under his able guidance, the Ministers produced the far-seeing Addis Ababa Plan. Hopes were high; but there was enough realism for the Conference to underline the following invaluable thought:

 

 

“More than money is required to give a less-developed country a firm start.  Also required are certain conditions in the aided nation.  These include careful planning and clearly defined goals, a strong commitment of local resources to the pursuit of these goals, determination by the government and people alike to get on with the job and, most important of all, a concurrent commitment to the promotion of social justice. 

 

Given these conditions, the possibility of external assistance contributing successfully to economic and social development is good; without them it is non-existent.” [UNESCO Final Report - Conference of African Ministers of Education, Addis Ababa, 15-25/5/1961, p. 19, para. 33].

 

 

In those early sixties, Lee Kuan Yew of Singapore set out to win friends in Africa for his part of the world. After seeing Conakry in Guinea and Accra in Ghana and meeting leaders “who talked in socialist terms of the distribution of wealth” he came to the conclusion that those leaders were preparing themselves to lead their countries into poverty. [The Singapore Story, Times editions, p. 532].  He was subsequently proved right. 

 

In 1996, the Dutch Economist, Albert Winsemius, who has earned alongside Lee Kuan Yew the credential of being the Founding Father of Singapore, said: “it is senseless to launch an economic development programme in a country which lacks political stability and does not have a government that sticks to that programme in the knowledge that, one day, it will be recognized and rewarded by the voters.”  [Tamboer K, 1996, Albert Winsemius: Founding Father of Singapore, International Institute for Asian Studies (IIAS), IIASN-9, Summer]

 

We in Ghana were left in 1957 with £400 million pounds with which to build a new nation. We were not too successful in using that windfall wisely, as President J J Rawlings indicated forty years on in 1993. He said: “How we can readjust the structure of our economic relations with the so-called Western or industrialised countries, quite frankly, is something that eludes us all the time.” [Interview on the programme “Out of Africa” with Zaina Badawi of Channel 4 in the United Kingdom]

 

The inability to grasp opportunities that such words portray is a crucial issue for debate at the national level. If Ghana continues to be unable to marshal fully its intellectual resources – the only real asset any country ever has – to serve its own interest, the prospects offered by the future will go un-harvested.

 

“Development Decades” have come and gone. The dimensions of policy advisory direction and policy development in general, and policy for industrial development in Developing Countries in particular, have changed. The volume of policy analysis has greatly expanded, as have the number and variety of organisations (and institutions) offering differing qualities of policy advisory services for development.  In sharp contrast to these changes, the ‘policy space’ - broadly speaking, the freedom at hand for generating policy options, setting economic policies and calibrating them in the national interest - has become increasingly restricted.  Moreover, several countries in sub-Saharan Africa, which have been blessed with rich natural resurces, have found their wealth to be a “curse” rather than a blessing; they have indeed led to adverse effects on growth and development.

 

GHANA has discovered oil offshore. I appeal to you, Ghanaian  national in the Diaspora, to work to avoid the “paradox of plenty”, the “resource curse” or the “oil curse.” I exhort you to mount a robust evaluation of the current state of preparedness to manage petroleum revenues efficiently and to join in a national effort to guarantee that Ghana benefits from its petroleum resources.

 

Strong incorrupt institutions are the key factor for development and growth along not only with diversification of the economy and robust regulation and laws but also an increasing number of men and women who prize honour and integrity above the external advantages of rank and wealth. Ghana has taken steps in the right direction to learn and adopt good practices in petroleum management.  However, the structuring of the oil sector, together with major investments in the institutional infrastructure and human capital ‘we need for the building of our democracy and the physical infrastructure necessary for growth’ [Joseph Stiglitz: Making Globalization Work, Penguin Books, 2007, p. 40] have yet to become a top priority of the government.  If Ghana is to avoid the fate of its African oil-producing neighbours, strong leadership with clear commitment to long-term development is crucial for creating economic growth and welfare based on its petroleum resource sector.

 

In 2007, President John Kufuor announced the discovery of about 600 million barrels of light crude oil offshore. Champagne bottles popped. He also made the following statements: “Even without oil, we are doing so well. With oil as a shot in the arm, we’re going to fly; we’re going to really zoom, accelerate, and if everything works, which I pray will happen positively, you come back in five years, and you’ll see that Ghana truly is the African tiger, in economic terms of development.” [BBC News: Ghana will be an African Tiger.] When countered with the history and mismanagement of oil revenues of other African oil producers, the President dismissed this possibility since it was not in the destiny of Ghana to be victim of the “resource curse”.

 

The Oxford English dictionary defines a tiger as a large carnivorous animal, widely distributed in Asia, and proverbial for its ferocity and cunning. With that definition in mind and the facts on the ground in sub-Saharan Africa flashing a warning amber light ahead, I am frightened. I therefore ask you, members of the Mfantsipim Foundation, to co-operate with as many Ghanaians in the Diaspora in this part of the world as possible to direct energy towards ensuring:

 

(a) that the ex-President’s words do not literally become prophetic;
(b) that the figurative import of his words, signifying vigour, persistent and unyielding effort and sober optimism, grows to characterize Ghanaian political thought and national action; 
(c) that well-articulated policies are put in place to be followed by action that is continuously guided by a concern that the institutional infrastructure of the ways and means by which the country’s leadership makes decisions and promotes action are rooted in:

 

i) whatsoever things are true,
ii) whatsoever things are honest,
iii) whatsoever things are just,
iv) whatsoever things are pure,
v) whatsoever things are lovely, and
vi) whatsoever things are of good report,

 

which must themselves stand the test of virtue and praiseworthiness [Philippians IV, 8] and

 

(d)  that the cost to Ghana of wasted opportunity that has led to decline over the years is not forgotten.

 

 

In practical terms, we will do well, first, to embark on a national campaign of self-education to put at the centre-stage of political thought a growing awareness of the conditions that lead to internal decline, such as

I

(a) increased consumption,
(b) decreased savings,
(c) resistance to taxation,
(d) inequality, 
(e) corruption,
(f) mounting debt and
(g) finance that becomes more dominant in the economy than industry [Charles

 

Kindleberger, Cited in the Financial Times 12 November 2009 p.9: Analysis, “Decline but no Fall” by John Plender] and, secondly, resolve - and act accordingly - to make certain that whatever the mistakes of the past, we will do our utmost to save Ghana from being dragged once again into any of these categories - with or without oil.

 

 

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