Talking Drums

The West African News Magazine

The political economy of Ghana

Ebenezer Mireku

Ebenezer Mireku, a regular contributor to this magazine from Switzerland adds his voice to the debate on return to constitutional rule with this piece which tackles the issuesfrom the economic angle.

The Economic Situation:

The Secretary for Finance and Economic Planning, Dr Kwesi Botchwey, "the principal architect of the Economic Recovery Programme", said that the economy of Ghana is picking up (Ghana Today, 1984 p.14). As a matter of fact, Ghana recorded a GDP growth rate of 7.6% in 1984, so that his assertion seems correct. But is it really justified to say "the economy is picking up", taking into account 1960 how far the economy had broken down in 1982/83? Is the growth not mainly 1962 due to good rains in 1984?

According to the law of Okun, a 2.5% growth of GDP ensures a 1% decrease in unemployment rate. Taking this law for granted, the unemployment in Ghana should have decreased by not less than 3% by a growth of 7.6%! The opposite is rather the case. Is Okun wrong?

Okun's Law is based on the assumption of a steady growth. In Ghana we have had a steady growth - when we think of the time from 1960 - only between 1968 and 1971. We had an average growth of GDP of over 6%. This was a time of a relative stable political situation in Ghana, under the leadership of Prof Busia and his colleagues a civilian government, democratically elected in a competitive multi-party elections. The architects of this miracle were Ghanaians and Mr J. H. Mensah! Even in 1980/81 the Limann government did very well. Their only problem was that they had a very bad start due to the events of June-September 1979. The 3 months of AFRC rule weakened the backbone of the Ghanaian economy, i.e. the mammies and petty traders.

The table (right) shows the rates of growth of GDP for Ghana, Ivory Coast and Africa. Let us refresh our memories with the following dates: 1961: Introduction of one-party system; 1966: NRC Coup; 1972: SMC- Coup; 1979: AFRC - Coup; 1982: PNDC - Coup. Apart from 1984, all figures are from IMF Statistics (1984). The unusual growth in 1973 was due to a sharp rise in cocoa prices on the world-market. This also partly explains the decline in 1975 when cocoa prices fell, a situation which was aggravated by the beginning of discussions on UNIGOV.

The Economic Recovery Programme has failed. This year, about 60% of Ghana's export earnings will be used for debt servicing, and it will be higher next year under the prevailing conditions. Most of these debts are from the IMF and World Bank, and must be paid if we don't want to get into more trouble. The desperate efforts being made by the Ministry of Finance and Economic Planning to acquire revenue, as well as speeches made by Dr. Botchwey (Standard, July 21, 1985) depict that their estimated growth of 5.3% will remain a wish. I estimate a growth of 0 +- 2% for 1985.

Therefore it is time that other solutions to the economic problem are considered. On this point, I agree with Paa Kwesi Mensah, (viz Talking Drums of June 24, 1985) and all before us, that a stable "political kingdom" could be the key to the solution. This political kingdom must be based on the silent Ghanaian majority.

The Alternative:

Up to now, the National Commission for Democracy hasn’t pointed out the the exercise on decentralisation being carried out in two areas is worthless, since the environments aren't integrated. Only when decentralisation is done on a national scale can the results be seen. Experiments with a one-party system are bound to fail as our experiences in the past have shown.

Any model therefore, which will support he traditions and aspirations of Ghanaians, must be based on:

Freedom and Justice
Balance of Power

Ghana could be organised, based on the traditional areas which already exist, and the possibility of traditional to area survive economically. On the citizens' own choice, two or more areas could join to form one. The ministries should be reorganised so that they should not be more than ten.

On the national level there would be a a Federal House, Executive and Judiciary. The Federal House comprises of the Parliament and the House of Chiefs. It will be the Legislature and as such the highest organ, apart from the citizens. The Federal House will sit periodically, so that Ghanaian from all walks of life can stand elections, without giving up their professions. Members, so as to ensure competition among those elected Ghanaians abroad should also be represented in Parliament so that they can contribute to the welfare of our motherland.

The Executive will consist of 10 Ministers, one chosen from each of the now existing regions. These ministers after being elected in the respective region (a man and a woman) - will finally be elected by the Federal House. This will ensure that at least three of them are women, and a sense of national responsibility among the ministers. One of these ministers will then be elected president for a one-year term of office.

The office of presidency will only be for ceremonial purposes. These 10 ministers will be the heads of the 10 ministries. Each of us can identify him or her.

All responsibilities not constitutionally vested in the Federation, should be fulfilled by the traditional areas. Each traditional area will make its own constitution, taking into account its traditional, geographic and social situation. In any case, this constitution must in no way be contrary to the Federal Constitution. There will be a Governor and his ministers, directly elected by the citizens of the traditional area. Integrated in a traditional area are the towns. What responsibilities should be fulfilled on the town level will be decided by the local council and the house of chiefs in the traditional area. These responsibilities must be laid down in regulations. The local house of chiefs will be presided by the Omanhene.

Every citizen must have the opportunity of initiating an amendment of the constitution or a regulation. In order to ensure that there is public interest, a certain number of supporters is necessary, depending on the level in question. Disputes between institutions must be settled locally, and only when this fails should a higher institution intervene.

A few corrections need to be made on the 1978 constitution for it to fit this model which I have presented. Having practised the system for about 10 years, we shall have discussed and drafted a suitable constitution which will last. In any case, nobody in a responsible position must impose him or herself on Ghanaians.

Elections will ensure that only those whom Ghanaians want occupy any position. Since soldiers are integrated as citizens, it is highly improbable that there will be a coup-d'état. The Armed Forces must be so deployed that there is at least a Unit in each traditional area. The soldiers will help to build the infrastructure, and need not be im- prisoned in the barracks.

Why do we need a federal form of organisation? Despite the fact that we are all Ghanaians, the interests of a Kwahu or Fanti may be quite different from those of a Ga or Ewe, since their cultures are different in many ways. This fact influences our way of thinking, much more, our way of seeing things. Although we have more than 40 ethnic groups in Ghana, no efforts have been made to put this into consideration.

Kwesi Botchwey's economic miracle?

Ghana could be organised, based on the traditional areas which already exist, and the possibility of a traditional area to survive economically. On the citizens' own choice, two or more areas could join to form one

Through a well-organised federal system, most problems will be left to the people themselves whom these problems concern to settle. The responsibility of the central government must mainly lie in formulating general policies an foreign affairs. Our history also shows that the relative prosperity of the Gold Coast was mainly due to its federal organisation. We must however bear mind that the traditional areas can flourish only if Ghana as a whole flourishes.

The Preparation:

One of the main reasons why the Limann Government was overthrown was its plan to devalue the cedi. This was also the reason why the Busi Government was overthrown. The World Bank in its report on Ghana (1984), acknowledges that a devaluation of 10% in 1972 would have saved us a lot of troubles thereafter. The PNDC has now devalued at a rate of over 2000%, without the citizen having any say whatsoever but the political and economic problems of Ghanaians have rather worsened thar before the 31st December 1981. believe that members of the PNDC, the secretaries, as well as the CDRs love Ghana. They must also take into consideration that other Ghanaians love Ghana much the same, if not more.

Time is running out for the PNDC and Ghana as a whole; another military coup might spell the doomsday for our motherland. I therefore implore the PNDC to find some means of dialogue with representatives of all former civilian governments and leaders of present opposition groups such as the GDM and its sister- organisations.

A general amnesty to all political refugees will be in the right direction. A date must then be fixed for a free and fair elections with multi-parties on both national and local levels. Experiences in 1968 and 1978 show that even the preparations for such elections have positive effects on the Ghanaian economy.

I am confident that when due respect is paid to the fundamental human rights, most of the problems that prevail in Ghana will resolve themselves. The federation is the key to "Freedom and Justice" in Ghana.

Growth Rate GDP 1960-1984 for Ghana, Ivory Coast, Africa

Year  Ghana  Ivory Coast  Africa

1960    2.3    -    4.1
1961   6.2   -   4.2
1962   4.8   -   5.7
1963   3.5   -   4.9
1964   2.2   -   5.2
1965   1.4   -   4.9
1966   0.1   -   4.5
1967   -3.0   -   5.3
1968   6.4   -   5.6
1969   5.9   -   5.1
1970   6.8   -   5.1
1971   5.6   6.7   5.1
1972   -2.5   6.1   3.2
1973   15.3   5.6   3.6
1974   3.4   3.0   7.5
1975   -12.9   7   1.5
1976   -3.5   12.0   2.7
1977   2.3   4.7   1.9
1978   8.5   10.6   -0.6
1979   -3.5   1.9   3.5
1980   0   5.2   7.9
1981   -1.8   0.2   3
1982   -7.2   -3.9   -0.4
1983   0.7   -4.4   -0.7
1984   7.6

talking drums 1985-10-07 Nigeria at 25 - A nation in a hurry