Afro-euphoria, typified by the ‘Africa rising’ narrative, has been widely criticised as misleading for relying solely and narrowly on African growth figures to promote the notion of an emerging economically powerful Africa (Akolgo Forthcoming). The political environment under which African growth has occurred for the past decade has been disregarded by Afro-optimists and, more importantly, many African governments have not adequately addressed issues such as inequality, poverty, unemployment and environmental destruction from natural resource extraction, which is a large source of Africa's growth (Akolgo Forthcoming; Beresford 2016; Obeng-Odoom 2014). Adding to this, Bush and Harrison (2014) provide two insights into the so-called African economic boom, cautioning against premature optimism. One, they assert that growth cannot, and should not, be equated with economic transformation. The fact that growth figures are soaring does not imply positive changes either in the social order, production technologies or in the economic class structure such that the poor suddenly get rich. Two, the capitalism that has driven the new African development does not necessarily seek the well-being of the (entire) African society but, as has been the case historically, capitalism can be a persistent manipulative tool for wealth creation and is sometimes ‘inextricably interlinked with impoverishment and extreme hardship’ (4). Writing at the same time as Bush and Harrison, Taylor (2016) insists that ‘structural features’ must be differentiated from ‘superficial features’ in Africa's so-called ‘rise’. The evidence of Africa's structural profile, Taylor observes, is weak or non-existent. Instead, the ‘superficial features’, such as GDP figures, and prices of minerals or raw materials such gold, oil, coffee, cocoa, among others, have influenced those people currently reconstructing, by means of false gospels, Africa's former ‘hopeless’ image as a ‘hopeful’ one.
The criticism of the African growth paradox presents an opportunity to rethink African political economy and its assessment of the continent's development, particularly the role of governments in promoting a kind of growth that encourages national welfare, not just the enrichment of a few. This Briefing therefore discusses the extent to which Ghana's political leadership has promoted economic growth that addresses poverty, income inequality, spatial inequalities (the country's north–south development gap), the dangers posed by natural resource extraction and the unemployment faced by many citizens, especially youth. Three things motivate this assessment. One, Afro-optimists and, sometimes, critics of Afro-euphoria have largely and effectively adopted the approach of Africa as one economic unit, with a common political ideology and the same level of political maturity for all its countries. Two, while the treatment of Africa as a single unit of analysis provides insights into policy-making given the continent's shared political history, a country-level assessment of Africa's touted rise provides a realistic understanding of African development since countries can be assessed on their particular systems. Three, Ghana presents a good case study in understanding the African growth paradox from the standpoint of the role of the political system. This is arguably so because Ghana plays a significant role in African political and economic discourse, particularly in decolonising the continent and promoting Pan-Africanism (Zack-Williams and Harrison 2009). It was the first country in colonised Africa to gain independence in 1957, serving as an experimental ground for development economics (Killick 2010; Tignor 2016). Its high growth since 2000 mirrors that of the resurgence in regional growth; and since the beginning of the 1992 Fourth Republican Constitutional Rule, Ghana has proven to be the leading – and probably an exemplary – democracy in the continent (Carson, 2016; Schneidman 2016; Songwe 2016).
At no point in Ghana's political history has it ever become so evident that the rhetoric of high GDP figures by various governments is deceptive than the result of the December 2016 presidential and parliamentary elections. The then incumbent president, John Dramani Mahama, and his National Democratic Congress (NDC) lost the election massively and disgracefully (since this had never happened to a first-time incumbent leader running for a second term) to Nana Addo Dankwa Akufo-Addo, the New Patriotic Party candidate, who is now serving as president. For the first time since the country's return to multiparty democracy about 25 years ago, a sitting president served only one four-year term of the maximum eight years. Additionally, President Akufo-Addo is the first to defeat an incumbent president in one straight round, winning about 53.85% of the votes and a majority of parliamentary seats (Electoral Commission of Ghana 2016), as a result of widespread frustration among Ghanaians (Schneidman 2016). When the NDC gained power in 2008, the economy was growing above 8% and reached an all-time high of 14% by 2011, thanks largely to new oil revenues. The emergence of oil to add to the revenues from gold and other exports was expected to transform the economy, and the government missed no opportunity in propagating what its communicators, or perhaps surrogates, called ‘unprecedented growth’. At the same time, however, living conditions were getting worse than ever in the country's development history. The electricity crisis which began in 2006 had been aggravated by 2012 and the word Dumsorisation 1 emerged not only as a synonym for the frequent erratic power supply but as an alias and a derogatory term for the government and, more so, the president. Many businesses were crushed, and jobs were lost throughout the industry chain as power was rationed: sometimes there was power supply for only 12 hours, after which consumers endured a further 24 hours or so without power, and this cycle continued. The same period saw the collapse of the Savannah Accelerated Development Authority, set up by the previous NDC government under the late president Professor John Evans Ata Mills to transform the poverty ravaging the north of Ghana, owing to financial embezzlement from managers of the scheme (Agyeman 2015). The country's largest mining concessionary, AngloGold Ashanti in Obuasi, was closed down in 2014. Thousands of workers lost their jobs and the inhabitants of a village contaminated by mining chemicals were mourning the failure of its land to yield crops for survival. All these were occurring at the same time as the rising (even sometimes falling) GDP figures. The results were growing unemployment, rising income and wealth inequalities, a slow rate of poverty reduction relative to population growth (Cooke, Hague, and McKay 2016), an unchanging development landscape between northern and southern Ghana, and general disaffection, anger and, to be plain, hatred for the government which occasioned its historical political disgrace.
But the foregoing narrative is not peculiar to the NDC government although it was pronounced during its tenure. It is the result of what President Akufo-Addo has now aptly described as the Guggisberg Economy. Gordon Guggisberg was a colonial governor in the Gold Coast (now Ghana) and a reference to his administration is reminiscent of the colonial economic structure of raw material exportation, which President Akufo-Addo insists is the reason why development has been slow and painful in the country. This kind of economy has lacked a human face in its notion of development. The focus has been like a government which says to its experts, ‘mine gold, drill oil, collect cocoa beans, export these raw products, earn foreign exchange and keep the growth figures high (whether politicians are looting the revenues or not, it does not matter). If the people ask us what we are doing for them as government, we can tell them: look, we achieved an unparalleled growth of 14%, we built these number of roads (even if the roads are leading to mining centres only) and very soon your lives will change – your suffering would soon be over.’ Governments, especially over the last 10 years, have promoted this short-sighted view of growth as development. So, by examining closely the Ghanaian economy, this Briefing seeks to reveal its true state in the light of the soaring growth for more than a decade. What has happened to the relatively underdeveloped northern Ghana since independence? What have been the trends in unemployment, poverty and inequality? Answering these questions gives us a clearer picture of whether or not the nature of Ghana's economic growth is different from the broader African growth trend that has been described as a paradox.
Politics, economic growth and development in Ghana
After political independence in 1957 from British colonial rule, Ghana alternated between civilian and military rule, starting from the 1966 coup that overthrew Dr Kwame Nkrumah, the country's first president. The country since 1992 has practised constitutional, multiparty democracy. The past 25 years have seen Ghana go through seven democratic, free, fair and peaceful elections and it is now considered a ‘gold standard for Democracy in Africa’ (Carson 2016). This new rating of the country is largely the result of its 2016 presidential election, which demonstrated not only a resolve to resort to democratic means of changing governments, but a testimony that Ghanaians will no longer tolerate bad governance. In his reflection of post-colonial thinking about development using the famous novel The beautiful ones are not yet born, Obeng-Odoom (2015) noted that Ghana's independence struggle and the later coups merely changed the ‘personalities’ in control of the state, not the system of governance towards development. In other words, nothing structurally changed in the operation of state institutions after the overthrow of Kwame Nkrumah or the others who followed. Different people took control of the country but the orientation towards the economy was the same. In a similar fashion, the Fourth Republic has yet to see a major change in the Ghanaian economic system although governments have changed several times over. The same neoliberal economic structure that sees natural resource extraction as the surest way to boost economic growth, and economic growth as the best measure of economic ‘success’, has remained unchanged. In the same way that international financial institutions such as the World Bank and the International Monetary Fund praised Ghana, their ‘star pupil’, for its growth under the Structural Adjustment Programme as well as the gains in creating a capitalist-free society, the country's political leaders have over the years sought refuge in GDP and democratic rule. Democracy, at least in its basic form as ‘a system of government in which the people choose their leaders and representatives, and can replace them, in regular, free and fair elections’ (Diamond 2005), has been a remarkable success in Ghana. But, combined with the country's growth, have these two delivered significant development in the country? And what constitutes development in the Ghanaian context? It is necessary to set out what will suffice as development in the current Ghanaian economic and political dispensation so as to ascertain the state of events.
It is now widely known, if not agreed, that the conventional view of economic development from the standpoint of economic growth is shortsighted. The reason is that economic growth is a necessary but not sufficient condition for achieving development goals like poverty reduction (Dagdeviren, Hoeven, and Weeks 2002; Ravallion 2001; Thanawala 1992), unemployment and inequality (Cooke, Hague, and McKay 2016). An exaggerated emphasis on growth measured by GDP and GDP per capita is misleading. Criticisms of this traditional approach abound and the attempt here is not to rehash the arguments except for echoing critical thoughts in this direction. Earlier in the 1960s, Dudley Seers observed and stated eloquently the insufficiency of economic growth to address society's deeper concerns:
In fact, it looks as if economic growth may not merely fail to solve social and political difficulties; certain types of growth can actually cause them. … The questions to ask about a country's development are therefore: what has been happening to poverty? What has been happening to unemployment? What has been happening to inequality? If all three of these have declined from high levels, then beyond doubt this has been a period of development for the country concerned. If one or two of these central problems have been growing worse especially if all three have, it will be strange to call the result ‘development’, even if per capita income doubled. (Seers 1969, 2, 5)
Solely viewing the growth trend since the year 2000 does not give sufficient understanding as to how it positively affects citizens. The consequences of natural resource dependence are now evident. Mining communities are paying a painful price for governments’ continual allocation of large portions of their land to mining companies. Surface mining in areas such as the Western Region has deprived peasants of their farmland, cutting off their source of food (Ayelazuno 2014).
The closure of Obuasi Gold Mine
A case at hand that demonstrates the tragedy of growth dependent on natural resources is the closure of the Obuasi Gold Mine by AngloGold Ashanti (AGA). As far back as 1987, commercial gold-mining took place in the Obuasi Mines, then called Ashanti Mines (Angyobore 2016). Obuasi is a mining community in the Obuasi Municipality in the Ashanti Region of Ghana. For more than 100 years, Ashanti Goldfields Corporation controlled the Obuasi mines, and extracted large amounts of gold until 2004 when it was acquired by AGA, a subsidiary of Anglo American – one of the world's largest mining and resource companies (ActionAid 2006). For all those years, millions of dollars/cedis have flowed from the rich mine into the national GDP (or perhaps mostly into the pockets of mining companies or politicians who protect their interests).
But the community in which this rich metal has been mined for over a century has remained in poverty and devastation. ActionAid published a report in 2006 documenting AGA pollution of rivers and streams in Obuasi from toxic deposits with high levels of arsenic, iron, manganese and heavy metals, and contamination of farmlands (ActionAid 2006). In 2014, AGA closed its Obuasi mine and retrenched more than 3500 workers (Angyobore 2016) over what the company says is the result of operational challenges that have necessitated a closure for ‘care and maintenance’ (Myjoyonline 2014). But others such as Mathews (2016) have linked the closure of Obuasi to issues such as the decline in gold prices since 2011, AGA's deteriorating mining infrastructure and the resultant fall in the company's production volumes. About 6500 were expected to be retrenched (Myjoyonline 2014) and different sources continue to report different figures mostly in the thousands. In fact, it is safe to say that Obuasi is a microcosm of the Ghanaian macrocosm; one of the tragedies of a nation that has relied on natural resource extraction at the expense of its citizens’ well-being to fuel a jobless growth.
What has been happening to unemployment, inequality and poverty?
Unemployment statistics are sources of conflict between government statisticians on the one hand and civil society and ordinary Ghanaians on the other. Whether it is the Ghana Living Standards Surveys (there have been six surveys since the 1980s) or the latest 2015 Labour Force Report, the government has continued to churn out employment figures that are too often considered by the populace to be an understatement of the volume and extent of joblessness that prevails. For instance, the 2015 Labour Force Report, which was launched in March 2017, projects national unemployment at a rate of approximately 12% (Ghana Statistical Service [GSS] 2015). The Institute for Liberty and Policy Innovation (ILAPI) and the Unemployed Graduate Association of Ghana (UGAG) described the GSS rate as inaccurate. For the ILAPI, the unemployment figure is a result of ‘lazy research’ conducted through ‘dreams’ and baseless assumptions and brainstorming (Ghanaweb 2017). If we dismiss these concerns as unsubstantiated claims and confront the GSS’s own data and reports (see Tables 1 and 2 and Figure 1), the perception of employment crisis is preponderantly evident. A large proportion of the employed (68.7%) are engaged in ‘vulnerable’ employment; people the GSS describes as being ‘employed under relatively precarious circumstances’ (GSS 2014). This implies, as Honorati and Johansson de Silva (2016) observe, that holding a job in Ghana does not guarantee that a person will escape poverty. What Ghanaian youth need is a ‘good job’, one that offers sufficient earnings, as opposed to ‘bad jobs’ that offer ‘low pay, are dangerous or illegal’ (Filmer and Fox, cited in Honorati and Johansson de Silva 2016). But how can a state that has made its agricultural and associate factories collapse create good jobs? Tomato production in the Upper East created many jobs in the 1980s and early 90s but, since the closure of the tomato factory in the region, all that the jobless youth dream of is to travel to the south in a scramble for the lower-paying, limited jobs. The trend is the same for many other regions and one's life goals are now almost tied to ‘a pilgrimage’ to Accra, the capital, which many prefer to call the ‘real Ghana’.
| Region | Total | Urban | Rural | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Male | Female | Total | Male | Female | Total | Male | Female | Total | |
| Western | 5.1 | 6.2 | 5.6 | 6.2 | 6.1 | 6.2 | 4.3 | 6.2 | 5.2 |
| Central | 5.5 | 3.9 | 4.6 | 7.1 | 6.9 | 7.0 | 4.5 | 1.5 | 2.9 |
| Accra | 6.9 | 7.4 | 7.2 | 7.0 | 7.4 | 7.2 | 4.3 | 7.5 | 5.9 |
| Volta | 2.9 | 3.6 | 3.3 | 4.2 | 5.5 | 4.9 | 2.5 | 2.8 | 2.6 |
| Eastern | 2.5 | 5.9 | 4.3 | 4.6 | 8.4 | 6.7 | 1.1 | 3.6 | 2.3 |
| Ashanti | 4.6 | 4.7 | 4.6 | 7.4 | 6.2 | 6.8 | 1.6 | 2.9 | 2.3 |
| B. Ahafo | 2.5 | 3.4 | 2.9 | 3.5 | 4.9 | 4.3 | 1.6 | 1.9 | 1.7 |
| Northern | 3.2 | 5.9 | 4.6 | 3.1 | 8.5 | 6.0 | 3.3 | 4.7 | 4.0 |
| Upper East | 10.5 | 11.0 | 10.8 | 6.4 | 10.1 | 8.3 | 11.5 | 11.3 | 11.4 |
| Upper West | 8.8 | 6.5 | 7.6 | 2.2 | 10.3 | 6.4 | 9.9 | 5.8 | 7.8 |
| Total | 4.8 | 5.5 | 5.2 | 6.1 | 6.9 | 6.5 | 3.6 | 4.1 | 3.9 |
Source: GSS (2014).
| Region | Population distribution % | Share of poor population % |
|---|---|---|
| Northern Ghana | ||
| Northern Region | 10 | 20.8 |
| Upper East Region | 4.1 | 7.4 |
| Upper West Region | 2.9 | 8.4 |
| 17 | 36.6 | |
| Southern Ghana | ||
| Western Region | 9.2 | 7.9 |
| Central Region | 8.9 | 6.9 |
| Greater Accra | 16.3 | 3.8 |
| Volta Region | 8.7 | 12.1 |
| Eastern Region | 10.4 | 9.3 |
| Ashanti Region | 19.7 | 12 |
| Brong Ahafo Region | 9.8 83.0 | 11.4 63.4 |
| Total | 100 | 100 |
Source: Cooke, Hague, and McKay (2016).
Absolute poverty remains pervasive despite the proportion of the poor between 1991 and 2013 falling by more than half (Cooke, Hague, and McKay 2016; GSS 2014). Besides, the poor are concentrated in rural areas and the north of the country. National poverty statistics have masked the wide disparities across the 10 administrative regions. Inequality, which stood at 42.3 Gini points in 2013, threatens efforts at poverty abatement. Cooke, Hague, and McKay (2016) report that between 2006 and 2013, inequality reduced the rate of poverty reduction by 1.1%.
One other disturbing phenomenon is Ghana's rising graduate unemployment, which has led to the formation of UGAG to mitigate the challenges in getting jobs after graduating from university or polytechnic (Oppong and Sachs 2015). Oppong and Sachs report that in 2012 UGAG estimated graduate unemployment at 50.8%. It is further estimated that 50% of graduates from universities and polytechnics are unlikely to a find a job two years after their mandatory national service and 20% will remain jobless for three years after the service (Owusu-Ansah and Poku 2013, cited in Oppong and Sachs 2015). Given Ghana's youthful population, graduate unemployment poses a threat to national development. Not only does it increase the dependency ratio and poverty, it has the potential to create a vulnerable youth who can be preyed upon to create chaos, or at worst, could be recruited by terrorist networks; these terrorist organizations promise huge financial rewards.
Further evidence of Ghana's mixed economic successes is the perception of ‘suffering’ and the general feeling of governance failure, especially since 2012. The Center for Democratic Development (CDD) (2016) in Ghana conducted a survey prior to the presidential election (Figure 2), which showed that a majority of Ghanaians believe their personal and national living conditions are ‘fairly bad’ and ‘very bad’ respectively.
The north–south divide
A big development gap widely recognised in Ghana is the underdevelopment of northern Ghana relative to the south. Northern Ghana comprises three administrative regions: Northern Region, Upper East and Upper West. The underdevelopment of the north cuts across many aspects of national development, from education to infrastructure, employment and poverty reduction. Many institutions of higher learning are concentrated in southern Ghana and the massive drift of northerners to cities such as Accra and Kumasi is evidence of a search for greener pastures. The Africa Progress Panel observes that more than two decades of rapid growth have contributed little to reducing the ‘highly concentrated’ poverty in the north despite the national fall in the rate of extreme poverty (APP 2013). The panel cites for example that the number of people in northern Ghana increased from 2.2 million in 1999 to 2.6 million in 2006 despite the reduction in the national poverty rate. The north–south divide has been a result of colonial development history, the unfavourable climate in the north that results in low crop yields, and post-independence development policies that focused on southern Ghana (Save the Children 2012; Tsikata and Seini 2004, cited in World Bank 2006; Mancini 2009). The colonial infrastructure was mainly intended to extract minerals such as gold, bauxite and diamonds as well as timber. These resources are found predominantly in southern parts of the country such as Kumasi in the Ashanti Region, Takoradi in the Western Region, where oil is now being explored, and the Brong-Ahafo Region. As such, development took place around these areas and the gap has prevailed post-independence.
Some have attributed the low investment in northern Ghana during colonial and post-independence regimes to a ‘deliberate policy to underdevelop Northern Ghana in order to create a labour reserve for export production in the south, (Shepherd, Ladouceur, and Konigs, cited in World Bank 2011). For instance, the Government Secondary School located in Tamale was the only secondary school in the whole of northern Ghana at independence, although the south witnessed several decades of secondary education before independence (World Bank 2011). Sixty years after independence, the north still serves as a labour reserve in the exodus of both educated northerners and school dropouts to the major cities in southern Ghana. Citing Nana Brukum, Phebih-Agyekum (2006) provided a vivid description of the north–south divide, warning that the nation risks a future civil war if the trend is not reversed:
… jobless youth spending the lean dry seasons drinking alcohol and fighting amongst themselves, young people forced to walk all the way from the north carrying guinea fowl to sell in Kumasi and Accra; the north as a grovelling source of cheap labour for the south (watchmen, cooks, houseboys, farm labourers, mine workers, etc.); general despondency among the old and the young alike when the rains don't come and crops fail …
Conclusion
Narratives of African development have revolved around triumph and tragedy, hope and hopelessness. More often than not, these have been shown to be false gospels that succeed in reflecting a different picture to that which prevails in the continent. The recent optimism around African economies on account of growth figures is one such narrative. But both Afro-optimists and sometimes critics of Afro-optimism have treated the continent as a single economic unit and made sweeping generalisations about the development of all African countries. A better alternative is to examine the individual economies to ascertain the truism of their ‘rise’. This Briefing discusses the Ghanaian political economy on the basis of this Afro-euphoria. Its main argument is that past political leadership has failed to confront the country's development holistically and, much like ‘Africa rising’, has sought refuge under ‘superficial’ features such as GDP and prices of gold and cocoa among others. Multiparty democracy is flourishing since its inception in 1992 and given the peaceful transfers of power for more than 25 years now. But the other significant aspect of democracy – efficient management of state affairs and resources – is yet to be fully realised. For instance, corruption remains pervasive mostly in state institutions, crime is inadequately curtailed, medical services are of a low standard and general living standards require much improvement. As a show of unbearable suffering and frustration with the government's failure to promote pro-poor inclusive growth for the past eight years, Ghanaians voted out the NDC. The burden of reviving the reeling economy lies with the new government under the leadership of President Akufo-Addo. Things must change; institutions of state must be cleansed of naked corruption, we need broad-based government policies across sectors and geographical locations, with the north given a special focus, and the laws must be enforced. The NDC's rejection at the 2016 polls marks a new dawn in Ghanaian politics: the citizens will no longer accept cheap propaganda as a substitute for the proper running of their country by leaders they have elected.