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Can oil transform Ghana's fortunes?

Charlotte Attwood | 17:20 UK time, Monday, 31 May 2010

The Africa Have Your Say team is part of the BBC Africa Kicks team travelling through West Africa - the power house of African football.

As well as discussing how the country's team, the Black Stars, will perform at the World Cup in South Africa, Ghanaians are also talking about oil and how it will transform their lives and the nation's economy.

Off shore drilling is set to begin at the end of the year. Should Ghanaians have great expectations? If you are in Takoradi or elsewhere in Ghana, do you think you will benefit from the oil? Should areas in close vicinity to oil wells get a larger share of the profit? If you're elsewhere in the continent please send us your views and share your experiences with us.

To debate this topic LIVE on air on Tuesday 1st June at 1600 GMT, please include a telephone number.

 

Comments

  • Comment number 1.

    It is a BIG NO! from me on this question. Throughtout human history there cannot be any evidence to support the assertion that the presence resources alone can transform a country or the status of a group of people. Ghana can only be changed and transformed by transformational and generational thinkers who have both the desire and the discipline to course the old order to change to a new and prosperous one. That is straight and simple.
    Transformation of a country is coursed by great and powerful ideas that potentiates the end results of many good and small ideas by several orders of magnitude. Take the effect of PCs and internet alone, this did not transform only USA but the world, standard of living is higher due to this.

    PAKAR
    Accra-GHANA

  • Comment number 2.


    Off course, people close to oil fields should the first ones to test the Honey- in form of better schools, hospitals, roads and the general infrastracture they need. As far as employment, locals should also have their lion share.
    As an African, I am proud of what my Brothers and sisters in Ghana Achieved- the freedom and democracy they are enjoying. When it comes to oil drilling in Ghana, I think Ghana is among the few African countries who can manage their mineral resources, oil in this case for the benefit of the people and country.More importantly, I want make clear that environment and regulations related to environmental pollution as a result of hydrocarbon development must be in place before any drilling.

  • Comment number 3.

    Oh Yes, it will transform Ghana, the question is what kind of transformation. Those in the helm of affairs will cease all opportunities on the quite and enrich themselves and lord it over the rest of us to perpetuate their perceived power over us. they will create mini of-shore companies to buy shares in whatever new investment companies that will come in. The result will be an even wider gap between the have's and have nots. as to the development of the economy, what have we done with cocoa, gold, and timber? all of which some years back enjoyed fantastic prices on the world market. which industry or sector of the economy have we developed to compete globally to show we have the will to succeed? even the educational sector which was reputed to be among the best, is today a pale shadow of itself.

  • Comment number 4.

    as a Nigerian and seeing what our leaders with connivance with western powers have done to impoverished my country,I'd love to cautioned my Ghanaians brothers to tread softly because if it's not well managed,it will become a curse rather than a blessing as is the case with Nigeria.
    But all the same, I wish them the best of luck. they need a lot it.
    [Personal details removed by Moderator]

  • Comment number 5.

    I doubt if oil can do anything for Ghana. The change Ghana needs is not monetary but attitudinal. I can say for a fact that there's already a lot of money in Ghana in the hands of Ghanaians but so long as the people are not ready to work and be committed to building a beautiful, clean and wealthy Ghana, oil may just come and go. I only pray it does not come with all its troubles as we've seen in Nigeria.

  • Comment number 6.

    Ghanaians should not really expect so much from the oil revenue because even though we have been exporting gold and cocoa all these years,the money generated from these commodities hasn't transformed the country.However if good policies are put in place it can change our fortunes but not overnight.The profit from the oil should be shared equally among all the regions but the people close to the oil well must be given a fair share if it is directly going to affect their livelihood.

  • Comment number 7.

    Currently Ghana is very peacefull, but with anticipated Oil discovering and exploration, it wil soon begin to exibit some political turbulence. These will be at the instigation of Corporate entities with geo political interests, not that of Ghanians. Zambia is also peacefull because there is nothing to fight for. [Personal details removed by Moderator]

  • Comment number 8.

    Yes, Ghanaians should have great expectation because the little knowledge we have about oil even tells us how best we can utilize the oil in the country.When we look at some countries like Nigeria, Libya,Algeria,Angola,Mexico,and others and how they have really made use of their oil, I think ours is going to be more of a blessing since oil has so many uses which we are ever ready to embrace it .I think areas to close vicinity to oil wells should be given larger share of the profit because contamination and pollution will be bounded by them.And in this case, they are going to endure all the hardship since it is "oil".So why not making them feel great at least for once in Ghana because most of the mining communities are deprived of basic things when they start mining and I think this time it is going to take a different turn altogether.

  • Comment number 9.

    Dear Lord, not when Ghana was just beginning to show signs of progress from the madness of the past. And now, its rulers have been given something to fight over, steal, or both. "The resource curse" isn't a myth in Africa; it is a living reality. I sincerely hope I'm wrong about Ghana. It's great but longsuffering people certainly don't deserve my apocalyptic predictions.

  • Comment number 10.

    having oil in Ghana will not help much to the ordinary people because it will cause displacement to people who are living near the oil fields. it is also going to polluted the environment and it can result to the lost of lives if no preventive measures are in place to protect the civilians by the government and the oil exploring company. like in Sudan where I am the oil rich areas,such as unity state and Abyei, the community is partly benefiting from it and the government of the state is getting share as part of CPA peace deal but in Ghana it is going to help them but there are still little impact to be feel later on.

  • Comment number 11.

    Well,it all depends on the kind of leadership the Ghanaians choose over the next few elections. If they are swayed by petty politics, they could be heading the way the many other africa countries went a la Nigeria, Congo etc. But, if there is one set of people who can play the game differently, it would be the Ghanaians ! Also, another factor would be how much of an influence they let the Western countries wield upon them. Ghana would do well to use the riches they get from oil to build the next generation of citizens by helping kids to school and to help local business grow in the field of Agriculture etc. If they do this well, they can leave a mark !

  • Comment number 12.

    The answer is YES, oil can transform Ghana's fortunes. HOWEVER!!! The resource has to be managed very well. As long as there is transparency and goodwill on the part of the oil companies and government the whole country can benefit. OIL FOR DEVELOPMENT!!!

  • Comment number 13.

    I would be surprised to see any nationwide transformation. Maybe that can only happen when the greedy politicians decide to be greedy for Ghana as a nation. We've got several natural resources that should have catapulted us into, at least, a semi-developed country but what do we see? It is a shame that potential blessings may be turned into real curses before our very eyes.

  • Comment number 14.

    Can oil transform Ghana's fortunes? Absolutely! Will oil transform Ghana's fortunes? Absolutely not! with the kind of leaders who are negotiating on our behalf.

  • Comment number 15.

    Are we still talking about how oil will help Ghana. How long has it been now. They should start drilling then we will know whether it will help the country or not.

  • Comment number 16.

    There is no doubt that oil can transform Ghana. The transformation process, for the better or worse is what have to be intelligently, cautiously and most importantly unselfishly be planned. As a native Ghanaian who has studied and lived abroad for for most of my adult years, I have followed Ghanaian politics and economics for most of my adults life and I know Ghana. I had the privilege of volunteering to live and work at Takoradi last year for one month and even had another privilege to attend a meeting with Western Region house of chiefs and all the oil stakeholders. The subject of the meeting was oil and how it's impact will transform the region and Ghana as whole so this discussion means a to me. I even traveled to Axim with my team have private audience with the King of Axim on this same subject. It was a big eye opener. The expectation of transformation is very high among Ghanaians especially the western regional natives. To me it is normal and expected. They are learning very fast. The natives are learning about the greed and woes that can come with oil. But the big question is who can be the transformational leader who will effect the process? It cannot be left to our politicians. They are too self serving. It needs an independent mind serving as 'oil commission' not appointed by politicians but by an independent body like International Monetary Fund (IMF) for a period of time, let's say the first 10 years to manage the affairs of the oil industry and the revenue. If we leave it to the politicians at the beginning, it will be politics and greed as usual and the transformation will be another sad chapter in Ghana's history.

  • Comment number 17.

    Hopefully the Oil will be produced responsibly, and ALL environmental impacts managed to eliminate problems. The revenue retained by the Government will trickle down to some of the people, not all of the people.
    Roads, Airports and modern hotels will benefit. Some individuals who will get work from the Oil companies will benefit. Dont expect that everyone will get a fair share, that does not happen anywhere in the world. Be happy for those who benefit.

  • Comment number 18.

    History demonstrates that healthy caution is necessary when it comes to managing natural resource revenues. Ghana has, however, made history by hosting a series of free and fair elections in recent years, two of which the opposition has won and the incumbent has stepped down in a display of due respect for democracy. This is groundbreaking progress, given the African context of ‘Big Man’ rule.
    The resource curse literature strongly suggests that high quality economic and democratic institutions – in place at the point of discovering mineral wealth – can serve to optimise developmental progress (and so prevent a resource curse). These are analysed below.
    Ghana boasts a strong civil society, and certainly the media is unafraid of offering a critical voice, both of which bode well for democratic consolidation.
    Oil revenues are likely to peak within the next 7 years. On average, they are likely to provide approximately US$1 to 1.5 billion per annum for the next 15 years. Given that current government revenues are approximately $3.7 billion, this is significant additional revenue, which can be perceived both as a blessing and a limitation. Both civil society and aid organisations recognise Ghana’s lack of absorptive capacity, which renders it incapable of spending extra immediate revenue fruitfully. Oil prices tend to be volatile, thereby creating a difficult investment environment. Additionally, if the budget depends too heavily on oil revenues, budget volatility will result. This greatly undermines planning, a key component of developmental success. These organisations are therefore particularly adamant about the need for a stabilisation fund that will: smooth the budget; contribute to a heritage fund; and enhance human capital, all of which would help to improve absorptive capacity and ensure optimal public service delivery.
    There is, fortunately, a sober awareness that oil in itself will not shift the core structure of the economy. Capturing the gas released with oil extraction, however, could provide the necessary backbone to a sound industrial policy framework - one that will catalyse economic diversification. Oil exports have a tendency to falsely inflate the value of a country’s currency and so undermine the export competitiveness of other sectors (also known as ‘Dutch Disease’). With agriculture as the primary export earner and the largest employer, the implications of such a scenario are devastating. Thus, careful management is called for to ensure that gas simultaneously improves the yield of the agricultural sector and that economic diversification builds on agri-business rather than undermining it.
    A major institutional concern is the delay in legislating the Oil Revenue Management Framework, which sceptics fear is an indication of the legislature’s weakness. Parliamentary oversight is an essential democratic function. Additionally, oil contracts are shrouded in legislative and contractual secrecy. Taken together, these factors may indicate that patronage networks are being established. If true, civil society has good reason to be concerned about democracy’s longevity. The reasons for the delay in passing legislation have not been publically communicated. Combined with the simultaneous lack of transparency around oil contracts, communities are becoming agitated, and potential conflict is not implausible. Conflict is often the precipitator of a resource curse. The greatest lesson, then, is that communities should have been far more widely consulted. Government has unwittingly allowed unmet expectations to germinate and fester. If communities are presented with the opportunity to articulate what they want to accomplish with oil revenues, then they can create - and work to fulfil - their own expectations.
    It should also be noted, however, that the government faces numerous difficulties. First, there were purportedly genuine concerns with the withdrawn petroleum bill (which had been tabled in haste during the election campaign). Second, the government lacks negotiating skill, rendering it unable to bargain for stronger terms of trade. Ghana must, for instance, avoid ‘stabilisation clauses’, which multinationals use to avoid inconvenient legislation. Third, there is a vast array of political and business interest in Ghana’s oil, making it difficult for the government to know whom to trust. Transparency would help a great deal, although the neo-realist perspective still holds weight: Multinational corporations are far wealthier and more powerful than Ghana, and if they perceive that minimal transparency is in their profit-maximising interests, then government may acquiesce to their demands. This is especially true where immediate cash is tempting and negotiating capacity is weak.
    In the final analysis, then, oil’s likely effect on Ghana’s democracy is ambiguous at best. It is unlikely to shake the core of democracy, although the dangers should never be dismissed out of hand. If its revenues are thoughtfully and creatively managed, however, it can strengthen democratic institutions and produce fruitful developmental outcomes.

    Ross Harvey
    Cape Town, South Africa

  • Comment number 19.

    Ghana has the history of being more modest and astute(Post the cleansings) than Nigerian and stand the chance of utilising any oil resources better. It is also on records that Nigerian leaders were more prudent in the years before oil was discovered.

    My advice is for them to learn from the Nigerian experience and thread carefully.

  • Comment number 20.

    Has oil transformed the fortune of any other African country with the exception of Libiya??

 

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