Oil Debate: So Far, So Good
By Kofi Akosah-Sarpong

Since last year when Accra announced the discovery of offshore oil fields at its west coast after decades of exploration, there have been balanced debates nation-wide and among transnational Ghanaians. The debate isn’t only from the experts, bureaucrats, the media, academics and the global oil industry but more broadly from ordinary Ghanaians – from villages near the oil fields to traditional rulers to even remote places in the northern parts of Ghana to religious organizations. In all these debates, fair sharing of the prospective oil wealth, poverty alleviation, accountability, transparency, sound macroeconomic management, good life and peace ring supreme.

President John Kufour, with his eyes on history and racing to better the late President Kwame Nkrumah in terms of development attributes and democratic growth, argues that the oil finds are under his watch, and is therefore engineering to make Ghana an "African Tiger." Kufour is drawing on the African and global oil experiences to beat the much dreaded “resource curse,” otherwise called “Dutch Disease,” that sends most oil producing developing countries down-hill economically by blinding them from other commodity sectors such as agriculture and manufacturing that become less competitive and less profitable.

More broadly, Kufour and his team are working to counter the African disease of rentism (where the natural resources is rented to foreign firms by the elites against other commodities that are marginalized and majority of the citizens left dry and poor) by making sure that lot of money in the oil industry doesn’t make it into the pockets of corrupt fat cats in Accra, a fault that has afflicted both government officials and oil firms that elect to pay bribes in most oil producing African countries.

In this sense, as the various oil and gas forums show, the central issue is “transparency” and “accountability” in dealing with the complicated issue of being an oil producer in the face of Ghana being far below the United Nations Human Development Index (Ghana is at 135th position against 177 nations ranked in 2007), historically worrying and varied macroeconomic regimes, incoherent and lack of continued development agendas over the past 51 years, and struggling democracy against the backdrop of 21 years of mindless military juntas and 6 years of overpowering one-party regimes.

Kufour’s “African Tiger,” though a bit exaggerated in terms of the expected 60,000 bbl/day production compared to Equatorial Guinea’s (dubbed the “Kuwait of Africa”) over 420,000 bbl/day, resonates with the broader imagination of Ghana emerging as Qatar, Kuwait, and Dubai. This is against the backdrop of West Africa’s new oil producing stars like Mauritania and Sao Tomei and Principe that are seen more as wealth anchor. More hopefully, all these beautiful imaginations and forums are driven by the fact that more oil fields are being discovered day in, day out in a West Africa that is fast emerging as leading global oil and gas producer – from Angola to Mauritania, with prospective oil finds in places like Sierra Leone, Guinea-Conakry, Liberia and the Gambia mentioned in the Unites States’ Congressional strategic energy reports.

The underpinning relevance of the Ghana oil find, African-wise, isn’t that the finds are always increasing: from the initial 250 million barrels to 600 million barrels to possible 3 billion barrels of oil boom projections. Or Ghana will in future produce oil at the level of Nigeria’s, sub-Sahara’s leading oil producer. The lesson is how Ghana’s emerging democracy has allowed its citizens to participate openly and critically in the oil debate without fear or reprisal from the government unlike other African states such as Equatorial Guinea.

By doing so, a culture of transparency and accountability, key pillars of democracy and development, are being enriched, and a climate is being constructed to contain the much feared “resource curse” and “rentism.” This is reflected in one of the recent consultative meetings on Oil and Gas Policy that saw the Ghana Navy, student representatives, members of the Regional House of Chiefs, Labour Commission, National Commission on Children, security agencies and the media attending, among others, participating. Oil producing Africa has not seen such broad participation in deliberating oil finds from scratch.

No doubt, Sheikh I.C. Quaye, Greater Accra Regional Minister, reflecting the feelings of Ghanaians, said that “Ghana’s oil discovery would be meaningless unless every Ghanaian benefited from the resource as well as its developments.” And this prepares Ghana better to appropriate its oil and gas wealth for greater democratization and development. Unlike African countries such as Equatorial Guinea where there wasn’t any such open national debate before the production of its oil and after which the oil windfall, under the brutal grip of the ruling Fang elites, has put the country under threats from the increasingly marginalized population who still live on US$2.00 a day despite the country’s oil income hitting well over US$1 billion yearly.

A Spanish judge last week jailed Severo Moto, one of the main exiled opposition leaders, for attempting to smuggle arms to over the President Obiang Nguema Mbasago’s regime. This isn’t the first time, in 2005 Moto hired some European and South African mercenaries (including Sir Mark Thatcher, former British Prime Minister, Lady Thatcher’s son) to overthrow the Obiang regime with the understanding that Moto will give them US$1.8 million and oil rights. While the Equatorial Guinean case fit into John Ghazvinian’s Untapped: The Scramble for Africa’s Oil, where most Africans in oil producing countries do not benefit from their oil premium enough, the on-going oil debate in Ghana foretell different prospects in a climate of fast developing democracy with all corks of freedoms working.

The implications of Ghana’s oil wealth benefiting ordinary Ghanaians’ well-being is informed by the country’s developing democracy and its consequent deepening decentralization exercise that has given Ghanaians greater participation and say, through an increasingly freer mass media, in its oil finds and its prospects. This isn’t the case in Equatorial Guinea, as Randall Fegley indicates in Equatorial Guinea: An African Tragedy, that had had long-running brutal autocratic rule, immense suppression of the mass media, violent human rights abuses, extreme tribalism, and fake democracy even up till today that is so bad that at a point one-third of its 520,000 people were either in exile or imprisoned, making the country got the tag “Africa’s concentration camp.”

Equatorial Guinea’s ruling elites have not being able to play with the intersection of oil windfall, democracy and development for an all-inclusive progress of its citizenry as oil rich Canada have done. Ghana is not in this state of Equatorial Guinea’s development and makes the prospects of its oil finds benefiting its citizens brighter.

The comparison of Ghana to Equatorial Guinea oil scene fit into the contentious arguments that oil boom in a democracy brings better development than oil boom in autocracy as somehow Malabo is touting, which unwittingly provides a perpetual rational for maintaining autocracy, as Joseph Siegle explains in The Governance Roots of the National Resource Curse. But that’s not good for development, especially considering Africa’s development history and culture. The reason, as the Indian Nobel Prize winning laureate Amartya Sen argues in Development in Freedom, is that development necessitates the unblocking of foremost sources of unfreedom – poverty, tyranny, “poor economic opportunities as well as systematic social deprivation, neglect public facilities as well as intolerance or overactivity of repressive states.”

The oil debate is so far so good, as seen in Accra’s playing with international oil experts, learning from the African experiences, tapping the experiences of oil producing nations such as Norway, and involving local non-governmental organizations such as Transparency International in order to avoid any threats of the “resource curse” or “rentism.”

* Mr. Kofi Akosah-Sarpong, who is published in over 30 African countries, just completed a study of the intersection of Africa’s emerging oil windfall, development and democratization at Canada’s University of Ottawa’s International Development and Globalization Department. He takes up appointment as a senior international development planner at an international development NGO in Toronto.