Monday, June 28, 2010

Some day, Ghana's Legendary Score > USA by 2-1 will be remembered as the QUINTESSENCE of David vs Goliath, that Economic Might is not Might Everywhere

And so I started my Facebook status, which attracted quite some comments, including one about FORBES.

Some of you may not know, but FORBES--a right-wing publication--has come out very recently to describe Ghana's economy as the "ninth worst" economy in Africa. There's a background to this, which is summed up by one of Ghana's foremost economists Dr.Nii Moi Thompson, who writes:

For years, the US media and successive US governments have been among the loudest cheerleaders for Ghana’s socio-economic accomplishments, but all that seemed to have changed recently when the Ghanaian government dared challenge the decision by Texas-based Kosmos to sell its shares in Ghana’s Jubilee oil fields to fellow American company Exxon without the fiduciary consent of the Ghanaian government, the custodian of the nation’s natural resources. Kosmos’ intended sale was announced on October 12, 2009, a day after China’s National Offshore Oil Company’s interest in Jubilee was made public. Thus, overnight, Ghana found itself in the middle of the new scramble for Africa

Now we don't need any Einsteins in the house to know what's going on. That China's interested in African oil is no news, but what is is the fact that US oil companies want to do us in over our oil. I don't know any country which will quietly sit down and accept that no less than a multinational like Exxon sell its stake in a country's oil to its partner American company. I wouldn't know whether it's a breach of contract in the legal sense, but it doesn't smell right.

Neither does it smell right that FORBES decides to denigrate Ghana--on the basis of no less than statistics from...the IMF!

So, Ghana does not deny being a developing country--but neither is it poor, when endowed by so many natural resources! Our democracy has been hailed worldwide for having been sustained since 1992. It is far from perfect, but time and again, the Western press claims we are "a model" for the continent.

This volte-face is too serious to be funny.

I am glad to see that for once, the government has been quick to react to the story:

The Finance And Economic Planning, Dr. Kwabena Duffuor, has maintained that the current growth being recorded is far higher than what pertains in most sub-Saharan African countries.

In a robust defence of the economic management and performance of the country, Dr. Duffuor rejected a recent publication in a United States publication, Forbes Magazine, that Ghana’s economy was the ninth worst economy in the world, describing the rating as a gross misrepresentation.

He stressed that although the country was faced with serious economic challenges, the growth in the real value of total goods and services produced in the country, also known Gross Domestic Product (GDP), for 2009 far exceeded the average growth rate for the region. The June 10, 2010 edition of the magazine gave Ghana the ranking under the headline, “Ghana Ranked 9th Worst Economy in the World”.

Now, today, I read a Financial Times piece, entitled, "Oilfield dispute fires up Ghana-US match", which offers a fair assessment of the genesis of the dispute:

Kosmos, which is backed by US private equity groups Blackstone and Warburg Pincus, agreed to sell its 23.5 per cent stake in the Jubilee field to ExxonMobil last year. But the Ghana government has declined to approve the $4bn deal, partly because it wants to control who participates in a venture critical to the country’s fortunes.

Ghanaian authorities allege that Kosmos was in breach of regulations when it shared sensitive data with potential bidders without first informing the Ghana National Petroleum Corporation (GNPC).

Another bone of contention has been the link between Kosmos and EO, a small company founded by two allies of former president John Kufuor, whose equity in the oilfield is financed by the Texan company.

Sources close to Kosmos claim factions within the Ghana government are using these issues to thwart the deal because they want to buy the stake at below-market value.

The Jubilee field, which may hold at least 1.2bn barrels of oil, has also attracted interest from Chinese, Korean, French, Irish and British companies.

But here's where it gets juicy, and right on point:

“Ghana is where Washington needs to put a backstop on China’s invasion of Africa,” says an Accra-based businessman sympathetic to US ambitions.

I would love to say I am fearful of what this oil will do to Ghana, but it is not as if we have not been here before ( and neither is it that we will not overcome!).

When our first President Dr.Kwame Nkrumah started getting aid from the "East" after Ghana's independence from the British in 1957, Eisenhower and subsequent presidents--with the exception of J F Kennedy--labelled Nkrumah as a communist. He was summarily overthrown (with Ghanaian help) in 1966 in what we now know was a CIA-inspired coup.

Never mind that Ghana has been a democracy since 1992, for the acolytes of the Bush

administration, it's all about the bottom line. I am over-joyed to read that Ghanaians are reacting to Forbes' mendacity. One such article can be found here:

The author writes:

Our country is not in denial neither are we complacent on the issues confronting us as a nation. However, Forbes reliance on just IMF statistics to portray Ghana’s economy as a lost cause have provided ammunition to our detractors and caused a lot of “collateral economic damage to the economy”.

None of us would have challenged the findings of Forbes if its research had been comprehensive, holistic and balanced.

For example, a World Bank (2008) report states, “as a small open economy, Ghana remains vulnerable to external shocks over which it has little control: commodity prices, climatic conditions, regional tensions, and fluctuations in global, international trade and investment flows.”

In the final analysis, to have beaten the United States with a scoreline redux of 2006 could be construed as possibly the greatest redemption Ghana could ever get!
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