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Opinions Mon, 5 Nov 2012

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Can Ghana Learn Lessons from China?

By Kwesi Atta Sakyi 31st October 2012

China, with an estimated population of 1.6 billion, is the ascending

economic giant and cynosure of all global eyes. Chinese manufactured

goods have permeated every part of the world. Made in China is now a

brand to be associated with quality and affordability. Of note are

Chinese electronic goods such as laptops, cameras, camcorders,

tablets, cell phones of all super brands such as Toshiba, HP, Sony,

Panasonic, Lenovo, Canon, among others. The Chinese have become so

much sought after that many colleges and schools around the world have

started offering basic courses in Chinese languages such as Mandarin.

The Chinese themselves are also aware of their global reach and

importance, and they are voraciously learning English. Chinese

students have also invaded most of the prestigious universities around

the world to gain more knowledge. They have the brains, the money and

steeled nerves to make it to the top, especially in mathematics,

engineering, ICT, physical sciences, among others. China’s land mass

is about 9.6 million square kilometres, or 40 times the area of Ghana,

and their population of 1.5 million is about 60 times that of Ghana.

. The Chinese model of economic growth has remained an enigma and

perhaps hard to replicate, especially regarding their sheer

mammoth-size population and large market. To imitate China is to have

their huge size population and perhaps their peculiar cultural

characteristics. We have had the Asian Tigers and the other Asian

growth models, but nothing is as enigmatic as China’s. We in Ghana, a

tiny West African country with only 24 million people, cannot mimic

China. However, there is always room to improve on our learning curve

and borrow a leaf from the Chinese model. The Chinese have graduated

from a very troubled and harrowing past. Up to 1978, there was the

centrally–planned commandist economy, driven by communist

apparatchiki. In the 60s, we had Premier Chou-en-lai and we had

Chairman Mao Tse Dung. The Chinese crafted an inward-looking closed

economy, with a monolithic state apparatus that led to an autarky

situation or no-trade situation. Since 1978, China has reformed and

liberalised. Yet they are accused of state capitalism and deliberately

maintaining a low exchange rate of their local currency, the yuan or

remimbi in order to gain comparative advantage on the global market in

terms of having relatively low prices for their quality but very cheap

exports.

The Chinese crafted a pro-communist ideology and their foreign policy

had strong undertones of anti-imperialism. China offered help

militarily and otherwise to many non-independent countries in Africa,

particularly Tanzania, Zambia, Ghana, among others. I remember in the

mid 60s, when I went to teacher training college in Ghana, I bought

some top quality white polyster long and short-sleeved shirts called

‘Dadi’ shirts. They are the best shirts I ever saw and wore in my

life. That was from 1966 to 1970. Who says Chinese goods have been

inferior all along? How about in 1280, Marco Polo’s account of high

civilization in the court of Kublai Khan? After 1978, China started

unfreezing her centralist orientation, embracing liberalism or free

market principles.

The Chinese still maintain their strong age-long traditions but at the

same time, they are willing to imbibe the best from other cultures

such as western technology, capitalism and science. That is cultural

diffusion and acculturation. China is one country where Christianity

failed to make inroads. Under communism, religion was banned because,

according to Chairman Mao, it was the opium of the masses, as it

made them sedated and comatose. I have never been to China but I have

come across some Chinese and taught some of their students. The

Chinese are very down-to-earth, pragmatic and highly industrious

people. They are frugal as they do not waste money. Like the early

Pilgrim Fathers in the USA, who embraced the Protestant ethic of

saving, the Chinese save a lot and work hard to accummulate capital.

This is exactly what the Japanese also did to break through. To do

this, you need self discipline and to be focused on your economic

goals. No matter what you earn, you must always save say 20%.

This is seed capital for future wealth. Many people aver that the

secret of the stupendous growth of China is because of availability of

cheap state capital and state incentives given through most of the

banks, which are state-owned. But who, in the first place, put the

savings in those banks? The Chinese people! We Ghanaians, with our

extended families and dependency syndrome, cannot save. We rather

invest in social relationships. Perhaps, we have to tone down on our

external families and concentrate on our nuclear families. The

Chinese invested heavily in human capital, science and innovation, as

well as social and public infrastructure such as irrigation canals,

dams, power stations, roads and bridges, railways and schools. The 3

Gorges Dam on the Yangtze River is classified as one of the largest

civil engineering and multi-purpose project ever undertaken by man on

the face of the earth. The majority of the Chinese are still rural,

as they farm the family lands to feed themselves and even export.

They have got their equation right because there is a strong agrarian

base to ensure food security. Rural youth do not desert the land for

the urban areas. Thanks to government incentives and humongous support

to agriculture. Exports of Chinese silk, tea and rice is world famous.

Government incentives are given to rural farmers who are organized

into cooperatives. Chinese in the Diaspora send lots of investment

capital home to establish firms. Our Ghanaians in the Diaspora need

to do the same. Our rural youth must stay on their farms and come up

with innovative farming ideas to boost production. Our value and

supply chains need vertical integration to avoid bottlenecks in

production, storage, transport, distribution and marketing. We need a

well articulated agriculture programme in Ghana as the backdrop for

our industrial take off, as increased productivity in agriculture will

provide the capital, raw materials and market for the industries.

Hence, the primacy of agriculture in the development calculus.

Our Produce Buying Agencies need to be properly equipped and organized

and incentivised. I think our rural banks’ concept needs to be

empowered by the Bank of Ghana so as to let them behave like the

State-owned banks in China, which offer soft credit lines to emerging

start-ups and entrepreneurs. Each Ghanaian family should register a

company or family business. I salute the Kwahus, Ashantis and

Akwapims who are enterprising in our retail sector in Ghana. The

other tribes can follow their lead. We need to carry out reforms in

land tenure to make it easy for Ghanaian investors to acquire land for

business. Our chiefs should sell land to only serious investors and

desist from selling land to quacks and land speculators. The law on

land needs to be beefed up. In the 60s, there was an indigenous

company which made the waves and it is still going strong. This is

Mechanical Lloyd Ltd, late Robert Darko’s, which deals in heavy

earth-moving machinery. When growing up in Winneba, there were a few

local businessmen or contractors. I will not like to mention names

here. They were notorious for buying expensive cars to show off and

they took to having many wives, concubines and girlfriends.

You cannot mix business with pleasure in a frivolous way. Business

requires discipline. I think Ghanaians can learn from the Chinese. I

have seen Chinese who save money by walking long distances, thus

saving bus or taxi fares. They drink water instead of buying

expensive fizzy drinks. The Chinese are now so rich that they are

buying landed properties in Canada, US, Switzerland and everywhere.

Other successful Ghanaian businesses include Nkulenu Industries, Paa

Kwesi Nduom, Azumah Banda, among others. Instead of our wasteful

pastime of divisive politics in Ghana, let us concentrate on building

our businesses by synchronizing our efforts in partnership synergies.

The story of Lenovo in China is very moving. The promoter started his

business even when China did not allow private enterprise. He was

tenacious and adamant, and he networked with people outside.

Eventually, he broke through and took over IBM. It is said that where

there is a will, there is a way. China has become a most preferred

investment paradise because of highly skilled cheap labour, good

government investment policies, quality infrastructure, food

security, state-sponsored capitalism, a budding middle income class of

entrepreneurs, dynamic culture, discipline, high proclivity for

saving, Foreign Direct Investment from global MNC giants such as

Microsoft, Toshiba, Canon, Airbus, VW, Toyota, among others.

The Chinese now own assets worth trillions of dollars all over the

world, especially in the UK, Germany and USA. Chinese capital

deepening tactics, aggressive and meticulous planning and their robust

culture, have paid dividends in producing GDP growth rates, ranging

from 9% to 12%. The Chinese are unafraid to try new ideas, despite

having a strong traditional culture. Ghanaians can learn a lot from

the Chinese. We must cement our bilateral ties with China and learn

from their example of hard work, discipline and huge appetite to

acquire technical knowledge. I hope that whoever wins the December

2012 elections will not water down our foreign policy towards China,

but will take the fraternal bond of friendship to a higher height.

Contact: kwesiattasakyi449@gmail.com

Columnist: Sakyi, Kwesi Atta

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