Every Ghanaian Should demand oil revenue plan

Before you read this article, ask yourself two things. Can you state how much Ghana expects to earn from oil and any projects the revenue will be used for? If you are like me and cannot answer these questions then you must read on.

As a concerned citizen, I have observed with immense dismay that as Ghana draws closer to commencing oil production, a well-defined, clear plan still does not exist as to what the nation intends to do with the estimated $1Billion a year in oil revenues. Without such a plan, the country is knocking on the door of national discontent, tribal infighting and wasted opportunities. A wise man once said, “When you fail to plan, you are surely planning to fail”. It is utterly unacceptable that to this day, there still is no transparent and strategic plan of action detailing exactly how much revenue is to be allocated to which areas of targeted investment, in order to generate subsequent income for further development. The nation is toying dangerously with repeating similar mistakes, where after decades of foreigners helping themselves to our natural resources, it is estimated that almost 80% of our people still live on less than $2 a day. It is my hope that our rural folk, in-country intelligentia, academia, the Ghanaian diaspora, middle and upper class, and the youth will join the clarion call to speak up and demand answers.

WHERE IS THE PLAN?

So where is the plan? A brief by Revenue Watch (3 August 2010) stated, “Most importantly, in conjunction with the Ghanaian Oil Revenue Bill, Ghana needs to have in place a long-term development plan to ensure that oil proceeds are in fact channeled towards productive domestic investment.” An article by Chuck Neubauer in The Washington Times (9 July, 2010) stated, “With oil set to flow in a matter of months, critics are worried that Ghana has failed to come up with a detailed national strategy for spending an estimated $1 billion a year in revenues.”

Our nation needs a bold, dynamic and inspiring vision as to where we are headed when the first drop of oil is brought to the surface. If there was ever a time that we needed great and transformational leadership - it is now. We stand at a very important crossroad in our journey as a nation and with no plan or “map” we risk taking a very wrong turn.

GHANA OIL REVENUE BILL NO SUBSTITUTE FOR VISION.

The Petroleum Revenue Management Bill makes a descent attempt at establishing a framework for the collection and management of Ghana’s oil revenue; however, it lacks a vision for the future. The suggestion that oil revenues should be used to meet Government expenditure or collateralize loans is precarious and condemns future generations to risk virtually no benefit from the oil. This formula is the same formula we have been using for our diamonds, gold, etc. Have you been to Akwatia or Obuasi lately? Trust me it is no Johannesburg.

POOR MAN’S THINKING VERSUS RICH MAN’S THINKING.

When you are poor and God blesses you with an unexpected source of money, you can do a couple of things. You can rapidly invest the money in some business or industry that will generate a large return on your initial investment and allow you to build wealth for your heirs. Under this approach you also continue with whatever you were doing to survive before you were blessed with the new revenue stream. The other thing you can do is take your new revenue and use it as a down payment or guarantee (collateral) to take out loans. Now consider that you already have a pretty dismal track record when it comes to taking loans, accounting for these loans, paying back loans and showing what these loans where used for. In addition, you also decide to use this new revenue to pay your living expenses. Also take into account that you do not understand the meaning of delayed gratification. So we are confident that your appetite for expensive cars, private luxury jets and multiple homes will get the better of you. Eventually, the money will run out, servicing your loans will consume you and you will be broke. Case in point is Nigeria.

I submit the first approach is the more prudent one, but for some reason a few people are pushing the latter in the halls of Ghana’s parliament. Just because you are fully funding the government budget does not mean that the country will develop. Remember, Government expenditure includes many things that have absolutely nothing to do with development or directly benefiting our citizens. That is why we need a visionary plan.

PLANNING TO BE LIKE NIGER DELTA OR HOUSTON, TEXAS.

The plan I speak of should be bold yet at the same time simple enough so that almost every Ghanaian can understand and articulate it. Let me give you some examples. Maybe the vision could be to turn Ghana into the petro-chemical industry leader in the sub-region and not an oil producing country. There is a big difference between being an oil producing country and a petro-chemical industrial leader. One is short term thinking versus long term thinking. One is developing nation thinking versus developed nation thinking. One is Niger Delta thinking versus Houston, Texas thinking. A plan could be unveiled showing how Ghana would take the lead in creating a robust petro-chemical industry that would employ a number of Ghanaians in well-paying jobs.

Or our leaders could tell us that the vision is to use oil revenues to build world class state of the art universities in every region. Make Ghana the premier destination for tertiary education and market our schools to students from the sub-region, whose tuition fees would be used to subsidize the tuition of Ghanaian students.

Or the plan could be to build a high speed rail network throughout the country to carry people and goods. A rail system so well thought out and planned that it is possible to envision living in Takoradi or Kumasi, yet traveling to work every day in Accra. This rail system could be linked to our ports in Takoradi, Tema and our borders crossings in the Ivory Coast, Togo and Burkina Faso. This would establish Ghana as the logistics and supply chain king of the sub-region.

Maybe the vision could be to transform our hospitals to match any top health center in the world, propel Ghana to a center of healthcare excellence and market it to anybody in the sub-region willing to pay for quality healthcare. This would create a healthcare industry that could be used to subsidize care for our citizens and better enumerate our embattled and overworked physician and nursing core.

Heck, I would have no problem if all the revenues were used to transform the Western Region into an African icon of quality jobs, infrastructure, tourism, schools, industry, sanitation and utilities. Even that would have a spillover effect that would benefit the whole country. I am sure other individuals more capable than myself can come up with even more examples of profitable, focused, measurable and attainable industries that will continue to create wealth and jobs long after the last drop of oil is gone.

WE MUST DREAM AGAIN.

I am sure this article will be criticized for being naïve, idealistic, dreamy eyed and not understanding national realities. That may be true; however, I do understand that almost every phenomenal success is usually birthed with a deliberate, cohesive and thoughtful plan. It is not a sin to dream for a better Ghana. The day we stop dreaming of a better future for our children and our nation, we will be rendered hopeless, desperate, bitter and disillusioned by the nightmare of our present condition.

No one should tell me that the points listed above are beyond our reach or capabilities. I have seen the best of Ghanaians both in-country and all over the world. We are the descendants of freedom fighters and visionaries. There is nothing we cannot achieve. Our forefathers from every tribe built great empires, complex societies, resisted oppression and captivated the world with the birth of the Black Star of Africa. Let us rally that inner strength, focus and determination that our forefathers had and use this oil find as a catalyst for something great. Let not the world point at Ghana 20 years from now as another example of African failure, incompetence and mismanagement. Rather, let us ensure that the whole world will look at us 20 years from now and say that Ghana was different. May all come to see our beloved nation as an oasis of peace and prosperity in a sub-region that desperately needs a shining example of hope and possibilities. Really, is a plan too much to ask for?

Comments can be sent to Kwabena N. Asamoah, Fels Institute of Government. Email: kasamoah@sas.upenn.edu