Flaws in article on Ghana Rice Coalition

Mon, 18 Sep 2006 Source: Brown, Patrick

On September 7, 2006, Franklin Cudjoe posted an article on ghanaweb.com, entitled "Response to the Ghana Livelihood Coalition on Rice Importation".

While I don't doubt his sincerity in helping Africa resolve her problems, I must take him to task on some flaws in his article about rice and trade policy for Africa.

Mr. Cudjoe claims that "[rice] self-sufficiency can only lead to higher prices for long-suffering consumers, with trade barriers to keep more efficient (cheaper) producers out….. Ghanaian consumer has suffered because of shoddy and defective goods manufactured locally".* * While it is true that imported rice has better quality, it is false to claim that rice production is more efficient in the US and Europe. Why? It is because a sector cannot be subsidized and efficient at the same time. The true cost of imported subsidized rice will be significantly higher if open and free markets were to dictate. As to the issue of shoddy local goods, promoting intra-regional trade and private enterprise competition are better solutions than importing subsidized goods.

Mr. Cudjoe's comparison of Ghana to Hong Kong, Taiwan or Korea reveals a big gap in his understanding of East Asia. To say that "Hong Kong has never been self-sufficient in food production" is ignorant at best. The truth is that these highly populated Asian states have a rather well-rounded development approach. Every sector of the economy is well-developed and agriculture is no exception. If one considers the scarcity of arable land in East Asian states, it is amazing how farmers in these places are productive and advanced. Mr. Cudjoe proposes that we should excel in "Information Communication Technology (ICT)" because agriculture may not be Africa's forte. As an example of the ICT economic model, he cites India. Yet we all know that India is a nation whose model of outsourcing is creating imbalances and institutional poverty. Taiwan, another example he cites, is acceptable but not because of its inferior agriculture sector. A wiser comparison to Africa would be Brazil. Brazil is on mission to become self-sufficient in many sectors - commodities (cotton, fuel, grains), aircraft, and even nuclear energy.

Perhaps the most troubling aspect of Mr. Cudjoe's analysis is his constant reference to supranational organizations like WTO. Which is the worst thing to come from these organizations? Is it their self-serving rankings (freest nation, richest or poorest countries, most human-righteous nation, and so on)? Or is it their "advise" on how to be a perpetually debtor nation. Need we be reminded again and again of the hit men and women who run these organizations?

Notwithstanding all his flaws, Mr. Cudjoe gets it right when he asks* " *Would Uganda get to sell its excess maize or coffee to Tanzania, which probably has about as much maize and coffee to deal with?" Intraregional trade, in conjunction with a *balanced economic model*, is the key to success in Africa. Africa has little or no comparative disadvantage; she has it all (land, solar, oil, man and brain power) except for leadership. All three sectors of the economy must be developed and integrated – basic goods, services and infrastructure. We may import commercial airliners from Boeing and Airbus but certainly not rice, soap, and basic commodities. We need basic infrastructure that integrates West Africa - roads, airports, electrical and communication facilities. As for the service sector, I cannot imagine anything more urgent than a unified central bank for at least West Africa. This will end our need for "hard currency" borrowing, remittances, and reserves. I hope to have eliminated some confusion that Mr. Cudjoe's views could cause. Together, we can make the world a better place for all humanity.

Views expressed by the author(s) do not necessarily reflect those of GhanaHomePage.

Columnist: Brown, Patrick