How Do You Build A Financial Capital?

News report that caught my eyes is a report that a Constitutional Review Implementation Committee has recommended that the government build a second capital that will be Ghana's financial capital in Kumasi. Welcoming as the news may sound; it shook me to the core for the simple reason that a massive waste is ahead of us just like Nigeria wasted lots of money when they started drilling oil.

How do you build a financial capital? Is the government going to move Bank of Ghana to Kumasi? Is the government going to relocate the bank head offices to Kumasi or is the government going to provide incentives for the banks to build the head offices in Kumasi? I have heard of moving the seat of government; one of the most recent and famous being Nigeria's move of the capital to Abuja from Lagos, but financial capital?

American system of government leaves room for one state to pit against another for business headquarters. For instance, former Senator Dodd from Connecticut, who was very influential and a long time chairman of the financial committee in the US senate, lured many banks to locate their headquarters in Connecticut. Delaware lured many banks to locate their head offices in Delaware with laws favorable to the Banks. North Carolina in recent years has done the same thing to attract banks to locate in Charlotte, North Carolina.

It is true that many countries have the seat of government in one city and financial capital in another. For instance the seat of government of the US is in Washington, DC as everyone knows and the financial capital is in New York. (And may I point out that the Federal Reserves Bank has its headquarters in Washington, DC where the seat of government is.) Often, as I know it, financial capitals evolve naturally through trade around where the seat of government is because that is where most of the jobs are and that is where trade and financial activities revolve. Yes, occasionally financial capitals evolve outside where the seat of government is, but often the seat of government is moved and the financial capital that has evolved around the seat of government is left behind like Nigeria did. This is nothing that Ghana should emulate anytime soon. Nigeria's act kept it from becoming the financial power house that it could have become.

In my opinion, countries that shore up their farming base often survive through financial turmoil. America survived its depression years despite the hardship that many went through. South Africa has a well established farming system. Zimbabwe used to be the bread basket of Africa because of its farming until the farm lands where taken away and the farmers stopped farming. Kumasi is already our "Garden City." Further investment in farming in the area will do a lot more for Kumasi.

If the idea of a new financial capital in Kumasi is an attempt at reducing overcrowding and transportation problems, this is ill-advised. Kumasi itself has its own overcrowding problems. Even Cape Coast has overcrowding problems. You do not solve poor city planning issues by building new capitals. I will grant that even our colonial masters may not have anticipated how Accra grew. The time Ghana should have started working on the poor planning of Accra is long gone but that does not mean we cannot start working on it now. We are definitely not going to do it by driving peddlers from the streets or having Accra Mayor sending his men out to bite off people's ears. Despite the overcrowding, I believe Accra has room to grow and grow beautifully but you start rebuilding Accra from outside Accra.

America solved its depression problem by pumping public money into work programs. Many people living in America, I'm sure, have seen lots of road construction going on in their cities. President Obama continues to hound congress for money for infrastructure rebuilding. President Carter had a highway construction program when he was president. So did President Reagan and the junior Bush. The senior Bush refused to have a highway construction program and wind up a onetime President. America's first line of defense is a jobs program to build or repair roads.

If we want to "empty out" Accra, the first thing is to plan a trans-Ghana highway system and start construction in many small cities along the highway system. This will provide jobs outside Accra and people hanging out in Accra with no jobs will rush out to find the jobs. Bear in mind that as people work doing construction, they make money that they spend on rent, furniture, food, clothing, and even an occasional hard liquor: this provides economic activities in other areas and help provide employment in other areas. As the highway system gets closer to Accra, we will have a well spread out Ghana and room to build a well planned Accra that will be bustling and well ready to house a vibrant financial capital and seat of government.

Of course we can't keep borrowing money from China and bringing Chinese to Ghana to build our highways. We should start making wise investment with our oil money. We should also start now training people with the skill that we need to build the highways.

There is a prosperous future for us if we take the right steps to move our country. Long live Ghana.

Tony Pobee-Mensah