Ghana: Stability giving way to uncertainty?

Ross Gillam

Guardian, Christian Thompson/AP -

Ghana’s President, John Dramani Mahama, has much to ponder on how to use Ghana’s new oil wealth. The Guardian, Christian Thompson/AP.

Having had 6 elections since military rule ended in 1992, Ghana is seen as one of Africa’s most stable and successful democracies. However, despite the perceived stability and political maturity of Ghana, the most recent elections were always likely to test Ghana’s democracy. The prize of victory has grown due to accelerating economic development – Ghana’s economy is one of the fastest growing in the world with predicted growth of 8% in 2012.

Following elections in December and the subsequent announcement that the incumbent President John Dramani Mahama of the National Democratic Congress (NDC) had won, Nana Akufo-Addo of the opposition New Patriotic Party (NPP), deemed the results unacceptable following the supposed “systematic rigging” of the election by the NDC. The opposition have now submitted a petition to the Supreme Court, which is expected to return a verdict this month. The opposition’s claims of electoral malpractice largely counter independent supervisors of the election, including the African Union and ECOWAS, who have claimed it was free and fair. Although Akufo-Addo honourably (and rightly) accepted electoral defeat four years ago to John Atta Mills by a narrow 1%, it is hard to decipher whether his actions following this election are honest or not. As stated earlier, the fact the prize for winning the latest election increased, thanks to new found oil riches, might have pushed Akufo-Addo into contesting the result more readily than previously.

Regardless of whether Akufo-Addo’s claims are legitimate, no longer can oil and Ghanaian politics be analysed independently from one another. As Emmanuel Gyimah-Boadi of Ghana University said in a recent Financial Times interview, the latest election was also a “proxy battle for the control of Ghana’s oil and gas revenue”. Natural resources have too often fuelled corruption and the enrichment of a select few in countries across the world. Now Ghana’s politicians need to ensure this does not happen in Ghana, by ensuring oil revenues are invested appropriately for the benefit and future of wider society. This requires exceptional discipline from Ghana’s politicians, who must also ensure the Ghanaian economy remains diversified and not overly dependent on oil. Again, too often have countries around the world who have large oil reserves failed to diversify their economies, making their economy susceptible to crashes any time the global price of oil falls. The streaming of Ghanaian gas is also imminent, which provides an opportunity for diversification, although it is not the full answer to diversifying Ghana’s economy given that it is another energy stream.

Ghana’s new found energy sources also present opportunities for international energy companies and investors. For instance, the Italian oil firm Eni SpA recently announced the discovery of approximately 450m barrels of oil off the coast of Ghana. Whilst this is an obvious boon for Eni SpA and Ghana, the discovery also poses some less obvious challenges for Eni SpA. Whilst some would argue otherwise, I believe firms like Eni SpA have a responsibility to see that their extraction of Ghanaian oil has a beneficial impact for Ghana’s people in a broad sense and that it doesn’t fill the coffers of a select few. As foreign owners of energy assets in Algeria recently witnessed, it is difficult to operate in a silo from the reality of the social, economic and political situation on the ground. Therefore, shrewd foreign investors and energy companies operating in Ghana will ensure that the benefits of Ghana’s oil and energy assets are felt by the masses, as failure to do so could undermine their own interests.


Oil presents huge opportunities and challenges for Ghana. Photo courtesy of VibeGhana.

Back to the latest political developments, one thing that is good about Akufo-Addo’s challenge is that it is being conducted through legitimate legal channels. Too often have we seen politically motivated violence and coups, as opposition pursue their grievances outside state institutions (granted that these institutions are sometimes not there, or are entirely inept).  Ultimately, many African coups have undermined the fragile development of African democratisation.

Given the international community’s current focus on Mali and Algeria, it is unlikely that they will take much notice of the political tension in Ghana. However, this would be a mistake. Given that Ghana has been a beacon of stability and political maturity across Africa, the international community should urge and support the different political factions of the west African country to come to an amicable resolution. However, whilst this should entail the UK playing a leading a role given our historical relationship with Ghana, this should not be an exercise to patronise or dictate to Ghana as to what it should do. Instead, simple encouragement should be given which also stresses the need for Ghana to maintain its position as a pillar of stability in Africa, whilst simultaneously acknowledging that it is a Ghanaian affair that they alone most resolve.

With parts of Africa seemingly in a period of renewed instability, the international community must hope that Ghana lives up to its reputation as a stable democratic nation. An end to the current political wrangling would help significantly in achieving this, but in the long run it is new energy discoveries which pose the greatest risks and will require the greatest management from internal and external actors.

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