Comparing Ghana to Singapore

What made Singapore better developed than Ghana? (Part 1 of 3)

-In his Independence Day message, Arthur Kobina Kennedy wrote, ?So old in terms of a life yet so young in the life of a nation. Despite the short span, nations like Singapore have shown that it is enough time to move from third to first world status? (www.ghanaweb.com March 6, 2006).

The miracle of Singapore

Can Ghana match Singapore's achievements? Yes we can. All Ghana needs is fresh leadership; a leadership with some hunger and will to transform Ghana and her institutions. Leadership with a similar appetite of Ghana's first young and dynamic Head of State, Kwame Nkrumah, who saw the skies to be the only limit for Ghana even as a young nation. Will Kennedy be a good substitute? You bet! Ghana needs some miracle to even up with Singapore?s achievements though. Kennedy?s Independence Day message seeks to unite the nation not divide it, to work with all qualified Ghanaians irrespective of party affiliations or ethnic composition. Ghana is for all Ghanaians not the few. No tribe or regional entity should claim monopoly of power or wisdom to rule Ghana. However, Ghana needs a strong leader. Kennedy is strong enough to put his feet down and tackle with assiduousness, diligence and persistence the problems that hang around the neck of the Northern Region.

Ghana oh Ghana! ?So old in terms of a life yet so young in the life of a nation. Despite the short span, nations like Singapore have shown that it is enough time to move from third to first world status? (Arthur Kobina Kennedy). Where is Ghana now? Would Kennedy be a miracle worker or what!? Nkrumah declared on the eve of Independence, ?Ghana is free forever.? But can we say so now when we can?t even manage our own national parks? Although private ownership may be more durable and profitable in today?s economies it is not prudent on the part of our government to ignore its nationals when it comes to NATION BUILDING. Privatizing national assets to foreign companies or the management thereof is not a suitable antidote for Ghana?s poverty.

According to the GNA report of 25th February 2006, Professor Dominic Fobih, Minister of Lands, Forestry and Mines, has announced that three national parks have been earmarked for privatization in the country. They are the Kakum National Park in the Central Region, Mole National Park in the Northern Region and the Shai Hills in the Greater Accra Region. The Minister of Lands made the announcement at a ceremony at the Manhyia Palace in Kumasi on Friday 24 February 2006 to formally introduce members of the Kumasi Zoo Advisory Board to the Asantehene. According to the honorable Minister a Dutch company from Tanzania had already made a good offer in respect of the Kakum Park, while the Shai Hills "is already under Marina Tours?. How can a country sell its land (assets) to foreign companies and claim to be free and independent? Rather than building upon the infrastructures Osagyefo Dr. Kwame Nkrumah in his wisdom and vision has built for Ghana (and posterity) our recent governments have been doing all in its power to sell the legacy which have been entrusted in their hands. As Kennedy rightly puts it,? We should not pass on difficult issues to future presidents, parliaments or people to deal with.? The present Government and Parliament must ACT Now.

It must be recalled that Nana Akuffo Addo, Ghana?s Foreign Minister, unveiling his manifesto at KNUST for his 2008 presidential bid remarked that, ?it is unacceptable that Ghana gets 5% of the value of gold exports, as reported by UNCTAD last September.? 100 percent of Ghana?s gold is exported yet Ghana makes only 5%? Under the Ghana Free Trade Zones law established in May 1996, a company qualifies to be a free zone company if it exports more than 70 percent of its products. Among the incentives for free zone companies are a ten-year corporate tax holiday and zero duty on imports. God help Ghana! The principal law regulating investment in minerals and mining is the Minerals and Mining Law, 1986 (PNDCL 153) as amended by the Minerals and Mining Amendment Act, 1994 (Act 475). This law regulates investment in mining, except for small-scale mining, which is reserved for Ghanaians. The government revised the law again in December 2005. The revised law contains a stability and development agreement, which protects the holder of a mining lease from future changes in law for a period of 15 years. The Minerals Commission is the government agency that implements the law. So, the question is why is NPP (his government) repeating the same mistakes of the former regime in leaving ownership of Ghana?s infrastructure solely in the hands of foreign companies? Major foreign investments in Ghana are mainly in mining and manufacturing. Great Britain is Ghana's leading foreign investor with direct investment exceeding USD 750 million. Major U.S. investors are, CMS Energy (independent power producer), Regimanuel Gray Limited (housing and construction), Coca-Cola Company, Affiliated Computer Services (data processing), Pioneer Foods (Star-Kist tuna), Phyto-Riker (pharmaceuticals), Millicom (telecommunications), and Newmont Mining.

This author is hereby beseeching Ghana Government to consider Ghana leadership union?s appeal to consider a second alternative by making it a condition for foreign investors only to be allowed to subscribe to 49 per cent of the share value of any Ghanaian investment opportunity while Ghanaians both home and abroad are allowed to subscribe to the remaining 51%. As good custodians our government (today) must reconsider the reasons behind Nkrumah?s vision and motivation in building such infrastructures as National Parks and find some innovative way to deal with the re-colonization politics of the IMF and the World Bank. What prevents our government from handing over ownership and management to qualified Ghanaian investors (or genuinely including them in the ownership deal in the open market? As Kennedy has rightly said, ?Ghanaians should be more welcoming of diasporans as investors, civil servants and experts deserving of the same respect and acceptability reserved routinely for foreign experts? (Arthur Kobina Kennedy).

According to Article 257 (1) of the 1992 Ghana constitution, (as cited by George Asomaning, Esq. in his article, unpublished). ?All public lands in Ghana shall be vested in the President on behalf of and in trust for, the people of Ghana?. Article 266 stipulates in no uncertain terms, that ?No interest in, or rights over, any land in Ghana shall be created which vests in a person who is not a citizen of Ghana a freehold interest in any land in Ghana?. Therefore, it would be proper for the government to reconsider its decision in this matter of selling Ghana national parks wholly to foreign firms as outlined by the honorable Minister of Lands. The idea of selling or long term lease of national parks and assets to foreigners is inimical to the interest of the people and the State, and must be stopped.

It must be recalled that on February 15, 2006 our honorable Foreign Minister, Nana Akuffo Addo remarked that as Ghanaians we cheat ourselves if we buy the lie that we need outsiders to teach us entrepreneurial skills. As proposed by our incumbent Foreign Minister in his ?indigenous capitalism? crusade we need to look nowhere beyond our own birthright and our recent evolution in order to imagine and realize the answer to more effective growth in our country. ?By indigenous capitalism I am talking about the kind of wealth accumulation that ensures no one has to go hungry, that ensures the greatest number of the population actively participates and benefits from economic growth. The kind of capitalism that is protective of the vulnerable and generous in its calculation of the bottom line? (Nana Addo Dankwa Akufo-Addo). According to GIPC, the minimum capital required for foreign investors is USD 10,000 for joint ventures with Ghanaians or USD 50,000 for enterprises wholly owned by non-Ghanaians. Trading companies either wholly or partly-owned by non-Ghanaians require a minimum foreign equity of USD 300,000 and must employ at least ten Ghanaians. So how much is being offered for Ghana national parks and who are the other 10 other Ghanaians?

The Ghana Investment Promotion Center (GIPC) Act, 1994 (Act 478), needs some scrutiny. It is very ridiculous for Ghana government only to see local investors in the eyes of ?Neo-colonization? (what Kwame Nkrumah fought against at independence). ?The GIPC law specifies areas of investment reserved for Ghanaians, as small-scale trading, operation of taxi services (except when a non-Ghanaian has a minimum fleet of 10 vehicles), pool betting businesses and lotteries (except soccer pools), beauty salons and barber shops. The law further delineates incentives and guarantees that relate to taxation, transfer of capital, profits and dividends, and guarantees against expropriation. The Government of Ghana has no overall economic or industrial strategy that discriminates against foreign-owned businesses (US Department of State website). Although it is good for the Government of Ghana to be ?foreign-investment-friendly? it is also not good for Ghana Government to discriminate against Ghanaians when it comes to privatizing Ghana?s infrastructures. It was only prudent for the GIPC also to give some attention if not priority to Ghanaian investors. Ghana Government officials use their positions to enrich themselves. According to the United States Government, Ghana government employees have been known to ask for a "dash" (tip) in return for assisting with license and permits applications. The anti-corruption institution established in 1998, called the Serious Fraud Office(SFO), to investigate corrupt practices involving both private and public institutions is highly ineffective.

Comparing Ghana to Singapore

Both Ghana and Singapore were former British colonies. Like Ghana, Singapore is strategically placed on the map. .Ghana and Singapore are blessed with a natural harbor and strategic location. Like Ghana in 1957, Self-government was attained by Singapore in 1959. In May 1959 Singapore's first general election was held. Ghana?s first general election was held around the same time and became a republic in 1960. Like Ghana on July 1, 1960. Singapore was separated from the rest of Malaysia on August 9, 1965, and became a sovereign, democratic and independent nation. Thereafter commenced Ghana and Singapore's struggle to survive and prosper on its own. However, in the late 1950s and early 1960s, while Ghana was booming with all the vibrancy of a newly born nation, Singapore was unable to generate enough jobs for the thousands who were entering the labor market. Unemployment was high and rising. In 1957 the unemployment rate was 5% rising to 9.2% in 1966. There was an acute shortage of housing and inadequate health facilities in Singapore. This was compounded by the high population growth rate of 4.4% per annum between 1947 and 1957.

What made Singapore so developed than Ghana then?

LEADERSHIP! To say the least, Military adventurism (administration) has crippled Ghana?s growth. Today an estimated 40% of Ghana?s population of approximately 21 million still has a per capita income of less than $1 per day and unemployment remains high. According official document (2006 Congressional Budget Justification) inflation is expected to rise to 20% by year's end.

Like Nkrumah of Ghana, Lee Kuan Yew of Singapore envisioned that farming and production of raw materials to feed multi-national companies was not the answer to economic growth and prosperity. So they embarked on solid industrialization on attainment of independence. Factories were built. Nkrumah like his friend, Lee Kuan Yew of Singapore also saw that the inherited colonial education was inadequately developed to meet the needs of the local community so they began to reform the colonial heritage. However, Nkrumah?s dream for Ghana was short circuited by some men in uniform in 1966. While Ghana in the 1970s and 1980s was crippled by khakitocracy (and military coups), Singapore was working on her industrialization strategy. During the period 1970-79 real GDP grew by 9.4% per annum. Singapore absorbed during this period an average of US$0.3 billion of foreign direct investment (FDI) yearly making it the fifth largest recipient among developing countries. The economy was transformed with this injection of foreign capital and expertise. Manufacturing became the largest sector with its share of GDP rising from 20% in 1970 to 27% in 1979. Exports of goods made in Singapore became more important than re-exports. Domestic exports rose from 39% of total exports in 1970 to 59% in 1979. The share of re-exports fell from 61% in 1970 to 41% in 1979. The financial sector grew rapidly. The Asian Dollar Market grew from US$31 million in 1968 to US$38 billion in 1979. The commerce sector grew rapidly from a new source - tourism. The number of visitors grew from 500,000 in 1970 to 2.2 million in 1979. Massive unemployment disappeared. Unemployment fell from 6.0% to 3.3% in 1979. During this period a total of 430,000 new jobs were created, with the manufacturing sector generating nearly half of the new employment. Full employment was attained in the early 1970s and labor shortage and job hopping developed. Thanks to political stability and her focus on key economic indicators like education today Singapore's government has raised its 2006 growth forecast to as much as 6 percent after the economy expanded faster than economists expected in the fourth quarter on exports of electronics and drugs (Bloomberg, Feb. 16, 2006 online).

According to BBC News, in 2004 Singapore's economy grew at a rate of 12.5% in the three months to June from the same period a year earlier. The Ministry of Trade and Industry (MTI) has forecasted growth of between 8% and 9% for the whole year, putting Singapore on a par with China, the fastest growing economy in Asia. It is the fastest quarterly expansion in a decade, and confirms the country's status as one of Asia's fastest growing economies. The main driver of growth has been increasing global demand for computer chips and pharmaceuticals. Singapore's economy has delivered near double-digit growth in each of the past four quarters as it recovers from the effects of the Sars virus. The virus badly affected south-east Asia, denting tourism revenues and travel across the region. (BBC News, Monday August 9, 2004, 05:39 GMT 06:39 UK). So how did Singapore overcome these hurdles and gained a fist world status by 2000? This author would like to trace Singapore?s victory to her Educational Policies. This author would like to trace Singapore?s victory to her Educational Policies. [TO BE CONTINUED IN PART 2]