President John Dramani Mahama on sustainable growth

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President John Dramani Mahama


Africa has had a chequered history, and we have gone down the wrong path several times. Today, all of us recognise that it is necessary for society to progress as a single unit and that we cannot achieve the kind of progress we desire when one section of society lives in absolute wealth while the majority of the people wallow in poverty.

Today, we all, as the world, adopted the Millennium Development Goals, and we resolved to cut poverty in half by 2015. We resolved to achieve universal primary education and gender parity in education; we resolved to eradicate HIV/AIDS; we resolved to cut maternal mortality in half; we resolved to ensure access to clean drinking water for people; we resolved to ensure access to sanitation.

These are all goals that were not heard of in the 1970s. And so, all of us have been working to achieve these goals.What it shows is that typical capitalist concepts of economics to fix economies will not work in a continent like Africa. You need to advance the nations of this continent in unison and not in segments. You cannot have a super rich segment of Africa enjoying all the fruits and the majority of our people living in poverty.

Let governments create the right environments for the private sector to take opportunities to develop our countries.We have done it before, and I had the opportunity to assist in Ghana as Minister of Communications to deregulate the telecoms sector. I remember that when we started the deregulation and liberalisation of the telecoms sector, there were the apostles of doom, and there were others who said the telecoms sector was so sensitive that it could threaten the security of the state if you allow the private sector to come in.

Today I look back, 15 years on, and see how far not only Ghana, but also the whole of Africa, has come with respect of the telecoms sector, and it is amazing. The bulk of this investment has been done by the private sector and not by governments.

We can repeat what we did in telecoms in other sectors. Let’s deregulate the energy sector and let the private sector do what it does best: invest and produce energy to feed industry and for domestic consumption.

Let us deregulate the transport sector and let the private sector do what it does best.

Invest in transport, and we will be able to move our people across the continent.

Let us let the private sector do what it does best – raise investment for infrastructure – while government concentrates on the social sector to improve health care, to improve education and other essential human development index indicators.

Africa has a very big advantage because it has a rapidly growing youthful population, which means that there is a big labour force that, if well trained, could make Africa into the centre of business and manufacturing.

But this also represents a threat, because if the current growth rates that we are seeing across the continent are not translated into jobs, then we are going to have a threat from the growing population who will become a huge labour force that cannot find work on the continent.

What must we do as governments? It means that we must reorient our economies away from just what was handed down to us. One of the critical things that we need to be doing as national leaders is to promote value addition to the natural resources that we possess.

We are the second largest exporters of cocoa in the world and yet cocoa, as a finished product, is mostly secured from the advanced Western countries in the form of chocolate, in the form of drinking chocolate and in all its other manifested forms.

We have for many years been exporting raw beans to the international market, and the beans are processed in other countries and sold to us. In Ghana we have increased local processing, and we are going to continue to increase local processing. We currently have capacity for processing up to 24% of our raw beans, and it is our intent to increase that to 50% of our raw beans in the near future.

We have an aluminium industry and the Volta River Project, which is the Akosombo Dam. It was established as a result of the aluminium smelter that was built by Kaiser Aluminium in the 1960s. Ghana has bauxite, and what happens is, the bauxite is mined, it is exported to alumina plants abroad, it is processed into alumina, the ingots are imported into Ghana to feed our aluminium smelter in Tema, and the aluminium is produced and re-exported to the world market. It is our intention to build an integrated aluminium project by fitting in the missing link to mine the bauxite, produce the alumina, feed the alumina to the aluminium smelter to either export or use what we can in our own industry.

We can make the same changes to our gold production. Ghana is currently a significant producer of gold. We mine the gold, and we export the bullion in its raw form. Despite many years of exporting gold, we do not yet have a refinery located in Ghana. It is our intention to build a refinery in Ghana to refine our gold and also build a jewellery industry, so that we will be able to export world-class jewellery. If we accomplish this, we will not have to export raw gold to have it refined and then go back again to import world-class jewellery.

It is the same situation with other countries producing oil and gas. In Nigeria, for instance, oil is exported in huge quantities – almost 2m barrels per day – and yet Nigeria has to import the finished products such as petrol, diesel and all that. Ghana is a young entrant into the oil and gas industry, and we do not produce anything near the quantities we see in Nigeria. And so we must create a value addition even to this oil and gas industry.

Trade among African countries is still the lowest. The latest figures I saw showed that only about 11% of total trade in Africa is amongst us, and there have been hindrances put to expanding this trade.

I think that it is time for us leaders to start walking the talk and that it is in the interest of all of us, it is a win-win for all countries in Africa, that we increase integration and trade amongst ourselves.

My own sub-region, ECOWAS, is probably the oldest sub-region. It was formed in 1975, before even the EU was formed, and yet despite the protocols that we have passed, we still see too many hindrances to integration.

We do not yet have a free trade area established among us; we have not yet agreed on a common external tariff. Just recently, when we met in Abuja with ECOWAS to agree on a common external tariff, we still had problems: at the last minute one of our countries raised an objection and said they were not ready yet, and after seven years of negotiation, we still have to wait for others to get ready before we are able to introduce a common external tariff.

We must give meaning to integration if we are to move our countries forward.

Another threat to Africa’s development, and this is my final point, is the availability of power. Nobody will invest significantly in a continent when he is not sure that he will have access to reliable, affordable power. And if there is one challenge that we face in almost all of our countries, it is that we do not have enough power.

Yet we have the potential to be probably the biggest producers of power in the world. That is why we need to deregulate the energy sector and allow the private sector to come in and produce power. Government on its own cannot leverage the kind of investment that is needed to provide the power that Africa needs, and so we should allow the private sector to come in.

We have started to do this in Ghana with independent power producers, and we hope that it will grow and be able to interlink our transmission grids so that those countries with excess power can export to other countries that do not have enough.

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Cover of The Report: Ghana 2013

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