AFRICA’S NATURAL RESOURCES AND UNDERDEVELOPMENT How Ghana’s Petroleum Can Create Sustainable Economic Prosperity KWAMINA PANFORD Africa’s Natural Resources and Underdevelopment Kwamina Panford Africa’s Natural Resources and Underdevelopment How Ghana’s Petroleum Can Create Sustainable Economic Prosperity Kwamina Panford Northeastern University Boston, Massachusetts, USA ISBN 978-1-137-54071-3 ISBN 978-1-137-54072-0 (eBook) DOI 10.1057/978-1-137-54072-0 Library of Congress Control Number: 2016961204 © The Editor(s) (if applicable) and The Author(s) 2017 This work is subject to copyright All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed The use of general descriptive names, registered names, trademarks, service marks, etc in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made Cover illustration: © imageBROKER / Alamy Stock Photo Printed on acid-free paper This Palgrave Macmillan imprint is published by Springer Nature The registered company is Nature America Inc The registered company address is: New York Plaza, New York, NY 10004, U.S.A I dedicate this book to Family Panford of Koforidua, Saltpond, Cape Coast and Nyamoransa (Ghana) led by Double Knight Sir Nana Kodwo Panford, Obaa Panyin Efua Atta Abokoma Panford and John Graves Panford; to the memory of Madam Kate Bampoe of Elmina and Koforidua and Auntie Maggie of Cape Coast and to my wife, Naana Panford, and my grown-up daughters, Araba and Esi Panford Preface As most of the readers of this book will know, the academic enterprise is never the effort of a sole individual Although this book is single authored, its main theme, the need to manage Ghana/Africa’s natural resources well, itself required me to collaborate with many colleagues both within and outside of Ghana and the US. I utilized the theoretical and practical insights of several colleagues who were so generous in many respects This book is the culmination of a journey which started at the Institute for Development Studies (IDS), University of Cape Coast (UCC) in 2009 I joined researchers embarking on an exciting journey: documenting socio-economic, political, and physical conditions in Ghana’s six oil districts before commercial oil production commenced In 2011–2012, I returned to IDS as a Senior Fulbright Scholar to conduct additional oil-related fieldwork in Cape Coast, Accra, Tema, and Sekondi–Takoradi, Ghana’s emerging oil hub I continued this research until June 2015, when I moved to the Sociology Department, University of Ghana, Legon as a Carnegie-University of Ghana Fellow Thus, I am grateful to the US Fulbright Scholar Program, the Carnegie Corporation, and the University of Ghana Diaspora Program; colleagues at IDS/UCC; the Sociology Department, Legon and Ghana Government Ministries/Departments and agencies that provided crucial institutional context and support to allow me to observe firsthand and also participate in phenomena linked to Ghana’s budding oil and gas industry Important among such unique opportunities was vii viii PREFACE my participation in drafting Ghana’s petroleum revenue management and local content (local employment, the use of local supplies, and the involvement of Ghanaian businesses) laws, policies, and practices I had many more privileges to be actively engaged in Ghana’s unfolding oil scene In February 2012, I led the team of consultants that wrote one of the few reports (Public Interest and Accountability Committee (PIAC’s) Report of 2011 in which Ghana declared data/information on how much oil was produced, income earned, and how the incomes were being utilized This report could be one of the first, if not the first, in all of Africa and a rarity in other parts of the world despite the global push for transparency in the oil business As the Lead Technical Consultant, I obtained from the Bank of Ghana data such as the price which Ghana received for its crude oil and the exact types of investments made with the nation’s petroleum funds The Ghana Trades Union Congress (TUC) furnished me with avenues to learn and apply new expertise I addressed the TUC’s Executive Board, and participated in educating workers about international oil intrigue while I completed an inventory of oil skills and training in Ghana as at 2012 This study was sponsored by the Ghana TUC and Norway’s LO. I then spearheaded the crafting of the TUC’s Oil Policy Paper of May 2012 This paper is expected to guide Ghana’s main labor federation in its deliberations, programs, activities, and policies relating to oil I even dialogued with the Ghana National Catholic Bishops’ Conference at Takoradi on November 2011 to allow me to gauge the extent of civic knowledge, commitment, and participation as one of many crucial elements for insuring successful use of Ghana’s newly-found oil At UCC, from 2009 to 2014, I had a unique practical experience that informed my approach to the roles of Ghanaian tertiary institutions in the proper management of oil and other natural resources in this book As a key resource person, I literally sat at the table at which Ghana’s first public university-affiliated oil and gas studies institute was created: the Oil and Gas Studies Institute at UCC. To cap my activities at UCC, the Vice Chancellor and University Libraries invited me to present my research on Ghana’s oil to launch UCC’s Oil and Gas Studies Institute I rely on some of these and other real-life experiences, especially academic exchanges on controversial issues such as whether or not there is, in fact, a resource curse in Africa PREFACE ix to write this book This was, in particular, the case with sections on policies to place Ghana on the right path to ensure that its petroleum resources yield widespread and optimum economic prosperity to avoid disasters that have been created in other African countries such as the four discussed in this book—Nigeria, Equatorial Guinea, Angola and DR Congo Since my main aim in writing this book is to disseminate lessons (both positive and negative) that I learned from my work in Ghana from 2009 to 2016, I consulted many colleagues who shared and shaped my ideas to come out with workable policy recommendations I thank, in particular, the anonymous scholars who peer-reviewed my published articles, technical papers/reports, and the manuscript for this book I acknowledge their constructive critique and recommendations Many of my students and colleagues at Northeastern University, UCC, and the University of Ghana encouraged me to finish this book while some helped with word processing and research assistance To my young scholars, I say thank you While writing this book, I experienced a serious leg injury Thus, I would also like to thank the orthopedic and physio teams at Beth Israel Deaconess Hospital and ATI Physical Therapy, Boston for making it possible for me to finish this book under such daunting circumstances Since this book is about implementing the right public policies and practices in Ghana, the rest of Africa and even the developing world with respect to natural resources and oil in particular, and to create more economic prosperity, I acknowledge the achievements of premier Ghanaian/African nationalists and Pan-Africanists whose lives and achievements made it possible for me as a child in post-colonial Africa to use publicly funded education and training to acquire the knowledge and experience to generate the public policies proposed in this book Foremost among these figures are: Tweneboa Kodua; Paa Grant; Kobina Sakyi; Kwame Nkrumah; Casely Hayford; Nana Kwamena Ansah; Yaa Asantewa; Nana Agyemang Prempeh I; J. R Asiedu; Ako Adjei; Kwegyir Aggrey; Joe Fio-Meyer and John Tettegah of Ghana; Nnamdi Azikiwe of Nigeria; Patrice Lumumba of DR Congo; Chief Lobengula of Zimbabwe/South Africa; Marcus Garvey of Jamaica; Sylvester Williams of Trinidad; King Chaka of South Africa and WEB Dubois of the US. Besides their commitment to their citizens’ welfare, x PREFACE these and numerous others inspired and fought for Africa’s liberation and taught me two valuable lessons: Africa today is stuck in the rut because most, if not all, contemporary leaders have stopped caring for their citizens and They give the hope that Africans too, with perseverance, diligence and careful and smart planning, can deploy their vast natural resources, including petroleum, to generate shared economic and social prosperity Kwamina Panford Boston, MA December 2016 List ACEP AGA AGC AIP Bod BoG CEPA CIDA CNG CPP CRI CSIR DFID EAC ECOWAS EIU EPA ERP EU FDI FTSE GDP GGC GH TUC GIHOC of Abbreviations Africa Center for Energy Policy AngloGold Ashanti Ashanti Goldfields Corporation American Petroleum Institute Barrels of Oil Daily Bank of Ghana Centre for Policy Analysis Canadian International Development Agency Compressed Natural Gas Convention People’s Party Cocoa Research Institute Council for Scientific and Industrial Research Department for International Development (UK) East African Economic Community Economic Community of West African States Economic Intelligence Unit Environmental Protection Agency Economic Recovery Program European Union Foreign Direct Investment Financial Times Stock Exchange Gross Domestic Product Ghana Gas Company Ghana Trades Union Congress Ghana Industrial Holding Corporation xi ...Africa’s Natural Resources and Underdevelopment Kwamina Panford Africa’s Natural Resources and Underdevelopment How Ghana’s Petroleum Can Create Sustainable Economic Prosperity Kwamina Panford... public policies and practices in Ghana, the rest of Africa and even the developing world with respect to natural resources and oil in particular, and to create more economic prosperity, I acknowledge... citizens and They give the hope that Africans too, with perseverance, diligence and careful and smart planning, can deploy their vast natural resources, including petroleum, to generate shared economic