So Ghana will begin reaping oil revenues within a couple of years. This country, though still something very different from a post-industrial economy, has long been considered and oasis of stability and relatively little corruption in Africa.
Its population remains quite poor, though it continues to improve steadily and thus probably more sustainably, while Nigeria sees increasing violence.
On the Foreign Policy website this week, Todd Moss argues in Saving Ghana from Itself to pay oil dividends directly to citizens.
In Nigeria, giving more money to local officials meant it was only rerouted from one set of corrupt officials to another. Rebel and/or criminal groups, which increasingly overlap as the conflict goes on, have had a surprisingly effective impact on the oil industry there, reducing production by 20% consistently, and sometimes up to 40%. Rebels argue for compensation for environmental degradation, health problems and development, as well as the provision of energy to local communities, which would facilitate development. Alas, it remains cheaper to flare the excess gas from the oil fields than to channel it into local communities (which would also need the infrastructure to use it).
The UK, Norway, Chili, Botswana and Alaska (after a major corruption scandal) have managed to escape the 'resource curse'.
Moss suggests Ghana go the Alaska way with paying citizens directly oil dividends. My first reaction to this was, oh no, willy nilly spending as credit card companies and other opportunists move into a market not used to such products. However with the return rather low, about $85 per person according to Moss, this does not look like it would lead to such problems.
It is argued by some that in countries where citizens do not see returns from oil and gas extraction, they either turn to insurgency as in Nigeria, or populist political movements, as in Venezuela. Neither has happened in Azerbaijan yet. Or you could have Angola, where rival groups capture oil installations and damn sure guarantee their security in order to fund themselves.
An insurgency would take some time to develop, and hopefully Ghana's political institutions are robust enough to stave off systemic corruption and the subsequent hollowing out of political and economic institutions. Oman, having oil wealth equal only to a fraction of the flamboyant UAE, has embarked on a far more modest sustainable model of development, without major security threats develop as they have elsewhere on the peninsula.
I don't know enough about Ghana to make a semi-credible prediction here but hopefully it will pull of something similar to the other success stories.
No comments:
Post a Comment