West Africa Rising: Ghanaian citizens develop ‘social pact’ on oil wealth ahead of elections

To prevent the misuse of newfound oil wealth, Ghana citizens groups are urging political parties to adopt a social pact into their manifestos in the leadup to 2012 elections, and to ensure that oil wealth is used for the greater good.

When the coastal West African nation of Ghana struck upon oil in the waters, hopes for its future were raised high. But how to ensure this resource is used to benefit the nation and citizens of Ghana instead of merely draining into the pockets of a few politically connected members of the elite?

A network of civil society groups thinks it has the answer to this question, one that has bedeviled other oil-rich African nations. The solution is a "social pact" between the nation's leaders and its citizens, committing to an agreement on the governance of national resources such as oil and gas that would be incorporated into the manifestos of major political parties before they head to the polls in 2012. Parties that refuse to adopt the pact could face stiff consequences, including getting boycotted.

Ghana has long been the continent's shining example of a relatively functioning democracy, with strong institutions of governance and relatively free of corruption. But even so, many citizens groups say that ordinary Ghanaians have failed to benefit from the country's two economic pillars -- gold and cocoa -- and worry that the discovery of oil could weaken state institutions and increase the gap between the haves and the have-nots.

The group that spearheaded the project, the Integrated Social Development Center (ISODEC) a network of NGOs and civil society groups, recently held its first meeting that was attended by members of prominent think tanks and Ghana’s political parties, including the ruling National Democratic Congress (NDC) and New Patriotic Party (NPP).

Steve Manteaw, editor of the advocacy newspaper the Public Agenda and ISODEC’s campaign coordinator, says the goal of the social pact, the first of its kind in Ghana, is to establish consensus among political parties about the management of natural resources and the nation’s development.

“The rationale basically is to force some kind of national approach to doing things in this country,” says Dr. Manteaw. “Resource management and development has always been governed by a ‘winner-takes-all’ approach, where one party decides how resources should be managed. We cannot leave the management of this country’s destiny entirely in the hands of politicians.”

At the meeting the group agreed on broad areas around which they need to build consensus, among them a clear vision for how local businesses and workers can participate in the natural resources sector, as well as transparency and accountability in the natural resources sector. At present, the major players in Ghana's oil and gas exploration sector are large foreign-owned exploration firms. The largest of these, Tullow Oil Ltd, is headquartered in London.

Analysts have long identified consensus on natural resource management and continuity of development master plans as among the major setbacks that have hindered Ghana’s development. These issues were intensely debated at a conference held by Ghana’s Constitutional Review Commission earlier this year in which members of the public offered suggestions and ideas for amendments to sections of the 1992 Constitution.

Need a stronger mandate

Economist and senior fellow at the Accra-based Institute of Economic Affairs John Kwakye said that part of the problem has to do with a lack of clarity in the 1992 Constitution about the role and political independence and neutrality of the National Development Planning Commission (NDPC), which develops policies in consultation with the president.

“The Constitution seems to charge individual governments to develop their own plans to be coordinated by the NDPC,” says Dr. Kwakye. “This has led to haphazard development of half-plans that do not get fully implemented and which are discarded by succeeding governments. Meanwhile, the NDPC lacks the independence and resources to carry out its mandate effectively.”

IEA and others think tanks have proposed to the Constitutional Review Commission (CRC), the need for a long-term coherent national development plan that would extend beyond government terms. They also recommend that the NDPC should function as an autonomous and politically neutral body.

Kwakye says that Ghanaians have not sufficiently benefited from mining revenues, particularly due to the high retention benefits granted to the mining companies to attract investment.

He says the social pact was a unique and innovative idea that could encourage greater governmental accountability.

“It will be good to have all governments, notwithstanding their political affiliation, sign on to a pact that commits them to use Ghana's natural resource wealth transparently and accountably for the development of the country for the benefit of all the citizenry,” he says.

While the project is still in its infancy, Manteaw says he is certain that Ghanaians would support the idea.

“Any divisions that will arise will be over the content of the pact that is developed rather the idea itself,” Manteaw says.