As the President Akufo-Addo government has innaugrated a 13 member committee to develop a charter for the Ghana Beyond Aid mantra, Bright Simons, Founder, mPedigree, has a mind reflecting piece which gulvanizes the aptitudes of Ghana government and other African governments to rise up to the task and liberate themselves from over reliance.

This article featured in the THE AFRICA REPORT MAGAZINE June edition and published on their website on June 13 2018.

As a vice president to IMANI Africa, be prepared for expressions and deliberations which will emancipate you from mental slavery...

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"On the same weekend that Black Panther became the first movie by a black director to cross the $1bn box office mark, Ghana’s President Nana Akufo-Addo was on TV promising to free his country from aid, which could make him, perhaps, the first African leader to do so.  

There are a lot of firsts milling about here. Ghana was, after, all the first sub-Saharan African colony to throw off the yoke of colonialism, and the first to produce a PhD. It was the first to chair the United Nations (UN) General Assembly, and the first to produce a black UN secretary general, etc.

It would be apt if Ghana could usher Africa into the post-aid era. At the April Commonwealth Heads of Government Meeting in London, the Ghanaian leadership was pushing this theme at every opportunity. But this goal is not that ambitious – not if aid is seen in the way it has been framed in the post-aid narrative in Ghana today: charity money dished out to the country by richer, usually Western, countries out of pity or condescension. The euphemism for this kind of handout is ‘grants’.

If aid is really about grants, then Ghana has been ‘beyond aid’ for more than half a decade. Grants received over the course of 2017 by the state amounted to roughly $300m – less than 0.8% of gross domestic product (GDP) and just 3% of the government’s total revenue during the same year.

For further perspective, take the current International Monetary Fund (IMF) arrangement. It involves loans, not grants. But these loans are ‘concessionary’, meaning that the interest rate and other terms are so lenient that one has to distinguish between these types of loans and the sort that Ghana takes out on the commercial market. 

To qualify for these lenient terms, however, Ghana has to consent to intrusive IMF tutoring on fiscal and monetary policy. If Ghana remains a well behaved pupil for a three-to-four-year period, it gets a total of $918m. The impact per year on the government’s budget is about 2.3%.

Curiously, this amount is less than what the country lost in store supplies alone at public sector organisations in 2012. In short, if Ghana simply introduced superior supply chain and inventory management, it could rid itself of the need for IMF money and all grants.

So why would the government of Ghana and its visionary-sounding president set the bar so low by pledging the country to go “beyond aid”, when aid in this sense is already a steadily shrinking insignificance in the financial scheme of things? To fully understand this situation, one must take another look at the IMF programme and do the same to all the World Bank, European Union and related initiatives that continue to clog the attention of senior officials in countries like Ghana.
Ghana did not need the IMF just because of an extra 2.3% in government revenue. Ghana continues to need the IMF and the World Bank and similar institutions for credibility. The country has become rather enthralled by the opportunities available on the international debt market and has been borrowing aggressively.

At the time of writing this article, the government was commencing a roadshow to borrow three times the amount of money it will be receiving from the IMF over four years, except that it aims to collect all this money within a few weeks with zero intrusion into its affairs by the lenders. Of course, it will likely settle for an interest rate far higher than it would pay the Bretton Woods institutions and about four times higher than what more creditworthy countries pay in similar circumstances. In a recent domestic issue, the government agreed to pay a whopping 19.75% for the equivalent of $1.1bn in local currency.

Ghana’s fiscal managers worry about their credibility when they go out in search of these deals, which the government has grown increasingly dependent upon to finance everything from free secondary education to teachers’ salaries. Money folks worry about the country’s capacity to pay it back.

Currently, the public debt stock is about 72% of GDP. This is high for Africa – the debt levels for Nigeria, Kenya and Côte d’Ivoire are roughly 22%, 58% and 49%, respectively – but it is moderate in global terms: the US, Britain and Japan have debt levels of 105%, 89% and 200% respectively. The real mess is in how much countries spend to service their debts. Whilst Britain spends 8% of tax revenue to service its public debt, Indonesia about 12% and the US about 14%, Ghana spends a whopping 42%. Being in the good books of the IMF and World Bank is thus Ghana’s way of signalling to international lenders that we are not dangerous.

It is not only in the matter of borrowing on international markets that Ghana needs validation. A recent controversy over a military agreement with the US showed that the country has, at least since the late 1990s, been signing raw drafts of these agreements with one-sided clauses that most countries insist on modifying when they sign. Evidently, Ghana is almost desperate to assure the US of what a non-fussy ally it can be.

Agreements with international companies – such as the now infamous contract with South Korean conglomerate STX to build 200,000 houses for the security services for $10bn – usually suffer from the same lack of scrutiny on the Ghanaian side due to a desperate desire to solicit validation. Mining agreements signed with multinationals have long been criticised for a lack of strategic character. Typically, such agreements are rushed through Ghana’s piteously pliant parliament whilst more critical domestic legislation, such as a 2013 bill to modernise the country’s regulation of limited liability companies and improve the corporate climate, languish for years, sometimes even decades. A case in point is the jinxed ‘right to information’ bill now entering its third decade of waiting.

In light of the above, ‘Ghana beyond aid’ is not merely, or really, about the amount of financial resources Ghana receives as tokens of charity; it is about a culture of self-respect – a mindset shift towards greater national self-actualisation. Above all, it is about a Ghana whose leadership and political elite take upon themselves the long overdue task of committing all the country’s energies, talents and resources to proving themselves primarily to the people they serve. The feats that this true domestic validation should include are transforming the quality of health and educational institutions; modernising infrastructure; promoting services-driven industrialisation and an eco-friendly green revolution; and developing a law enforcement system that genuinely treats all citizens fairly. But the greatest feat of all would be the commitment to move beyond rhetoric and show by deed that the Ghanaian people are not just graduating from aid but, more importantly, they have graduated from self-pity to Wakandan swag"

The question then is ...Why do both past and current fight the concrete researches and submissions by non malicious think tanks like IMANI in critical policy formulation and implementation... Hmm! Ama Ghana

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