Country Profile 2004 Ghana This Country Profile is a reference work, analysing the country’s history, politics, infrastructure and economy. It is revised and updated annually. The Economist Intelligence Unit’s Country Reports analyse current trends and provide a two-year forecast. The full publishing schedule for Country Profiles is now available on our website at http://www.eiu.com/schedule The Economist Intelligence Unit 15 Regent St, London SW1Y 4LR United Kingdom The Economist Intelligence Unit The Economist Intelligence Unit is a specialist publisher serving companies establishing and managing operations across national borders. For over 50 years it has been a source of information on business developments, economic and political trends, government regulations and corporate practice worldwide. 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Country Profile 2004 www.eiu.com © The Economist Intelligence Unit Limited 2004 Ghana 1 Contents Ghana 3 Basic data 4 Politics 4 Political background 5 Recent political developments 9 Constitution, institutions and administration 10 Political forces 12 International relations and defence 13 Resources and infrastructure 13 Population 14 Education 16 Health 17 Natural resources and the environment 18 Transport, communications and the Internet 22 Energy provision 24 The economy 24 Economic structure 25 Economic policy 29 Economic performance 32 Regional trends 33 Economic sectors 33 Agriculture 36 Mining and semi-processing 39 Manufacturing 41 Construction 41 Financial services 45 Other services 46 The external sector 46 Tra d e i n go od s 47 Invisibles and the current account 48 Capital flows and foreign debt 50 Foreign reserves and the exchange rate 52 Regional overview 52 Membership of organisations 56 Appendices 56 Sources of information 57 Reference tables 57 Population and labour force 57 Electricity generation and consumption 58 Gross domestic product by sector 58 Gross domestic product by expenditure © The Economist Intelligence Unit Limited 2004 www.eiu.com Country Profile 2004 2 Ghana 58 Gross domestic product 59 Government finances 59 Interest rates 59 Money supply 59 Mineral production 60 Manufacturing production 60 Ghana Stock Exchange 61 Main trading partners 61 Balance of payments 62 Net official development assistance 62 External debt 63 Exchange rates 63 Foreign reserves Country Profile 2004 www.eiu.com © The Economist Intelligence Unit Limited 2004 Ghana 3 Ghana Basic data Land area 238,537 sq km Population 20.9 m (2003, IMF estimate) Main towns Population in millions (2000 population and housing census, Ghana Statistical Service) Accra (capital) 1.65 Kumasi 1.17 Ta mal e 0. 2 0 Climate Tropical Weather in Accra Hottest months, March, April, 23-35°C; coldest month, August, 22-27°C; driest (altitude 27 metres) month, January, 15 mm average rainfall; wettest month, June, 178 mm average rainfall Languages English (official), Twi, Ewe, Fante, Ga, Hausa Measures Metric system Currency Cedi (C)=100 pesewas. Average exchange rate in 2003: C8,677:US$1. Exchange rate on October 20th 2004: C9,017:US$1 Time GMT Holidays January 1st, March 6th (Independence day), Good Friday, Easter Monday, May 1st (Labour day), July 1st (Republic day), December 6th (Farmers’ day) December 25th-26th © The Economist Intelligence Unit Limited 2004 www.eiu.com Country Profile 2004 4 Ghana Politics Ghana is a unitary republic with a multiparty democratic system under which executive power is vested in a president who is elected by universal suffrage every four years. John Agyekum Kufuor and his New Patriotic Party (NPP) won the presidential and parliamentary elections of 2000. This bought to an end the administration of Jerry John Rawlings, who had ruled the country as a military ruler from 1981 to 1992, and for the subsequent eight years as a constitutionally elected president. Mr Kufuor was sworn into office in January 2001. The next presidential and legislative elections are scheduled for December 6th 2004. As a result of a reasonable economic performance in their first term, we expect Mr Kufuor and the NPP to be re-elected. Political background British colonialism The British originally came as traders. However, in the late 19th century the scramble for Africa led Britain to invade the Ashanti kingdom in 1874 and declare the Gold Coast a British colony, which, after a struggle, it controlled by 1901. The Gold Coast became one of Africa’s most successful colonial economies, based on peasant cash-crop production, mainly of cocoa, and on gold mining, which was largely controlled by foreign interests. Farmers’ initiatives and local familiarity with international trade also helped to bring relative prosperity. The road to independence Lawyers and other educated elites who were excluded from politics by the colonial state dominated the early political movements. After World War Two other social groups also became involved; for example, ex-soldiers who had fought for the British in the war demanded a role in the administration and business opportunities in the colonial system. By 1949 nationalists had split into moderates and radicals, the radicals supporting Kwame Nkrumah’s Convention People’s Party (CPP). Backed mainly by young people and poorer sections of the middle class, the CPP won the country’s first election in 1951. In 1957 Ghana became the first Sub-Saharan African country to gain independence. The CPP government was ostensibly socialist, and laid down the basis of Ghana’s current industrial infrastructure, though its policies alienated cocoa farmers and influential private-sector businesses; and in 1964 it introduced a one-party state. Nevertheless, the legacy of Kwame Nkrumah, as “father of the nation”, remains important: even today, several political parties lay claim to the Nkrumahist tradition. Political instability and the Ghana experienced nine changes of government, including four military coups, descent into corruption between 1957 and 1981, but escaped the violence that afflicted many other African countries. Poor economic management and perceptions of corruption have been the most common sources of dissatisfaction. In contrast to much of Africa, ethnicity has played a relatively minor role in mainstream political conflicts. Country Profile 2004 www.eiu.com © The Economist Intelligence Unit Limited 2004 Ghana 5 In 1966 an economic crisis and rumours of cuts in the military’s resources prompted Ghana’s first (bloodless) military coup, by conservative generals, who formed the National Liberation Council (NLC). They handed over power to the laisser-faire Progress Party (PP) after elections in 1969. The PP, led by Kofi Busia, continued the NLC’s economic reforms. However, a fresh economic crisis brought another military coup in January 1972. The younger left-wing colonels of the National Redemption Council (NRC), led by the late General Ignatius Acheampong, reversed the PP’s policies in favour of a quasi-socialist programme. In July 1978 other defence chiefs in the NRC who favoured a return to civilian rule removed Mr Acheampong. Before elections could be held, however, younger officers staged a fresh coup on June 4th 1979 and formed the Armed Forces Revolutionary Council (AFRC), led by a 32-year-old junior officer, Flight-Lieutenant Jerry John Rawlings.