<<

A publication of ihe African Studies Program of The Georgetown University Center for Strategic and International Studies

No. 42 • May 2, 1985 The Rawlings Revolution in : Pragmatism with Populist· Rhetoric by Donald Rothchild

When Flight-Lieutenant seized power in taken in the economic sphere. The best that can be Ghana for the second time on , 1981, his said is that the marginal improvement in the economic inspirational personality and the new government's picture has given him some breathing room. populist commitment raised a depressed 's hopes. An elected but elite-dominated government was The Early Days replaced by a regime that held out the promise of full The first 18 months of the second Rawlings regime public participation in decision making, a redistribution were indeed a time of strong commitment to populist of wealth, a reduction of neocolonialist influence, and a change. In a January 5, 1982 radio broadcast to the crackdown on kalabule (hoarding, overpricing, smug­ nation, Rawlings dedicated his administration to mak­ gling, and other "corrupt" practices). "National ing democracy "really work for the ordinary man, not reconstruction" would encompass new international just for a small group of people to exploit them and with other populist and radically-inclined ride over their misery." "Let the world know," he states (including Libya and Upper Volta), a reduction in affirmed, "that Ghanaians want a government with an the size of the central bureaucracy, and "the creation agenda, not just a talking shop, and that this is a of the material basis for ensuring a democratic and democratic revolution to assure for our people the popular education as well as health schemes, housing, basic conditions of their survival." In carrying forward food, and transportation to ensure the physical, this agenda, the Provisional National Defense Council spiritual, moral, and cultural quality of life of our (PNDC) set up People's Tribunals (from whose verdicts people." In brief, popular participation and equality no appeals were permissible) to expedite the trials of were to be the foundation for economic opportunity individuals charged with a wide variety of criminal and self-sufficiency, without any trade-off between these offenses, many of them involving some aspect of cor­ objectives. ruption or seditious behavior. Decrees reminiscent of This populist orientation initially attracted enthusi­ the "housecleaning" exercise under the first Rawlings astic backing from both the disadvantaged and regime in 1979 resulted in a sharp fall in rents and elements of the intelligentsia. Over time, however, as transportation charges, and new monetary measures Rawlings accepted the necessity of more conventional led to modest declines in commodity prices. economic policies, the heady expectations of the imme­ Other initiatives reflecting the populist tone of diate post-coup period gave way to disappointment and Rawlings II were the oft-repeated calls for decentralized cynicism. administration; the establishment of People's Shops; Even though economic conditions have become the implementation of more effective procedures for tax somewhat less oppressive in 1984 and early 1985 (in collection (especially from self-employed members of the wake of rains that seemingly broke a severe the middle class); the institution of the "Akuafo cheque multiyear drought and some successes in Ghana's system" designed to ensure the direct deposit of a trade/ aid dealings with the West), Rawlings is still farmer's earnings into his personal bank account; the faced with the problem of resolving the contradictions mobilization of a task force of university students to between his regime's populist stance, at least in its vin­ bring cocoa to the port of Tema from the rural areas tage form, and the increasingly conservative decisions for export to world markets; and the restoration of

Editor: Helen Kitchen, Director of African Studies • Associate: J. Co leman Kitchen, Jr. • Production/Circulation: Evelyn Barnes CS IS Notes, Suite 400, 1800 K Street, N.W., Washington , D.C. 20006 • Te lephone (202) 887-0219 • ISSN 0736-9506 2 friendly ties with Colonel Qaddafi's Libya that included ly one-sided master agreement with a previous govern­ negotiations for a six-month supply of crude oil at ad­ ment, to sell its rubber and tire manufacturing interests vantageous terms. In February 1982, tens of thousands to a small, locally-owned concern.) of students, farmers, and workers demonstrated in Meanwhile, Ghanaian hopes for an oil bonanza (see downtown , protesting alleged U.S., British, and David C. Underwood, West African Oil: Will It French plans to "invade" Ghana in "close collabora­ Matter?, CSIS Significant Issues Series, 1983) have tion" with Nigeria, Togo, and Cameroon. been largely frustrated by the unwillingness of foreign While this populist fervor became less strident over companies to make major commitments to the explor­ time, the change was a matter of degree only. The ation or development of Ghana's potential. Ghana has public demand for increased minimum wages and only one producing field, off the coast near Saltpond. worker and peasant participation in the decision­ Operated since 1978 by Agri-Petco of Ghana (a con­ making and "judicial" processes persisted, and the sortium led by the U.S.-based Signal Oil Group), that continued to invoke the language field currently has a reported output of only 1,500 bar­ of and to enact legislation, such as the rels a day. Wealth Tax Law, that indicated an ongoing commit­ In the domestic sphere, low productivity has con­ ment to transformationalist and egalitarian objectives. strained the regime's ability to achieve its transforma­ tionalist goals. Almost three decades after in­ International and Domestic Constraints dependence, Ghana ·remains a "soft" state- a term As the months wore on, however, the regime found used to describe a government that lacks the capacity itself compelled to adjust to a range of economic and to regulate society and to implement its policies political realities. throughout the territory under its nominal authority. At the international level, the constraints of inherited Key causes of this state softness, as in a number of structural linkages with the of the industri­ other sub-Saharan African examples, include a scarcity alized West remained as firmly in place as ever. Ghana of resources available to public authorities for recurrent had little choice but to continue to export its com­ and capital expenditures as well as the relative fragility modities through established channels, receiving in and lack of perceived legitimacy of formal and informal return a declining amount of manufactured goods and political institutions. (Rawlings' reliance upon an elite petroleum products as the world prices of many com­ praetorian guard, perceived to be dominated by his modities tumbled in the recession-plagued 1980s. To own ethnic constituents, is an indicator of his own make matters still worse, Rawlings returned to power recognition of the fragility of the state's control.) Ad­ at a time when North American and Western European ministrative corruption, a telltale sign of public failure commercial banks and corporations had already been to accept the validity of formally sanctioned norms and gradually reducing their investments as Ghana's rating values, is as pervasive as ever. Customs officials and fell to that of a politically unstable and economically soldiers manning barricades continue to look upon the marginal country. At the very time when Rawlings and dash as a perquisite of office, and the cross-border his supporters were chastising international capitalism smuggling of food and export crops reportedly goes on as exploitive and responsible for the country's impover­ as before. Coup attempts by dissatisfied factions or ishment, the companies themselves were pulling back personalities within the army, another indicator of from extensive engagement in Ghanaian banking, weak regime legitimacy, occur with regularity. agricultural, and industrial activities. (Among the In sum, Ghana today is the victim of a vicious ironies was the decision of the Firestone Tire and Rub­ circle: the soft state is unable to gain legitimacy ber Company, denounced over the years for its alleged- because it has limited resources to distribute; lacking

Ghana's Major Exports 1975 1982 Cocoa Beans, tons 322,000 179,000 Cocoa Products, tons 19,000 15,700 Gold, grams 15,973 9,386 Timber, cubic meters 623,000 110,000 Diamonds, carats 2,372,000 688,000 Manganese, tons 373,000 97,000 Bauxite, tons 320,000 36,000

Sources: Kodwo Ewusi, The Ghana in 1981 -82: Recent Trends and Prospects for the Future (Legon: Institute of Statistical, Social, and Economic Research, 1982), p. 34; of Ghana, Quarterly Digest of Statistics, 11, 2 (June 1984); , December 24/ 31, 1984, p. 2641.

CSIS Africa Notes, May 2, 1985 ...... 3

The Governments of Ghana, 1957-1985

March 6, 1957. Ghana, an entity combining the favor of a coalition of the armed forces, the police, and former British colony known as the and the individual civilians. This concept is greeted with hostility UN Trust Territory of (British) Togoland, becomes an in­ by the middle class, which perceives it as a device for dependent state. , whose Convention perpetuating military control. People's Party (CPP) has won three successive pre­ March 30, 1978. Amid accusations of foul play, the independence elections, is prime minister. SMC claims that a majority (25 percent of the total elec­ July 1, 1960. Following elections and a constitutional torate) of those participating in a referendum endorsed referendum in April, Nkrumah is inaugurated as president the UNIGOV concept. and Ghana changes from a British dominion to a July 5, 1978. Acheampong is removed from office by republic. his colleagues, and. the SMC is reconstituted under the January 1964. A constitutional amendment declaring leadership of Lieutenant-General (later General) Frederick Ghana a single-party state is approved in a public Akuffo. Akuffo focuses on ridding the military government referendum. of corrupt practices that have all but destroyed its public February 24, 1966. While Nkrumah is away on a visit credibility. to China, the army and police seize power. The CPP is January 1, 1979. Political parties are legalized, in ·abolished and replaced by a National Liberation Council preparation for elections scheduled for June 18 and a of police and military officers. The NLC undertakes to planned July 1 turnover of power to a new civilian prepare the ground for a civilian "second republic" with government. constitutional safeguards intended to prevent a recurrence May 15, 1979. A group of junior officers and NCOs of Nkrumah-era excesses. Nkrumah spends the re­ ostensibly led by 32-year-old Flight-Lieutenant Jerry mainder of his life in exile in nearby Guinea, where he Rawlings makes an unsuccessful coup attempt; Rawlings dies in 1972. is imprisoned. October 1, 1969. Following the lifting in May of a ban . Rawlings is freed from prison by junior of­ on party politics and subsequent (August 29) elections for ficers who join him in seizing power in a popularly ac­ a new National Assembly, Dr. Kofi Busia takes office as claimed coup on June 4. An Armed Forces Revolutionary prime minister of Ghana's second civilian government. Council (AFRC) is established to carry forward the return January 13, 1972. As economic troubles and public to civilian rule, and an energetic anticorruption drive dissatisfaction mount, the second republic is overthrown marked by populist rhetoric is launched. Presidential and by a military junta headed by Colonel (later General) Ig­ parliamentary elections are held (as previously scheduled natius K. Acheampong. The coup takes place while by the Akuffo regime) on June 18. Acheampong and Busia is in London for medical treatment. Party politics is Akuffo are executed by month's end. banned and a National Redemption Council composed of September 24, 1979. Dr. of the People's army and police personnel becomes the ruling body. The National Party, the winner of a July 9 runoff election, is NRC initiates a drive toward Ghanaian economic self-suf­ inaugurated as president of the "third republic." ficiency. December 31, 1981. Citing corruption and the coun­ October 1975. Acheampong forces the retirement of try's continuing economic slide as justifications, Rawlings three key NRC colleagues, and replaces the NRC's seizes power a second time. Limann is imprisoned. The executive council with a seven-man Supreme Military constitution is abolished, parliament dissolved, and Council (SMC), gaining more power in the process. political parties banned. Rawlings becomes chairman of a September 1976. Under pressure from a new round of ruling Provisional National Defense Council (PNDC) and economic problems, Acheampong proposes a "union head of state. government" (UNIGOV) that would reject party politics in -J.C.K.

legitimacy, it becomes prey to further misuse of public critically important cocoa crop, 41 percent for gold, office for private purposes and so finds itself even less and a precipitous 82 percent for timber. capable of improving its economic situation. The effects of these production declines were cushioned to some extent by rising world gold and The Historical Backdrop cocoa prices, but an absolute decrease in the cedi The endogenous constraints discussed above originated value of exports was recorded in the cases of timber, long before the 1981 coup. The gross domestic product manganese, and bauxite. In addition, the domestic decreased by 15 percent between 1974 and 1981, while economy has been hurt by the unprofitability of many the population was increasing by an estimated 2.6 per­ parastatal organizations (for example, only eight of the cent a year. As the table on page 2 indicates, total Ghana Industrial Holding Corporation's 16 divisions production of major exports fell significantly between have consistently reported profits in recent years) and 1975 and 1982-by some 44 percent in the case of the the plunge in food crop production that occurred in

CSIS Africa Notes, May 2, 1985 4 ......

1983. Rainfall was better than average in 1984, voluntarily turned political authority over to a resulting in at least a temporary moderation in food constitutionally-elected president, Dr. Hilla Limann, on prices and reduced expenditures on food imports. September 24, 1979. Although the Limann government While all past regimes have been subject to the came to power through elections, and thus possessed a vagaries of weather, international price fluctuations, built-in legitimacy denied to its immediate regional migrations of people searching for employ­ predecessors, it could not overcome the economic ment opportunities, and other factors beyond their con­ legacy of the past. Consumer goods remained scarce, trol, much of the blame for Ghana's current malaise inflation stayed high, production and exports were low, must go to the irresponsible fiscal policies pursued by and imports (especially manufactured goods and the regime of General I.K. Acheampong (see ''The petrol~mm) increased steadily in price. Limann's pro­ Governments of Ghana," page 3). The 1978-79 Budget gram of inflation control, price inducements for Statement underscores the degree of mismanagement farmers, subsidies for agricultural inputs, and incentives under Acheampong: a rate of inflation estimated at for foreign investment in Ghanaian industries was over 100 percent per annum; a downturn in the real realistically geared to the country's restrictive economic GOP; a gross imbalance in the external accounts, with environment, but it did not hold out any hope for ma­ reserves "at a very low level"; a rise in net credit from jor innovations, much less any type of structural the international banking system to finance budget transformation. Lacking an inspiring vision of the deficits, from 17 million cedis in 1973 to 781 million future, and as mired in corruption as its predecessors, cedis in 1977 (in 1977, $1.00 = 1.15 cedis); a sharp this third try at civilian government since independence increase in unplanned government expenditures during ended when Rawlings came from the wings on New Acheampong's final years in power; a jump in the Year's Eve 1981 to take back the reins of power. money supply from an average of 280.6 million cedis in 1971 to 1.761 billion cedis in 1977; an overall "Popular Sense" vs. "Populist Nonsense" budget deficit that had "reached a level which has Although Rawlings has continued to speak in the necessitated a serious review"; and an accumulation of mid-1980s in terms of his revolutionary mission, he short-term debt obligations estimated at 403.4 million has in practice moved toward more conventional cedis as of April 30, 1978. economic policies and international alliances. A broad­ This general fiscal disarray led to an upsurge in the cast to the nation on May 2, 1983 is illustrative of the cost of imported goods and services (which were new mix: a reemphasis of his future vision of already increasing in price because of worldwide infla­ democracy, social justice, and dignity combined with a tion and the "oil shock") at a time of stagnating focus on "productionist" goals. "Countrymen," he domestic industrial production and declining com­ counselled, "the surest cure to our long-standing ail­ modity exports. The grave hardships suffered by the ment as a nation is a set of policies that will stimulate as a result of this economic crisis production and at the same time discourage unproduc­ contributed to the loss of regime legitimacy that even­ tive activity." To this end, he proposed to provide in­ tually led to Acheampong's undoing. centives, "particularly in the foreign exchange earning The reconstituted Supreme Military Council that sector of the economy," to encourage those in produc­ assumed power in July 1978 under the leadership of tive enterprises to redouble their efforts. By August 28, Lieutenant-General F. W .K. Akuffo sought to restore 1983, the message had become more explicit: " ... pro­ public confidence by setting out a program of economic duction and efficiency . . . must be our watchwords. stabilization. Austerity measures were introduced im­ Populist nonsense must give way to popular sense." mediately, aimed at reducing inflation and corruption. In response to International Monetary Fund "advice," New policies, urged by the International Monetary the regime took the politically risky step of devaluing Fund team then present in Ghana, included a 59 per­ the cedi-from 2.75 cedis to the dollar in 1981, to 30 cent devaluation, controls on the monetary supply, and cedis in 1983, to 50 cedis in 1984, and then to 53 a reduction in public expenditures. cedis in April 1985. The black market rate has mean­ Akuffo's stabilization program was never given a while risen to well over 100 cedis to the dollar. In an chance. In June 1979, a group of impatient junior of­ effort to curb inflationary tendencies, the regime has ficers, led by Rawlings, intervened and launched an placed a tight rein on the supply of money. Taxes have alternative economic program of their own that em­ been introduced on transactions utilizing foreign ex­ phasized price controls, increased domestic prices for change and indirect taxes and customs duties have certain agricultural commodities, and a frontal assault been increased. Steps taken to increase the govern­ on kalabule. While well-intentioned, this reform ment's ability to extract taxes from the self-employed package resulted in the selling off of the existing stock sector resulted in a rise of receipts from 52.3 million of consumer items by nervous traders anxious about cedis in 1980 to 307 million in 1982, and then another price controls and the possibility of public humiliation 20 percent in 1983. More consumer goods have at the hands of the soldiers for alleged acts of become available, although permitted price increases profiteering. for essential goods such as petrol, soap, and meat Rawlings' Armed Forces Revolutionary Council have restricted effective demand for consumable

CSIS Africa Notes, May 2, 1985 5 items. The IMF and the have taken note popularity," Rawlings insisted that his regime "place[d] of and been duly impressed by these anti-inflationary the interest and the very survival of the nation before actions. The donor Consultative Group for Ghana, its own interests" and had therefore opted for a set of meeting at the World Bank's European headquarters in policies aimed primarily at stimulating productivity. Paris in December 1984, declared that "skepticism Whether or not one accepts these arguments at face about Ghana has gone" and gave substance to this value, they nonetheless deserve dispassionate analysis. conclusion by promptly pledging the $450 million requested. The Public Response In addition to invoking cautious monetary policies, Ghanaians, weary of repeated regime changes and un­ the Rawlings government has taken measures to fulfilled promises, varied from apathetic to negative in stimulate agricultural and industrial production. Cocoa their response to the PNDC's turn toward pragmatism. farmers, long the mainstay of the economy, have been Small farmers, poorly organized and characteristically given help in the form of available inputs and con­ low-keyed, did not react with alacrity to government sumer goods, an improved process for banking their offers to replant devastated cocoa farms, and instead earnings, and assistance in replanting farms affected by continued to speak of replacing their aging cocoa trees bush fires. Although the producer price has been with palm, maize, and other less risky crops. Urban raised with each devaluation, the effect has been more workers, who were a major source of support for Rawl­ nominal than real, and therefore cannot be considered ings' return to power, were inclined to view devalua­ a meaningful incentive to production. tion, the reduction of subsidies on consumer goods, The Rawlings II regime has also made notable ef­ other austerity measures, and the failure to establish forts to revive the mining industry, renovating the gold an effective network of People's Shops as amounting to mines at Dunkwa, Prestea, and Tarkwa and, with help a betrayal of promises made at the time of the revolu­ from the United Development Program, carry­ tion. Although the government had responded to ing out exploratory and prospecting work at the worker dissatisfaction by raising the daily minimum Konongo gold mine in -Akim district. New at­ wage to 70 cedis, this adjustment had only a marginal tempts have been undertaken to negotiate petroleum effect. With a loaf of bread costing 90 cedis, an egg exploration and producing agreements with a number 11, and a pineapple 120, a day's wage is often insuffi­ of North American and Western European companies, cient in 1985 to feed a family, much less pay for and a grant of $22 million has been secured from the clothes, rent, and medical and educational fees. The Canadian International Assistance Corporation to relenting of the drought and its accompanying short­ enable Petro- International to explore for oil ages brought some relief in 1984; nevertheless, the and gas in the continental shelf off Tano Basin in the aspirations of the working class remain unfulfilled and Half Assini area. their mood is one of acquiescence to PNDC rule. The recent initiative most critical from the standpoint The middle class has been even more vocal and per­ of national development has been the new agreement sistent in its expressions of' disapproval. Resentment signed in January 1985 with the Volta Aluminium over Rawlings' populist style and their reduced status Company Ltd. (VALCO). Displaying both skill and and perquisites remains widespread among this ele­ determination at the bargaining table, the Ghanaian ment of the body politic. But their most intense negotiating team, led by Professor Akilagpa Sawyerr, criticism is directed at abuses of civil liberties and the secured terms that benefit Ghana and also satisfy established legal system. A particularly frightening VALCO's primary concerns. VALCO gained the right episode, the abduction and murder of three high court to continue its operations in the country, a slightly ex­ judges and a retired major in 1982, came to symbolize panded privilege of holding foreign currency in a.n ex­ uncontrolled official lawlessness for many middle-class ternal account, and an undertaking from the govern­ citizens. Although Rawlings has made a range of over­ ment to refrain from expropriating its assets. PNDC tures in recent years to professionals and businessmen Coordinating Secretary P.V. Obeng, speaking at the -appointing traditional leaders and establishment signing ceremony, cited some "significant gains" for figures to high government posts and substituting Ghana: a 20 percent reduction in the amount of energy rather amorphous Committees for the Defense of the VALCO is entitled to take from the Akosombo plant, a Revolution for the much-feared People's and Workers' jump in the base power rate from 5 to 17 U.S. Defense Committees-there can be no doubt that mills/kwh, an increase in VALCO's income tax rate Ghana's middle class continues to nurse its grievances from 40 percent to 60 percent, and the right to tax and long for a return to civilian rule under its own dividends distributed to shareholders and interest paid auspices. to creditors. While the middle class generally feels threatened by What accounts for this "U-turn," as it is commonly the PNDC because of its populist rhetoric, a segment referred to in Ghana? In his May 1983 speech, Rawl­ of the intelligentsia takes the opposite tack, criticizing ings gave notice that the economic crisis facing the the "conservative" trend in recent government policies country called for bitter medicine. Dismissing short­ and pressing for a reaffirmation in words and deeds of sighted policies that would allow the regime "cheap the revolution promised in 1981-82. Evidence of this

CSIS Africa Notes, May 2, 1985 6 defection on the "left" surfaced prominently in January Acheampong effort to establish "union government." 1985 as mimeographed statements appeared on public More difficult, but not beyond the realm of possibil­ buildings, describing devaluation as a device to sup­ ity, would be a second legitimacy-building option: the press the working class and decrying Rawlings' "U­ rejuvenation of the regime's populist image. This could turn" as a "betrayal" of the revolution. One excep­ entail the rebuilding of linkages with the urban working tionally bitter statement issued under the name of the class, or, alternatively, a shift in emphasis to gain United Revolutionary Front talked of Rawlings' "sell­ rural-based support. The latter approach could involve out" and described this recent period as involving "the an altering of rural-urban terms of trade to the advan­ most dramatic, the most amazing and indeed the most tage of the rural majority (some 70 percent of the shameless U-turn of any government not only in country's 12 million people), in conjunction with the Ghana's history but in all post-independence African encouragement of communal agriculture. Moreover, history." carrying out the promised decentralization program and promoting more active rural participation in the Rawlings' Options decision-making process might generate new support As the foregoing discussion suggests, the conditions of for the regime in the hinterland. scarcity and state softness have persisted in Ghana Without a populist dimension or a new support base, across regimes. Unable to alter the basic structure of the regime's longevity is open to doubt. Rawlings' sur­ society, Rawlings has found himself with little apparent vival and the achievement of his revised objectives will alternative but to adjust to the powerful forces of require both dexterity and creativity. Rawlings realizes domestic and international capitalism. With his support this. As he noted in his previously-cited August 1983 among the disadvantaged weakened by his apparent broadcast, "Unless . . . we break new ground . . . we retreat from his initial fiery populism, he has attempted will be adding to the already intolerable suffering of our to muddle through, relying on a combination of inter­ people." But given the constraints under which any national backing, improved weather conditions, and an Ghanaian government labors in the latter half of the adequate level of state repressive capacity to maintain 1980s, matching the need for creativity with deeds is an even keel. His balancing act has been aided by the an enormous task. extensiveness of the Ghanaian informal sector, which continues to absorb the energies of much of the socie­ ty. But any deterioration in international support or a Donald Rothchild is a professor of political return of drought would make a muddling-through science at the University of California, Davis. A fre· strategy difficult to maintain for very long. quent visitor to Ghana over many years, he was a Rawlings has several options. He might attempt to visiting professor at the , build a formal coalition with key civilian spokesmen, Legon, in early 1984. Dr. Rothchild is a frequent bringing the leaders of various class and ethnic in­ contributor to professional journals, and his books terests into a more representative government. include Toward Unity in Africa (1960); Politics of In· Although his ministries are now manned by selected tegration (1968); Racial Bargaining in Independent Kenya (1973); a co-authored volume, Scarcity, civilians, a move to involve the leaders of important Choice and Public Policy in Middle Africa (1978); social elements in the running of the state might have and four co-edited volumes, Government and · the effect of broadening his appeal-depending, of Politics in Kenya (1969), Eagle Entangled (1979) , course, upon the extent to which major groups and Eagle Defiant (1983) , and State Versus Ethnic their leaders perceived themselves to be adequately Claims (1983). With E. Gyimah-Boadi, he has writ· represented in the ruling coalition. It is significant in ten a more detailed study of the Rawlings regime this regard that a commission chaired by Justice D. F. entitled "Ghana's Economic Decline and Develop· Annan has been asked to make recommendations on ment Strategies," to be published as a chapter in the establishment of a non-party constitutional system John Ravenhill (ed.), Africa in Economic Crisis in Ghana, a proposal reminiscent of the earlier (London: Macmillan, 1985).

CSIS Africa Notes, May 2 , 1985