A DARK DAY FOR GHANA’S ECONOMY

.....Stooge Government buckles under pressure from EU and big business. On Friday 14th December one more death nail was driven into the economy of Ghana when the Government of Ghana signed a version of the Economic Partnership Agreement (EPA) between the EU and ACP countries. Ghana is the second country after Cote de Voire to sign the EPA in the West African region. Against the backdrop of incessant and sustained pressure from the civil society on the government not to sign the deal they went ahead anyway. Over a period of two years a lot of protest has been organized by civil society organizations across Africa backed by solid research findings advising against entering into this trade trap. Led by organizations such as Third World Network, Action Aid, Ghana Trade and Livelihood Coalition, Christian Aid and OXFAM a lot of awareness was created in Ghana on the nature and possible impacts of the EPA and there was a massive consensus that it would spell doom for the Ghanaian economy especially in the areas of Fiscal Policy, Agriculture and Industrial Policy. The West African Economic Community the ECOWAS resolved to refuse to sign the EPA en bloc saying that the deadline of December 2007 was too short for them to adequately negotiate a favorable deal and conduct a comprehensive impact assessment study. It seemed that for the first time in many years our leaders will listen to the internal voices of reason and do what would be in the overall interest of Ghanaians and not consent to the parochial interest of the elite clientele. The Government of Ghana affirmed the position of ECOWAS and the reasonable voices of the majority of Ghanaians and made strong statements that it was not ready to sign the EPA. Up until the EU – AU summit in Portugal between 8th and 9th December. Cracks began to appear in the united front when Cote de Voire signed under pressure from the EU and the powerful French business interests (Cote de Voire is the biggest and the most significant economy in the UEAMOA currency zone.). After the summit the government performed an acute about turn after it had apparently been put on enormous pressure by the imperialist powers. The government has gone ahead to sign the deal knowing perfectly all the repercussions that the EPA will have on the economy. This was clear from the pronouncements of the negotiating team and officials from the Ministry of Trade who had declared on numerous occasions that Ghana was not ready to sign the EPA The deal will cost the government about $120m in lost tariff revenue yearly. This will rob the government of badly needed funds for infrastructure and social investments. The EPA will also mean Ghana will open its markets to competition from highly subsidized agricultural goods from the EU. Since Ghana was hurried to sign the EPA it had not apparently prepared to even negotiate some concessions from the EU. This led the government to stage a farcical tough stance by appearing to hamper the signing ceremony. The signing was done on 14th instead of the advertised 13th. Ghana has suffered under the pressure of “The Washington consensus” policies via the Structural Adjustment programs of the 1990s. The stuttering industrial sector is set to suffer further from the unfair competition from obviously advanced and highly competitive European industrial products. It is estimated that it will displace about 8% of the industrial sector in Ghana over the next five years. For a nation that is already experiencing deindustrialization (before it even started), this will definitely be the death of industry in Ghana. The Agricultural sector is the one at risk the most from the deal since it is already suffering from the effects of the first and second wave of the deadly trade liberalization in the previous decade. Due to the unfair competition from the highly subsidized agricultural product from the EU and the USA, the agric sector in Ghana has been driven to the point of extinction. The grains, livestock and poultry subsectors have especially felt the pinch leading to shrinking of their productivity. Rice production especially has taken a heavy hit since the trade liberalization in the early 1990s.Rice production has fallen by as much as 25% while poultry production has fallen drastically under the weight of the dumped and highly subsidized (about €1.25bn) poultry products from the EU. The EPA will be a challenge to the livelihood and food security of the poorest section of our already poor nation. Even the EU’s own Sustainability Impact Assessment report admits that ECOWAS region will be adversely affected by the EPA. There are even some studies that suggest that only about 23% of Ghana’s export to the EU will benefit from an enhanced access as a result of the EPA. 73% of Ghana exports to the EU is covered by MFN zero and GSP zero tariffs. It is clear that this government is incapable of taking policy that will be in the interest of majority of Ghanaians. Under pressure from their imperialist masters and the rent seekers (exporters of marginal products inconsequential to the overall economy) this incompetent government has taken this country into a deal that will be most damaging to the majority of Ghanaians.