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As The Economist points out in Into Africa:
After lagging behind the rest of the globe in the 1990s, African output growth has averaged 5% a year since 2001, while the world has averaged just 4.2%. Strong commodity prices have, of course, played a vital part in this. The continent has 8% of the world’s oil reserves; more of America’s oil imports now come from Africa than from the Persian Gulf. . . . The continent has 23% of the world’s land, but only 12% of its farmland; there is scope to bring more territory under cultivation.
Many talk about the “resource curse” that has bedevilled Africa. If an economy has vast natural resources, a government can tax them easily; as a result, there is little incentive to produce the kind of regulatory environment that would encourage the development of a wider tax base. The availability of a “cash cow” such as an oil sector also encourages corruption.
. . . the volatility of African equity returns was no higher than that of Latin America over the period 1995-2006. There may yet come a time when African equities are hot stocks.
Ghana needs to protect her agriculture, and diversify. And when The Economist, or any western voice, talks about putting more land into cultivation, countries should be careful about what they plan to cultivate. Every country should plan to feed itself first, try to minimize environmental damage and create sustainable agriculture. The vision of the US right wing, of Africa as a continent sized sugar plantation growing bio-fuel for the US petrol appetite, would be comic, except that it is part of their reason for creating AFRICOM.
Ghana needs to beware. Oil, and other extractive resources can make a country much poorer, described succinctly in an article in Foreign Policy:
Collier’s model shows that producers of oil, timber, and minerals would on average see their gross domestic products rise by 10 percent in the first seven years, only to have them crash two decades later to only 75 percent of where they started. Sudden cash flows in unprepared countries, he says, lead to unsustainable public consumption, rising inflation, soaring inequality, trade protectionism, and a real danger of civil war.