Ghana looks to coming election for economic turnaround

Ghana, the first African country to gain independence, is democratically electing a president in December amid an economic downturn

From Charlayne Hunter-Gault
CNN Correspondent

ACCRA, Ghana (CNN) -- As Ghana prepares to take another step towards democracy, the seven candidates in December's presidential election are concentrating on the state of the nation's economy.

In 1957, this West African nation was the first on the continent to gain independence from a colonial power. But it faced a rocky start, with a series of coups and political repression.

Since then, primarily under the leadership of outgoing President Jerry John Rawlings, the country has averaged economic growth of about 4 percent -- almost twice the African average.

Rawlings' goal has been for Ghana to become a middle-income country in 20 years. For that, the country needs an annual growth rate of at least 8 percent, and has worked closely with the International Monetary Fund and the World Bank, privatizing state-owned enterprises and deregulating much of the economy.

But Ghana's much-heralded economic reforms and progress toward a market-driven economy are in danger of being reversed, threatened by the collapse last year of the prices of gold, cocoa and timber -- Ghana's basic export commodities. Meanwhile, the cost of oil has doubled.

From The Gold Coast to the poor coast

"We've been independent for 43 long years," says presidential candidate John Kufuor, "and the nation that used to be called The Gold Coast -- within the space of 43 years -- finds itself more like the poor coast."

The government admits the economic turndown has been a blow, but is optimistic. As Minister of Communication John D. Mahama said, "I don't think it can get worse."

VIDEO CNN's Charlayne Hunter-Gault looks at Ghana's growth and its future potential Play video (QuickTime, Real or Windows Media)

But that opinion isn't universal.

"This corn I'm buying right now, tomorrow you come, the price has increased," said civil servant Jonathan Anun. "The day after, it'll just be increased. So today, it looks like my salary has been divided into three."

Some Ghanaians blame the government, as do some economists.

The economic growth "was a mirage, in the sense that the structure of the economy has not changed, meaning we still have agriculture being the dominant activity in the country," said George Apenteng of the Independent Economic think tank.

And agriculture is in decline as more and more Ghanaians -- especially the young -- gravitate towards the city and an economy already flooded with the unemployed causalities of privatization and a private sector not yet big enough to take them in.

Vice President John Evans Atta Mills says the government has achieved a lot in diversifying the economy and, if allowed to stay in power, will overcome this spate of economic bad luck, brought on by global economic forces.

As Communications Minister Mahama says: "We think that the economy will survive. Indeed, the Ghanaian economy is more resilient today than it was in the past."

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Ghana government

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