reforming dysfunctional institutions through democratisation? reflections on ghana

Reforming Dysfunctional Institutions through Democratisation? Reflections on GhanaAuthor(s): Richard Sandbrook and Jay OelbaumSource: The Journal of Modern African Studies, Vol. 35, No. 4 (Dec., 1997), pp. 603-646Published by: Cambridge University PressStable URL: http://www.jstor.org/stable/162007 .

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The Journal of Modern African Studies, 35, 4 (I997), pp. 603-646 Printed in the United Kingdom ? I997 Cambridge University Press

Reforming Dysfunctional Institutions Through

Demo cratisation ? Reflections on Ghana

by RICHARD SANDBROOK and JAY OELBAUM*

H o w can Africa's societies reorient and rebuild state apparatuses where predatory, neo-patrimonial governance has held sway? This emerges as a key question if one accepts that dysfunctional institutions, and not just poor initial conditions, a hostile international environment, external shocks, or policy errors, have impeded Africa's economic recovery. Although analysts and organisations place differing weights on these various causes, few now dissent from the consensus that political-institutional reforms are a necessary condition for African development.1 Yet recognising the need for such change is one thing; knowing how to bring it about is quite another. Few guidelines exist to steer this complex and long-term task. Democratisation is now often cited as one means to foster institutional renewal, and this article draws on the Ghanaian experience to reflect upon the efficacy of this route.'

* Richard Sandbrook is Professor of Political Science and Jay Oelbaum is a Ph.D. Candidate, University of Toronto.

1 See, for example, World Bank, Sub-Saharan Africa: from crisis to sustainable growth. A Long- Term Perspective Study (Washington, DC, I989); Barbara Grosh, 'Through the Structural Adjustment Minefield: politics in an era of economic liberalization', in Jennifer A. Widner (ed.), Economic Change and Political Liberalisation in Sub-Saharan Africa (Baltimore and London, I 994), pp. 29-46; G. K. Helleiner, 'From Adjustment to Development in Sub-Saharan Africa: consensus and continuing conflict', in Giovanni Andrea Cornia and Helleiner (eds.), From Adjustment to Development in Africa (New York, I994), pp. 3-24; Paul Kennedy, 'Political Barriers to African Capitalism', in The Journal of Modern African Studies (Cambridge), 32, 2,June 1994, pp. 191-2I3;

David C. Sahn, 'Economic Crisis and Policy Reform in Africa: lessons learned and implications for policy', in Sahn (ed.), Adjusting to Policy Failure in Africa (Ithaca, I994), pp. 381-4; Michael Chege, 'Sub-Saharan Africa: underdevelopment's last stand', in Barbara Stallings (ed.), Global Change, Regional Response: the new international context of development (Cambridge, 1995), pp. 309-45; Tony Killick, 'Economic Inflexibility in Africa: evidence and causes', in Killick (ed.), The Flexible Economy: causes and consequences of the adaptability of national economies (London, I 995), pp. 1 54-96; Kidane Mengisteab, 'A Partnership of the State and the Market in African Development', in Mengisteab and Ikubolajeh Logan (eds.), Beyond Economic Liberalization in Africa: structural adjustment and the alternatives (London, 1995), pp. I 63-8 I; and Sayre P. Schatz, 'The World Bank's Fundamental Misconception in Africa', in The Journal of Modern African Studies, 34, 2, June I 996, pp. 239-47.

2 This article derives from four periods of field work: in I 993, I 994, I 996, and I 997. Much of



604 RICHARD SANDBROOK AND JAY OELBAUM

If, as even such a proponent of state activism as Sayre Schatz accepts, 'government and politics contribute to the malfunctioning of African economies, often very heavily',' how does this happen? One way of explaining this connection is by reference to the institutions of neo- patrimonial governance, the modern form of patrimonialism to which Max Weber devoted so much attention. 'Institution' is a word subject to many interpretations: we use the term to refer to 'a regularized pattern of interaction that is known, practised, and accepted (if not necessarily approved) by actors who expect to continue interacting under the rules sanctioned and backed by that pattern', as explained by Guillermo O'Donnell.' Institutions therefore refer to rules that, in actual practice, regulate behaviour and expectations because they are widely shared.

It is characteristic of neo-patrimonialism that it is not the formal constitutionally-mandated institutions that usually count. The elections, legislatures, parties, judiciaries, and civil services that prescribe the normative rules of gaining and exercising power may be publicly honoured but are often privately circumvented. It is rather the informal institutions that shape political behaviour and expectations, even though they are publicly unacknowledged or even condemned. The essence of neo-patrimonialism is the private appropriation of the state's powers. The distribution of state-generated benefits to political followers, the selection of public officials on the basis of personal rather than institutional loyalty, and the unmediated and uncircumscribed control of a coercive apparatus constitute the main methods by which rulers gain, hold, and exercise political power.5 Unfortunately, some of these stratagems impede economic development by fostering uncertainty, a structure of incentives that rewards unproductive behaviour, and the waste of scarce public resources.6

In particular, four practices associated with neo-patrimonialism hinder the development of capitalism:

I. The use of governmental powers to reward political insiders

the research involved interviews (for which anonymity was a condition) with political leaders, public servants, and those knowledgeable about developments in civil society.

Schatz, loc. cit. p. 242.

4 Guillermo O'Donnell, 'Illusions about Consolidation', in Journal of Democracy (Baltimore), 7, 2, I 996, p. 36.

' For more details, see Richard Sandbrook, The Politics of Africa's Economic Recovery (Cambridge, 1993), ch. 2.

6 ' Prebendal strategies of political management directly contradict the requisites of productive economic activity', as tersely observed by Peter M. Lewis, 'Economic Statism, Private Capital, and the Dilemmas of Accumulation in Nigeria', in World Development (Oxford), 22, I994, p. 440.



REFLECTIONS ON GHANA 605

encourages 'rent'-seeking behaviour and concomitantly discourages productive, entrepreneurial activities.7 The forms of such rents are legion: the award of public contracts at inflated prices to favoured contractors; the manipulation of regulatory powers to benefit political followers - for example, in the allocation of undervalued foreign exchange, import licences, and credit from directed credit schemes, as well as the granting of individual exemptions from general rules, such as those governing tariffs; and the levying of preferential rates (or the implicit right of non-payment) for public services, such as utilities.

2. The ruler's acquiescence, if not active involvement, in the misappropriation of state funds or the non-payment of taxes by his political cronies lowers the rate of public investment in human and physical capital, especially in infrastructure, education, and health care, thereby restricting the growth potential of national economies operating within highly competitive global markets.

3. The distribution of state jobs by political patrons to followers, especially in combination with the tacit acceptance of bureaucratic corruption, fosters incompetence, indiscipline, and unpredictability in the civil service and state-owned enterprises. These deficiencies discourage productive investment, and demoralise competent, honest, and apolitical public servants who then either join the 'political game', depart for the private sector, or emigrate. Clientelism may also impel the proliferation of inefficient, debt-plagued public corporations.

4. Neo-patrimonial rule often threatens private property by the weakness or non-existence of the rule of law - a consequence of some combination of political instability, undisciplined troops and police forces, arbitrary officials, and political determination of judicial decisions. This uncertainty further discourages long-term investments in favour of speculation, capital flight, and political advantages.

If certain informal institutions are dysfunctional to economic development, what can be done to remove them?8 Specifically, how do reformers reduce the premium on political power and institutionalise new rules of the game that (among other goals) foster productive economic activities? Removing the first two above-mentioned impediments will require political reforms strictly understood: preferably those which limit the scope of predatory government and, in the longer

7 A 'rent' is a windfall gain, that is the return which a firm or individual receives from a transaction in excess of that which would have been obtained in an 'arms length' market situation.

8 Institutional reforms are a necessary but obviously not sufficient condition for capitalist development where institutions unconducive to market relations hold sway.



6o6 RICHARD SANDBROOK AND JAY OELBAUM

run, improve its accountability, transparency, and responsiveness. Minimising the third and fourth institutional hindrances demands wide-ranging administrative and legal reforms. This adds up to a daunting agenda.

Since we can safely assume that neo-patrimonial governance is deeply rooted in the history, political culture, and material conditions of societies, reforms will be difficult. Historical legacies of traditional patrimonialism, the weakness of national integration in recently contrived multi-ethnic societies, the widespread poverty and numerical predominance of peasantries, and the flux of undeveloped class societies - these are some factors which have encouraged leaders to substitute personalistic authority, clientelistic networks, and force for weakly legitimated formal institutions. In such unpropitious circumstances, activists may perhaps find that there are 'no shortcuts to progress', that capitalism requires nothing less than a bourgeois revolution.9

Or perhaps not. Maybe institutional reforms need not wait for the rise of a class with the capacity to mould a disciplined state and a bourgeois culture. Decisive strategies have, here and there, wrought significant social and political changes.10 First 'revolutions from above' have occasionally been engineered by populist/reformist leaderships which seized power in a coup d'Wtat.11 But the conditions of their success in reorienting development strategies and national institutions are stringent: a unified leadership, a coherent nationalist/statist ideology, a foreign threat, and an absence of personal or professional links between the traditionally dominant classes and the new leadership. These conditions have rarely obtained in post-colonial Africa. Consequently, populist military interventions have proved notoriously ephemeral: in West Africa, their leaders have either succumbed to compromises with ingrained institutional practices (erry Rawlings of Ghana), or been assassinated (Murtala Mohamed of Nigeria and Thomas Sankara of Burkina Faso) by those who would.

Secondly, external support of institutional reforms may prove effective. Although structural adjustment programmes (SAPs) as supported by the International Monetary Fund (IMF) and the World Bank have not yet delivered economic breakthroughs in Africa, they

' Goran Hyden, No Shortcuts to Progress: African development management in perspective (London, 1983), ch. 8.

'" Cf. R. Quentin Grafton and Dane Rowlands, 'Development Impeding Institutions: the political economy of Haiti', in Canadian Journal of Development Studies (Ottawa), 17, 2, 1996, pp. 270-2X

" E. K. Trimberger, Revolution from Above: military bureaucrats and development in Japan, Turkey, Egypt and Peru (New Brunswick, 1978).




may none the less address long-term constraints. Where predatory regimes prevail, state-led development has led to economic disaster. Hence, the neo-liberal recipe of the minimal state, more scope for market forces, and attention to better governance through 'institutional capacity-building' may represent the best available option in these circumstances."2 Optimally, reformers within government will use support from external agencies and middle-class constituencies to build techno-bureaucratic enclaves within a state apparatus hitherto dominated by clientelistic criteria. But external assistance is inevitably limited in its impact: nationalists will reject institutions foisted on them by foreigners, and donors will succumb to 'fatigue' when they recognise the long-term commitments inherent in governance reforms.

If populist leaderships, local technocrats, and foreign supporters will not suffice, can democratization spur the needed reforms? Opinions diverge on this question. On the one hand, a 'governance' perspective holds that the process can lead to institutional reforms where predatory and authoritarian states have prevailed.'3 Democratisation, it is hoped, will empower domestic social forces which have a vested interest in defending a new order of limited and market-friendly government, accountable and honest officials, transparent decision-making, effective and predictable administration, and a rule of law that protects human rights, private property, and the sanctity of contracts. Economic liberalization, financial-sector improvements, the creation of stock markets, privatization, legal reforms, the support of think-tanks: much of what the IMF and the World Bank advocate is designed to foster a bourgeoisie with the confidence, resources, and political clout to anchor a functioning market economy. If sizeable segments of the middle class and poor also desire a break with the bankrupt institutions of the past, then democracy may generate a sustained pressure for institutional reforms that can underpin a market economy.

On the other hand, sceptics maintain that old neo-patrimonial traditions will quickly corrupt and even overwhelm fragile democratic

12 On the World Bank's approach to governance, see Sub-Saharan Africa, i989, and Governance and Development (Washington, DC, I 992). Also David Williams and Tom Young, 'Governance, the World Bank and Liberal Theory', in Political Studies (Oxford), 42, I, I994, pp. 84-i00.

13 World Bank, Sub-Saharan Africa, I 989; Pierre Landell-Mills, 'Governance, Cultural Change, and Empowerment', in The journal of Modern African Studies, 30, 4, December I992, pp. 543-67; John Healy, Richard Ketley, and Mark Robinson, 'Will Political Reform Bring About Improved Economic Management in Sub-Saharan Africa?', in IDS Bulletin (Brighton), 24, I, I993, pp. 3i-8; Adrian Leftwich, 'Governance, Democracy and Development in the Third World', in Third World Quarterly (Abingdon), I4, 3, I993, pp. 605-24; and Nicolas van de Walle, 'Crisis and Opportunity in Africa', in Larry Diamond and Marc F. Plattner, Economic Reform and Democracy (Baltimore, I995), pp. I53-66.



6o8 RICHARD SANDBROOK AND JAY OELBAUM

institutions, thus undercutting market-oriented reforms."4 Not only do the new democracies confront hostile socio-economic conditions and non-democratic legacies, but they also must cope with the social costs to key constituencies inherent in their often unpopular adjustment programmes. These circumstances, the sceptics argue, impel elected governments to centralise power and resort to populist rhetoric, clientelistic politics, and the cultivation of particularistic loyalties. Corruption, closely associated with pervasive clientelism, will also soon resurface. These practices will, among other things, imperil macro- economic stability. Beneath the trappings of liberal democracy, the ingrained informal institutions of neo-patrimonial governance re-emerge to jeopardise disliked economic reforms.15

Which of these two viewpoints is better supported by the evidence? Is democratisation a gamble worth taking, not only for its intrinsic value as a defence against tyranny but for its instrumental value in institutional change and improved policy? Or is democracy another false start in poor countries attempting costly economic reforms?

We use the experience of Ghana to reflect upon this important issue. In certain respects this country has traced a political and economic trajectory since independence in I957 which is typical of sub-Saharan Africa. In I959, it emerged as one of the first de facto one-party states under Kwame Nkrumah (who was overthrown in i966). His regime introduced the informal institutions of neo-patrimonialism at the national level that were to hold sway until the populist coup of December i98i. Brief experiments in redemocratisation in i969-72

(the Second Republic) and 1979-8i (the Third Republic) modified but did not eradicate neo-patrimonial patterns. Partly as a consequence of dysfunctional institutions, the economy entered into decline from the

mid-ig6os, a downward slide that accelerated in the I970s.

By the early I98os, the Ghanaian economy was on the point of collapse, which meant that Flight-Lieutenant Rawlings and his Provisional National Defence Council (PNDC) had little choice but to

14 Atul Kohli, 'Democracy Amid Economic Orthodoxy: trends in developing countries', in Third World Quarterly, 14, 4, 1993, pp. 67i-89; Guillermo O'Donnell, 'Delegative Democracy', in Journal of Democracy, 5, I, I994, pp. 55-69; and Thomas M. Callaghy, 'Africa: back to the future?', in Diamond and Plattner (eds.), op. cit. pp. I40-52.

15 Michael Bratton and Nicolas van de Walle, 'Neopatrimonial Regimes and Political Transitions in Africa', in World Politics (Princeton), 46, I994, pp. 453-89, contend that the less institutionalized and more personalistic an authoritarian regime, the more likely is the re- emergence of clientelism, personalism, and corruption in the new democracy.




adopt stabilisation and adjustment programmes in order to attract loans and grants from the IMF, the World Bank, and bilateral donors. The regime received accolades from its foreign supporters for adroitly and consistently implementing top-down, stroke-of-the-pen liberalisation measures during i983-91. But the more complex institutional changes associated with the second phase of adjustment were another matter. In the hope of buttressing the PNDC's legitimacy and effectiveness, donors joined with an indigenous pro-democracy movement to urge political reforms. A partial transition took place during I991-2, and we thus draw upon the experience of more than four years of semi-democracy January I993 to April 1997) in order to assess the extent of its impact on institutional improvements.

We argue that the Ghanaian experience provides some basis for the 'positive' view that democratization can facilitate institutional change. The situation, however, is highly contradictory. On the one hand, the process has stimulated the resurgence of neo-patrimonial institutions under the guise of liberal democracy - to the extent that by the mid- I99OS the regime resembled that of Nkrumah's which Rawlings had once decried. Pervasive clientelism in I 992 predictably undermined macro-economic stability as the sluice gates of patronage were opened up to win the elections that year. Budget deficits and mounting inflation forced the Government to accept the IMF's stringent terms for a new stabilization programme. On the other hand, beneath the surface, and in tandem with the strengthening of middle-class civil associations, important changes were underway that ran counter to the logic of neo-patrimonial traditions. These included the fortifying of liberal-democratic political and intermediary institutions, the legal system, and, to a minor degree, the bureaucratic apparatus. Some hoped that reforms along these lines would, if continued, permit Ghana to transcend the low savings and investment rates that had impeded recovery during its first decade of adjustment.16

It can be argued that the continuity of neo-patrimonial practices during the process of building liberal institutions mirrors Ghana's contradictory legacies. Although neo-patrimonial traditions are well entrenched in the country's political culture, liberalism too has extensive historical roots. But before proceeding to evaluate the impact of democratization, we need first to establish that dysfunctional institutions were implicated in Ghana's severe economic malaise.

16 Ravi Kanbur, 'Welfare Economics, Political Economy, and Policy Reform in Ghana', Washington, DC, I994, World Bank Policy Research Working Paper No. I38i.



6io RICHARD SANDBROOK AND JAY OELBAUM

THE POLITICS OF ECONOMIC DECLINE AND RENEWAL

Counter-productive policies and practices bear a heavy, though far from exclusive, responsibility for Ghana's economic problems between i960 and i982.17 Successive governments failed to furnish adequate incentives to rural producers, and emphasised ill-conceived and poorly executed state-led industrialization. From its inception this strategy had a political logic that went beyond the familiar explanations of urban bias or Nkrumah's grandiose plans to build pan-African unity on Ghana's success. The Convention People's Party (CPP) was handi- capped by the fact that the opposition liberal elite, together with the traditional authorities, possessed a large share of the country's wealth, especially in the cocoa-growing regions. Nkrumah sought to overcome this liability by expanding the public sector (and hence the CPP's access to patronage) at the expense of the private sector.18 By the time the President was overthrown in I 966, Ghana had 53 public enterprises, i2 joint state-private ventures, 23 public boards, and extensive price, credit, and exchange controls. A policy environment had been established that discouraged savings and investment, and made rent- seeking a basic requirement of daily survival.

Virtually none of the import-substituting industries established could be justified on the basis of cost calculations, and most had extremely low rates of capacity utilization; in some cases, incremental capital-output ratios became negative. Even monopoly enterprises were not profitable. The reasons for failure were manifold but included inappropriate technology, poor project planning, and what Tony Killick calls 'trivialization of political control'."1 On the one hand, ministers failed to provide policy guidelines; on the other hand, they frequently interfered in the day-to-day affairs of state enterprises. They expected unqualified followers to be employed, regulations to be overlooked in favour of constituents, businesses to be purchased at

17 Tony Killick, Development Economics in Action: a study of economic policies in Ghana (London, I978); R. H. Green, Ghana Country Study i (Helsinki, World Institute for Development Economics Research, 1987) ;John Toye, 'Ghana', in Paul Mosley, Jane Harrigan, and Toye (eds.), Aid and Power: the World Bank and policy-based lending, Vol. II (London, i99i), pp. I5I-200; Douglas Rimmer, Staying Poor: Ghana's political economy, 195o-i990 (Oxford, 1992); and J. Clarke Leith and Michael Lofchie, 'The Political Economy of Structural Adjustment in Ghana', in Robert H. Bates and Anne Krueger (eds.), Political and Economic Interactions in Economic Policy Reform (Oxford, I993).

18 A senior economic adviser to the President stated that 'Nkrumah informed us that if he permitted African business to grow it will grow to the extent of becoming a rival power to his and the party's prestige) and he would do anything to stop it which he actually did'. E. Ayeh Kumi, quoted in West Africa (London), March i966.

19 Killick, Development Economics in Action, I978, p. 246.



REFLECTIONS ON GHANA 6I I

inflated prices. The state-dominated banks politicised the allocation of finance, as loans were made without due regard for their security.20 State expansion was financed by heavy taxation of the cocoa sub-sector and excessive foreign borrowing. In I96I the CPP regime responded to a crisis in the country's balance-of-payments by abolishing non- restrictive import licences and by assigning the Ghana National Trading Corporation, a parastatal, monopoly rights to import a wide variety of basic commodities. These measures of control accelerated the inflationary tendencies in the economy by closing off the import safety- valve. They also generated a rent-seeking constituency that stood to benefit from the overvaluation of the cedi, and that would later prove resistant to reform.21 Even legitimate traders had no choice but recourse to bribery to secure licences.2

Economic decline accelerated in the post-Nkrumah era. Ghana's share of the world cocoa market fell from 35 per cent in the mid- I96os to less than Io per cent by I982.23 Continuous budget deficits, which peaked at over I3 per cent of gross domestic product (GDP) in I976, underpinned an entrenched inflation which averaged 58 per cent during I972-82. By the end of that decade the parallel market rate of exchange was 22 times the official rate. Price controls on consumer goods which were sustained in the face of rising inflation also furnished incentives for parallel market growth; by one estimate this activity accounted for 32 per cent of GDP by I982. By then a messenger's real basic salary was 40 per cent of its I975 level, while a principal secretary's was an astonishing I I per cent.24 This resulted in severe institutional decay; the average worker in the public sector was spending only I5-20 hours a week at his/her job by the early I980s.25

The persistence of quantitative restrictions on what could be

20 Martin Brownbridge and Augustine Fitz Gockel, 'The Impact of Financial Sector Policies on Banking in Ghana', Institute of Development Studies, Brighton, August I 996, Working Paper No. 38.

21 See, for example, Jeffrey Herbst, The Politics of Reform in Ghana, I982-9i (Berkeley, Los Angeles, and Oxford, I993).

22 Maxwell Owusu, Uses and Abuses of Political Power: a case study of continuity and change in the politics of Ghana (Chicago, I970), and Victor T. Le Vine, Political Corruption: the Ghana case (Stanford, I975).

23 International Monetary Fund, Ghana Selected Issues and Statistical Annex: background information to the Staff Report on the I996 Article IV consultation (Washington, DC, 7 June I996). The percentage lost because of reduced production is unclear, but it has been estimated that in some border areas at least 50 per cent of the crop was smuggled. See E. May, 'Exchange Controls and Parallel Market Economies in Sub-Saharan Africa', Washington, DC, I985, World Bank Staff Working Paper No. 7 II .

24 D. L. Lindauer, 0. A. Meesook, and P. Suebsaeng, 'Government Wage Policy in Africa', in The World Bank Research Observer (Washington, DC), 3, I, i988.

25 Green, op. cit. i987, p. 14.



6I2 RICHARD SANDBROOK AND JAY OELBAUM

purchased externally, combined with the fall of export earnings, led to massive compression of imports which eroded infrastructure and undermined production. Domestic investment fell an average of 5-9 per cent per annum between I970 and i983, and average capacity utilisation in industry was less than 20 per cent in I982 (in textiles it was below Io per cent).26

In human terms the economic collapse was devastating. By I982

one-half of the urban and two-thirds of the rural population were below the poverty line, the estimated daily intake of calories per capita was only 68 per cent of requirements, and previously eradicated diseases such as yaws and yellow fever had resurfaced.27 Daily survival became even more of a challenge in I983 as the economy faced two shocks: a prolonged drought with attendant crop-damaging fires, and the return of a million Ghanaians expelled from Nigeria.

The newly installed PNDC responded to the gravity of the crisis by commencing an orthodox stabilization and adjustment programme in April i983.28 This initiative, while in most respects salutary, was also surprising given the radical-populist orientation of Rawlings and his comrades. That a regime of the PNDC's complexion in a country with patrimonial traditions actually implemented a stringent set of neo- liberal measures over many years is even more remarkable. The leadership's authoritarian approach, the depth of the preceding crisis, and the consequent debilitation of trade unions and other potential opponents, as well as generous inflows of donor finance, account in large part for the PNDC's record.

Authoritarian control and the determination of Rawlings to find a way out of economic collapse shielded a core of technocrats from distributive pressures. A National Economic Reform Committee was established and a number of key advisers who enjoyed the President's confidence - notably Joseph Abbey, Kwesi Botchwey, P. V. Obeng, and Tsatsu Tsikata - had a relatively free hand in the design of economic policy. This was formulated and managed in a non- consultative manner that both senior World Bank officials and leading bureaucrats in Accra consistently refer to as a 'command and control' operation.

Those most likely to oppose austerity measures and economic

26 Yao Graham, 'From GTP to Assene: aspects of industrial working class struggles in Ghana, I 982- I 986', in Emmanuel Hansen and Kwame A. Ninsin (eds.), The State, Development and Politics in Ghana (Dakar and London, i989), pp. 43-72. 27 Green, op. cit. i987, p. 27.

28 See Chad Leechor, 'Ghana: frontrunner in adjustment', in Ishrat Husain and Rashid Faruqee (eds.), Adjustment in Africa: lessons from country case studies (Washington, DC, I994), pp. I53-92.



REFLECTIONS ON GHANA 6I3

liberalisation were severely weakened by the preceding economic crisis. For example, industrial decay led to a substantial reduction in the numbers employed in mines and factories, while charges of corruption and sycophancy levelled at union leaders in the early I98os, as well as splits in the Trades Union Congress, further weakened the response of organised labour to adjustment policies.29 Concurrently, urban consumers, who elsewhere have resisted the removal of subsidies and price controls, were not deeply affected by such measures. They had already been paying inflated parallel-market prices for 'free' public services and 'controlled' consumer goods. Civil servants, as noted, had already adopted survival strategies involving moon-lighting and/or corruption. Although the radical intelligentsia who had originally embraced the PNDC were strongly opposed to the regime's neo-liberal

turn, a failed coup in I982 discredited this group, most of whose members fled into exile in England.

Business people generally greeted structural adjustment with relief. Not only did neo-liberal reforms signal a retreat from the rhetoric and practice of class struggle, formalised by the dissolution of the Defence Committees in December I984, but they also relaxed the constraints on imports. Ghana's remaining professionals and entrepreneurs had been cowed by the Defence Committees, by the shocking murder of three Supreme Court justices and a retired manager in i982, and by the extra-judicial bodies established by the PNDC to root out and punish corrupt practices.30 Natural allies of market reforms, business people none the less were to remain suspicious about the real intentions of Rawlings for many years.31

Following this change of economic strategy, the PNDC identified itself rhetorically with the smallholding farmers, although no steps were taken to organise their support by means of a party or movement. By the mid- I 980s, therefore, Ghana approximated to Goran Hyden's image of the African state floating above society.32 The regime's pronounced autonomy from social forces was, however, a mixed blessing, since this did not provide a conducive context for the

29 Graham, loc. cit.; Herbst, op. cit.; and Paul Nugent, Big Men, Small Boys and Politics in Ghana: power, ideology and the burden of history, I982-I994 (London, I995).

30 These included the National Investigation Committee which was empowered to investigate any person whose bank deposits exceeded 50,000 cedis, the Citizens Vetting Committee which vetted individuals whose lifestyles were considered to be incommensurate with their official incomes, and the People's Tribunals which were authorised both to try and punish corruption though they were not manned by lawyers. These had complete jurisdiction and could, and did, deliver the death sentence.

31 Roger Tangri, 'The Politics of Government-Business Relations in Ghana', in The Journal of Modern African Studies, 30, I March I992, pp. 97-II I. 32 Hyden, op. cit. i983.




institutional reforms that were required to restore commercial confidence and stimulate greater savings and investment. Many began to realise that a more consultative and co-operative approach would be needed. Hence, the World Bank advocated broader participation in political life in its i990 Country Strategy Paper, believing that this would lead Ghanaians to develop a sense of ownership in the reform process. In the event, however, political liberalization itself was something of a 'command and control' operation.

Ghana's political liberalization resulted from external and internal pressures which had been intensifying since I988. None the less, the PNDC never yielded its control over the institutional arrangements, sequencing, or timing of the transition.33 Formal debate over these national political issues commenced in August I990, when a series of government-orchestrated seminars were held at regional capitals. Only a handful of individuals opposed to the PNDC were ever given an opportunity to present papers, and the majority of participants backed a no-party option. Popular support for a return to multi-partyism, however, was transparent. Moreover, two surveys undertaken by the Government between the middle of I990 and August I99I indicated that Rawlings would probably win any contested elections.

A political transition timetable had been outlined by the President in January i99i, and in May he confirmed that Ghana would return to a multi-party system. A constitution was approved by referendum in April i992, and the ban on party activity was lifted in May. This left only seven months for opposition parties to establish themselves and organise against a regime that had enjoyed an eleven-year incumbency.

NEO-PATRIMONIALISM RESURGENT: RAWLINGS AS

THE NEW NKRUMAH

From one perspective, we see in the Fourth Republic that was

inaugurated in January I993 what O'Donnell refers to as a 'delegative democracy'.34 This differs from Nkrumah's authoritarian regime principally in the willingness periodically to hold more-or-less free multi-party elections and to respect, at least to some extent, the civil and political rights of citizens. Ghanaians can form associations, including political parties, subject to certain legal requirements (albeit quite onerous), and amidst acrimony and threats, an independent press

3 Kwame A. Ninsin, 'Some Problems in Ghana's Transition to Democratic Governance', in Africa Development (Dakar), i8, 2, I993, pp. 5-22, and Nugent, op. cit. I995.

" O'Donnell, loc. cit. I994.



REFLECTIONS ON GHANA 6I5

continues to exercise its 'freedom' of expression. Yet, under the democratic facade, the old neo-patrimonial rules of the game hold considerable sway. Centralisation of power, personal loyalties, pervasive clientelism, growing corruption, and unofficial presidential control of coercive force undercut the formal democratic institutions that are designed to monitor, check, and discipline the Government between elections. Patrimonial traditions, the continuing premium placed on political power by persistent poverty, and the strain of imposing unpopular economic reforms in the midst of crisis account for the President's efforts to escape day-to-day accountability. Competitive elections and civil liberties, however, are the price he must pay to build legitimacy in the eyes of possibly violent opponents and potentially ungenerous foreign donors. The danger is that resurgent neo- patrimonialism will again impede capitalist development, unless mitigated by ongoing institutional reforms.

I. Elections

Ghana has held two sets of presidential and parliamentary elections during its most recent redemocratisation. Were they 'free and fair'?` Foreign observer teams judged them, on the whole, to have been so, but as elsewhere, the outcome may have been shaped by irregularities and unfair practices that occurred long before the casting and counting of votes had been observed. Governments may employ invalid electoral rolls, deny opponents access to the state-owned media, restrict opposition campaign meetings, use militias to intimidate the members of hostile parties, and buttress their own support by the distribution of patronage and use of public resources. Judged by these standards, Ghana's elections in December i996 were fairer than those held in November-December I 992. To this extent we can speak of a partial institutionalisation of the electoral rules of the game - a real, though fragile, achievement.

Although a Commonwealth Observer Team pronounced the I992

presidential elections 'free and fair', this judgement remains controversial.36 The opposition parties denounced the contest as fraudu- lent, and boycotted the subsequent parliamentary elections. The New

3 Gisela Geisler, 'Fair? What Has Fairness Got to Do with It? Vagaries of Election Observations and Democratic Standards', in The Journal of Modern African Studies, 31, 4, December 1993, pp. 6I3-37.

36 See, for example, Richard Jeffries and Clare Thomas, 'The Ghanaian Elections of 1992', in African Affairs (London), 92, 368, July I993, pp. 33i-66, and Mike Oquaye, 'The Ghanaian Elections of I992 - a Dissenting View', in ibid. 94, 375, April I995, pp. 259-75.



6i6 RICHARD SANDBROOK AND JAY OELBAUM

Patriotic Party (NPP) issued a report which contained detailed allegations of irregularities in I oo of the country's 200 constituencies,37 many of which related to the conduct of the voting, or to systematic rigging of the results by a partisan Interim National Electoral Commission. But other charges related to practices that occurred earlier. One concerned the electoral rolls which, according to the Washington-based International Foundation for Electoral Systems, contained many irregularities: 'ghost' as well as multiple entries of the same voter; inconsistent alphabetisation (so that even Rawlings was unable to locate his name during the I 992 referendum); failures to record corrections and to list about five per cent of the eligible voters. Indeed, as many as one million of the 8-4 million entries were estimated to be erroneous.38

In addition, Rawlings and his newly minted National Democratic Congress (NDC) made full use of the advantages of incumbency. Civil servants were given a major pay rise just before the 1992 elections, an action which pushed the budget into deficit. Rawlings had targeted the rural areas as a major base of governmental support since i988. He campaigned extensively in the countryside in I992, and liberally dispensed patronage to local communities in the form of electricity extensions, water supplies, feeder roads, or school improvements.39 This strategy (which nicely complemented the higher producer prices for cocoa under structural adjustment) 'paid off', as the rural areas outside Ashanti favoured Rawlings. NDC candidates also relied on government vehicles and public radio and television to conduct their campaign. And officials confounded the opposition parties by delays in granting permits to hold rallies.40

Many of these campaign practices also characterized the I 996 elections, though the registration of voters and ensuing procedures involved far fewer irregularities. Rawlings continued to court rural constitutencies. Phase 2 of the Self-Help Electrification Project had been launched in I995 with the goal of bringing light and power to Iooo towns and villages, and the following year donor funds also under-

3 New Patriotic Party, The Stolen Verdict: Ghana, No/vember 1992 presidential elections (Accra, I993) -

38 Laurie Cooper, Fred Hayward, and Anthony Lee, Ghana: a pre-election assessment report (Washington, DC, International Foundation for Electoral Systems, i992).

3 Daniel Green, 'Ghana's "Adjusted" Democracy', in Review of African Political Economy (Abingdon), 22, 66, December I995, pp. 577-85.

40 Donald Rothchild, 'Rawlings and the Engineering of Legitimacy in Ghana', Conference on Democratisation and the I992 Elections in Ghana, University of London, 5-6 August I993, and Jeff Haynes, 'Sustainable Democracy in Ghana? Problems and Prospects', in Third World Quarterly, I4, 3, I993, pp. 45i-67-



REFLECTIONS ON GHANA 6I 7

wrote a number of various government-directed rural infrastructure projects.4" Rawlings won 57 per cent of votes cast to elect the President, including a majority in all regions except Ashanti (the NPP's heartland). In contested parliamentary elections, the NDC emerged with I33 seats to the 66 won by the 'Great Alliance' of the NPP and the People's Convention Party. The opposition accepted its defeat this time; indeed, it congratulated Rawlings on his victory, in marked contrast to the rancour associated with the I 992 elections. Concessions won by the opposition as regards the preparatory arrangements account for this conciliatory attitude. A representative committee oversaw the Electoral Commission's registration of voters, preparation of listed names for constituencies, and arrangements for voting day. The Government also agreed to use transparent ballot boxes, to allay suspicions that they had been stuffed in advance by its agents.

None the less, the NDC continued to exploit numerous strategic advantages. It had much more money to spend than the opposition, widely attributed to kickbacks on state contracts which were channelled into the coffers of the ruling party. It could therefore afford to mount an advertising blitz through newspapers and billboards that could not be matched by the opposition, although the latter gained access to a larger audience than hitherto with the advent of independent radio stations and legally-sanctioned access to state-owned media. The NDC and its associates could also afford to import election 'gifts' (T-shirts, wrist watches, wall clocks, bicycles, umbrellas, sewing machines - all embossed in the party's colours) which were handed out to potential supporters, mainly in the rural areas.42 In Akim Oda, in the Eastern Region where we observed the I996 elections, an NDC pick-up truck distributed brand-new colour TV sets to villages the day before the elections. Ghana's capital budget rose to six per cent of GDP in I995

and about four per cent in I996, and half of this went into the repair/construction of roads.43 Gift-giving and infrastructural development, when combined with the boosts to cocoa production, gold- mining, and forestry which were part of structural adjustment, proved a winning formula for Rawlings in the countryside. The urban areas languished, however, with rising prices and limited employment opportunities stirring discontent.

41 Daniel Green, loc. cit. I995, p. 580. 42 The independent press delighted in announcing new shipments of election 'goodies' as they

arrived at Tema and allegedly cleared through customs by the NDC and its affiliates without the payment of import duties. Such reports often listed both the contents and the registration number of the containers. See, for example, the Ghanaian Chronicle (Accra), 25-28 April and 6-9June i996.

4 Financial Times (London), 9 July I 996.



6i8 RICHARD SANDBROOK AND JAY OELBAUM

Beyond the various strategic advantages enjoyed by the Government, some rules were clearly flouted. Reports alleged that NDC agents had purchased registration cards from NPP supporters in order to vote in their stead.44 Domestic election observers from Ghana Alert discovered that large numbers of children had voted, especially in the North. They and other observers also wondered how 9 2 million voters could be registered in a country of I 7 million people, many of whom are below the age of I5." Assaults on suspected supporters of opposition parties and party agents occurred from time to time.46 Some incendiary speeches by NDC leaders included threats to use whatever means were needed to crush the opposition, characterized as 'thieves and rogues who are desperate for the spoils of the nation's wealth to enrich themselves'.47 Even Rawlings was reported to have warned a Sekondi rally that, if the NDC lost the elections, 'perhaps we can only get

[power] through anotherJune 4th [coup]', and 'ifJune 4, I 979 repeats itself I o times, I will do what I did then I o times over'.48

Despite the fact that the incumbents enjoyed many advantages during the nation-wide campaign, and that incivilities, scattered irregularities, and acts of intimidation periodically erupted, the concessions made to the opposition lent legitimacy to the electoral process. The opposition was willing to abide by the ground rules, and bide its time. It now controls one-third of the parliamentary seats. We can therefore speak of a fragile institutionalisation of electoral norms by I996-7.

2. Presidential Rule

Highly centralised personal rule sanctified by periodic elections characterizes the Fourth Republic, In some ways, little has changed from the days of the PNDC. Rawlings continues to dominate the scene from his seat in the Castle-Osu, chafing against restraints on his power imposed by the Constitution or civil society. And he retains control of a significant coercive apparatus. In other ways, however, much has changed from his early days. Having carried out two coups ostensibly to stamp out the informal institutions of neo-patrimonial rule -

44 Ghanaian Chronicle, i o October I 996.

4 E. Gyimah-Boadi, 'Ghana: the challenges ahead', in journal of Democracy, April I 997, p. 83. 46 Ghanaian Chronicle, 25-28 January and i8-2 I April i996. 4 Ibid. i8-2i April i996. 48 Ibid. I5-i8 November i996. Reported also in Free Press and The Independent on the same

date.



REFLECTIONS ON GHANA 6i9

especially clientelism, rent-seeking, and corruption - Rawlings has ended by surreptitiously embracing these same stratagems. He and his lieutenants have built a political machine that rivals that of Nkrumah's CPP. Pervasive clientelism and personalism have inevitably stoked the fires of corruption.

Rawlings continues to govern largely as he sees fit since 'redemocratisation'. His supremacy derives partly from the 1992 Constitution which has created a parliamentary system in which the President is ultimately responsible for the determination of policy. He appoints and chairs his Cabinet, whose members may or may not have been elected to the National Assembly, and they assist in designing the legislation which is then submitted by the responsible Minister for parliamentary hearings, amendments, and approval, as are the state's budgets.

The President, in addition, has wide powers of appointment and confirmation of status, and these have enabled him to project his influence down to the district level. During the PNDC era, Rawlings retained considerable leverage over chiefs, not least since their legal status depended upon recognition by the Government, a requirement that discouraged these local leaders from making overt criticisms of those in power. However, under the I 992 Constitution the President now wields only indirect influence over the traditional rulers, mainly through patronage (for example, by the distribution of tractors) and NDC involvement in chieftaincy disputes, as well as by the threat of withholding development expenditures.49 Not surprisingly, many have backed the Government's agenda, even to the extent of being willing 'to explain and propagate the ideals and aims of the revolution' at durbars.50

The I992 Constitution also empowers the President to appoint the district chief executives (DCEs) who play a prominent r6le in the I io district assemblies by virtue of their seat on the executive committees. The DCE may be removed from office by a vote of no confidence supported by at least two-thirds of all members of the district assembly, 30 per cent of whom are appointed by the President, which means that challenges are rare. This central influence is significant in that according to the Constitution, district assemblies must be allocated not less than five per cent of national revenues. This prompted widespread fears that DCEs in NDC-controlled district assemblies would penalise

4" Jeff Haynes, 'Ghana: from personalist to democratic rule', in John A. Wiseman (ed.), Democracy and Political Change in Sub-Saharan Africa (London and New York, I995), p. io6.

50 Maxwell Owusu, 'Tradition and Transformation: democracy and the politics of popular power in Ghana', in The journal of Modern African Studies, 34, 2, June i996, p. 34I.




communities which favoured the opposition, by directing development funds to other areas.51

Besides using his broad constitutional powers to build acquiescence, the President has sought to neutralise formal institutions which assert their right to hold the Government accountable. The legislature was hobbled by the near-monopoly of seats enjoyed by the ruling coalition before the i996 elections. It none the less was far from supine; two independent members posed embarrassing questions to ministers, and the committee system provided opposition leaders with a forum in which to criticise legislation and budgets. Opposition parties and the independent press have voiced persistent complaints about the Government's policies and behaviour, but a lack of resources and periodic intimidation have inhibited their impact. The Supreme Court and other judicial bodies have delivered some courageous judgements which have circumscribed presidential discretion and reasserted the formal rules of fair play.

What of civil society? To what extent has this held the Government accountable for its actions? The Ghana Bar Association, the Christian Council of Ghana, the Ghana Bishops Conference, human-rights organizations, and to a lesser extent the Trades Union Congress and the National Union of Ghanaian Students, have continued to monitor government actions, publicise abuses, and criticise policies, as they did during the latter days of the PNDC. Yet organised centres of potential opposition to the regime attract the attention of NDC stalwarts who seek to gain control or to split them. Consider the fate of the Ghana Association of Private Voluntary Organisations for Development (Gapvod), which aspired since being registered in i980 to become the umbrella body for indigenous and foreign non-governmental organisations. But Gapvod broke down into factional conflict in the highly charged political atmosphere of I990-2. The immediate issue was the management of a $6oo,ooo grant from the United Nations Devel- opment Programme. But the belief that NDC agents were seeking to control the NGO sector led to the alienation of many member organizations and the virtual collapse of a promising experiment in

I 992.52

Rawlings has also apparently retained extensive control over a

5 See, for example, Kojo T. Vieta, 'Non-Partisan Elections?', in West Africa (London), i4-20

March 1994, pp. 438-9, and Ghanaian Chornicle, 15-i8 February i996. As Gyimah-Boadi notes in loc. cit. p. 87, these fears are well founded in that many DCEs have held office since the PNDC days in the late i980s.

5 Ian Gary, 'Confrontation, Co-operation or Co-optation: NGOs and the Ghanaian state during structural adjustment', in Review of African Political Econom!y, 23, 68, June i996, pp. I49-68.



REFLECTIONS ON GHANA 62I

coercive apparatus. The military has remained shielded from the scrutiny prescribed by the Constitution. Despite being legally required to audit the accounts of the military, the Auditor-General has been prevented from doing so. And while an elected head of state in a constitutional system should have only an arms-length association with the armed forces and militias, many Ghanaians believe that they remain under the tight personal control of the President.53 Junior officers and lower ranks twice carried through coups (4 June I979 and 3I December I98I) in order to elevate Flight-Lieutenant Rawlings to power. In i983-4 he placed loyalists in charge of the army, navy, and air force after retiring many senior officers. Certainly, the armed forces and intelligence agencies constituted an important power base of the PNDC, especially after i983 when IMF-backed adjustments alienated other supporters, notably urban workers and university radicals.

The so-called '3 December I98I Revolution' was in part a revolution led by Rawlings against the established military hierarchy, which helps to explain the creation of the Armed Forces Defence Committees which, as with other Committees for the Defence of the Revolution (CDRs), reported through their own hierarchy to the PNDC. Reorganised on a 'voluntary' basis, an Armed Forces Association for the Defence of the Revolution continued to operate under a Forces Sergeant-Major after the return to constitutional rule in January 1993. During its first administration, the NDC Government had therefore not abandoned the model of politically engaged armed forces in favour of an apolitical, professional, and hierarchical military establishment.

Apart from the military, Rawlings apparently commands other armed groups. During the PNDC era, the paramilitary Civil Defence Organisation (CDO) operated alongside the CDRs as an intimidating presence, especially in the countryside. With the advent of the Fourth Republic, the CDOs were absorbed into special units of the armed forces and police service. But some journalists and informed observers insist that 'the Castle' retains direct control over these units which, so it has been alleged, would be mobilised for action against demonstrators. Finally, and not surprisingly, a presidential guard unit reports directly to Rawlings.

5 See Eboe Hutchful, 'Military Policy and Reform in Ghana', The journal of Modern African Studies, 35, ,JJune I997, pp. 25I-78, and a series of investigative pieces by The Statesman (Accra), especially in the issue of 1 June 1994, based on interviews with anonymous officers. It should be noted that this newspaper is owned by Nana Akufo-Addo, a leader of the opposition NPP.




3. The 3/DC as a Political Machine

If presidential rule shows some continuity with the preceding authoritarian structures, a major discontinuity lies in the resurgence of neo-patrimonial mechanisms as a means of building support and accumulating wealth. The NDC emerged in 1992 as the successor to a military regime which, during its decade in power, had not converted itself into a mass movement. The PNDC had rested heavily on its base in the military and intelligence agencies, its cadres in the form of the CDRs and paramilitary CDOs. With the advent of a multi-party system, the NDC had quickly to develop a popular constituency. Opposition parties laid claim to the two main political traditions of the country: the liberalism associated with DrJ. B. Danquah and Professor Kofi Busia, and the radical-populism of the CPP. Although the fledgling NDC allied itself with one faction of the Nkrumahist family (the National People's Convention), it still required a popular base. It built one primarily through the construction of a political machine which drew heavily upon state resources.

The NDC, in contrast to the opposition parties, is well-financed and well-organised on a country-wide basis. It boasts an impressive headquarters in Accra, as well as a full array of regional and district branches. Its top officials in 1994 were former PNDC activists, some of whom also held government appointments to public boards and offices. The general secretary, appropriately enough, was the former head of the CDRs. Informally, the NDC has constructed clientelistic networks which extend right down to the grassroots, mainly thanks to the key roles played by (i) the former CDR hierarchy, (ii) the 3ist December Women's Movement, and (iii) the Council of Independent Business Associations. An array of smaller organisations have also played their part, including (iv) the Ghana Private Road Transport Workers Union, as well as market women's associations and other affiliated groups. Many have acquired the right to collect rates and taxes from their members and others, and to allocate assets, such as market stalls.

(i) The Former CDR Hierarchy

During the reign of the PNDC, the cadres of the populist 'revolution' were the militants known as the CDRs. They were organised at five levels, from Accra, through the districts, and down to the zones, wards, and units (the last located in a village or small town). Paid salaries and benefits by the Government, the CDRs were not really revolutionary.




Local studies reveal that they often usurped some of the powers of the chiefs, especially by engaging in security and police functions, and that they frequently involved themselves in ongoing local disputes over land and chieftaincy.54

Under constitutional rule, the CDRs lost much of their arbitrary power, and indeed found themselves converted into 'non-governmental organizations': namely, Associations for the Defence of the Revolution (ACDRs). Members could no longer be treated as civil servants, and hence the NDC found new employment niches for them, especially in the state-funded but ostensibly independent National Commission for Civic Education, directed by a former PNDC ally,55 and in the parastatal National Mobilisation Programme. The opposition parties, not surprisingly, wondered how objectively such cadres would deliver ' civic education' ! After I993, ACDR members acted as youth-wingers at campaign rallies, and were sometimes used to intimidate those who joined in demonstrations organised by opposition parties, most infamously the 'Kume Preko' protest against value-added tax (VAT) in May 1995, when four demonstrators were killed. Members continued to participate in local government institutions, from the unit/village committees and town councils to the district assemblies.56 These positions gave such NDC activists a continuing influence over the allocation of resources at the local level, in particular development funds, often in collaboration with the district chief executive and district NDC officials.

(ii) The 31st December Women's Movement (DWM)

Headed since I984 by the 'First Lady', Nana Konadu Agyeman Rawlings, the 3Ist December Women's Movement is the second pillar of the NDC's political machine having been founded early in i982 as one of the PNDC's 'revolutionary organs'. However, in the late I 980s,

the 3I stDWM declared itself to be 'non-governmental' in order to qualify for grants and assistance from donor agencies and international NGOs. Despite this legal change, the Movement informally operates as the women's wing of the NDC, and has received financial support from

54 KwesiJonah, 'Elections in the Ahanta West Constituency and Its Capital', Conference on Democratisation and the I992 Elections in Ghana, University of London, 5-6 August I993, and Sam K. Asibuo, 'A Study of Governance in Ghana under Decentralization', School of Administration, University of Ghana, Legon, January I 994.

5 Confidential interview, National Commission for Civic Education, June I994.

56 See, for example, Ren6 Lemarchand, 'Report of a Democracy/Governance Consultancy to Ghana: local government', US Agency for International Development, Accra, January I994.




the public treasury which permits it to run a large headquarters in Accra and cover the travelling expenses of the First Lady.57 Some of its full-time organisers receive salaries from ministries: indeed, its general secretary in 1994 was Cecilia Johnson, who was the Deputy Minister of Local Government, as well as the NDC's national women's organiser. The NDC insignia and signs are conspicuously displayed at the headquarters of the Movement, and there is little doubt that the resources and projects distributed by the First Lady are widely perceived as part of the largesse of the NDC.

The ostensibly independent National Council for Women and Development (NCWD) works closely with the 3istDWM. Officially established in 1975 to co-ordinate women's groups and advance women's economic and social interests, the NCWD fell under the sway of the NDC in 1992- 3. The Government ensured that NDC activists gradually replaced members of the Council, which channels donor and state funds into a number of 3istDWM projects. None the less, even Ghanaian critics admit that the NCWD carries out some useful functions, not least by providing a monthly forum in which problems can be resolved. It has created a resource centre on women's issues, attracted donor funding for some worthwhile rural projects, and used its regional and district offices to help organise local activities by Accra- based women's groups.

The 3istDWM is Ghana's only mass women's movement. It claims over one million 'members' - both directly and indirectly through its 28 affiliated groups - although most tend to remain inactive until a visit by Nana Konadu and other dignitaries galvanises them into action. The affiliated groups are diverse in function since they include, for instance, the Hairdressers and Beauticians Association, the EP Church Women's Union, the Police Wives Association, and the Nurses Association, as well as 'ladies clubs' in government departments or parastatals. This constitutes a formidable network that can be mobilised during election campaigns in order to provide significant support for the NDC. Material inducements apparently ensure loyalty, notably the right to collect rates from members. The 3istDWM has offices with paid staff in Accra, the regional capitals, and all iio districts, and claims to have organisers and volunteers active in most zones and many wards/units.

The Movement undertakes a variety of projects designed to assist mainly rural women. It has been associated with the construction of

57 Gary, loc. cit. I 996, p. i 6 i.




silos for storage of crops, processing mills for gari and palm-oil, the growing and spinning of cotton, the promotion of craft industries such as pottery, weaving, and tie-and-dye clothing, the organisation of revolving-credit schemes for members, and the building of day-care centres. It finances these projects through funds from donors, contributions from local businesses, profits derived from 3istDWM enterprises, and transfers from collaborating Ministries, for instance Health. Critics fear that the Movement uses its control over productive facilities and micro-credit organisations to exclude women who do not support the governing party.

(iii) The Council of Independent Business Associations (CIBA)

The PNDC promulgated the law creating this innocuously named organisation as one of its last acts in early 1993. Its president and founder was a Deputy Minister (1992-6), Peter Vaughan-Williams, and it is chaired by the First Lady. The CIBA constitutes a third leg of the President's clientelist network. It ostensibly represents the interests of small entrepreneurs before governmental agencies, and promotes micro-enterprises through the construction of industrial estates, the provision of low-interest credit, and the regularisation of tax-collection from members. In practice, however, the CIBA may be described as a creature of government which likes to pose as an NGO, although ten of its 20 'independent' business associations had no choice in their affiliation, in that the legislation lists them as members with no provision for withdrawal. The Government donated 150 million cedis as a 'capacity-building grant' in 1993, with more to come if the fledgling organisation performed well.58 The inflow of funds to the CIBA from both the state (ostensibly to promote small business) and the 3 I stDMW led to a well-publicised scandal in the run-up to the I996

elections, when leaders of both the NDC and the Movement demanded that the CIBA account for the 'billions' of cedis it had allegedly received.5

The CIBA appears to have acted as a major conduit of NDC patronage, notably by providing material pay-offs to the leaders and employees of those associated organisations which have been granted the (questionable) right to collect taxes from their members on behalf of the Internal Revenue Service and/or a municipal authority, in

58 Reported in The Pioneer (Kumasi), 9 February 1994. 5 Ghanaian Chronicle, 6-8 May i996.




exchange for a commission. The CIBA itself has collected rates in the capital of Ashanti on behalf of the (irate) Kumasi Municipal Assembly, for which it received a ten per cent commission. Such 'tax-farming' creates jobs for NDC supporters, as well as substantial revenues for compliant associations. In addition, the allocation of scarce credit, subsidised equipment, and work sites to small entrepreneurs gives ample political leverage to Council officials. In August I996, the CIBA imported 330 containers of election gifts - umbrellas, hairpins, plastic chairs, hairdressing equipment - with foreign exchange reportedly provided by the Bank of Ghana.60

(iv) The Ghana Private Road Transport Union (GPRTU)

Drivers and their assistants make up the membership of this staunchly pro-NDC organisation, which is a relatively minor cog in the patronage machine. The GPRTU provides 'jobs for the boys' by assuming responsibility for collecting daily tolls from the drivers at the lorry parks which it manages. In addition, the Union has received extensive 'loans' from the Government, which are not repaid - in 1994

and I995 these totalled more than 17' million cedis61 - and which critics charge are used to subsidise the vehicles, tires, and lubricants purchased by GPRTU members.

The clientelism discussed to this point involves mainly dyadic relationships - a patron provides one or two clients with patronage, each of whom may in turn act as a patron to further clients. Since the networks extend right down to the grassroots, many tens of thousands gain an incentive to support the NDC, including those who receive benefits directly from the Government, especially in the form of contracts to party loyalists.

Another side of the President's machine involves 'aggregative' clientelism, whereby political leaders allocate public funds that will help selected regions and communities in order to maximise their electoral or general support. Large salary increases to civil servants, as well as extensive infrastructural investments in potentially supportive rural constituencies, figured heavily in 1992, and the latter again

60 Ibid. 26 August i996. 61 Republic of Ghana, Report and Financial Statements of the Controller and Accountant-General on the

Public Accounts of Ghana, rear Ending 31 December I995 (Accra, I 996).




during 1995-6. The home town of a long-time Minister (and former PNDC Secretary) in the Central Region graphically illustrates the rewards of political loyalty, since in 1994 it boasted an unusual array of newly constructed amenities: a well-maintained main road, electricity connections, a water bore-hole, a day-care centre, latrines, and a workshop for the junior secondary school. The NDC had little to fear here in the i996 elections.

Corruption seems to have grown in step with the extension of clientelism, as Rawlings acknowledged in a speech in 1993 to mark the first anniversary of his election as President. He warned then of the corrupting effect of political power: 'The victory we won was not a victory we have come to eat'.62 He pointed out that opportunism had led to the demise of earlier ruling parties, including Nkrumah's CPP, Busia's Progress Party, and Hilla Limann's PNP. In December I995, Rawlings reportedly administered a severe beating to his Vice- President, allegedly because the latter had publicly accused his Cabinet colleagues of corrupt activities ;63 and in October I996, the government- appointed National Commission of Human Rights and Administrative Justice issued a courageous report which reprimanded two ministers, and the presidential advisor on cocoa affairs, for various nefarious activities. The independent press was filled with reports of irregularities in the award of state contracts, particularly for road-building and drainage works; to be successful, contractors allegedly needed to be supporters of the NDC and to pay kickbacks. These allegations gained further credibility when a NDC member asked in the National Assembly 'whether the Government was trying to develop a new class of businessmen where Political Party card qualifies one for assistance '64

By 1997, public servants expected to receive 'dashes' for their performance of many routine duties.

DEMOCRATISATION AND MACRO-ECONOMIC PERFORMANCE

Has this resurgent neo-patrimonialism, stimulated by democratic contestation, contributed to undermining Ghana's hard-won economic gains, as sceptics would maintain? Since the beginning of the redemocratisation process in 1992, the economy has failed to attain virtually every target set by the Government and donors. Ghana had to seek a Structural Adjustment Facility loan from the IMF in 1995,

62 Ghanaian Democrat (Accra), I 5-2 i November 1993. 63 Ghanaian Chronicle, 2-7 January 1995. 64 Ibid. 26 February-3 March i996.




but then breached the conditions required to renew that in I996.

Democratisation, however, is not wholly responsible for recent economic problems. Fiscal control slackened as early as I990, in part owing to unbudgeted outlays for a summit meeting of the Non-Aligned Movement and peacekeeping operations in Liberia.65 Deficiencies in adjustment policies, poor harvests in 1993 and 1994, and withheld disbursements of loans have also played their part.66

Elections have promoted fiscal laxity. Total government expenditures in I992grew by almost 45 per cent,67 partly because of politically inspired rural infrastructure projects and an increase of 6o per cent in public-sector wages. The broad budget deficit reached 4 8 per cent of GDP, reversing the fiscal surpluses attained in the previous six years. This fiscal shock had wide ramifications as the money supply increased by more than 50 per cent, the current account deficit widened, the depreciation of the cedi accelerated, and inflation surged from Io per cent in I992 to 25 per cent in I993 and to 6o per cent in I995.68 A combination of large nominal interest-rate hikes and high government borrowing then caused a major contraction of credit to the private sector. Primary budget surpluses were restored in I 994, albeit achieved only by treating divestiture receipts as normal revenue. The highest profile divestiture involved the sale of 30 per cent of the Government's shares in the Ashanti Goldfields Corporation, which reportedly netted 3 I6 million cedis. The use of such revenues to cover budgetary deficits helped to conceal the unsustainability of Ghana's fiscal position.

Yet some of the 'political' expenditures are defensible on other grounds. Although electoral considerations influenced the timing of the public-sector pay boost in I992, it was claimed that the wage-bill 'explosion' was partly due to an earlier failure to implement the selective salary increases for civil servants that had been proposed by World Bank officials, only to be rejected by the IMF.69 Wages are still too low to rebuild the morale of public employees, who continue to register high rates of absenteeism and who expect side payments to perform regular duties. Road construction has also been driven by political imperatives. Yet it is hard to argue that such expenditures are

65 Overseas Development Institute, Adjustment in Africa: lessonsfrom Ghana (London, July I 996), Briefing Paper.

66 According to the Economist Intelligence Unit, Ghana: country profile, i996-97 (London, I 996), donors have withheld disbursements of $I00-330 million each year since I992.

67 Centre for Policy Analysis, Macroeconomic Review and Outlook (Accra, i996), p. 28. 68 International Monetary Fund, op. cit. i996, p. v. 69 Robert P. Armstrong, Ghana Country Assistance Review: a study in development effectiveness

(Washington, DC, i996), World Bank Operations Evaluation Study, p. 43.




frivolous when 98 per cent of freight is moved by road, and more than half of the trunk roads remain unpaved.70 The six-year programme of the Ministry of Roads and Highways, launched in I 995 at a projected cost of 2,Ioo million cedis, should be assessed in this light.

Less defensible on economic grounds are the Government's loans to state-owned enterprises and 'private' organisations such as the GPRTU. The loans extended to the Ghana National Petroleum Company (GNPC) headed by Tsatsu Tsikata, one of the President's closest associates, have been the most controversial of these credits, with many Ghanaians suspecting that a share of this money found its way into NDC coffers. The World Bank later reported that the 1992 fiscal shock in Ghana was in part caused by the decision to write off the I4,000 million cedis in taxes owed by the GNPC, whose central bank borrowing in I 994 led to a 46 per cent rise in the money supply and higher inflation.

Other incidents which seem to confirm the economic costs of democratization reveal more ambiguity on closer examination. For example, fiscal problems in I 995 derived in part from the Government's withdrawal of a value-added tax following mass demonstrations in Accra, led by an alliance of opposition politicians who took advantage of the officially permissive environment to harness popular grievances to their own agenda. However, the controversy and subsequent withdrawal of the VAT should not be understood as a simple case of democratically unleashed populism undermining sound fiscal practice. There were serious problems with the implementation of the tax which was introduced at a difficult time - the peak of the lean season for local foodstuffs - while the educational campaign led by the VAT secretariat was inadequate. By design or inadvertence, vendors applied the I7-5 per cent tax several times to the same goods or services,71 and this created an understandable backlash against VAT.

Consider finally the dismal performance of Ghana's manufacturing sector, which is sometimes attributed to the macro-economic instability engendered by democratization. Actually, deficiencies in the design and implementation of adjustment policies, apparent long before the fiscal shock of I 992, largely account for the current difficulties. Manufacturing growth was substantial after i983 as imported inputs were made available to existing industries with excess capacity. However, too rapid liberalization of imports and exposure to world

70 Economist Intelligence Unit, op. cit. I996. 71 Institute of Statistical, Social, and Economic Research, The State of the Ghanaian Economy in

i995 (Legon, July i996), p. 1 7.




competition have led to a deceleration of output growth since i987.72 Even the normally guarded World Bank has acknowledged that problems in manufacturing arise from the poor design and sequencing of trade liberalisation, the lack of assistance for potentially viable firms in the wake of reforms and the failure to push for a more competitive financial sector, which left the credit and foreign-exchange markets with oligopoly structures.73

It is, in sum, an over-simplification to blame Ghana's recent fall from economic grace on d emocratisation.

COUNTER-MOVEMENT: LIBERAL INSTITUTIONAL REFORMS

The institutionalisation of formal electoral rules may have been fostered by democratization, but the process has also reinvigorated the informal institutions of neo-patrimonial governance. The Fourth Republic of Rawlings bears a strong resemblance to Nkrumah's First Republic.74 Clientelism, personalism, and corruption have returned with a vengeance, and their resurgence has contributed to macro- economic instability.

But this is only part of the story. The other is the gradual strengthening of some important institutions of a liberal-democratic society which should not be dismissed as a mere epiphenomenon, since the future of capitalist development in Ghana may hinge on continued progress in that direction. Ghanaian politics today is shaped by a tension between neo-patrimonialism and liberalism, though the former is undeniably the stronger current. To illustrate this liberal counter- movement, we briefly evaluate institutional reforms in three core arenas: the parties, the courts, and the public sector.

I. A Stable Party System?

If democratisation improves governance by promoting the accountability, transparency, and responsiveness of decision-makers, then an institutionalized party system will be key to this change. Most conducive to stable democratic governance, according to conventional wisdom, is a two-party system. Where only two or three parties

72 Sanjaya Lall and Frances Stewart, 'Trade and Industrial Policy in Africa', in Ben Ndulu and Nicolas van de Walle (eds.), Agendafor Africa's Economic Renewal (Washington, DC, 1996).

7 Armstrong, op. cit. i996, pp. 49-50. 74 See, for example, Henry L. Bretton, The Rise and Fall of Kwame Nkrumah: a study of personal

rule in Africa (London, i966).




compete for power, they will all woo, and try to integrate, diverse constituencies. And the losers will possess the resources and incentives to monitor the winners and to galvanise opposition to poor policies or abuses of power.

Ghana is better-placed than most African countries to develop such a two or three-party system.75 Until the ruling coalition disintegrated in early I996, the NDC and its allies - the National Convention Party and the tiny Egle Party - controlled all but two legislative seats. The NDC that emerged in I992 as a personal vehicle for Rawlings was a lineal descendant of the PNDC that he had headed for a decade. It displayed little uniformity of views, its leadership including former Marxists, Nkrumahists, and Danquah-Busia supporters.76 Besides the NDC and its allies, four other parties contested the presidential elections of November I 992 and then boycotted the December parliamentary elections, including the substantial New Patriotic Party (NPP), the inheritor of the conservative Danquah-Busia tradition, while the other three were in the Nkrumahist tradition. Despite this multiplicity of parties and the personalistic basis of the President's NDC, some historical probing reveals an incipient two-party tradition in Ghana.

The I947 split in the nationalist movement set the mould for Ghanaian politics.77 Danquah's elite-led, liberal, and moderate United Gold Coast Convention (UGCC), which drew a great deal of support from the relatively well-off Ashantis and Brongs, found itself opposed by Nkrumah's breakaway Convention People's Party (CPP), with its militant, populist appeals, its petty-bourgeois base in Standard VII leavers, and (in time) its disproportionate strength among the Ewes and peoples of the Northern Region. Thereafter, competitive national elections pitted the parties in these two traditions against each other on four occasions: I954, I956, I969, and I979. However, the I 992

elections may seem to contradict this incipient two-party model since the victorious NDC, in serving as a personal vehicle for Rawlings, represented neither tendency.

7 For some comparative evidence, see Richard Sandbrook, 'Transitions without Consoli- dation: democratization in six African cases', in Third World Quarterly, I7, i, March i996, pp. 69-87.

76 See A. Essuman-Johnson, 'The Democratic Ethos and Internal Party Democracy: the case of the parties in the Fourth Republic', in Kwame A. Ninsin and F. K. Drah (eds.), Political Parties and Democracy in Ghana's Fourth Republic (Accra, I993), pp. I92-204.

7 For a detailed analysis of party politics from I 95 I to the formation of the PNDC in I 98 I, see Jon Kraus, 'Political Party Failures and Political Responses in Ghana', in Kay Lawson and Peter H. Merkl (eds.), When Parties Fail (Princeton, i986), pp. 464-99.




In early I 994, however, most of the Nkrumahists merged into a People's Convention Party (PCP), and two years later those in the National Convention Party (NCP) terminated their alliance with Rawlings after he had fallen out with his NCP Vice-President. But, by then, the governing NDC had already declared itself to be the true embodiment of the Nkrumahist philosophy. The opposition between the Danquah-Busia tradition and the Nkrumahists had thus surfaced anew, though now two major contenders, the NDC and the PCP

(including the NCP), and one minor one, fought over Nkrumah's mantle.78 In the run-up to the i996 elections, an opportunistic 'Great Alliance' of the NPP and PCP emerged to challenge Rawlings. But the governing party responded effectively by means of machine politics and an advertising campaign that, inter alia, cast Rawlings and his wife as the embodiment of Nkrumah and his wife. The NDC won owing to shrewd advertising and campaigning, blatant patronage, and the disunity of the 'Great Alliance', whose members had spent much of their time bickering and insulting each other.

Adherence to the Danquah-Busia or Nkrumahist tradition has much more to do with style than substance, but the division is no less important for that fact. On the one hand, the parties of the former tendency profess a commitment to a market economy and liberal values; they have usually enjoyed the backing of many business people, professionals, civil servants, and the educated elite in general; and they have always had a strong base in Ashanti. On the other hand, the Nkrumahist parties all revere the memory and achievements of the Osagyefo, although they no longer adhere to his doctrine of socialist- oriented, or at least heavily state-led, development. All leading politicians agree on the need to encourage free enterprise, differing only in the precise mix, pace, and sequence of market reforms. It is just that the Nkrumahist parties, including the NDC, echo the old CPP's populist denunciations of the exploitative elite who take advantage of the suffering masses. This division is therefore reminiscent, at least in certain respects, of that between the Republicans and the Democrats in the United States.

Are the parties building some institutional capacity, or do they exist as mere election vehicles? A major constraint on all, except the NDC, is a weak financial base. Registered parties are legally required to maintain offices in all ten regions and two-thirds of the I Io districts, and even if most rely on volunteers, they still have to pay rent for some

78 West Africa, 25 September-8 October I995.




buildings and salaries for staff. Additional expenses include the maintenance of the head office, and especially the cost of campaigns, rallies, regional seminars, and conventions. Although opposition parties claimed that donations fell drastically after the I992 elections, this is not such a problem for the NPP which is supported, albeit unobtrusively, by several wealthy Ghanaians. However, its leaders feel constrained by the Political Parties Law, which restricts the maximum annual donation to one million cedis and prevents firms from making political contributions. In addition, there is no doubt that those who depend upon the Government for contracts are loath to be seen as members of the opposition. President Rawlings has publicly urged his supporters on several occasions to boycott the products of firms whose proprietors allegedly back opposition parties. Hence, potential donors remain aloof from damaging political commitments.

Financial weakness translates into meagre or non-existent formal party organisation. Indeed, only the NDC has offices in all ten regions and in over go per cent of the constituencies - though some actually serve two or more that are adjacent - and relies upon 'volunteers' at the grassroots level, though they generally expect to be recompensed in one way or another. Even the governing party, however, has its problems. These spring from the fact that the NDC is actually a vehicle built around its leader. The personalistic basis of the party breeds opportunism and factional struggles, and few committees play any role in the creation or modification of Ghana's social and economic policies. Most prominent NDC officials are Cabinet ministers or members of Parliament and/or hold one or more state appointments, which means, inter alia, that the line between party and state has blurred.

Despite financial stringency, the NPP has maintained a capacity for formulating policy and criticising governmental actions. It established i8 'sectoral committees' in I993 which were expected to monitor the activities of relevant ministries, and to formulate the party's position on the issues of the day. One impressive NPP report constituted a critique of the Government's budget of January I993, while another, issued in April I993, contained a list of electoral reforms that were supposed to create a 'level playing field' for the regime in power and the opposition. The party's sectoral committee on legal affairs has also mounted some successful Supreme Court challenges to the Government based on constitutional requirements.

An institutionalised party system is one in which both government and opposition not only sustain an organizational and programmatic presence, but accept each other's legitimate role and the rules of




electoral competition. Is there evidence of the latter in Ghana? One positive sign was that soon after the controversial I992 elections, in which campaigning had assumed a vitriolic tone on both sides, the opposition signalled its intention to restrain its outraged militants and pursue only peaceful actions within the constitution. Forming an Inter- Party Co-ordinating Committee, the opposition bloc announced on the inauguration of the Fourth Republic that it accepted 'the present institutional arrangements', and urged members to 'give the NDC-led government a chance to prove that it is genuinely interested in the institutions and restoration of democracy'." This defused some of the tensions that had accompanied the elections and subsequent scattered riots. Another encouraging sign was the formation of an inter-party advisory committee in April I994, chaired by the head of the Electoral Commission, to work out a compromise concerning identification cards, registration procedures, and the training of registration assistants and party observers. This set the stage for a peaceful second set of elections in I 996, at the conclusion of which the conciliatory attitude of both opposition and government may further have entrenched the normative rules of party competition.

In sum, the Fourth Republic features an incipient two-party tradition, involving organisations that have built up a sustainable presence, and a fragile elite consensus on rules of contestation. A large and talented bloc of NPP parliamentarians daily criticise the actions and policies of a shrewd NDC regime. This is a good foundation on which to build more accountable government.

2. A Rule of Law?

Ghanaians have only sporadically enjoyed the rule of law.80 Most of the time, they have been subject to the whim of strongmen who have undermined judicial independence, detained opponents, countenanced (or practised) rent-seeking and corruption and, during I982-3,

empowered public tribunals to confiscate private property and jail businessmen for 'economic crimes '. These practices had several detrimental consequences. The insecurity of property rights and contracts, and the indiscipline of officials, discouraged productive investments in favour of speculation, political investments, and capital

7 Ibid. 8-14 February, p. I95. 89 See A. N. E. Amissah, The Contribution of the Courts to Government: a West African view (Oxford,

I 98 I).




flight.81 Many hoped that the Fourth Republic would restore constitutionalism and the rule of law and, in the process, reassure investors and entrepreneurs. What success has been achieved in the legal sphere?

An encouraging development in the early years of the Fourth Republic was the evident self-confidence of Ghana's top judicial authority, not least since the I992 Constitution assigns jurisdiction to the Supreme Court over all matters pertaining to the Constitution. The opposition could not use the National Assembly as a forum in which to curb the Government, because it had boycotted the I 992 parliamentary elections, and therefore looked to the independent judiciary to enforce rules of fair play. In I993 the NPP won four major constitutional challenges. The Supreme Court directed the Government (i) to accord the opposition equal access to the state-owned media, (ii) to cease using public funds to celebrate the 3ISt December coup, (iii) to change its practices in the election of district chief executives, and (iv) to stop requiring police permits for political demonstrations.

Although the Government sought to tame such assertive judges, supportive constituencies have emerged to defend the hard-won gains. In particular, the Ghana Bar Association and the independent press have resisted what they perceived as politically inspired threats to judicial independence. Inevitably, such struggles involve intricate manoeuvres which we do not have the space to chronicle. But some illustrations may clarify the situation. The Ghana Bar Association challenged the Government's choice of I. K. Abban as ChiefJustice in February I995 largely because it had not been consulted. During the parliamentary hearings on the appointment, the Free Press published an article which questioned Abban's suitability for the post, and alleged breaches of acceptable judicial conduct in the case concerning the celebration of the 'December 3ISt Revolution' as a public holiday. The Attorney-General brought charges against staff of the newspaper, and the Supreme Court found the publisher, the editor, and the writer of the article, guilty of contempt of court. Hefty fines were imposed, and the journalist concerned was sentenced to one month's imprisonment with hard labour.

Two of the three judges who delivered dissenting verdicts in this contempt case have since been retired, for technically legitimate but involuntary reasons. Two of the four other new appointments to the Supreme Court (Justices Atuguba and Akuffo) have aroused suspicions

8' Ernest Aryeetey, 'Private Investment under Uncertainty in Ghana', in World Development, 22, I994, pp. 12I 1-2I.




of pro-government bias. Neither had served on the Court of Appeals, the usual stepping-stone to the Supreme Court, and Akuffo both lacks experience and is reputed (according to opposition leaders and some apparently non-partisan members of the legal establishment) to have close ties to the NDC.

The Supreme Court still on occasion rules against the Government on important constitutional matters. In i996, for example, it decided in favour of the NPP in a case concerning freedom of association. PNDC Law 3I2 of I 993, which established the CIBA, included a list of indigenous business associations which could not withdraw from the Council, and the Court declared this provision inconsistent with constitutional provisions on freedom of association, and therefore null and void. But a final written decision, as of April I997, had yet to be issued.

In other recent cases, the Supreme Court has ruled more in the Government's favour, including the decision taken in mid-i996 to permit non-public officers (such as the President's wife) to institute proceedings for criminal libel. During that year the Court found that the Frequency Board, an agency of the executive, could legally enforce the regulations requiring the licensing of radio stations that had been used to prevent a prominent opposition politician, Charles Wereko Brobbey, from operating a radio station in I995, even though chapter I 2, section I 62 (3), of the I 992 Constitution specifies that 'there shall be no law requiring any person to obtain a license as a prerequisite to the establishment or operation of a newspaper, journal or other media for mass communication'. In March I997, the Supreme Court made an equally questionable decision by accepting the constitutionality of a Nkrumah-era law that made it a criminal offence to 'publish a false report which is likely to injure the reputation of the state'. This so- called seditious libel law is widely regarded by Ghana's legal experts to be inconsistent with the Constitution, and critics in Accra see this as a dangerous development in the Government's ongoing battle to contain threats posed to its authority - whether through scurrilous excesses or legitimate watchdog reporting - by the country's independent media.82

Consider now the Commission on Human Rights and Administrative Justice, instituted by the Constitution of the Fourth Republic, which has a mandate similar to that of an Ombudsman. It possesses broader

82 Between i 99 i and early I 996, as many as 72 court cases were brought against journalists and media houses in Accra courts, often by the former NDC Chief Whip and the current Deputy Interior Minister, Albert Bosumtwi-Sam. See Audrey Gadzekpo, 'Lawsuits Against the Press: justice or punishment?', in Media Monitor (Accra), 4, July-September I996, p. 5.




powers, however, as it is authorised to sue in court to enforce its findings. Despite initial concerns in the opposition that the body might become a star chamber, it seems to have become an effective agency committed to redressing human-rights violations and the misappropriation of state resources and powers. The Commission appears to enjoy wide support among urban elites, and receives a great deal of media attention which may have strengthened its hand vis-a-vis the Government. The commissioner and deputy commissioners freely indicate that this is the reality, pointing to the receipt of letters and encouragment from the public.

Although most of the cases heard by the Commission concern allegations of wrongful dismissals, its most publicised activity involves probes of government officials. In October i996, the Commission submitted an interim report on an I I-month inquiry into allegations of abuse of office by the Minister of the Interior, Colonel Emmanuel Osei Owusu, the Trade and Industry Minister, Ibrahim Adam,83 the Presidential Adviser for Cocoa Affairs, Adjei Maafo, and another influential Presidential Adviser, P. V. Obeng. Of these only the last was exonerated. The others were found guilty of financial impropriety or negligence causing losses of revenue to the state.

The Government's reaction reveals much about what might be described as the 'informal rules of the game' in Ghana. While it did not publicly respond to this embarrassing report, it did comply with the initial recommendations. Money was returned to the state by Owusu, who subsequently resigned, as did Adam. But the decision to allow the latter to contest (and win) a seat in the i996 parliamentary elections, in effect condoned abuses of office by NDC stalwarts. On the other hand, the Commission continues to do its job of monitoring abuses of power, and thereby reinforces the formal rules of accountability and probity. In early I997, its investigation of the financial affairs and opulent life-style of the Minister of Roads and Highways produced several embarassing, and widely reported, revelations. The struggle is likely to continue since there is evidence to suggest that the Government is seeking to diminish the scope of the Commission's authority, and to impede its ability to investigate and prosecute violations of human rights and official misconduct. For example, in I995 the Attorney- General lodged a writ in the Supreme Court trying to prevent the Commission from investigating Owusu.

83 The charges brought against Ibrahim Adam were for activities undertaken while Minister of Agriculture since he was shifted 'horizontally' during the probe.




3. A Reformed State Bureaucracy?

The public sector sharply deteriorated in the I970s and I980s. The shortcomings in the early years of the economic recovery programmes (ERPs) have been enumerated by P. Gregory:

Shortages of skilled professional and technical personnel were endemic, while considerable overstaffing was evident in the junior levels. Nonlabor inputs, such as paper, office machinery, pharmaceutical supplies, and tools, had become extremely scarce. Productivity was ... extremely low in all of the basic functions of government, a condition exacerbated by absenteeism, moon- lighting, poor morale, lack of supervision, and an absence of pride in work and rewards for good performance. Contributing to this state of affairs was the inadequate level of remuneration, political instability, and the evasion of checks and balances designed to limit expansion in staff, enforce discipline, and control corruption.84

Although civil service reform was a component of the ERPs, little had apparently changed on the eve of the Fourth Republic. One observer concluded that many of the earlier weaknesses had persisted to produce a 'limited institutional capacity' in the civil service.85 To promote productive investment and efficiency Ghana clearly needed more responsive, expert, disciplined, and motivated civil servants, public corporations, and regulatory agencies.

Neo-patrimonial rulers are likely to be uninterested in, or even strongly opposed to, bureaucratic reforms that threaten their control of patronage and self-enrichment. But those who advocate the 'governance' approach hope that democratization will forge a more open, accountable, and legitimate state, rebuild legality, and strengthen the civil associations and interest groups which advocate institutional reforms. Technical improvements in pay and incentive systems, in procedures for recruitment and promotion, and in public management, although welcome, will not succeed in the absence of these deeper institutional changes, according to this view.86

In Ghana, however, the advent of multi-party politics has stimulated a resurgence of neo-patrimonial rules as well as a counter-movement of rational-legal reformism. One crude indicator that the former tendency predominates is the growth of the civil service, since the Fourth Republic has witnessed a reversal of earlier efforts to trim redundant

84 P. Gregory, 'Dealing with Redundancies in Government Employment in Ghana', in D. L. Lindauer and Barbara Nunberg (eds.), Rehabilitating Government: pay and employment reform in Africa (Aldershot, i996), p. i96. 85 Leechor, loc. cit. I994, p. i67.

86 Mamadou Dia, A Governance Approach to Civil Service Reform in Sub-Saharan Africa (Washington, DC, I993), World Bank Technical Paper No. 225, and van de Walle, loc. cit. I995, p. i6i.




staff in order to reduce expenditures and increase the salaries of those remaining. Although the number of core civil servants fell from 13 1,000

in August i987 to circa 105,000 in March 1992,87 by January I997 it

had grown to i83,717, an increase of roughly 70 per cent since 1992.88

This surprising figure is supported by other data which show that, in contrast to the sharp declines that accompanied the commencement of the redeployment exercise, officially recorded employment in the formal sector increased by Ioo,ooo in the I 990S.89

The 'governance' emphasis on building the capacity of key economic agencies has also produced disappointing results. Although the Bank of Ghana and the Ministry of Finance rely on their own specialised analysts for the formation of fiscal and monetary policy, both organisations have failed to recruit directors for their research departments.90 The reason, according to the World Bank and donor- backed National Capacity Building Assessment Group,91 is not so much the low pay as the limited freedom to initiate appropriate projects to support policy development. If this is true, it suggests that one of the more important potential benefits of political liberalization - increased freedom for civil servants to question and redesign policy - has not yet materialised.

No major pockets of technocracy seem to have developed in the civil service. World Bank documents continue to emphasise the absence of predictable and transparent regulatory procedures for the public sector, and the persistence of rent-seeking by officials.92 One senior member of the World Bank's staff long resident in Accra referred to a major disjunction between the performance and pace of reform of the public sector and the Government's reform rhetoric.

None the less, there are some modest indications of improved performance in agencies crucial to recovery in the private sector. For example, the cumbersome registration process for exporters has been streamlined; the Registrar-General and Ghana Investment Promotion

87 See Joseph R. A. Ayee, 'Civil Service Reform in Ghana: a case study in contemporary problems of reform in Africa', Development Policy Management Forum, Addis Ababa, 4-5 December i995, and Armstrong, op. cit. i996.

88 Information provided by the Comptroller and Accountant-General's office in Accra in February I997 from its computerised payroll, which had been 'cleaned' after the i996 elections.

89 Centre for Policy Analysis, I997, p. 29. 90 As of February I 997, the Bank of Ghana had lacked a director of research for eight years and

the Ministry of Finance for four years. 91 Steered by a committee of I 4 prominent individuals from the public and private sectors, this

Group aims to identify and address constraints on capacity building in Ghana's enterprises and institutions.

92 World Bank, Ghana: growth, private sector and poverty reduction (Washington, DC, I 5 May I 995), Country Economic Memorandum, and Armstrong, op. cit. i996.




Centre now have only five days in which to register a business, or inform the applicant of why registration has been denied; and revenue collection and the efficiency of customs also appear to have improved. Goods in general are cleared more expeditiously, a point confirmed by businessmen and representatives of their associations. That the Internal Revenue and Customs Service are better endowed than other public agencies may account for their superior efficiency. They operate within semi-autonomous units that offer relatively attractive conditions of employment.93

The Divestiture Implementation Committee (DIC), which is charged under PNDC Law 326 with implementing and overseeing all government policies in respect of the divestiture of public assets, published in March 1995 its rules and general procedures, long a contentious issue among entrepreneurs. The DIC has recently taken care to publish more information about the divestiture programme in the mass media than it had prior to the Fourth Republic. In September I996, the Government gazetted a full list of enterprises divested from I

January 1995 to 31 July I996, including the names of the new owners, the prices charged, and the outstanding balances.94

Doubts none the less remain about the transparency of the process. In I996 a policy of 'outsourcing' divestitures to private firms became operational. Controversy erupted in January 1997 when Ghana Telecom was sold to a Malaysian telecommunications company in partnership with a local consortium. This privately-managed sale aroused wide condemnation because the purchase price for a 30 per cent share was only $38 million, despite a Coopers and Lybrands valuation of the firm at $3i6 million. Critics charged corruption, and the ensuing furore illustrates that key stakeholders are now demanding greater transparency in the privatization of public assets.95

Another initiative reflecting the Government's efforts to reform the public sector was the launching in 1994 of the National Institutional Renewal Programme (NIRP), which is designed to enhance efficiency and to facilitate the development of a proactive and motivated public service. The NIRP was placed under the leadership of Presidential Adviser Obeng, in concert with the Minister of Finance and the Head

93 However, the dismissal of the CEPS Commissioner in July I997, following three years in which he had vigorously investigated instances of tax evasion and smuggling, threw the future of this key agency into doubt. 9' Gyimah-Boadi, loc. cit. I997.

95 The sale generated massive amounts of media attention - see African Observer (Accra), 20

February-5 March I997; Daily Graphic (Accra), 7 February I997; Business and Financial Times (Accra), I7-23 February I997; Ghanaian Chronicle, 3-4 February I997; and Business Chronicle (Accra), I I-24 February I997.




of the Civil Service. The key managers of the process, however, are the members of the NIRP secretariat, senior civil servants seconded from the various Ministries. It is premature to evaluate the success of the NIRP, which aims to achieve its objectives through participation and consensus-building in order to ensure that public-sector reform is flexible and well-adapted to local conditions. As an essential first step the NIRP convened a series of diagnostic workshops in the line Ministries in I996. But its main champion, Obeng, was heavily involved in behind-the-scenes power struggles in 1997, and if he should lose this factional fight, the NIRP will probably fade away. The seemingly intractable problems afflicting Ghana's public sector are graphically illustrated by the dependence of such an important initiative on a single individual.

Considerable progress has been made in reform of the financial sector. Since restructuring began in I 99 I, the state-owned banks - with the exception of the Ghana Co-operative Bank and, recently, the Bank for Housing and Construction - have generated rates of return that on average have exceeded inflation. The Government finally moved to sell part of its holdings in state-owned banks - in the Social Security Bank in I995, and in the Ghana Commercial Bank in I996. There have also been a limited number of new entries into the country's financial markets since I992. A foreign commercial bank, Meridian BIAO, set up a subsidiary in I992, and two new merchant banks, First Atlantic and Metropolitan and Allied, were established in I995, both of which have major equity participation from the local private sector.

These changes have raised new regulatory challenges for the Government. On the one hand, banks are now under less political pressure to stock their portfolios with unviable and unsecured loans to political clients, as was formerly the case. On the other hand, however, insider-lending has emerged to threaten the security of the financial sector. Large foreign-exchange liabilities have also become a serious problem for private banks in the context of macro-economic instability and the constantly depreciating cedi. In April I 995 the local subsidiary of Meridian BIAO was closed after incurring a large foreign-exchange exposure to its parent bank, which the Bank of Ghana appeared incapable of detecting and addressing until it was too late. The Securities Discount Company Investments (SDCI) was placed in liquidation in I996 because many of its loans had not been serviced: it turned out that the SDCI had not been licensed under the 1993 Non- Bank Financial Institution Law, had violated its legal exposure limits, had extended credit to its director, and had failed to obtain adequate




security for about half of its outstanding loans.96 This experience does not reflect well on the regulatory powers of the Bank of Ghana, which excused itself on the grounds that its supervisory capacities as regards non-bank financial securities were not operational when the infringe- ments took place.

Another 'insider' banking scandal revealed in January 1997 has raised further doubts about the regulatory capacity of the central bank. The case involves the Ghana Commercial Bank and the managing director of A Life supermarket chain, who owns 4 per cent of the GCB. The latter, with the apparent collaboration of senior bank staff, took advantage of a generous overdraft facility to cash over 75,000 million cedis from the coffers of the GCB and two other banks (both of which have since been removed from the central bank's clearing system since their total deposits have been wiped out). Opposition MPs created an uproar when they demanded to know why the Bank of Ghana had not detected the scandal and called for the Governor to appear before Parliament to answer for his conduct.97

In sum, institutional reforms in the public sector are limited, obstructed by entrenched clientelism and scarce managerial skills. It may take many years and much conflict to build a professional, non- partisan, and disciplined public sector to support economic growth.

HISTORICAL LEGACIES AND INSTITUTIONAL CHANGE

Institutional reforms in the Fourth Republic are contradictory, discontinuous, and fraught with contention. On the one hand, redemocratisation has accelerated the reintroduction of neo-patrimonialism, as the pessimistic thesis had predicted. Although clientelism, particularism, and corruption had reappeared in the final years of the PNDC,98 competitive elections magnified their salience. And this reinvigoration of economically dysfunctional institutions threatened again to undermine capitalist accumulation. Yet realists must expect the early years of redemocratisation to be tumultuous as weak parties vie to mobilise constituencies. Two transitions are necessary - to a market economy and a democratic polity - and each produces losers as well as winners. The promise of democracy belongs to the longer term: observers, including impatient donors, need to bear this in mind.

On the other hand, the Ghanaian experience has not yet disproved those who expect democratization to spur needed reforms. Not only has

96 This paragraph draws heavily on Brownbridge and Fitz Gockel, op. cit. i996. 97 Ghanaian Chronicle, I4-20 March I997. 98 Nugent, op. cit. especially pp. I92-3.




the Fourth Republic already outlasted earlier democratic interludes, but also it has spawned, albeit in the midst of conflict and compromise, a fragile institutionalisation of some key rational-legal organizations and procedures. A complex electoral system worked quite well during its second test in I 996. An incipient two-party system consolidated itself further. Struggles to impose legal limits on state officials continued with some victories and defeats. Although initial efforts to augment the efficiency and accountability of public servants foundered, modest successes have been achieved. And underpinning this whole experience is the resurgence of civil society, especially as manifested in the press, in professional, employer, and labour organizations, and other NGOs - a story we have not had the space to tell.99

How do we explain this contradictory experience? As Robert Putnam and others have argued, institutional performance is shaped by traditions established over many years, if not centuries.100 In Ghana, contemporary clashes over reforms reflect the co-existence of contradictory historical legacies. A well-established patrimonial tradition contends with a weaker, more elite-based, but no less indigenous, liberal tradition. This unusual historical pattern imparts an open- endedness to institutional struggles which probably does not exist in neighbouring countries.

Ghana's patrimonial legacy requires little comment, as its existence is widely acknowledged. Many have argued that the traditional political pattern of southern Ghana, especially that of the Akan peoples who constitute about 45 per cent of the country's population, persisted into the colonial and post-colonial periods to shape relationships between the governors and the governed. Robert Price refers to this as the 'big-man, small-boy syndrome'."' In the pre-colonial era, chiefs ruled partly on the basis of 'traditional legitimacy', but largely on the extent to which they could provide for the material well-being of their subjects through ritual observances and personal gift-giving. According to Maxwell Owusu, this system fostered a highly instrumental approach to politics on the part of both leaders and followers:

What tied the follower to the political leader was ... economic necessity, a

99 See E. Gyimah-Boadi, 'Associational Life, Civil Society, and Democratization in Ghana', in John W. Harbeson, Donald Rothchild, and Naomi Chazan (eds.), Civil Society and the State in Africa (Boulder, I994), pp. I25-48, and Gyimah-Boadi, loc. cit. I997, pp. 88-9I.

00 Robert D. Putnam, Making Democracy Work: civic traditions in modern Italy (Princeton, I993). "' Robert M. Price, 'Politics and Culture in Contemporary Ghana: the big-man, small-boy syndrome', in Journal of African Studies (Washington, DC), I, I, I974, pp. I73-204. Nugent's insightful analysis, op. cit. I 995, of the re-embedding of the Ghanaian state in clientelist networks also draws heavily upon the 'big-man, small-boy syndrome'.




reciprocal tie that at times assumed the form of a patron-client relationship ... The relationship held so long as the patron honored his material and economic obligation, and the client his duty to vote at elections and perform various other services for the patron, including ritually praising him in public.102

Personal loyalties, clientelism, and the use of state resources by patrons to build factional support, deference towards those who conspicuously command power and wealth, and even corruption would flourish in the context of such a political culture.103 The neo-patrimonial governance evident since independence can only be understood by reference to this tradition; and the corollary of such a system is a high premium placed on political power, a tendency for politics to become a struggle with few restraining rules, leading to recurrent oligarchies, instability, and violence.

Yet a second, contradictory, tradition has emerged over the past century or so, whereby influential groups have championed civil and political rights, including the notion of popular sovereignty, against both authoritarian colonial governments and more recent military regimes. Several factors account for the development of a hardy liberal ethos among the urban middle classes in particular. First, European rule was established in I 850, but avoided the presence of a white settler community that would have given colonialism an oppressive cast. Notions of legal rights and due process, parliamentary democracy, and national self-determination circulated in the Gold Coast from early times - which is not to say that they were honoured in practice by colonial governments. However, the latter were willing to tolerate 'liberty of speech, of movement, of organization, and ... a considerable degree of abuse from Press and public platform'.104 Secondly, the establishment of schools in the coastal towns had led to the emergence of an educated elite by the late nineteenth century, which included

102 Owusu, Op. cit. I970, p. 25I. The few available studies of popular attitudes uniformly portray Ghanaians as expecting their politicians to be self-aggrandizing, and therefore hoping to receive some tangible benefits in exchange for their continued support. Political cynicism breeds, at the same time, a populist yearning which Rawlings initially satisfied. See Fred M. Hayward, 'Rural Attitudes and Expectations about National Government: experiences in selected Ghanaian communities', in Rural Africana (East Lansing, MI), i8, Fall I972, pp. 40-58;

Richard Sandbrook and Jack Arn, The Labouring Poor and Urban Class Formation: the case of greater Accra (Montreal, I977), McGill University Occasional Monograph No. I2; David Brown, 'The Political Response to Immiseration: a case study of rural Ghana', in Geneve-Afrique (Geneva), i 8, I, i980, pp. 55-74; and Kwame A. Ninsin, 'The Electoral System, Elections and Democracy in Ghana', in Ninsin and Drah (eds.), op. cit. pp. I 75-9I.

103 Naomi Chazan, An Anatomy of Ghanaian Politics: managing political recession, I969-i982

(Boulder, CO, i983), pp. 98-i02, and Nugent, op. cit. I995.

104 David Kimble, A Political History of Ghana: the rise of Gold Coast nationalism, i850-I928

(Oxford, I963), p. 557.




lawyers whose wealthy merchant or royal families had sent them

abroad for study. The development of a prosperous cocoa economy in

African hands further solidified the opportunities for advanced education, while promoting an individualistic ethic with a natural affinity for liberal doctrine.105

Finally, Akan political traditions were not antithetical to notions of

personal achievement and constitutional limits on political power.106 Although chiefs were drawn from one or more royal lineages, no right of automatic succession existed. Usually the Queen Mother, assisted by the elders, selected a new chief. And personal qualities, such as wisdom, generosity, and courage, often influenced the choice among those who were eligible, as well as achievement, as it does today since many well-

educated chiefs work in towns and cities. In addition, those who abused their traditional authority could be ousted or 'destooled' if certain strict procedures were followed. As explained by David Kimble:

One of the recognized grounds for destoolment was habitual disregard of [the advice given by the council of elders]; and the Chiefs duty of consultation with the representatives of his people, coupled with the possibility of removing him in the last resort, meant that even if the system did not approach democracy, at least it avoided the dangers of autocracy.'07

This was the context in which an urban elite, especially lawyers and journalists, championed civil and political rights, and equality of opportunity for Africans. As early as i875, Colonial Office despatches were referring to 'educated natives' as a 'thorn in the side' of the Gold Coast government.'08 African-owned newspapers in Accra, Cape Coast, Sekondi, and Kumasi sharply criticised colonial policies and practices, and demanded greater African representation in government.

Protest movements also emerged at an early stage. The Aborigines Rights Protection Society successfully defended African rights to land in I897-8, at about the time when colonial rule was just being installed in East Africa, and continued to make political demands until replaced by the National Congress of British West Africa in I921 . Not surprisingly, Africans were always better represented in the Gold Coast than in other British colonies. Even the first Legislative Council in I 850 included a prosperous African merchant among its five unofficial members.'09 And throughout the early twentieth century, demands that the British authorities remove all impediments to African progress

105 J. D. Fage, Ghana: a historical interpretation (Madison, I959), pp. 69-70. 06 Dennis Austin, Politics in Ghana, I946-I960 (London, i964), pp. i8-2I.

107 Kimble, op. cit. p. I27- 108 Ibid. p. 9i. 109 Ibid. p. 405.




in the public service and professions kept up the pressure on the colonial power to practise what it preached. The post-war period of political ferment, from I946 to I952, therefore drew upon nearly a hundred years of struggle.

Several discordant institutional tendencies today reflect these contradictory legacies. The neo-patrimonial tradition is doubtless more deeply rooted in the history and culture of Ghana, not to mention better adapted to its poverty, limited class formation, and peasant origins, than the liberal-democratic tendency. Yet the latter, after a century of nurture in the Ghanaian, middle-class soil, can hardly any longer be regarded as an 'alien' intrusion. It provides roots for liberal institutional reforms to a degree that is rare in Africa.

Where traditions conflict, broader scope may exist for political movements to shape institutional reforms by selectively drawing upon historical memories. As well, the disastrous examples of chaos in Liberia, Sierra Leone, and elsewhere have focused the mind of Ghana's political class on compromises which avoid the abyss.110 These circumstances, together with donor pressure, may yet facilitate the gradual institutional change which can support a market economy. There may yet be a shortcut to progress.

110 This was a common theme in interviews with opposition leaders in I993, I994, i996, and I997.



reforming dysfunctional institutions through democratisation? reflections on ghana

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