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Country Commercial Guides for FY 2000: Ghana Report prepared by U.S. Embassy Accra, released July 1999

CHAPTER III:   Political Environment

1.   Nature of Political Relationship with the U.S.

The U.S. and Ghana enjoy a relationship best described as close and constructive. Despite the warm bilateral relationship, the disproportion between the size and wealth of the two countries contributes frequently to divergent perspectives regarding global and regional political, military, economic and trade issues. In the past, Ghana has exercised a position of leadership within the non-aligned movement and its voice in international fora is most often heard in support of debt-relief and other issues that tend to have a North-South orientation. Various African leaders have spent time in their formative years in Ghana and this reinforces Ghanaian support for pan-Africanism and a populist brand of African democracy. Ghana has come to recognize the shift in the world power balance away from the former "East bloc" and towards the Western democracies. Despite this trend, Ghana maintains close official relations with Cuba, as well as apparently warm diplomatic ties with the Government of North Korea.

2.   Major Political Issues Affecting the Business Climate

The attitude of the GOG can be described as pro-business. While there are sometimes reports to the contrary, the former perceived government intolerance and hostility to private business and entrepreneurial development is gradually being replaced with seemingly genuine attempts at creating an enabling environment conducive to the transaction of business. Since 1989, there has been a steady and serious effort on the part of the GOG to privatize over 300 state-owned enterprises which were not profitable.

Today, Ghana offers potential investors a stable, multiparty democratic environment as well as a commitment to the philosophy and practice of market liberalization. Ghana's divestiture program, its priority for free enterprise and private sector initiative, as well as various tax incentives to attract foreign capital all contribute towards making Ghana an interesting place to invest.

3.   Brief Synopsis of Political System, Schedule for Elections, and Orientation of Major Political Parties

In December, 1996, Ghana had its second experience in multiparty elections since the inauguration of the 4th Republic.

The government is headed by President Jerry John Rawlings. In what is considered a generally free, fair and peaceful election, Jerry John Rawlings won a second four-year term in December, 1996, with 58% of the popular vote cast, while the opposition NPP/PCP Alliance and the PNC recorded 39.5% and 2.5%, respectively. Neither of the two previous returns to Constitutional rule (1969 and 1979) lasted more than 30 months. The NPP is the leading opposition party. The next general elections are scheduled for December, 2000. President Rawlings, who has been at the helm of government since December 31, 1981, is constitutionally ineligible for re-election, and it is fully expected that he will step down. Ghana's challenge will lie in how it prepares for the changeover after President Rawlings' long rule.

Out of a 200-member Parliament, the ruling party, the National Democratic Congress (NDC), has 133 seats, the New Patriotic Party (NPP) has 61 seats, the Convention Party (CP) has 5 seats, while the People's National Convention (PNC) has 1 seat. Although the ruling NDC continues to resist inclusiveness, there are indications of an increase in the competitiveness that bodes well for the future prospect of a peaceful turnover of power. Debates are gradually eroding government-opposition polarization, suspicion and mistrust. Government and the opposition fight out their differences in Parliament and occasionally at the courts. To date, however, bills are proposed on the initiative of the Executive branch of government. This notwithstanding, the committee system enables members to subject issues to close and detailed study, debates and objective criticism. Indeed, present political conditions have highlighted the prospect for building and sustaining a democratic culture of governance in Ghana.

A prominent feature of the present Parliament is that a large percentage of the minority and many of the majority are from the upper middle class, most of whom are professionals in law, medicine, commerce and industry. In theory and practice, Parliament sets its own agenda and determines how it should be carried out.

The Constitution affords the media protection and insulates it from state control and censorship. Although government controls a greater share of media time, the media have become unofficial watchdogs to ensure that policies are adhered to. While the state media is generally staid, and only echoes official voice and propaganda, the independent media is largely anti-government, or to be more accurate, anti-Rawlings. Their personal attacks on Rawlings sometimes obscure objective analyses and investigations, however. The private press often lands in court over alleged libel.