sharing in governance of extractive industries
There is enough experience from around the world to show that translating oil discoveries through production to revenues and inclusive growth is not necessarily a linear process. Inclusive growth has been particularly difficult to achieve in many places, and Ghana has been no exception so far. Can Ghana escape a resource curse? Our view is that it can, provided that it implements fully as soon as possible, and more diligently, the regulations that it has adopted.
Oil resources are neither a curse nor a blessing. The sound management of these resources can make them beneficial or otherwise. In order to translate Ghana’s oil resources into inclusive development amid high expectations, several laws and regulations have been passed and new institutions created.
Despite the presence of the new institutions, laws, and regulations, spending from petroleum revenues appears to be rather thinly spread and not efficient. This defeats the purpose of diversification and leads to high debt and cost overruns.
On a positive note, the Minister for Finance, the Public Interest and Accountability Committee, and Bank of Ghana have been complying with most of the transparency requirements specified in the laws. It is essential that spending from petroleum revenues is guided by a medium- to long-term inclusive development strategy that is based on proper needs assessment, global trends, feasibility studies, and possible growth dynamics of the country.
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