Bloomberg News

Ghana Votes as Leaders Pledge Oil-Led Development Plans

December 07, 2012

Ghanaians vote today to decide whether President John Dramani Mahama’s party has done enough to spread oil-led wealth in West Africa’s second-biggest economy or hand power to opposition leader Nana Akufo-Addo.

Voting, which was meant to start at 7 a.m., was delayed at some polling stations in Accra, the capital, because of slow delivery of election materials, Christian Owusu-Pare, a spokesman for the Electoral Commission, said by phone. Polls close at 5 p.m. and results may be known within 48 hours, according to the commission. Ballots were being cast in areas outside the city, including in Central and Volta regions, according to broadcasters Joy FM and Metro TV.

“The people are on their way, distributing the voting materials, they may encounter some traffic, they will surely get to the various stations soon,” Owusu-Pare said.

The winner will face mounting calls from Ghanaians to spread wealth from oil production that began in 2010. Spending promises made during the campaign may be hindered by a widening budget deficit and slowing economic growth in a nation where 18 percent of the population has formal employment.

“We know that it’s a very close election, it’s very competitive,” Ahmed Issack Hassan, chairman of Kenya’s Independence and Electoral Boundaries Commission and head of an observation group from the Electoral Institute for Sustainable Democracy in Africa, told reporters in Accra yesterday. “Africa is watching Ghana to live up to the expectation of a truly matured democracy.”

Manifesto Promises

Both Mahama, 54, and Akufo-Addo, 68, pledged to build schools, roads and housing, and use money from oil exports to boost the country’s manufacturing industries and create jobs, according to their manifestos.

After expanding 14.4 percent in 2011, the fastest pace in Africa, Ghana’s economy is projected to grow 8.2 percent this year and 7.8 percent in 2013, according to the International Monetary Fund. In the nine months through September, the fiscal gap widened to 7.3 percent of gross domestic product from 1.9 percent a year earlier, according to the Bank of Ghana.

“With growing expectations for improvements in standards of living, a growing proportion of the population is likely to feel disenfranchised from the benefits of oil revenues,” Ben Payton, an analyst with Bath, U.K.-based Maplecroft, a risk- analysis group, said in an e-mailed note Dec. 3. “The sectors that are most associated with increased economic growth, particularly oil and gold, have not generated substantial employment.”

Jubilee Crude

Mahama, a former communications minister with the National Democratic Congress, came to office in July following the death of John Atta Mills. Akufo-Addo, leader of the New Patriotic Party and ex-foreign minister and attorney general, lost to Mills by less than 1 percentage point in a run-off election in 2008.

Tullow Oil Plc (TLW) started pumping crude at the Jubilee field in December 2010. Production slowed to an average of 63,000 barrels of oil equivalent a day in the first half of this year, according to the central bank. Production is expected to increase to 90,000 barrels by the end of this year from 78,200 barrels in 2011, according to London-based Tullow.

Tullow, Anadarko Petroleum Ltd. and Eni SpA are developing more wells, while AngloGold Ashanti Ltd. and Newmont Mining Corp. are expanding their gold mines after prices for the metal rose 8.1 percent this year.

Accept Results

Cocoa production, which reached a record 1 million metric tons in the 2010-11 season, may slow to 800,000 tons from the harvest that started in October, according to the Ghana Cocoa Board. Archer-Daniels-Midland Co., Barry Callebaut AG and Cargill Inc. process cocoa in Ghana, the world’s second-biggest grower.

“Under our leadership we’re going to turn our back on the old economy, the raw material-exporting economy, and build a new, industrial, value-adding economy in our country that will bring jobs,” Akufo-Addo said at his final campaign event on Dec. 3.

Mahama said at his last rally that his party “has a solid program that goes beyond education, that includes creation of jobs, energy, agriculture, health, tourism, you name it.”

Ghana’s currency, the cedi, which has weakened 13 percent this year, eased 0.1 percent to 1.893 a dollar by 5:37 p.m. in Accra yesterday, according to data compiled by Bloomberg. The yield on the $750 million Eurobonds due in 2017 declined to the lowest in more than three weeks, easing 3.1 basis points, or 0.03 percentage point, to 4.96 percent.

“Our people are very much concerned about how competitive this particular election is turning out to be,” Jerry Rawlings, who led Ghana’s military administration in the 1980s and won elections in 1992 and 1996, told reporters yesterday after meeting with Kenya’s Hassan. “If the situation can be monitored to ensure that the elections remain free and fair then I think the results will be accepted by all.”

To contact the reporters on this story: Ekow Dontoh in Accra at edontoh@bloomberg.net; Pauline Bax in Accra at pbax@bloomberg.net

To contact the editor responsible for this story: Emily Bowers at ebowers1@bloomberg.net


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