THE saying that frogs behind take caution when the frog in front falls into a ditch would become a cliché when an oil-producing country which has witnessed the going down of its counterpart due to mismanagement of funds from oil deposits does same. Ghana can be compared in this case, especially after we are aware of various oil-producing countries, including those in the sub-region, which are going down largely due to this problem.
LIKE other resources, oil is an important ingredient driving the economies of the world today, so it is of little surprise that oil-producing countries are among the largest economies in the world. Not even Coltan found in large deposits in the Eastern parts of DR Congo and used in manufacturing microchips can act as a substitute for this single important resource.
AN increment in prices of oil affects almost all products in an economy as there would be a continual rise in the cost of production of goods and services and an increase in the relative price of energy inputs, which puts pressure on profit margins. Also, there will be an impact on the price level and on inflation but its magnitude will depend on the degree of monetary tightening and the extent to which consumers seek to offset the decline in their real incomes through higher wage increases, and producers seek to restore profit margins.
LIKEWISE, an oil economy is expected to provide economic freedom and an increase in market size in addition to various social facilities to its citizens to ease the pressure of economic hardship. Institutions and infrastructures are expected to boost macro-economic stability as well improve health and education.
THEREFORE, it was no news when Ghana’s economy was tipped to do very well after the commencement of oil exploration in December 2010. Though too early to judge, a year after exploration leaves nothing but little to write home about.
LITTLE has been achieved in terms of transparency as government and the exploiters have failed to publish accounts of oil transactions. The least said of the slowness with which the flow meter meant for measuring how much oil is taken out of the Jubilee Oil Field was replaced when it got damaged the better.
IF this and other malpractices in the oil industry continue, then Ghana stands at nothing but an impending calamity that would befall the country like other West African countries including regional super-power, Nigeria. It is in this vein that we strongly support the content of the communiqué issued at the end of 63rd Annual New Year School and Conference (ANYSC).
IT is noteworthy that government and any other persons involved in oil production come clean and let transparency prevail. We agree with ANYSC that transparency must be ensured through the publication of receipts and records of revenues, as well as a tracking system for the use of revenues.
THE publication would help in record keeping and also reduce corruption so far as the management of the oil money is concerned. Let us be circumspect in the use of the oil money to ensure that other suggestions such as the provision of social interventions would be met.