IMF and USA set to ruin Ghana 111


Just ten years ago, Ghana had the most reliable electricity supply in all of Africa and the highest percentage of households connected to the grid in all of Africa – including South Africa. The Volta River Authority, the power producer and distributor was, in my very considerable experience, the best run and most efficient public utility in all of Africa. Indeed it was truly world class, and Ghana was proud of it.

Obviously the sight of truly successful public owned and run enterprise was too much of a threat to the neo-liberal ideologues of the IMF and World Bank. When Ghana needed some temporary financial assistance (against a generally healthy background) the IMF insisted that VRA be broken up. Right wing neoliberal dogma was applied to the Ghanaian electricity market. Electricity was separated between production and distribution, and private sector Independent Power Producers introduced.

The result is disaster. There are more power cuts in Ghana than ever in its entire history as an independent state. Today Ghana is actually, at this moment, producing just 900 MW of electricity – half what it could produce ten years ago. This is not the fault of the NDC or the NPP. It is the fault of the IMF.

Those private sector Independent Power Producers actually provide less than 20% of electricity generation into the grid – yet scoop up over 60% of the revenues! The electricity bills of Ghana’s people go to provide profits to fat cat foreign corporations and of course the western banks who finance them.

Indeed in thirty years close experience the net result of all IMF activity in Africa is to channel economic resources to westerners – and not to ordinary western people, but to the wealthiest corporations and especially to western bankers.

Not content with the devastation they have already caused, the IMF and the USA are now insisting on the privatisation of ECG, the state utility body which provides electricity to the consumer and bills them. The rationale is that a privatised ECG will be more efficient and ruthless in collecting revenue from the poor and from hospitals, clinics, schools and other state institutions.

Doubtless it will be. It will of course be more efficient in channelling still more profits to very rich businessmen and bankers. I suspect that is the real point. That privatised utilities bring better service and cheaper prices to the consumer has been conclusively and forever disproven in the UK. What it does bring is huge profits to the rich and misery to the poor. To unleash this on Ghana is acutely morally reprehensible.

Ghana has a political culture in which the two main parties, NDC and NPP, heatedly blame each other for their country’s problems. But if they only can see it, in truth the electricity sector has been ruined by their common enemy – the IMF and World Bank. I pray that one day the country will escape the grip of these bloodsucking institutions.


111 thoughts on “IMF and USA set to ruin Ghana

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  • Aidworker1

    Craig,

    I don’t know Ghana but Mozambique is a spectacular example of the point you make.

    If you don’t know Joe Hanlon see:

    Wolfowitz, the World Bank, and Illegitimate Lending

    It’s incredible how what’s happening isn’t more widely appreciated.

  • Herbie

    It would be great if everyone escaped the blood-sucking vampire that is the IMF and World Bank.

    Funny that only Africa is mentioned in this regard.

    Isn’t a similar blood-sucking process ongoing in Greece, Spain, Portugal, Ireland etc., earlier in the Asian crisis, and now again over the US effective veto over the IMF against the interests of Russia, China, India etc.

  • Don

    Craig,

    I apologise…I could not read the whole post, it is so disturbingly similar.

    Sometimes I despair.

    Sorry.

  • glenn_uk

    Has the IMFs prescriptions ever been known to actually benefit the country to which they are applied? I mean the economy of that country, the people who live there, the ecology of that country, or indeed anyone except the investor class (who usually do not live there).

    Pretty much seems like this scam of profitising any utility or service in return for the dubious assistance of the IMF has been going on for many decades, but why are poorer countries so easily swayed – surely the vicious price for a loan is well understood by now. Is it corruption at the top?

  • craig Post author

    Herbie

    Absolutely. The parallels to the last few days’ events over Greece are so startling I left people to draw their own dots.

  • TonyB

    “I suspect that is the real point. That privatised utilities bring better service and cheaper prices to the consumer has been conclusively and forever disproven” EVERYWHERE

    The conxept of a market in a natural monopoly is patently rediculous. Water and electricity come out of 1 “pipe”. The NSW govt is selling off the Poles and wires now agter yje Labour govt intoduced a market 20 years ago. Over 60% are agaist this further privatisation BUT wars and privatisation against majority public opposition. Public opinion only affects “lifestyle choices”. Australia will Automatically sign up to the TTP with the 2 neoliberal paries support ie. Labour and Liberal National and then everything else can be destroyed regardless of public opion. Aust jus signed a free trade agreement with China allowing China to imort Chinese worker on big projects.

  • Alcyone

    “The Volta River Authority, the power producer and distributor was, in my very considerable experience, the best run and most efficient public utility in all of Africa. Indeed it was truly world class, and Ghana was proud of it.
    ….
    I pray that one day the country will escape the grip of these bloodsucking institutions.”

    If everything was so hunky-dory, why did they submit to it? I presume they were making good money as “the best run and most efficient public utility in all of Africa.”.

  • craig Post author

    Alcyone

    VRA was fine, Ghana was hit by the collapse in gold prices. The reason it needed help was nothing to do with VRA, but opening electricity to the private sector vultures was a condition of the loan.

  • TonyB

    Sorry I’m a bit dyslexic & terrible speller plus using a laptop in bed in NSW at 6.27 am and missing the keys. Point was:
    Over 60% are against this further privatisation BUT wars and privatisation GO ahead against majority public opposition with the jeft wing of the meoliberal party’s support ie. the opposition or ALP {Labour} the oly resitance comes from the Greens who get 10-12% support and represent what is left of the left in Australia.
    Also we didn’t know about the right of entry of cheap workers until the FTA was signe by Tony Abbott a couple of weeks ago.

  • fwlster

    It would be interesting if Simon Mann were to post here although perhaps unlikely. He may come from a very different political background, but his Cry Havoc is a sort of whistle blowing account and what he has to say about Barrel Boyz and their interest in chaos or disfunction as opposed to functionality amongst African states (who might then develop along Opec lines) strikes a chord with what you say here (not sure if “Cry Havoc & let…….” also strikes a chord with your earlier post, but I hope not). It is a shame to hear about Ghana. I have not been there but have met some very positive people from the country.

  • Alcyone

    Craig
    27 Jun, 2015 – 9:32 pm
    Alcyone

    “VRA was fine, Ghana was hit by the collapse in gold prices. The reason it needed help was nothing to do with VRA, but opening electricity to the private sector vultures was a condition of the loan.”

    Sounds like a poorly lead negotiation to me. Don’t know as much about Ghana, but Africa in general has been very susceptible to rampant corruption and particularly poor at putting men and materials together to build an economy for its peoples. I wouldn’t put the whole blame on the Institutions, when you’re effectively playing the gold market. No brainer.

  • Courtenay Barnett

    Craig,

    Basically – the points to be made also relate immediately to the Greek situation vis- a-vis the IMF. The Greeks realise that their debt to GDP ratio structurally is not sustainable operating within the IMF conditionalities.

    Question:-

    A. If Cameron can hold a referendum on whether Britain remains in the EU; and/or

    B. If Scotland can be permitted to hold a referendum on whether or not to remain with London; then

    C. Why is the Greek Prime Minister to be deemed wrong in letting his domestic and democratic audience speak directly to the IMF?

    The point of course is that just like Jamaica or Ghana the disastrous IMF dictated policies do not work – and – it is the bankers who profit while entire economies and people plummet in their standard of living under the IMF prescribed policies. Even Ray Charles and Stevie Wonder can now both see that.

    Which country in the entire world has abided by an IMF set of conditions and found themselves prospering and advancing more than before they entered the agreement? Which one?

    CB

  • fwlster

    CB re C: Its not that he is deemed wrong, but its his timing or his gaming strategy in taking it right to the wire and beyond. Will it work?

    No idea. Interesting though.

  • fwlster

    BTW on question of who gained from IMF? Has Ireland gained? Michael Lewis’ Boomerang has some interesting broad brush comments on the differences between Greece and Ireland.

    Also can anyone recommend a good analysis on the IMF and the UK in the 70’s and its effect thereafter?

  • bevin

    “Africa in general has been very susceptible to rampant corruption and particularly poor at putting men and materials together to build an economy for its peoples…”

    This is arrant nonsense: Africa is no more susceptible to corruption (or corrupt) than Britain or the USA.
    Can you imagine a system more corrupt than colonialism was in Africa? Bearing in mind that the colonialists invariably handed power over to those pledged to maintain substantive imperialism it is not surprising that authoritarian traits were built into the post colonial states. Abuse of power, contempt for public opinion and civil rights and emnity towards social equality are characteristic of IMF supported regimes, as they are of the controlling interests in the Bretton Woods institutions.

    What is true, and lamentable, is that corruption in the imperialist countries is regarded, by the corrupt ideologists of those countries, including the media and academia, as healthy manifestations of a robust system. Grown-ups can usually see through the whitewashes and smoke screens which soften the stark outlines of a system which is wholly corrupt.

  • BrianFujisan

    And on, and on, it goes.. The leeching, devastation, genocides for profit, heart breaking the quenching of African progress. be it Water – the Great man made River, Electricity, oil, Gold, Diamonds,

    Oil – yet we have cars that run on sea water.. thanks for these insights Craig

  • fedup

    The ossifying arguments holding a far more efficient performance from privately owned concerns, as oppose to public ownership always leave the limited and obtuse private interests of profit seeking that ramps up the prices and lowers the standards and quality of service.

    UK Gas, Water, Electricity, prices have shot up due to profiteers, and privateers milking the punters with these monopoly services. Yet the same old tired arguments are forwarded over and again in the oligarch owned media to keep the public duped and keep up the same nostrum of yea olde robber barons; squeeze the last pennyworth out of the slaves.

    The IMF and the rest of the constructs are there to ensure the “order” and the “rules” are promoted and adhered to.

    The covert political manipulation is not enough, hence a more direct and immediate manipulation is recourse to bogus help of world bank and IMF.

    Enron ensured blackouts in US to ramp up the price of the unit of electricity. If a corporation cannot sell more then they make sure to rig the market to sell less and still make more profits. These crooks then were celebrated as the “most clever boys in the room”.

    Hence the sixty percent revenue of the private sector in Ghanaian electricity market, is based on sale of less and less electricity, at greater costs; most efficient way of ensuring greater profits and there is no doubt about it.

  • lysias

    The Guardian: Greek crisis deepens further as bailout extension rejected – live updates gives live update of Tsipras’s speech to the Greek parliament:

    4m ago18:39

    7m ago18:36

    We don’t want to break away with Europe, Tsipras pledges, just the policies which are counter to Europe’s traditional values…..

    8m ago18:35

    Syriza MPs are applauding, as their leader takes New Democracy to task:

    9m ago18:34

    Our Athens correspondent, Helena Smith, is tweeting the key points from Alexis Tsipras’s speech:

    11m ago18:32

    Tsipras is now criticising creditors, for insisting on further cuts to pension spending, hitting the poorest, and refusing to allow the minimum wage to rise.

    He also tries to build bridges with EC president Jean-Claude Juncker; not so much with the IMF though.

    18m ago18:25
    Facebook
    Twitter
    Google plus

    20m ago18:23

    This is a defiant speech from Tsipras; no sign of a backward step following today’s sensational development in Brussels, where finance ministers decided Greece’s bailout must end on Tuesday.

    23m ago18:20

    24m ago18:19

    Yesterday our creditors blackmailed us with the threat of depriving liquidity, says Tsipras, today they use the fear of a bank run.

    He speaks of a propaganda of fear – but argues that the referendum could shake it off.

    27m ago18:16

    Tsipras says Europe shouldn’t fear referendums – many countries have held them before, including to implement treaties such as Maastricht.

  • Ron Jeremy

    This repulsive Neo-Liberal ideology is like a fuckin leech that attaches itself to its unwitting host and keeps sucking the blood from them. In the literal sense, this particular leech won’t stop until it bleeds us dry.

  • lysias

    Lawrence Summers suggested in an op ed in the Washington Post a few days ago what struck me as a reasonable compromise: some more austerity in return for a substantial forgiveness of the Greek debt.

    By the way, one of the principal actions of Solon in reforming the Athenian state in the early sixth century B.C. was a substantial forgiveness of debt, the seisachtheia.

  • Ron Jeremy

    The IMF are a monstrous creation that serves only the monsters who created it. But they’ve got nothing on these fuckin greedy shits- check out the Bank of International Settlements- a fuckin cartel if ever there was one!!

  • Macky

    Lysias; “Tsipras says Europe shouldn’t fear referendums”

    I quite liked his words when he proposed the Referendum;

    “To this autocratic and harsh austerity, we should respond with democracy, with composure and decisiveness. Greece, the cradle of democracy, should send a strong democratic answer to Europe and the world community.”

  • Macky

    Craig; “Absolutely. The parallels to the last few days’ events over Greece are so startling I left people to draw their own dots.”

    Or did you leave out the obviously parallels to the what the Troika are & have been doing to Greece because of your pro-EU dogma ? A reminder, the Troika is not just the IMF, but also the European Commission and the European Central Bank.

  • Tony_0pmoc

    The IMF and USA set to ruin the entire Fucking World if No Honest Man has The Courage To Stand Up To Them…

    Meanwhile an old man from Manchester even older than me…spells it out..just as it is..don’t worry he banned me years ago..but I still read John Ward of The Slog..sometimes he sees through all the shit and just writes it as it is..(He doesn’t do 9/11 either)

    “THE MISSING PIECES IN THE GREECE v TROIKA2 PUZZLE: A FINAL ANALYSIS…..”

    https://hat4uk.wordpress.com/2015/06/26/the-missing-pieces-in-the-greece-v-troika2-puzzle-a-final-analysis/

    Extract

    “The power behind the technocrats
    [ … ]
    Is there a lesson in this, should it come to pass? I think so, yes. Syriza should have flatly refused to enter into negotiations at the outset. Hindsight is of course a marvellous but impractical thing….unless we learn the lesson. Everyone currently supporting secessional opinion in Spain, France, Italy and the UK needs to cotton on to that learning, and then have a Bill Clinton-style motto above their desk: ‘They’re the new Nazis, stoopid. There is no reasoning with them’.

  • lysias

    More from Guardian live updates: Greek parliament approves referendum next Sunday July 5 178-120.

  • Macky

    @Tony, when John Ward writes, “When the Colonels took over some 30 years later, the US did nothing.”, he is not quite correct, as they very much did do something, they put them in power ! It was Clinton as President, who visited Greece & finally officially apologised for that little matter !

  • Paul Barbara

    Right on, Craig! I knew you were genuine when I came up to Blackburn to do my little bit towards your campaign.
    But I do wish you would let up on the anti-Russian line; check this out, for openers: ‘Presstitute Turn Whistleblower: ‘Bought Journalism’ Paid By CIA’: https://www.youtube.com/watch?v=_q7SR_kYxIM You cannot have a ‘Democracy’ if the press is controlled (and ours is, even down to ‘extreme’ left-wing rags). The ‘Litmus Test’ as to ‘Press Impartiality’ (in other words, a truly ‘free’ press) is their willingness to address, with redress to any blurbs they might put out, about 9/11.
    The Mail and the Express will address and question the death of Princess Diana, but will NOT question, or allow to be questioned, 9/11.
    Oh, yes. Albert Pike, head of world-wide Masonry at the time, prophesied that there would be 3 World Wars (‘Morals and Dogma’), leading up to a NWO ‘One World Government’. So pushing Russia and China (who do NOT want a war) may be not a very good idea.

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