POVERTY REDUCTION AND OIL REVENUE

By Austin Brako-Powers

“Resource Curse” is a well known phenomenon in the African continent and the mention of countries like Nigeria, Angola and Sudan sends fear down our spines. Many countries in the continent have struck the black gold in God knows quantity but the timeless question has been that to what end has the oil discovery been to the citizenry? 

Reaping oil benefits demand a more sophisticated economic planning, fortified institutions to manage the inflow of revenue and a grounded social policy. Oil and Gas benefits for Ghana can be channeled to fighting the poverty and inequality situation its citizens live in so as to avoid the infamous “Dutch Disease” as well as unnecessary rate of corruption. However, few oil producing countries have the needed policies and structures in place when the oil starts flowing. This therefore, account for the weaken governance, political instability and the high cases of poverty and inequality that are synonymous to the continent.

The oil industry has Multi-national Companies (MNC’s) who are drilling the oil, the government; the citizens who should be the direct beneficiaries of the oil revenue and the development partners who help with a sponsorship package as the major stakeholders. The people of the land suffer from the poverty, inequality and violence that come from failed oil policies. Development Partners are focused on institutional reform and democracy promotion with little or no attention for the welfare of the citizens. 

The Multi-national Companies (MNC’s) like the oil companies would want to maximize profit to satisfy their stakeholders and therefore had no interest in poverty reduction, democracy or eradication of inequality.

This, therefore, means that, the government shoulders the responsibilities to fight poverty and inequality through putting in place required policies based on transparency in the management of the revenue.

When the government creates the platform for transparency, citizen scrutiny of activities and task force/laws/structures to punish offenders there will be a maximum utilization of the revenue for the comfort of the citizens. To achieve the above therefore requires capacity building of the citizens, as well as institutional reforms.

Austin Brako-Powers

Tel: 0242 628164

Email: Augrako4gh@gmail.com