Should Your Gov't Be Selling Coca Cola And Shoes?

....If Not, Why are you Crying?

It is quite amazing how we sometimes look at life. Many well educated friends would cry they don?t want to live under Communism or Socialism any more in Ghana. And yet when it comes to decisions that are the fundamental differences between the two economic principles of life: Free enterprise (alias capitalism) and Socialism, we sometimes get confused in Ghana.

In the news on www.ghanaweb.com: Business News of Monday, 18 November 2002, we read:

Eleven State Enterprises to be Sold Off ...Coca-Cola for sale...

Dear readers,
I am very surprised that writers on SIL (Say-It-Loud) on Ghanaweb don't see that not all SOEs are worth keeping by the government. The government really has no business running a business like Coca Cola or Hotels, nor Shoe factories. As much as some of us love Nkrumah, Socialism is dead and gone! And we must accept it and move on!

Government has more important things to occupy its time for the benefit of all of us. I will be darned if my taxpayer?s money were merely to support some Managing Director who lives like a King and cannot add and subtract, and let ordinary fine Hotels as under Nkrumah?s time become roach infested, and we keep the enterprise because it is government property. It is a shame what Ghanaian Mangers have done to the assets left to us by our founding fathers. We should have a law to prosecute such Mismanagement.

On divestiture (which is a silly big word for selling), the important issues are how the Companies to be sold are valued, and how the shares of the State are sold, and to whom.

There are cases like the Hotels, e.g., Hotel de Kingsway, Ambassador, and Continental, which were run down and hence sold very cheaply to surrogate companies owned by friends of the former government. Continental was sold to the Libyan government or some Libyan firms, renovated nicely and now rents at 3-Star rates of $150-$200 per night. Why Ghanaian managers could not maintain and manage them is another shameful chapter of our Independence. I don't think any of you will like our government to be running hotels, do you? How would you like the government to be selling shoes then? If not, then these Sues need to be sold, at fair valuation and to the general public, preferably to Ghanaians. However, in certain things like Hotels, I would not worry too much about the ownership, foreign or domestic, whiles in things like the Free trade Zone, Telecommunications and the Airport, I sincerely worry for national security's sake, and won?t sell to foreigners.

The fact of the matter is that States, be they Ghana or USA, should not be competing with the private sector in certain businesses like Hotels, which natives can be encouraged to invest in themselves. Ghana Airways is in debt by some $150 Million, and no Manager or Director has gone to jail yet! So why should our tax payer's money be subsidizing the elite lifestyles of some executives of GA whiles they are so incompetent? The Ghana Stock Market has proven itself to be a viable business forum or marketplace, and I would think it is the only viable and transparent instrument to use to diversify State Owned Enterprises now. I prefer that to the former DIC which was found to be so corrupt. We are waiting for al the men who run the DIC to be in jail. Period!

Amanfo, instead of criticizing the NPP or the Kufuor?s government, or whether the advice to sell came from the World Bank or IMF, I think what we should be looking these:

2. How do we evaluate and place a fair market value to a State Owned Publishing corporation, Pharmaceutical Company, Hotel, or Shoe factory?

3. Having evaluated them, how do we place a fair value to shares, and sell them? And who is to handle the transactions?

4. Having sold them, what does government do with the money? Buy more bullet proof vehicles or invest part of the money as Small business loans to help small businesses?

Honestly this latter part is the part that really bothers me. If we are selling all assets that Nananom, our founding fathers, used our taxpayers' money and resources to acquire, why should we squander all the money immediately without an effort to create jobs to substitute for any possible losses to the communities where these factories were located?! Seems like common sense, isn't it? If you sell your car and don't buy another one, at least you put some of the money aside to take a bus. Similarly if you sell your house, you put some money aside to rent a flat, or else sleep in the streets. It seems in Ghana, individual executives can make sensible decisions for their own assets, but when it comes to the state, they fail to use common sense! It is for this reason that I strongly support a legislation that will make the abuse or misuse of executive talent to defraud or cause a loss to the state punishable by imprisonment (we are over the age of the firing squad).

If an initiative is god, I don't care if this is an NPP, CPP or NDC initiative. So far as I can see, I think Osafo Maafo is on the right track, and we should support him, so far as there is transparency and goodwill in his efforts. Ghana has gone down the drain for decades now due to the poor decisions of men who have paraded the scene as Finance Ministers (Dr. Kwasi Botchwey being the biggest culprit) and knew not the meaning of the word ?Inflation?. The economy has gone down the drain for decades, and to put it right will take some harsh measures. We should not expect miracles from the NPP, just as the NPP leadership and executives should not expect to simply vote money for themselves that they have not worked to earn for the state.

The fraudulent habits of increasing their per diem allowances from $100 to $500 and $1,000 and traveling all the time in order to gain more money for themselves, is too obvious a trick to fool even children. It is my feeling that if the government?s President Kufuor and his Ministers exercises due common sense diligence, in cutting spending, limiting travel to only vital ones, and focus on problems at home, people will understand their policies better and sympathize.

Writers on SIL will be kinder and gentler on them.