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Economy / U.S.-Ghanaian Relations / Additional Information



Area: 238,538 sq. km. (92,100 sq. mi.); about the size of Illinois and Indianacombined.

Cities: Capital--Accra (metropolitan area pop. 3 million est.). Othercities--Kumasi (1 million est.), Tema (250,000 est.), Sekondi-Takoradi (200,000 est.).

Terrain: Plains and scrubland, rain forest, savanna.

Climate: Tropical.


Nationality: Noun and adjective--Ghanaian(s).

Population (1997 est.): 17.7 million.

Density: 74/sq. km. (192/sq. mi.).

Annual growth rate (1996 est.): 2.3%.

Ethnic groups: Akan, Ewe, Ga.

Religions: Christian 35%, indigenous beliefs 31%, Muslim 27%, other 7%.

Languages: English (official), Akan 44%, Mole-Dagbani 16%, Ewe 13%, Ga-Adangbe 8%.

Education:Years compulsory--9. Literacy--64.5%.

Health: Infant mortality rate (1996 est.)-- 80/1,000. Life expectancy--56 yrs.

Work force: 4 million: Agriculture and fishing--54.7%. Industry--18.7%. Sales andclerical--15.2%. Services, transportation, and communications--7.7%. Professional--3.7%.


Type: Democracy.

Independence: March 6, 1957.

Constitution: Entered into force January 7, 1993.

Branches: Executive--President popularly elected for a maximum of two four-yearterms. Legislative--unicameral Parliament popularly elected for four-year terms.Judicial--Independent, Supreme Court Justices nominated by President with approval ofParliament.

Subdivisions: 10 regions.

Political parties: National Democratic Congress, New Patriotic Party, People'sConvention Party, National Convention Party, People's National Convention, et alia. Names,slogans, and symbols of parties existing prior to 1992 are banned by law.

Suffrage: Universal at 18.

Flag: Three horizontal stripes of red, gold, and green, with a black star in thecenter of the gold stripe.


GDP (1997): $6.01 billion.

Real GDP growth rate (1997): 5.5%.

Per capita GDP (1997): $340.

Inflation rate (1997): 27%.

Natural resources: Gold, timber, diamonds, bauxite, manganese, fish.

Agriculture: Products--cocoa, coconuts, coffee, pineapples, cashews, pepper, otherfood crops, rubber. Land--70% arable and forested.

Business and industry: Types--mining, lumber, light manufacturing, fishing,aluminum, tourism.

Trade (1997): Exports--$1.6 billion: cocoa ($600 million), aluminum, gold, timber,diamonds, manganese. Imports--$1.9 billion: petroleum ($272 million), food, industrial rawmaterials, machinery, equipment. Major trade partners--U.K., Germany, U.S., Nigeria.

Official exchange rate (Dec. 1997): 2,295 cedis=US$1.

Fiscal year: Calendar year.


Ghana is located on West Africa's Gulf of Guinea only a few degrees north of theEquator. Half of the country lies less than 152 meters (500 ft.) above sea level, and thehighest point is 883 meters (2,900 ft.). The 537-kilometer (334-mi.) coastline is mostly alow, sandy shore backed by plains and scrub and intersected by several rivers and streams,most of which are navigable only by canoe. A tropical rain forest belt, broken by heavilyforested hills and many streams and rivers, extends northward from the shore, near theCote d'Ivoire frontier. This area, known as the "Ashanti," produces most of thecountry's cocoa, minerals, and timber. North of this belt, the country varies from 91 to396 meters (300-1,300 ft.) above sea level and is covered by low bush, park-like savanna,and grassy plains.

The climate is tropical. The eastern coastal belt is warm and comparatively dry; thesouthwest corner, hot and humid; and the north, hot and dry. There are two distinct rainyseasons in the south--May-June and August-September; in the north, the rainy seasons tendto merge. A dry, northeasterly wind, the Harmattan, blows in January and February. Annualrainfall in the coastal zone averages 83 centimeters (33 in.).

Volta Lake, the largest man-made lake in the world, extends from the Akosombo Dam insoutheastern Ghana to the town of Yapei, 520 kilometers (325 mi.) to the north. The lakegenerates electricity, provides inland transportation, and is a potentially valuableresource for irrigation and fish farming.


Ghana's population is concentrated along the coast and in the principal cities of Accraand Kumasi. Most Ghanaians descended from migrating tribes that probably came down theVolta River valley at the beginning of the 13th century. Ethnically, Ghana is divided intosmall groups speaking more than 50 languages and dialects. Among the more importantlinguistic groups are the Akans, which include the Fantis along the coast and the Ashantisin the forest region north of the coast; the Guans, on the plains of the Volta River; theGa- and Ewe-speaking peoples of the south and southeast; and the Moshi-Dagomba-speakingtribes of the northern and upper regions. English, the official and commercial language,is taught in all the schools.

Primary and junior secondary school education is tuition-free and mandatory. TheGovernment of Ghana support for basic education is unequivocal. Article 39 of theConstitution mandates the major tenets of the free, compulsory, universal basic education(FCUBE) initiative. Launched in 1996, it is one of the most ambitious pre-tertiaryeducation programs in West Africa. Since 1987, the Government of Ghana has increased itseducation budget by 700%. Basic education's share has grown from 45% to 60% of that total.

Students begin their 6-year primary education at age six. Under educational reformsimplemented in 1987, they pass into a junior secondary school system for 3 years ofacademic training combined with technical and vocational training. Those continuing moveinto the 3-year senior secondary school program. Entrance to one of the five Ghanaianuniversities is by examination following completion of senior secondary school. Schoolenrollment totals almost 3 million.


The history of the Gold Coast before the last quarter of the 15th century is derivedprimarily from oral tradition that refers to migrations from the ancient kingdoms of thewestern Soudan (the area of Mauritania and Mali). The Gold Coast was renamed Ghana uponindependence in 1957 because of indications that present-day inhabitants descended frommigrants who moved south from the ancient kingdom of Ghana.

The first contact between Europe and the Gold Coast dates from 1470, when a party ofPortuguese landed. In 1482, the Portuguese built Elmina Castle as a permanent tradingbase. The first recorded English trading voyage to the coast was made by Thomas Windham in1553. During the next three centuries, the English, Danes, Dutch, Germans, and Portuguesecontrolled various parts of the coastal areas.

In 1821, the British Government took control of the British trading forts on the GoldCoast. In 1844, Fanti chiefs in the area signed an agreement with the British that becamethe legal steppingstone to colonial status for the coastal area.

From 1826 to 1900, the British fought a series of campaigns against the Ashantis, whosekingdom was located inland. In 1902, they succeeded in establishing firm control over theAshanti region and making the northern territories a protectorate. British Togoland, thefourth territorial element eventually to form the nation, was part of a former Germancolony administered by the United Kingdom from Accra as a League of Nations mandate after1922. In December 1946, British Togoland became a UN Trust Territory, and in 1957,following a 1956 plebiscite, the United Nations agreed that the territory would becomepart of Ghana when the Gold Coast achieved independence.

The four territorial divisions were administered separately until 1946, when theBritish Government ruled them as a single unit. In 1951, a constitution was promulgatedthat called for a greatly enlarged legislature composed principally of members elected bypopular vote directly or indirectly. An executive council was responsible for formulatingpolicy, with most African members drawn from the legislature and including three exofficio members appointed by the governor. A new constitution, approved on April 29, 1954,established a cabinet comprising African ministers drawn from an all-African legislaturechosen by direct election. In the elections that followed, the Convention People's Party(CPP), led by Kwame Nkrumah, won the majority of seats in the new Legislative Assembly. InMay 1956, Prime Minister Nkrumah's Gold Coast government issued a white paper containingproposals for Gold Coast independence. The British Government stated it would agree to afirm date for independence if a reasonable majority for such a step were obtained in theGold Coast Legislative Assembly after a general election. This election, held in 1956,returned the CPP to power with 71 of the 104 seats in the Legislative Assembly. Ghanabecame an independent state on March 6, 1957, when the United Kingdom relinquished itscontrol over the Colony of the Gold Coast and Ashanti, the Northern TerritoriesProtectorate, and British Togoland.

In subsequent reorganizations, the country was divided into 10 regions, which currentlyare subdivided into 110 districts. The original Gold Coast Colony now comprises theWestern, Central, Eastern, and Greater Accra Regions, with a small portion at the mouth ofthe Volta River assigned to the Volta Region; the Ashanti area was divided into theAshanti and Brong-Ahafo Regions; the Northern Territories into the Northern, Upper East,and Upper West Regions; and British Togoland essentially is the same area as the VoltaRegion.

Post-Independence Politics

After independence, the CPP government under Nkrumah sought to develop Ghana as amodern, semi-industrialized, unitary socialist state. The government emphasized politicaland economic organization, endeavoring to increase stability and productivity throughlabor, youth, farmers, cooperatives, and other organizations integrated with the CPP. Thegovernment, according to Nkrumah, acted only as "the agent of the CPP" inseeking to accomplish these goals.

The CPP's control was challenged and criticized, and Prime Minister Nkrumah used thePreventive Detention Act (1958), which provided for detention without trial for up to 5years (later extended to 10 years). On July 1, 1960, a new constitution was adopted,changing Ghana from a parliamentary system with a prime minister to a republican form ofgovernment headed by a powerful president. In August 1960, Nkrumah was given authority toscrutinize newspapers and other publications before publication. This political evolutioncontinued into early 1964, when a constitutional referendum changed the country to aone-party state.

On February 24, 1966, the Ghanaian Army and police overthrew Nkrumah's regime. Nkrumahand all his ministers were dismissed, the CPP and National Assembly were dissolved, andthe constitution was suspended. The new regime cited Nkrumah's flagrant abuse ofindividual rights and liberties, his regime's corrupt, oppressive, and dictatorialpractices, and the rapidly deteriorating economy as the principal reasons for its action.

Post-Nkrumah Politics

The leaders of the February 24 coup established the new government around the NationalLiberation Council (NLC) and pledged an early return to a duly constituted civiliangovernment. Members of the judiciary and civil service remained at their posts andcommittees of civil servants were established to handle the administration of the country.

Ghana's government returned to civilian authority under the Second Republic in October1969 after a parliamentary election in which the Progress Party, led by Kofi A. Busia, won105 of the 140 seats. Until mid-1970, the powers of the chief of state were held by apresidential commission led by Brigadier A.A. Afrifa. In a special election on August 31,1970, former Chief Justice Edward Akufo-Addo was chosen president, and Dr. Busia becameprime minister.

Faced with mounting economic problems, Prime Minister Busia's government undertook adrastic devaluation of the currency in December 1971. The government's inability tocontrol the subsequent inflationary pressures stimulated further discontent, and militaryofficers seized power in a bloodless coup on January 13, 1972.

The coup leaders, led by Col. I.K. Acheampong, formed the National Redemption Council(NRC) to which they admitted other officers, the head of the police, and one civilian. TheNRC promised improvements in the quality of life for all Ghanaians and based its programson nationalism, economic development, and self-reliance. In 1975, a governmentreorganization resulted in the NRC's replacement by the Supreme Military Council (SMC),also headed by now-General Acheampong.

Unable to deliver on its promises, the NRC/SMC became increasingly marked bymismanagement and rampant corruption. In 1977, General Acheampong brought forward theconcept of union government (UNIGOV), which would make Ghana a non-party state. Perceivingthis as a ploy by Acheampong to retain power, professional groups and students launchedstrikes and demonstrations against the government in 1977 and 1978. The steady erosion inAcheampong's power led to his arrest in July 1978 by his chief of staff, Lt. Gen.Frederick Akuffo, who replaced him as head of state and leader of what became known as theSMC-2.

Akuffo abandoned UNIGOV and established a plan to return to constitutional anddemocratic government. A Constitutional Assembly was established, and political partyactivity was revived. Akuffo was unable to solve Ghana's economic problems, however, or toreduce the rampant corruption in which senior military officers played a major role. OnJune 4, 1979, his government was deposed in a violent coup by a group of junior andnon-commissioned officers--Armed Forces Revolutionary Council (AFRC)--with Flt. Lt. JerryJohn Rawlings as its chairman.

The AFRC executed eight senior military officers, including former chiefs of stateAcheampong and Akuffo; established Special Tribunals that, secretly and without dueprocess, tried dozens of military officers, other government officials, and privateindividuals for corruption, sentencing them to long prison terms and confiscating theirproperty; and, through a combination of force and exhortation, attempted to rid Ghanaiansociety of corruption and profiteering. At the same time, the AFRC accepted, with a fewamendments, the draft constitution that had been submitted, permitted the scheduledpresidential and parliamentary elections to take place in June and July, promulgated theconstitution, and handed over power to the newly elected president and parliament of theThird Republic on September 24, 1979.

The 1979 constitution was modeled on those of Western democracies. It provided for theseparation of powers among an elected president and a unicameral parliament, anindependent judiciary headed by a Supreme Court, which protected individual rights, andother autonomous institutions, such as the Electoral Commissioner and the Ombudsman. Thenew president, Dr. Hilla Limann, was a career diplomat from the north and the candidate ofthe People's National Party (PNP), the political heir of Nkrumah's CPP. Of the 140 membersof parliament, 71 were PNP.

The PNP government established the constitutional institutions and generally respecteddemocracy and individual human rights. It failed, however, to halt the continuing declinein the economy; corruption flourished, and the gap between rich and poor widened. OnDecember 31, 1981, Flight Lt. Rawlings and a small group of enlisted and former soldierslaunched a coup that succeeded against little opposition in toppling President Limann.

The PNDC Era

Rawlings and his colleagues suspended the 1979 constitution, dismissed the presidentand his cabinet, dissolved the parliament, and proscribed existing political parties. Theyestablished the Provisional National Defense Council (PNDC), initially composed of sevenmembers with Rawlings as chairman, to exercise executive and legislative powers. Theexisting judicial system was preserved, but alongside it the PNDC created the NationalInvestigation Committee to root out corruption and other economic offenses, the anonymousCitizens' Vetting Committee to punish tax evasion, and the Public Tribunals to try variouscrimes. The PNDC proclaimed its intent to allow the people to exercise political powerthrough defense committees to be established in communities, workplaces, and in units ofthe armed forces and police. Under the PNDC, Ghana remained a unitary government.

In December 1982, the PNDC announced a plan to decentralize government from Accra tothe regions, the districts, and local communities, but it maintained overall control byappointing regional and district secretaries who exercised executive powers and alsochaired regional and district councils. Local councils, however, were expectedprogressively to take over the payment of salaries, with regions and districts assumingmore powers from the national government. In 1984, the PNDC created a National AppealsTribunal to hear appeals from the public tribunals, changed the Citizens' VettingCommittee into the Office of Revenue Collection and replaced the system of defensecommittees with Committees for the Defense of the Revolution.

In 1984, the PNDC also created a National Commission on Democracy to study ways toestablish participatory democracy in Ghana. The commission issued a "Blue Book"in July 1987 outlining modalities for district-level elections, which were held in late1988 and early 1989, for newly created district assemblies. One-third of the assemblymembers are appointed by the government.

Under international and domestic pressure for a return to democracy, the PNDC allowedthe establishment of a 258-member Consultative Assembly made up of members representinggeographic districts as well as established civic or business organizations. The assemblywas charged to draw up a draft constitution to establish a fourth republic, using PNDCproposals. The PNDC accepted the final product without revision, and it was put to anational referendum on April 28, 1992, in which it received 92% approval. On May 18, 1992,the ban on party politics was lifted in preparation for multi-party elections. The PNDCand its supporters formed a new party, the National Democratic Congress (NDC), to contestthe elections. Presidential elections were held on November 3 and parliamentary electionson December 29 of that year. Members of the opposition boycotted the parliamentaryelections, however, which resulted in a 200 seat Parliament with only 17 opposition party members and two independents.

The Constitution entered into force on January 7, 1993, to found the Fourth Republic.On that day, Flt. Lt. Jerry John Rawlings was inaugurated as President and members ofParliament swore their oaths of office. In 1996, the opposition fully contested thepresidential and parliamentary elections, which were described as peaceful, free, andtransparent by domestic and international observers. In that election, President Rawlingswas re-elected with 57% of the popular vote. In addition, Rawlings' NDC party won 133 ofthe Parliament's 200 seats, just one seat short of the two-thirds majority needed to amendthe Constitution, although the election returns of two parliamentary seats face legalchallenges.


The Constitution that established the Fourth Republic provided a basic charter forrepublican democratic government. It declares Ghana to be a unitary republic withsovereignty residing in the Ghanaian people. Intended to prevent future coups, dictatorialgovernment, and one-party states, it is designed to establish the concept of powersharing.The document reflects lessons learned from the abrogated constitutions of the 1957, 1960,1969, and 1979, and incorporates provisions and institutions drawn from British andAmerican constitutional models. One controversial provision of the Constitutionindemnifies members and appointees of the PNDC from liability for any official act oromission during the years of PNDC rule. The Constitution calls for a system of checks andbalances, with power shared between a president, a unicameral parliament, a council ofstate, and an independent judiciary.

Executive authority is established in the Office of the Presidency, together with hisCouncil of State. The president is head of state, head of government, and commander inchief of the armed forces. He also appoints the vice president. According to theConstitution, more than half of the presidentially appointed ministers of state must beappointed from among members of Parliament.

Legislative functions are vested in Parliament, which consists of a unicameral200-member body plus the Speaker. To become law, legislation must have the assent of thepresident, who has a qualified veto over all bills except those to which a vote of urgencyis attached. Members of Parliament are popularly elected by universal adult suffrage forterms of four years, except in war time, when terms may be extended for not more than 12months at a time beyond the four years.

The structure and the power of the judiciary are independent of the two other branchesof government. The Supreme Court has broad powers of judicial review. It is authorized bythe Constitution to rule on the constitutionality of any legislation or executive actionat the request of any aggrieved citizen. The hierarchy of courts derives largely fromBritish juridical forms. The hierarchy, called the Superior Court of Judicature, iscomposed of the Supreme Court of Ghana, the Court of Appeal, the High Court of Justice,regional tribunals, and such lower courts or tribunals as Parliament may establish. Thecourts have jurisdiction over all civil and criminal


Principal Government Officials

President--Flt. Lt. Jerry John Rawlings (ret.)

Vice President--Dr. John Atta Mills

Minister of Foreign Affairs--James Victor Gbeho

Minister of Defense--Alhaji Mahama Iddrisu

Minister of Communications--Amb. Ekwow Spio-Garbrah

Minister of Finance--Kwame Peprah

Minister of Food and Agriculture--Dr. Kwabena Adjei, MP

Minister of Justice--Dr. Obed Yao Asamoah

Minister of Local Government and Rural Development--Kwamena Ahwoi

Minister of Mines and Energy--Ferdinand Ohene-Kena

Minister of Trade and Industry--John Frank Abu, MP

Chief Justice of the Supreme Court--Justice Isaac Kobina Abban

Speaker of Parliament--Justice Daniel F. Annan

First Deputy Speaker--Kenneth Dzirasah

Second Deputy Speaker--Freddie Blay

Majority Leader--J.H. Owusu-Acheampong

Deputy Majority Leader--Alhaji M. A. Seidu

Minority Leader--J.H. Mensah

Deputy Minority Leader--Gladys Asmah

Ambassador to the United States--Koby Koomson

Permanent Representative to the United Nations--Jack Wilmont

Ghana maintains an embassy in the United States at 3512 International Drive, NW.,Washington, D.C. 20008 (tel. 202-686-4500). Its permanent mission to the United Nations islocated at 19 E. 47th Street., New York, N.Y. 10017 (tel. 212-832-1300).


By West African standards, Ghana has a diverse and rich resource base. The country ismainly agricultural, however, with a majority of its workers engaged in farming. Cashcrops consist primarily of cocoa and cocoa products,which typically provide abouttwo-thirds of export revenues, timber products, coconuts and other palm products, sheanuts, which produce an edible fat, and coffee. Ghana also has established a successfulprogram of nontraditional agricultural products for export, including pineapples, cashews,and pepper. Cassava, yams, plantains, corn, rice, peanuts, millet, and sorghum are thebasic foodstuffs. Fish, poultry, and meat also are important dietary staples.

Minerals--principally gold, diamonds, manganese ore, and bauxite--are produced andexported. The only commercial oil well has been closed after producing 3.5 million barrelsover its seven-year life, but signs of natural gas are being studied for power generation,while exploration continues for other oil and gas resources.

Ghana's industrial base is relatively advanced compared to many other Africancountries. Import-substitution industries include textiles; steel (using scrap); tires;oil refining; flour milling; beverages; tobacco; simple consumer goods; and car, truck,and bus assembly.

Tourism has become one of Ghana's largest foreign income earners (ranking third in1997), and the Ghanaian Government has placed great emphasis upon further tourism supportand development.

Economic Development

At independence, Ghana had a substantial physical and social infrastructure and $481million in foreign reserves. The Nkrumah government further developed the infrastructureand made important public investments in the industrial sector. With assistance from theUnited States, the World Bank, and the United Kingdom, construction of the Akosombo Damwas completed on the Volta River in 1966. Two U.S. companies built Valco, Africa's largestaluminum smelter, to use power generated at the dam. Aluminum exports from Valco are amajor source of foreign exchange for Ghana.

Many Nkrumah-era investments were monumental public works projects and poorlyconceived, badly managed agricultural and industrial schemes. With cocoa prices fallingand the country's foreign exchange reserves fast disappearing, the government resorted tosupplier credits to finance many projects. By the mid-1960s, Ghana's reserves were gone,and the country could not meet repayment schedules. To rationalize, the NationalLiberation Council abandoned unprofitable projects, and some inefficient state-ownedenterprises were sold to private investors. On three occasions, Ghana's creditors agreedto reschedule repayments due on Nkrumah-era supplier credits. Led by the United States,foreign donors provided import loans to enable the foreign exchange-strapped government toimport essential commodities.

Prime Minister Busia's government (1969-72) liberalized controls to attract foreigninvestment and to encourage domestic entrepreneurship. Investors were cautious, however,and cocoa prices began declining again while imports surged, precipitating a serious tradedeficit. Despite considerable foreign assistance and some debt relief, the Busia regimealso was unable to overcome the inherited restraints on growth posed by the debt burden,balance-of-payments imbalances, foreign exchange shortages, and mismanagement.

Although foreign aid helped prevent economic collapse and was responsible forsubsequent improvements in many sectors, the economy stagnated in the 10-year periodpreceding the NRC takeover in 1972. Population growth offset the modest increase in grossdomestic product, and real earnings declined for many Ghanaians.

To restructure the economy, the NRC, under General Acheampong (1972-78), undertook anausterity program that emphasized self-reliance, particularly in food production. Theseplans were not realized, however, primarily because of post-1973 oil price increases and adrought in 1975-77 that particularly affected northern Ghana. The NRC, which had inheritedforeign debts of almost $1 billion, abrogated existing rescheduling arrangements for somedebts and rejected other repayments. After creditors objected to this unilateral action, a1974 agreement rescheduled the medium-term debt on liberal terms. The NRC also imposed theInvestment Policy Decree of 1975--effective on January 1977--that required 51 % Ghanaianequity participation in most foreign firms, but the government took 40% in specifiedindustries. Many shares were sold directly to the public.

Continued mismanagement of the economy, record inflation (more than 100% in 1977), andincreasing corruption, notably at the highest political levels, led to growingdissatisfaction. The post-July 1978 military regime led by General Akuffo attempted todeal with Ghana's economic problems by making small changes in the overvalued cedi and byrestraining government spending and monetary growth. Under a one-year standby agreementwith the International Monetary Fund (IMF) in January 1979, the government promised toundertake economic reforms, including a reduction of the budget deficit, in return for a$68 million IMF support program and $27 million in IMF Trust Fund loans. The agreementbecame inoperative, however, after the June 4 coup that brought Flight Lieutenant Rawlingsand the AFRC to power for 4 months.

In September 1979, the civilian government of Hilla Limann inherited declining percapita income; stagnant industrial and agricultural production due to inadequate importedsupplies; shortages of imported and locally produced goods; a sizable budget deficit(almost 40% of expenditures in 1979); high inflation, "moderating" to 54% in1979; an increasingly overvalued cedi; flourishing smuggling and other black-marketactivities; unemployment and underemployment, particularly among urban youth;deterioration in the transport network; and continued foreign exchange constraints.

Limann's PNP government announced yet another (2-year) reconstruction program,emphasizing increased food production and productivity, exports, and transportimprovements. Import austerity was imposed and external payments arrears cut. However,declining cocoa production combined with falling cocoa prices, while oil prices soared. Noeffective measures were taken to reduce rampant corruption and black marketing.

When Rawlings again seized power at the end of 1981, cocoa output had fallen to halfthe 1970-71 level and its world price to one-third the 1975 level. By 1982, oil wouldconstitute half of Ghana's imports, while overall trade contracted greatly. Internaltransport had slowed to a crawl, and inflation remained high. During Rawlings' first year,the economy was stagnant. Industry ran at about 10% of capacity due to the chronicshortage of foreign exchange to cover the importation of required raw materials andreplacement parts. Economic conditions deteriorated further in early 1983 when Nigeriaexpelled an estimated 1 million Ghanaians whohad to be absorbed by Ghana.

In April 1983, in coordination with the IMF, the PNDC launched an economic recoveryprogram, perhaps the most stringent and consistent of its day in Africa, aimed atreopening infrastructural bottlenecks and reviving moribund productivesectors--agriculture, mining, and timber. The largely distorted exchange rate and priceswere realigned to encourage production and exports. Increased fiscal and monetarydiscipline was imposed to curb inflation and to focus on priorities. Through November1987, the cedi was devalued by more than 6,300%, and widespread direct price controls weresubstantially reduced.

The economy's response to these reforms was initially hampered by the absorption of onemillion returnees from Nigeria, the onset of the worst drought since independence, whichbrought on widespread bushfires and forced closure of the aluminum smelter and severepower cuts for industry and decline in foreign aid. In 1985, the country absorbed anadditional 100,000 expellees from Nigeria. In 1987, cocoa prices began declining again;however, initial infrastructural repairs, improved weather, and producer incentives andsupport revived output in the early 1990s. During 1984-88 the economy experienced solidgrowth for the first time since 1978. Renewed exports, aid inflows, and a foreign exchangeauction have eased hard currency constraints.

Since an initial August 1983 IMF standby agreement, the economic recovery program hasbeen supported by three IMF standbys and two other credits totaling $611 million, $1.1billion from the World Bank, and hundreds of millions of dollars more from other donors.In November 1987, the IMF approved a $318-million, 3-year extended fund facility. Thesecond phase (1987-90) of the recovery program concentrated on economic restructuring andrevitalizing social services. The third phase, focused on financial transparency andmacroeconomic stability is scheduled for March 1998.

Ghana intends to achieve its goals of accelerated economic growth, improved quality oflife for all Ghanaians, and reduced poverty through macroeconomic stability, higherprivate investment, broad-based social and rural development, as well as directpoverty-alleviation efforts. These plans are fully supported by the international donorcommunity and have been forcefully reiterated in the 1995 government report, Ghana: Vision2020. Privatization of state-owned enterprises continues, with about two-thirds of 300parastatal enterprises sold to private owners. Other reforms adopted under thegovernment's structural adjustment program include the elimination of exchange ratecontrols and the lifting of virtually all restrictions on imports. The establishment of aninterbank foreign exchange market has greatly expanded access to foreign exchange.

The medium-term macroeconomic forecast assumes political stability, successful economicstabilization, and the implementation of a policy agenda for private sector growth, andadequate public spending on social services and rural infrastructure. The ninthConsultative Group Meeting for Ghana ended November 5, 1997 after deliberations in Paris.Twenty-four countries and donor entities were represented at this meeting called by theWorld Bank on behalf of the Ghanaian Government. The World Bank announced that, of thetargeted disbursement level of $1.6 billion sought from the donor community for 1998-99,they foresaw only a $150 million shortfall in commitments, and that this shortfall wouldbe easily realized should Ghana rapidly enact its macroeconomic program.

The government repealed a 17.% value-added tax (VAT) shortly after its introduction in1995, which resulted in wide-spread public protests. The government reverted to severalpreviously imposed taxes, including a sales tax. The government has set in motion aprogram to reintroduce a VAT bill, with implementation in 1998 after an extensive publiceducation campaign.


The United States has enjoyed good relations with Ghana at the nonofficial, personallevel since Ghana's independence. Thousands of Ghanaians have been educated in the UnitedStates. Close relations are maintained between educational and scientific institutions,and cultural links, particularly between Ghanaians and African-Americans, are strong.

After a period of strained relations in the mid-1980s, U.S.-Ghanaian official relationsare stronger than at any other time in recent memory. Ghanaian parliamentarians and othergovernment officials have through the U.S. International Visitor Program acquaintedthemselves with U.S. Congressional and state legislative practices and participated inprograms designed to address other issues of interest. The U.S. and Ghanaian militarieshave cooperated in numerous joint training exercises, culminating with Ghanaianparticipation in the African Crisis Response Initiative, an international activity inwhich the U.S. is facilitating the development of an interoperable peacekeeping capacityamong African nations. In addition, there is an active bilateral international militaryand educational training program. The Office of the President of Ghana worked closely withthe U.S. Embassy in Accra to establish an American Chamber of Commerce to continue todevelop closer economic ties in the private sector.

The United States is among Ghana's principal trading partners. The American privatelyowned VALCO aluminum smelter imports many of its supplies from, and exports almost all thealuminum ingots to, the United States. With a replacement value of more than $600 million,U.S. investments in Ghana form one of the largest stocks of foreign capital. VALCO--90%owned by Kaiser, and 10% by Reynolds--is by far the biggest investment, but otherimportant U.S. companies operating in the country include Mobil, Coca Cola, S.C. Johnson,Ralston Purina, Star-Kist, A.H. Robins, Sterling, Pfizer, IBM, Carson Products, 3M,Pioneer Gold, Stewart & Stevenson, Price Waterhouse, Great Lakes Shipping, andNational Cash Register (NCR). Several U.S. firms recently made or are consideringinvestments in Ghana, primarily in gold mining, wood products, and petroleum. In late1997, Nuevo Petroleum concluded an oil exploration agreement accounting for the last ofGhana's offshore mineral rights zones. Two other U.S. oil companies, Sante Fe and Hunt,are also engaged in offshore exploration.

U.S. development assistance to Ghana in fiscal year 1997 totaled $52 million, dividedbetween small business enterprise, health, education, and democracy/governance programs.Ghana was the first country in the world to accept Peace Corps volunteers, and the programremains one of the largest. Currently, there are more than 150 volunteers in Ghana. Almosthalf work in education, and the others in various fields such as agroforestry, smallbusiness development, health education and water sanitation, as well as youth development.

Principal U.S. Officials

Ambassador--Edward Brynn

Deputy Chief of Mission--Sharon Lavorel-Rutherford

Director, Peace Corps--Harriet Lancaster

Public Affairs Officer--Brooks Robinson

Acting Director, USAID Mission--Thomas Hobgood

Consul--Rudolph Boone

Administrative Chief--Perry Adair

Political Chief--Stephanie Sullivan

Economic Chief--Robert Merrigan

The U.S. Embassy is located on Ring Road East, near Danquah Circle, Accra (tel.233-21-775347/8/9). The mailing address is P.O. Box 194, Accra, Ghana. For Americancitizen services and visa questions, the Embassy Consular Section telephone number is233-21-776602.


For more information, visit the State Department's home page.

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