Have We Really Supported the Private Sector?

KARL MARX (1818 - 1883) and Friedrich Engels (1820 - 1895) published The Communist Manifesto and the latter finished "DAS Kapital" after the former's death in 1883.

But before they propounded the theory of communism/ socialism in the 19th century, which by the way is utopian, the world's dominant economy had been and still is free Market economy.

Vladimir I1yich Ulyanov aka Nikolai Lenin (1870 - 1924), the Philosopher of the Russian communist party and Mao Tse - Tung, head of the Chinese communist party with the help of their "comrades" introduced communism/socialism in 1917 and 1949 in their countries respectively.

In Africa, attempts were made to introduce this economic model that is socialism/communism which some even call "State capitalism", the principal actors being our own Osagyefo Dr. Kwame Nkrumah and Mwalimu (The Teacher) Julius Nyerere of Tanzani of blessed memory.

By the end of world war II and soon after when the cold war was at its height, Russia which by then had become the Soviet Union or USSR had spread communism / socialism across Eastern Europe to countries like Bulgaria, Romania, Poland etc.

Indeed after world war II, the world's third largest economy after the US and Japan, that is Germany, was divided into two, West Germany (Free Market economy) and East Germany (communism / socialism).

By the beginning of the 21st century, East Germany had abandoned their economic system and joined their brethren in West Germany to become one united Germany and the Soviet Union had collapsed and also adopted the free market system followed by its satellite states in Eastern Europe.

This author believes that very soon the last bastions of communism/socialism like Cuba, China and North Korea will fully adopt the free market economy model.

What this tells us is that "communism/socialism or State capitalism" is Utopian and does not work. The world's biggest economy, the United States of America where California's economy is bigger than that of Belgium, was modeled and still is on the free market economy system.

Indeed it has been said that the American economy was developed to a large extent by five great human beings or "Robber Barons" in the persons of Cornelius Vanderbilt (1794 - 1877) who built a lot of railroads, J. P. Morgan who also built railroads and formed the United States steel company (US steel), Andrew Carnegie (1835 - 1919) who also built railroads and iron and steel mills, Henry Ford (1863 - 1947) of Ford Motor Company fame who produced the first low priced automobile in the world in 1908 and developed the concept of the assembly line and John Davison Rockefeller, the world's first billionaire, whose family gave land free of charge for the east river side of the United Nations.

In Ghana, we also have had our "Robber Barons" in the persons of George Alfred Grant (Paa Grant), Amuah Sakyi, Patrick Kwaku Anim-Addo, S.C. Appenteng, J. K. Siaw and Francis Poku to mention but a few.

We still have astute businessmen like B.A. Mensah, S. K. Pepera, E. H. Boohene, L.B. Philips and Ernest Bediako Sarpong in our midst.

After our independence, our great and illustrious leader tried to introduce some form of "State capitalism" instead of supporting the private sector "as the engine of growth".

Under the idea of import substitution among others, he established the Industrial Development Company (IDC), which later on became the Ghana Industrial Holding Corporation (GIHOC) and also established state enterprises in all sectors of the economy. Naturally most of these enterprises failed and have been divested.

The State should by all means have controlling interests in some enterprises or sectors like electricity, water, health care, education etc because of our current development needs. But the core business of the State should be governance and not business.

It should create an enabling environment for the private sector to operate and be the regulator.

We as a country have not supported the private sector enough.

Unfortunately too, some administrations seized and nationalized private enterprises like Tata Brewery, International Tobacco Ghana Ltd, Fattal Brothers, Kowus Motor etc.

Having run them as State enterprises, most of these companies failed and they were sold to multinationals and others.

There is massive unemployment in this country and it is about time we really supported the private sector to create jobs to employ people.

Talking about unemployment let us take International Tobacco Ghana Ltd as a case study.

This company once belonged to Mr. Benjamin Amponsah Mensah.

It was taken away from him and run as a State enterprise and eventually sold to British American Tobacco.

At the moment, British American Tobacco has closed down their factory in Takoradi and produce their cigarettes for the Ghana Market in the Republic of South Africa. Some of us believe that if this factory was owned by Ghanaians, for the sake of patriotism, it will still be run but at a lesser profit till things turn around.

If we are saying that we believe that the private sector is the engine of growth and our country is the gateway to West Africa, it is high time we stopped paying lip service and really support the private sector especially Plantation Agriculture and the manufacturing sector in terms of finance to create wealth and employment.

Link to allAfrica.com: Ghana: Have We Really Supported the Private Sector? (Page 1 of 1)