Local Content Policy in Ghana:Impact on Business Development,Lessons and the Way Forward

摘要

The discovery of oil is,in recent times,received with cautious optimism due to its history of affecting resource-rich countries in both positive and negative ways.Whilst it could be a great blessing(Norway,Brazil,Saudi Arabia),it has shown in most cases that it could be a curse that can eventually drag an entire nation down through corruption,poverty,conflicts and environmental destruction(Indonesia,Nigeria,Sudan,Angola).It is for this reason,known as the paradox of plenty(Karl,1997)that oil producing countries are making efforts to put measures in place to ensure that their oil resources become a blessing and compliment the wider developmental initiatives.One of such efforts is the use of a local content policy to ensure that resource-rich countries reap far reaching benefits beyond revenues and royalties.This objective is usually described as a value-adding local participation.The quest for total value-adding participation of indigenous people in the oil and gas industry otherwise known as local content is becoming very popular with resource-rich African countries as governments and policy makers try to reap the full benefits of their oil as much as possible.Notably,this popularity is hatched from the success stories of the likes of Norway and to some extent Brazil who are believed to have effectively capitalized on the phenomenon to enhance growth,transform their economies positively and create employment.Although the local content hype is catching up fast in recent times,it is not a new thing on the African continent.For more than a decade,several African countries have sought to adopt local content policies in one form or the other.Angola,in 2003,passed a legislation that all oil-related procurements are solely from Angolan companies.This legislation covered both goods and services and was aimed at getting local companies significantly involved in the industry’s activities.Equatorial Guinea also slammed a 35 per cent mandatory domestic shareholding on all international oil companies operating locally.