Nkrumah's Trade Policy
Accra. October 9, 1960
As promised on my return to Ghana three days ago, I have come tonight to report to you of my visit to the United Nations General Assembly. Before doing so however, I wish to refer to a situation that has developed while I have been away. A number of statements appear to have been made by unauthorized persons and organisations regarding Ghana’s economic policy. These statements have culminated in a malicious newspaper article. Under the headline "Ghana Seizing All Foreign Firms" appearing in The News Chronicle on October 7th, an article written by one Mr. Norman Clark, who fled the country before the publication, alleges that "Ghana will decide to nationalise all foreign business firms and that the take-over will commence on May 1st and be completed in three years." This publication, I must say with all the emphasis at my command, is pernicious, wicked and deliberately calculated to damage the reputation and good faith which Ghana has built up. I know that our friends both here and abroad will not countenance such a publication or give it even the slightest credence.
I have stated on many occasions that the Government’s policy is aimed at evolving a socialist pattern of society, no secret has been made of this fact. I have also stated that there are different paths to socialism, that each country must find its own way and that socialism could differ in form from one country to another. Ghana intends to evolve its own socialist pattern of society adapted to its own particular needs.
I now wish to reaffirm and to clarify beyond any doubt the Government’s economic policy. In my message to the National Assembly of the 2nd September, this year, I defined the respective roles of the capital which is available within Ghana, and of capital which comes from abroad I stated that the economic structure divided into four different sectors. First, the State-owned sector; second, the Joint State-Private Enterprise sector; third, the Cooperative sector and fourth, the purely Private sector. I also stated that the Government intends to place far greater emphasis on the development of Ghanaian Co- operatives rather than encourage Ghanaians to start private business enterprises.
I will now elaborate on the policy in regard to each of these sections. First, the I State-owned sector. In previous statements I have made, I have defined this sector as embracing specific industries reserved to the State. Such industries include the manufacture of arms and ammunition, alcoholic beverages and the operation of facilities such as electricity, water supplies hydro-electric projects etc. It also includes industries of a pioneering nature which private enterprise is unwilling or unable to undertake. These industries will be undertaken by the Industrial Development Corporation. It has also been decided that the wholly owned subsidiaries of the Industrial Development Corporation will be retained permanently by that Corporation, on behalf of the State, and not handed over to private enterprise.
The second sector, joint-Private Enterprise, is intended to include those industries which, by their nature, make it essential for the state to hold a substantial interest in them either because they confer monopoly rights on their owners, or demand substantial protective tariffs. This sector will also include those industries which the private enterprise partners are unwilling or unable-to undertake without Government participation.
Ghanaian enterprise in all fields. In the past, the Government has given considerable assistance to Ghanaian private enterprise but the result has been negligible and disappointing. So disappointing, in fact that the Government feels that its assistance must be channelled in a more productive manner. My statement of the 2nd September and the Government’s intentions regarding Ghanaian private enterprise mean no more or less than was stated. It does not mean that Ghanaian private enterprise is to be nationalised but it must now stand on its own feet and not rely on the Government for its development. With regard to the distributive retail trades, the Government intends to foster cooperatives to enter this field both wholesale and retail. Fears have been expressed however that the Government intends to introduce import restrictions to assist the co-operatives in their developments. This is not so, the cooperatives must develop side by side with private enterprise either overseas or Ghanaian owned, in a freely competitive manner. I am quite satisfied that the large overseas firms are genuinely encouraging the growth of Ghanaian retail trade and that they will continue to do so.
Lastly, the purely private enterprise sector. For the reasons I have mentioned in relation to the Cooperative sector, this purely private enterprise sector mainly concerns investment from abroad. It is an accepted fact that there is not sufficient capital in the world to provide for the needs of all the developing countries which need it. This capital is therefore highly selective and tends to go where it feels it is welcome. I wish to leave no doubt in anybody’s mind that the Ghana Government accepts these facts, needs capital investment from all sources and welcomes it. It has been brought to my notice that overseas investors have been in some doubt as to their welcome, due to views expressed on exploitation. I now wish to direct the following remarks more particularly to my fellow countrymen. The Government receives by way of Company Tax eight shillings in every pound of profits made by companies both Ghanaian and overseas established in Ghana. This is equivalent to a 40 per cent non-voting shareholding for which the Government invests no capital. Overseas capital invested in companies in Ghana, provides holdings, plant and machinery which remain permanently in Ghana and become immediate assets of Ghana. In most cases, a large proportion of the turn-over of an industrial company remains in Ghana in the form of wages and salaries to employees. These wages and salaries in turn attract taxation and purchasing power which encourage further enterprises. In good companies, of which there are many, a share of the profits is ploughed back into the company l for development of its enterprises. This is, in fact, further investment. If there are fears of permanent foreign domination in the economy, these fears should be immediately and permanently abandoned. The Government has already taken adequate measures by limiting the tenure of leases and concessions and by clearing foreign elements from the ownership of land. It must be borne in mind however, that the duration of leases and concession must be balanced against the encouragement of overseas capital in such a way as to guarantee a reasonable return for the investment.
The Government recognises and accepts the fact that, overseas firms investing in Ghana have a duty to their shareholders, many of them small shareholders, to protect their investment and provide a return in the form of dividends to them. The Government is willing to take measures to assure each shareholder of protection and will welcome suggestions and advice on this matter from overseas companies through the Chamber of Commerce. I now wish to say a word about Chambers of Commerce. There are at present two Chambers, one for Ghanaian interests and one for overseas. The Government considers that this situation is anomalous in a country which is opposed to discrimination in any form and I have, therefore, today issued directions that the Government will only recognise one Chamber of Commerce to represent all private interests in Ghana.
The policy I have just outlined remains the basic policy of the Government in respect of the development of the economy of Ghana; Ghana wants to live at peace with all nations. We expect that all Governments represented here in Ghana will respect our policy of neutralism and non-alignment and will refrain from using the soil of Ghana as a platform for propaganda against another.
In this regard, Ghanaians should not allow themselves to be used as tools or saboteurs for subversive activities against their own Government and country. The Government will take appropriate step to arrest any such tendency in Ghana. And now may I revert to my recent visit to the United Nations: Africa is passing through the most momentous period in its history. The forces of colonialism and imperialism are fast retreating from our continent in the wake of the nationalist movement which is now sweeping the entire continent. However, the battle against colonialism is not yet over and day by day, we become increasingly aware of new forms of colonialism which are beginning to emerge in different parts of the continent. In such a circumstance, it is essential that the voice of Ghana and the voice of Africa should be heard unequivocally in the United Nations, especially in a time like this. These were the reasons why l decided this year to go to the United Nations.
The year 196O has been described as Africa Year in the United Nations. At the present session of the General Assembly, fifteen new Africa States have been admitted to membership of the United Nations. More are to come. We congratulate the new States of Africa as they begin their career in the international sphere and we hope that they will all join in working together for the political unity of our continent and in projecting the African personality in current international affairs. African States must either federate and survive or disintegrate and perish i.e. selling themselves to their former colonial masters or to some other foreign powers. I believe that a Union of the independent African States is not only necessary but vital to the maintenance of our independence and sovereignty. It is only if we are united that we can develop our resources and potentialities to our mutual benefit. We can also use our united strength to plead the cause of peace and secure the common, objectives which we all seek.
The grave issues facing the United Nations today, and in fact the entire world, are among others the situation in the Congo, the eradication of colonialism in all its forms from the continent of Africa, and, thirdly, the problem of disarmament. These are the problems upon which the peace and security of the world now depends and it is imperative that immediate solutions must be found to these problems. France’s nuclear test in the Sahara Algeria, South African apartheid policy, the problem of South West Africa, and a capital development fund for Africa under United Nations auspices.
I have stated elsewhere that a capital development fund for newly independent African States should be established as soon as possible within the United Nations. This would enable the newly independent States to borrow money from the development fund at lower interest than can now be obtained elsewhere, and would also enable the newly independent African States to carry on their economic development independently without being obliged to take sides in the cold war created by the East and West conflict. In my address to the General Assembly on the 23rd of September, I proposed among other things the replacement of the United Nations Command in the Congo with a strong command with clear directions to support the legally constituted government of the Congo, the disarmament of private armies, guaranteeing by the United Nations of the territorial integrity of the Congo and the channelling of all financial assistance through the United Nation to be supervised by a Committee of Independent African State appointed by the Security Council.
In so far as Ghana’s own efforts in the Congo are concerned, I am convinced, that for a speedy resolution of the problems involved, Ghana troops must not be impeded in the carrying out of their duties under the command of the United Nations and they must under no circumstances be removed from Leopoldville: that the Congolese Parliament must be allowed to function as the only legally constituted authority deriving its mandate from the Congolese people; that there must be immediate withdrawal of the Belgian troops still lingering on in the Congo Republic, and surreptitiously re-arming the Force Publique that private radio stations sponsored by imperialist powers operating from Brazzaville should be eliminated; that financial assistance should be provided to Lumumba and his legally constituted Government, and the last but by no means the least, the duly elected representatives of the legitimate Lumumba Government should be left free to take their seats at the United Nations.
With regard to colonialism and the problem of disarmament, my experience in the United Nations has reinforced my conviction that the time has come when Independent States of Africa should get together at the highest level to declare to the world our views and our position on these problems. Colonialism today is the basis of all the fears and tensions which now afflict the nations of the world. As long as colonialism continues to exist in Africa, the colonial and imperialist powers will do everything in their power to maintain their spheres of influence because they are afraid that the freedom and independence of African peoples and the forward movement of progressive ideas in the present day Africa are a danger to their prestige and influence in the world.
Colonialism has created fear and fear has led to the armaments race, thus the problem of disarmament is closely connected with the eradication of colonialism from Africa. As soon as possible, I will take steps to consult with the Heads of States of the various Independent African States with a view to convening a conference on about these two vital issues of colonialism and the problem of disarmament, and to declare the position of Africa on these issues. I am convinced that such a conference is vitally essential at this time, and it is the only way by which the States of Africa can contribute to the solution of these great issues which confront the United Nations and the world.
During the fortnight I spent in New York, I held personal discussions with President Eisenhower of the United States of America and Prime Minister Nikita Khrushchev of the Soviet Union. In these discussions, I explained to them the position of Ghana with regards to the issues affecting peace and security in the world today and especially the situation in the Congo, the eradication of colonialism and the problem of disarmament. The question of disarmament centres around the twin problems of inspection and control. To me, any distinction between them is arguing which comes first, the hen or the egg. Whichever comes first, the other must automatically and immediately follow.
I also had several discussions with President Nasser of the United Arab Republic, President Tito of Yugoslavia, Prime Minister Nehru of India, President Sukamo of Indonesia, Prime Minister Harold Macmillan of the United Kingdom, Prime Minister Diefenbaker of Canada Prime Minister Menzies of Australia and Prime Minister Nash of New Zealand. I also conferred with the Heads of Delegations of the various independent African States including the new African States who were recently admitted into the United Nations.
On Thursday, the 29th of September, Prime Minister Nehru of India, President Nasser of the United Arab Republic, President Tito of Yugoslavia and President Sukarno of Indonesia and I put forward a resolution to the United Nations in which we called upon the President of the United States of America and the Chairman of the Council of Ministers of the Union of Soviet Socialist Republics to renew their contacts which were interrupted recently, so that their declared willingness to find solutions to the outstanding problems by negotiation may be continued I am sure that the action we took contributed in no small measure to the reduction of tension that existed in the United Nations.
I also proposed that the independent African States, together with other States who adhere to a policy of positive neutralism and non-alignment should form themselves into a naturalistic group of non-committed nations within the United Nations so as to perform the role of a third force or a balancing influence between the Eastern and the Western blocs into which the world is at present divided.
This proposal is being seriously considered by the non-committed States in the United Nations as a basis of policy and action in our common effort to ensure peace and security in international relations. In all these matters, I want to re-emphasise the point that I am more than ever convinced that Ghana has a mission to fulfill in Africa and a decisive role to play in world affairs. To achieve these objectives, it is necessary for us to maintain the national unity which we have been able to achieve and work harder than ever before towards the economic, technological and industrial development of our country. In this great task for national development, I call upon every man, every woman, our farmers, our workers and Trade Unions the Cooperative Societies the teachers in our schools and institutions of learning, educators and politicians to direct their energies to bringing about the total elimination of poverty, disease and misery in Ghana.
I have no doubt that you, my people of Ghana, will rise up to these new tasks. May Providence abide with us in our efforts to make Ghana a country worthy of its people and of Africa.
As promised on my return to Ghana three days ago, I have come tonight to report to you of my visit to the United Nations General Assembly. Before doing so however, I wish to refer to a situation that has developed while I have been away. A number of statements appear to have been made by unauthorized persons and organisations regarding Ghana’s economic policy. These statements have culminated in a malicious newspaper article. Under the headline "Ghana Seizing All Foreign Firms" appearing in The News Chronicle on October 7th, an article written by one Mr. Norman Clark, who fled the country before the publication, alleges that "Ghana will decide to nationalise all foreign business firms and that the take-over will commence on May 1st and be completed in three years." This publication, I must say with all the emphasis at my command, is pernicious, wicked and deliberately calculated to damage the reputation and good faith which Ghana has built up. I know that our friends both here and abroad will not countenance such a publication or give it even the slightest credence.
I have stated on many occasions that the Government’s policy is aimed at evolving a socialist pattern of society, no secret has been made of this fact. I have also stated that there are different paths to socialism, that each country must find its own way and that socialism could differ in form from one country to another. Ghana intends to evolve its own socialist pattern of society adapted to its own particular needs.
I now wish to reaffirm and to clarify beyond any doubt the Government’s economic policy. In my message to the National Assembly of the 2nd September, this year, I defined the respective roles of the capital which is available within Ghana, and of capital which comes from abroad I stated that the economic structure divided into four different sectors. First, the State-owned sector; second, the Joint State-Private Enterprise sector; third, the Cooperative sector and fourth, the purely Private sector. I also stated that the Government intends to place far greater emphasis on the development of Ghanaian Co- operatives rather than encourage Ghanaians to start private business enterprises.
I will now elaborate on the policy in regard to each of these sections. First, the I State-owned sector. In previous statements I have made, I have defined this sector as embracing specific industries reserved to the State. Such industries include the manufacture of arms and ammunition, alcoholic beverages and the operation of facilities such as electricity, water supplies hydro-electric projects etc. It also includes industries of a pioneering nature which private enterprise is unwilling or unable to undertake. These industries will be undertaken by the Industrial Development Corporation. It has also been decided that the wholly owned subsidiaries of the Industrial Development Corporation will be retained permanently by that Corporation, on behalf of the State, and not handed over to private enterprise.
The second sector, joint-Private Enterprise, is intended to include those industries which, by their nature, make it essential for the state to hold a substantial interest in them either because they confer monopoly rights on their owners, or demand substantial protective tariffs. This sector will also include those industries which the private enterprise partners are unwilling or unable-to undertake without Government participation.
Ghanaian enterprise in all fields. In the past, the Government has given considerable assistance to Ghanaian private enterprise but the result has been negligible and disappointing. So disappointing, in fact that the Government feels that its assistance must be channelled in a more productive manner. My statement of the 2nd September and the Government’s intentions regarding Ghanaian private enterprise mean no more or less than was stated. It does not mean that Ghanaian private enterprise is to be nationalised but it must now stand on its own feet and not rely on the Government for its development. With regard to the distributive retail trades, the Government intends to foster cooperatives to enter this field both wholesale and retail. Fears have been expressed however that the Government intends to introduce import restrictions to assist the co-operatives in their developments. This is not so, the cooperatives must develop side by side with private enterprise either overseas or Ghanaian owned, in a freely competitive manner. I am quite satisfied that the large overseas firms are genuinely encouraging the growth of Ghanaian retail trade and that they will continue to do so.
Lastly, the purely private enterprise sector. For the reasons I have mentioned in relation to the Cooperative sector, this purely private enterprise sector mainly concerns investment from abroad. It is an accepted fact that there is not sufficient capital in the world to provide for the needs of all the developing countries which need it. This capital is therefore highly selective and tends to go where it feels it is welcome. I wish to leave no doubt in anybody’s mind that the Ghana Government accepts these facts, needs capital investment from all sources and welcomes it. It has been brought to my notice that overseas investors have been in some doubt as to their welcome, due to views expressed on exploitation. I now wish to direct the following remarks more particularly to my fellow countrymen. The Government receives by way of Company Tax eight shillings in every pound of profits made by companies both Ghanaian and overseas established in Ghana. This is equivalent to a 40 per cent non-voting shareholding for which the Government invests no capital. Overseas capital invested in companies in Ghana, provides holdings, plant and machinery which remain permanently in Ghana and become immediate assets of Ghana. In most cases, a large proportion of the turn-over of an industrial company remains in Ghana in the form of wages and salaries to employees. These wages and salaries in turn attract taxation and purchasing power which encourage further enterprises. In good companies, of which there are many, a share of the profits is ploughed back into the company l for development of its enterprises. This is, in fact, further investment. If there are fears of permanent foreign domination in the economy, these fears should be immediately and permanently abandoned. The Government has already taken adequate measures by limiting the tenure of leases and concessions and by clearing foreign elements from the ownership of land. It must be borne in mind however, that the duration of leases and concession must be balanced against the encouragement of overseas capital in such a way as to guarantee a reasonable return for the investment.
The Government recognises and accepts the fact that, overseas firms investing in Ghana have a duty to their shareholders, many of them small shareholders, to protect their investment and provide a return in the form of dividends to them. The Government is willing to take measures to assure each shareholder of protection and will welcome suggestions and advice on this matter from overseas companies through the Chamber of Commerce. I now wish to say a word about Chambers of Commerce. There are at present two Chambers, one for Ghanaian interests and one for overseas. The Government considers that this situation is anomalous in a country which is opposed to discrimination in any form and I have, therefore, today issued directions that the Government will only recognise one Chamber of Commerce to represent all private interests in Ghana.
The policy I have just outlined remains the basic policy of the Government in respect of the development of the economy of Ghana; Ghana wants to live at peace with all nations. We expect that all Governments represented here in Ghana will respect our policy of neutralism and non-alignment and will refrain from using the soil of Ghana as a platform for propaganda against another.
In this regard, Ghanaians should not allow themselves to be used as tools or saboteurs for subversive activities against their own Government and country. The Government will take appropriate step to arrest any such tendency in Ghana. And now may I revert to my recent visit to the United Nations: Africa is passing through the most momentous period in its history. The forces of colonialism and imperialism are fast retreating from our continent in the wake of the nationalist movement which is now sweeping the entire continent. However, the battle against colonialism is not yet over and day by day, we become increasingly aware of new forms of colonialism which are beginning to emerge in different parts of the continent. In such a circumstance, it is essential that the voice of Ghana and the voice of Africa should be heard unequivocally in the United Nations, especially in a time like this. These were the reasons why l decided this year to go to the United Nations.
The year 196O has been described as Africa Year in the United Nations. At the present session of the General Assembly, fifteen new Africa States have been admitted to membership of the United Nations. More are to come. We congratulate the new States of Africa as they begin their career in the international sphere and we hope that they will all join in working together for the political unity of our continent and in projecting the African personality in current international affairs. African States must either federate and survive or disintegrate and perish i.e. selling themselves to their former colonial masters or to some other foreign powers. I believe that a Union of the independent African States is not only necessary but vital to the maintenance of our independence and sovereignty. It is only if we are united that we can develop our resources and potentialities to our mutual benefit. We can also use our united strength to plead the cause of peace and secure the common, objectives which we all seek.
The grave issues facing the United Nations today, and in fact the entire world, are among others the situation in the Congo, the eradication of colonialism in all its forms from the continent of Africa, and, thirdly, the problem of disarmament. These are the problems upon which the peace and security of the world now depends and it is imperative that immediate solutions must be found to these problems. France’s nuclear test in the Sahara Algeria, South African apartheid policy, the problem of South West Africa, and a capital development fund for Africa under United Nations auspices.
I have stated elsewhere that a capital development fund for newly independent African States should be established as soon as possible within the United Nations. This would enable the newly independent States to borrow money from the development fund at lower interest than can now be obtained elsewhere, and would also enable the newly independent African States to carry on their economic development independently without being obliged to take sides in the cold war created by the East and West conflict. In my address to the General Assembly on the 23rd of September, I proposed among other things the replacement of the United Nations Command in the Congo with a strong command with clear directions to support the legally constituted government of the Congo, the disarmament of private armies, guaranteeing by the United Nations of the territorial integrity of the Congo and the channelling of all financial assistance through the United Nation to be supervised by a Committee of Independent African State appointed by the Security Council.
In so far as Ghana’s own efforts in the Congo are concerned, I am convinced, that for a speedy resolution of the problems involved, Ghana troops must not be impeded in the carrying out of their duties under the command of the United Nations and they must under no circumstances be removed from Leopoldville: that the Congolese Parliament must be allowed to function as the only legally constituted authority deriving its mandate from the Congolese people; that there must be immediate withdrawal of the Belgian troops still lingering on in the Congo Republic, and surreptitiously re-arming the Force Publique that private radio stations sponsored by imperialist powers operating from Brazzaville should be eliminated; that financial assistance should be provided to Lumumba and his legally constituted Government, and the last but by no means the least, the duly elected representatives of the legitimate Lumumba Government should be left free to take their seats at the United Nations.
With regard to colonialism and the problem of disarmament, my experience in the United Nations has reinforced my conviction that the time has come when Independent States of Africa should get together at the highest level to declare to the world our views and our position on these problems. Colonialism today is the basis of all the fears and tensions which now afflict the nations of the world. As long as colonialism continues to exist in Africa, the colonial and imperialist powers will do everything in their power to maintain their spheres of influence because they are afraid that the freedom and independence of African peoples and the forward movement of progressive ideas in the present day Africa are a danger to their prestige and influence in the world.
Colonialism has created fear and fear has led to the armaments race, thus the problem of disarmament is closely connected with the eradication of colonialism from Africa. As soon as possible, I will take steps to consult with the Heads of States of the various Independent African States with a view to convening a conference on about these two vital issues of colonialism and the problem of disarmament, and to declare the position of Africa on these issues. I am convinced that such a conference is vitally essential at this time, and it is the only way by which the States of Africa can contribute to the solution of these great issues which confront the United Nations and the world.
During the fortnight I spent in New York, I held personal discussions with President Eisenhower of the United States of America and Prime Minister Nikita Khrushchev of the Soviet Union. In these discussions, I explained to them the position of Ghana with regards to the issues affecting peace and security in the world today and especially the situation in the Congo, the eradication of colonialism and the problem of disarmament. The question of disarmament centres around the twin problems of inspection and control. To me, any distinction between them is arguing which comes first, the hen or the egg. Whichever comes first, the other must automatically and immediately follow.
I also had several discussions with President Nasser of the United Arab Republic, President Tito of Yugoslavia, Prime Minister Nehru of India, President Sukamo of Indonesia, Prime Minister Harold Macmillan of the United Kingdom, Prime Minister Diefenbaker of Canada Prime Minister Menzies of Australia and Prime Minister Nash of New Zealand. I also conferred with the Heads of Delegations of the various independent African States including the new African States who were recently admitted into the United Nations.
On Thursday, the 29th of September, Prime Minister Nehru of India, President Nasser of the United Arab Republic, President Tito of Yugoslavia and President Sukarno of Indonesia and I put forward a resolution to the United Nations in which we called upon the President of the United States of America and the Chairman of the Council of Ministers of the Union of Soviet Socialist Republics to renew their contacts which were interrupted recently, so that their declared willingness to find solutions to the outstanding problems by negotiation may be continued I am sure that the action we took contributed in no small measure to the reduction of tension that existed in the United Nations.
I also proposed that the independent African States, together with other States who adhere to a policy of positive neutralism and non-alignment should form themselves into a naturalistic group of non-committed nations within the United Nations so as to perform the role of a third force or a balancing influence between the Eastern and the Western blocs into which the world is at present divided.
This proposal is being seriously considered by the non-committed States in the United Nations as a basis of policy and action in our common effort to ensure peace and security in international relations. In all these matters, I want to re-emphasise the point that I am more than ever convinced that Ghana has a mission to fulfill in Africa and a decisive role to play in world affairs. To achieve these objectives, it is necessary for us to maintain the national unity which we have been able to achieve and work harder than ever before towards the economic, technological and industrial development of our country. In this great task for national development, I call upon every man, every woman, our farmers, our workers and Trade Unions the Cooperative Societies the teachers in our schools and institutions of learning, educators and politicians to direct their energies to bringing about the total elimination of poverty, disease and misery in Ghana.
I have no doubt that you, my people of Ghana, will rise up to these new tasks. May Providence abide with us in our efforts to make Ghana a country worthy of its people and of Africa.
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