Insurgency in Northern Mali: Diplomacy or Counterinsurgency?

By Lord Aikins Adusei

The recent take over of Northern Mali by National Movement for the Liberation of Azawad (MNLA) and Al Qaeda franchise groups such Ansar Dine and Al Qaeda in the Islamic Maghreb (AQIM) present difficult challenge to the civilian and military leadership in West Africa. There is no question that AQIM working closely with Ansar Dine would use their new trophy i.e. northern Mali not only as a supermarket for terrorism but also to fuel kidnapping, drug trafficking and other contraband activities in the Sahel region and beyond. Therefore allowing them to use the region as a safe haven for terrorism and their criminal enterprise could worsen Mali’s security problems and threaten the already shaky stability in neighbouring countries of Algeria, Burkina Faso, Ivory Coast, Guinea, Mauritania, and Niger. At the same time a counterinsurgency offensive on the part of ECOWAS to dislodge the MNLA rebels and Ansar Dine could trigger multiplier effects that ECOWAS might not be ready for. It is a serious dilemma that needs to be approached with extreme caution.

In formulating a proper response to the Malian problem, the leadership in West Africa should be guided by lessons in Somaliawhere efforts to root out Al Shabaab have remained not only elusive but to a larger extent have been counterproductive: spreading terrorism to Uganda and Kenya. More lessons could be drawn from the U.S.experience in fighting the Taliban and Al Qaeda in Afghanistan. Paul Scharre, former officer of the U.S. 75th Ranger Regiment and the author of “A More Agile Pentagon” observes that the Afghan war was initially conducted with a “shock and awe” strategy using light and fast vehicles but that soon changed to the use of heavily armoured vehicles as Taliban and Al Qaeda began using improvised explosive devices (IEDs)and roadside bombs to destroy convoys, road clearance vehicles and even the most potent of the coalition armoured vehicles with impressive results and with strategic consequences for the U.S. led coalition.

NATO, with its well trained 150,000 strong fighters and overwhelmingly superior capabilities, in addition to 305,000 Afghan Police and Armed Forces could not easily win the war against the battle-hardened, religiously and ideologically entrenched Al Qaeda and Taliban fighters. A change in both strategy and leadership on the part of U.S.-- including a 30,000 troop surge in 2009-2010-- did not overwhelmingly alter the battle environment in favour of the coalition forces. In the end U.S.began to engage the Taliban in dialogue for a negotiated political settlement. In June 2011, after ten years in Afghanistan and hundreds of billions of dollars spent in the war effort, President Barack Obama announced that he was bringing the U.S.troops home telling Americans “it is time to focus on nation building here at home”.

President Obama's announcement was made in spite of the obvious fact that Afghanistanis still unstable. While writing this piece report came in that the Taliban on Monday August 20, 2012shot and damaged the parked plane of General Martin Dempsey, the top-most officer in the U.S.military. The attack came months after U.S. Defence Secretary Leone Panetta was made a target of a suicide attack in mid-March 2012 while on a visit to Camp Bastionin Afghanistan. It is highly uncertain what will happen in Afghanistan when the troops leave, however the U.S. willingness to engage the Taliban in dialogue for a political settlement is a major lesson that ECOWAS’ political and military leaders could learn from. In other words ECOWAS’ leaders should hesitate in launching counter offensive against the insurgents and give diplomacy a chance while keeping the military option on the table.

There are several reasons why ECOWAS must give diplomacy a chance. First AQIM, Ansar Dine and the MNLA rebels are not only unconventional fighting force that respect no rules of engagement but are also heavily armed and could put up stiff resistance to ECOWAS' counterinsurgency efforts. This means that combined with the difficult and hostile Saharaenvironment, it will be difficult to completely defeat them. The war could in fact drag on for years if not decades as pointed out by James Thomas Snyder author of “Counterinsurgency Vocabulary and Strategic Success” who notes that modern counterinsurgency warfare usually last between 12 and 15 years. Going by this it implies that ECOWAS will find it difficult to conduct and sustain a war that will last for 12 or 15 years especially given other serious threats in the sub region such as maritime piracy in the Gulf of Guinea, terrorism in Nigeria, fragile stability in Ivory Coast and narcotics trafficking that equally need human, financial and material resources to confront them.

Besides, counterinsurgency like any other war could be humanly costly. AQIM, Ansar Dine and MNLA may use guerrilla tactics; hide inside the populations living in the Gao, Kidal and Timbuktu thereby making it harder for ECOWAS’Forces to root them out. Attempt to attack the insurgents in the towns could lead to high civilian casualties which could be exploited by the insurgents to make the counterinsurgency unpopular among the population.

Additionally, a counterinsurgency could also worsen the already bad humanitarian situation in the north of the country. So far about 500,000 people are known to have fled their homes, additional 250,000 are internally displaced while a quarter of a million more live in refugee camps. More people could be forced to flee and the complicated food, water and health security situation could get worse.

Moreover, as it is common with many wars, the counterinsurgency environment can change very quickly with unpredictable outcomes. The insurgents could adapt to counterinsurgency offensive and even change the environment in their favour. They may decide to extend their activities to relatively stable areas in Maliand even to neighbouring countries. This is exactly what Al Shabaab did in Uganda on 11 July 2010 when they killed more than 85 people who had gathered to watch the FIFA World Cup that was underway in South Africa.Kenyahas come under similar attacks from Al Shabaab and Boko Haram recently extended its activities to states in the middle belt of Nigeria.

More problematic is the financial situation in the ECOWAS region. ECOWAS countries, like the rest of the countries worldwide, are cash trapped due to the global financial and economic downturn. Governments in West Africa, United Statesand Europe are implementing austerity budget and struggling to stay afloat. Launching a war against the insurgents will not only require men but also money and military capabilities. Sending poorly equipped 3,500 fighting force to a region as big as France or U.S. state of Texas will be similar to repeating what the Malian government did when it sent soldiers with poor morale, leadership shortcomings and limited capabilities to confront the heavily armed insurgents, resulting in the lightening victory for the insurgents.

Heavily armed Tuareg rebels and Ansar Dine control key northern cities of Gao, Kidal, Timbuktu

In other words undertaking a counterinsurgency that could be lengthy and costly, in a financially weak-region, and in a global economy that is still struggling to recover definitely needs deep thinking and a deeper reflection. General Martin Dempsey, Chairman of U.S. Joint Chiefs of Staff recently cautioned that the complexities of modern warfare particularly counterinsurgency require “leaders who do not think linearly, but who instead seek to understand the complexity of problems before seeking to solve them”. This means that politicians and military leaders in ECOWAS seeking solution for Mali should understand the situation before prescribing any solution.

Lieutenant General William B. Caldwell IV, commanding general of the NATO Training Mission in Afghanistan and Captain Nathan K. Finney in an article titled “Security, Capacity and Literacy” published in the journal ‘Military Review’ in 2011 opined that “conventional military weapons alone will not win” the war against AQIM, Ansar Dine and the Tuareg rebels. Similarly Tony Blair in a speech on January 12, 2007 observed that “Terrorism cannot be defeated by military means alone”.

This suggests that there are other weapons that in addition to dialogue could be used to defeat the insurgents. One such weapon is the use of intelligence. Intelligence could be beefed up in the region controlled by the insurgents. This could help ECOWAS to know the mind of the insurgents, their strategy, tactics, their movements, weapons and their operational capabilities. Intelligence could also help to identify the leadership of the insurgent for special attention and to counter their propaganda.

In his book “The War within”, Bob Woodward observed that the strategy of using accurate intelligence to conduct precision raids, targeting insurgent leaders helped to turn the tide in Iraq. Abu Musab al-Zarqawi and the threats he and other Al Qaeda leaders posed in Iraq were removed with the help of intelligence. Thus intelligence fusion and precision raiding focusing strongly on the leadership of insurgent could weaken the terror group’s ability to mount effective response. Intelligence could alsolimit damage and bloodshed and unnecessary civilian casualties. Although Ansar Dine may quickly replace their captured or killed leaders, the new leaders may lack experience and skill which will affect their decision making and ability to wage a sustained war. Intelligence could also help to dismantle the drug trafficking, kidnapping and other criminal activities that serve as a key source of funding for the insurgents.

Also a strategy could be adopted to divide the front of the insurgents. There are two broad groups involved in the insurgency in northern Mali: Tuareg rebels and Ansar Dine. The Tuareg rebels are fighting for a homeland while the Ansar Dine is religiously fanatical organisation with links to AQIM that is seeking a haven to implement terror agenda in northern Mali. In other words the Tuareg rebels and Ansar Dine have different objectives when it comes ruling their captured territory. ECOWAS could exploit the deep differences the two groups have. For example ECOWAS could isolate Ansar Dine by talking to Tuareg rebels and working with them to implement the terms of the agreement they signed with the government in 2006. Energy then could be directed at AQIM and Ansar Dine.

Working with local leaders and improving governance could serve ECOWAS well. Local leaders could be of strategic value to ECOWAS’ forces regarding intelligence, and mobilising the people against the insurgents. Mark F. Cancian, a former Colonel in the U.S. Marine Corps Reserve, notes that in the Iraqi province of Al Anbar it was the involvement of the local leaders ‘Awakening sheiks’ that turned the war in U.S. favour in late 2006 and early 2007.

Similarly addressing poverty, inequality and underdevelopment in northern Mali could strategically tilt the hearts and minds of the population away from MNLA and Ansar Dine. By all account northern Mali is relatively poor compared to the south of the country. The lack of development combined with minimal government presence undoubtedly contributed in the takeover of the region by MNLA, AQIM and Ansar Dine. Thus improving food security, water, energy and health security and general infrastructure such as roads, education, irrigation and housing in northern Malicould win the population over to the ECOWAS and alienate the insurgents.

More crucial is building the capabilities of the Malian Police to provide security for the civilian population. The Police having operated in the cities in the north for years may know the leadership of the insurgents, where they live and could therefore provide useful information for their arrest. Building the capabilities of Mali’s 7000 poorly equipped and poorly remunerated soldiers and restoring the soldiers’ morale could tilt the balance of power in ECOWAS favour should full scale counterinsurgency become the last resort. In other words security must go hand in hand with governance and development. The three are what Bruce Hoffman and Seth G. Jones have termed “the holy trinity of counterinsurgency”.

Lord Aikins Adusei, politicalthinker1@yahoo.com

Ghanaians still in shock over Mills’ death

From Sebastian R. Freiku and Issah Alhassan, Kumasi

The death of His Excellency John Evans Atta Mills has come as a shock to many residents in Kumasi, the Ashanti Regional capital.

A few minutes after the rumour started, specifically from the social media platform like Facebook, about the sudden death of the President, many approached the information with cautious belief, with some speculating it was one of the usual buzzes that often surfaced about the late President.
Calls were made to friends, relatives and particularly the regional office of The Chronicle, seeking confirmation of the rumour about the demise of the President.
By 3 p.m. when it became apparent that the President was indeed dead, the mood and atmosphere in the Metropolis changed to that of sadness and sorrow.
While many immediately expressed dismay at the news, particularly considering the fact that the President recently arrived from medical check-up from the United States feeling healthier, others did not hide the fact that the leadership of government was the cause of the death of the late President.
Barely a day after the sad event, most people, particularly the self employed, who were in a moody situation and clad in mourning apparel took yesterday off their normal duties to mourn the late President in silence throughout the day.
Many public and private functions, which were scheduled to take place yesterday, were also canceled because of the sudden news of the death of the President. From drinking joints, lorry stations and inside commercial vehicles, the death of the President became the topic for discussion, with people expressing divergent views about circumstances that must have led to his sudden demise.
Some were of the opinion that the power brokers in government should have told the whole public the truth about the President’s health status, rather than keeping it secret, while others also said it was prudent security-wise, for the public to have been kept in the dark about the health condition of the late President.                                                                                                                           The paper has been speaking to some key political figures and personalities who have had association with the late President and his government.
The ex-Nifahen of the Mfantseman Council in the Ashanti Region, and an opinion leader in the Mfantseman community in Kumasi, Nana Ninsin-Imbeah II, said the whole Mfantse community in Kumasi was distressed by the news of the death of one of their own.
“I became speechless when I heard the news, the whole of today I have not gone out, I have not been able to go to work because I am still in shock,” Nana Imbeah lamented.
He observed that though he was privy to the unfortunate health status of someone who he said he had association with, he did not know that death was going to visit him so soon.
“We were expecting that at least the President would live to contest this year’s elections, but it was never to be,” Nana Imbeah bewailed and expressed the hope that the state protocol will put the necessary arrangements in place for the state to mourn and give him a befitting burial and funeral.
The former District Chief Executive of Sekyere East, Mr. Kwadwo Addae, said he could not believe his ears when he heard the news and had to do several calls to top rank government officials for confirmation.
He said the entire Sekyere East district and other adjoining towns were in a shock when the news broke.
Giving his personal testimony about the late President, Mr. Adae said he would fondly remember the late President for his humility and the fact that he gave him the opportunity to serve in his government.
A founding member of the opposition New Patriotic Party (NPP), Mr. George Ayisi-Boateng, said he was equally flustered when he heard the news of the President’s death. He said though he was a political opponent, he never wished that this should happen to the President, the NDC or the entire country.
“Death is not a good thing but God knows best, we wish he had stayed, but what God has arranged, man can do nothing about it,” he noted.
The NPP founding member said he was not, however, happy with the way leadership of government and top officials decided to deceive Ghanaians with the health status of the late President.
Mr. Ayisi-Boateng expressed the hope that the death of the President will unite the country and forge us ahead towards peace and tranquility in the upcoming elections.
The chairman of the erstwhile UK-based Ghana Democratic Movement (GDM), Mr. Alex Asabre, currently on short holidays in Ghana, expressed his heartfelt condolences to the bereaved family and wife of the late Prof. Mills, who he described as a great man.
Nana Karikari Appau II, Omanhene of Bekwai Traditional Area, noted that the untimely death of the late President was shocking and hoped Prof. Mills, who stood for  peace, sincerity and  honesty would be accorded a fitting funeral in his honour. He consoled with the family and urged the government to maintain the peace and unity of the people.
Mr. Patrick Adu Gyamfi, Bekwai NPP Constituency chairman and his executives have called on the local NDC constituency chairman, NDC constituency executives and the Bekwai Municipal Chief Executive to express sympathies of the NPP on the death of the President.
From the Afigya Kwabre district, Simmons Yussif Kewura reports that Mr. Badu Adu Boahene, Suame NPP constituency chairman was shocked at the death of President Mills. He said Prof. Mills was a good leader by all standards, and that his death was a great loss to the nation.  He said the late President would be remembered for his humility.
An NDC activist, Stephen Osei Owusu, who could not control himself, said the death of the law Professor was very painful.
Mr. Mohammed Loni, Kronum branch Organizer of the NDC said as painful as the news is, Ghanaians should take consolation in the fact that death is imminent. He said President Mills took Ghana on the path of development through his Better Ghana Agenda and hoped President Mahama can continue where his former boss left off and win the 2012 elections for the NDC.
Meanwhile, Ernest Best Anane, reports that the National House of Chiefs yesterday postponed its second general meeting to mourn with the people of Ghana, the wife and family of the late President of the Republic of Ghana, after His Excellency J.E.A. Mills passed away on Tuesday.
Prof. Naa S. Nabila, President of the National House of Chiefs, on behalf of the traditional authorities of Ghana expressed condolences to all the people of Ghana, especially the wife and family of President J. E. A. Mills.
The Standing Committee of the National House of Chiefs stated that the committee received the devastating news of the President’s death during their meeting in Kumasi.
The Committee recalled with nostalgia how only  four weeks ago (on June 29, 2012) the members of the Standing Committee had the opportunity to call on President Mills to welcome him back home, after his return from the United States, where he had undergone  medical check-up, and to wish him good health.
The National House of Chiefs expressed appreciation to Prof. Mills for responding to their appeal by contributing GH¢500,000.00 as seed capital for the establishment of House of Chiefs Endowment Fund endowment fund.
By his death, “Ghana has indeed lost a great statesman”, the chiefs emphasized, saying that since he was sworn-in as President in January 2009, “he (President Mills) worked so much, and worked so hard, to ensure the continued peace and stability for the development of the country.”
Northern Region
From Tamale Edmond Gyebi, reports that the former Vice President, Alhaji Aliu Mahama has asked Ghanaians living in and outside Ghana to see the sudden demise of the late President, John Evans Atta Mills as “national disaster” and offer their support to the bereaved family.
He described the Late Professor as father and mentor for many Ghanaians, and thus his untimely death was a big blow to Ghana, and more especially his family and the ruling National Democratic Congress (NDC).
Speaking in an interview with The Chronicle, the former Vice President said he was deeply shocked and could not do anything than to stand in awe for minutes, immediately the news got to him about the death of the President.
“Even though I and many Ghanaians were aware that he was not well for sometime now, I least expected him to join his ancestors so soon. But all the same, I send my condolence to the Widow and former First Lady, Ernestina Naadu Mills, the entire family, the NDC as a party and all Ghanaians who are now in a state of mourning”.
Alhaji Aliu Mahama told The Chronicle that just as the New Patriotic Party’s Flagbearer, Nana Addo Dankwa Akufo-Addo had suspected his campaign activities as a result of the death of Prof Mills, he had also kept all his activities and meetings on hold, and at the time of speaking to the paper, he had joined other NPP families to pay a visit to the widow.
He, however, added his voice to the call for peaceful general elections, and charged Ghanaians to allow the virtues of the Late President as man of peace to permeate their conscience and to ensure that there was peace in Ghana during and after the polls.
Meanwhile, the demise of the President of the Republic of Ghana, His Excellency Prof John Evans Atta Mills still remains a shock to members of the ruling NDC, opposition party members and other citizens within the Tamale Metropolis.
Several people, including government officials, motor riders, taxi drivers and party loyalists are still seen wearing red bands to signify their love, respect and loyalty to the Late President. Most government offices, including the Northern Regional Coordinat red flags and all street-lights in the Metropolis have been switched on since 3:00 pm on 24th July, 2012, till now.
The Chief of Tamale, Naa Alhassan Mahamudu Dawuni, said it was initially a rumour until around 5:00pm when the BBC and other radio stations in Accra broke the news through their affiliate stations in Tamale.
The Chief described the Late Prof Mills as “first class gentleman” and expressed his admiration of his humility and way of speaking.
The Metropolitan Chief Executive (MCE) for Tamale, Alhaji Abdulai Haruna Friday was also caught up by this paper in his office with red band around his neck, and surrounded by most of his honourable assembly members consoling him.
The Mayor told The Chronicle that he had had the opportunity to work with the late Prof Mills even before he became the President, and he eventually made him a mayor.
The Northern Regional Chairman of the NDC, Awudu Sofo Azorka in an interview with The Chronicle also said he was yet to accept the fact that the President was dead until he personally sees his corpse.
According to him, he spoke to the President few days before the news broke out and he was supposed to meet him at the Castle for some discussions towards the preparation of the NDC in the 2012 general elections.
The Tamale Metropolitan Manager of the National Health Insurance Scheme (NHIS), Mohammed Adul Sallam almost broke down in tears, when he attempted to speak to this paper about how he took the news about the death of the late President.
He cautioned the NDC Communication Team members in the Northern Region to stay away from making comment on how activities would be outlined for the burial and funeral of the President until they are asked to do so by the National Executive Committee.
Upper East, Bolgatanga
Members of the public, including politicians of various political parties and their activists in the Upper East Region were lost for words to comment on the passing on of President John Evans Fiifi Atta Mills, reports William N-lanjerborr Jalulah from Bolgatanga.
Most residents in Bolgatanga, who were contacted to share their memories about the late President could hardly speak, except to say his death was a big loss to Ghana.
Business activities came to a halt in most parts of the city as both buyers and sellers sniffed for confirmation of the President’s death. One could hear some people shouting; “Oh! President Mills, why so soon?” Others asked why he should die at this crucial time, when Ghanaians have just five months to the elections.
It was extremely difficult to get to speak with the regional NDC executives because they were all shocked and dumb-founded by the death of the President, since they were not aware of his illness. When the Regional Youth Organizer, Mr. Robert Yeli-Oni was reached, he could hardly speak, except to say, “We are mourning”.
When she was contacted, however, the New Patriotic Party (NPP) Regional Chairperson, Mrs. Agnes Asangalisa Chigabatia said “I broke down when I heard the sad news”. She said in the first place, he is a human being and secondly, he is the President of Ghana and not President of the NDC”.
Thirdly, he has died at a very crucial time when Ghanaians are preparing for the election.” Mrs. Chigabatia concluded by praying for the soul of the late President to have peace in the bosom of the Lord.
A visit to Atlantic base, the most popular sitting base of NPP supporters in Bolgatanga, saw members in a state of sadness. At the Regional Police Headquarters, both the police flag and the national flag were flying at half-mast, to signify the sadden demise of the Country’s leader.
Upper West
Residents of Wa on Tuesday evening gathered in small groups all over the township, discussing the sudden death of former President John Evans Atta Mills, reports Musah Umar Farouq from Wa.
The streets were unusually quiet as people stood in groups, wearing mournful faces and discussing the unfortunate and heart-breaking event. They expressed shock at confirmation of the news, while those who could not hold back their emotions shed tears.
Those who could not believe the story tuned into local radio stations, using their mobile phones to monitor live reports from partner radio stations in Accra, to confirm the news.
Speaking to The Chronicle, many residents were not happy that the death of the President was announced immediately, saying it could have been delayed for at least a day.
Mr. Abdul-Razak Mustapha, a business man described the death as “a sad day for Ghana” and appealed to Ghanaians to be mindful of utterances regarding the demise of the late law Professor and not to politicize the matter.
“We need to stand together and put our differences behind us at this emotionally difficult and challenging time,” he said.
Adams Fuseni, a lotto seller, said he was shattered by the sudden and unexpected passing on of the President. He said he could not believe the news because there was an earlier report by the various radio stations that President Mills was on a day’s return trip to Nigeria.
Brong-Ahafo
From Sunyani, Michael Boateng also reports that the news about the demise of Professor John Evans Atta Mills on Tuesday was received with shock and disbelief by residents of Sunyani and other parts of the Brong-Ahafo region, bringing business activities to almost a standstill.
Initially, it was taken to be another unfortunate rumour about the President’s health by some faceless persons, but this time the information compelled the doubting members of the public to get closer to their radio and television sets for confirmation.
The mood of the entire populace within the Sunyani Township changed suddenly after the death of Prof. Mills was confirmed, as people expressed total shock and dismay, particularly at the time where Ghana is preparing to go into another general election.
Prof. Mills’ demise was the main issue of discussion across the Sunyani Township, and in Taxis, drinking spots, shops, offices, restaurants and market places.
A visit to the Regional Offices of the National Democratic Congress (NDC) saw most of the party members and sympathizers rushing in to confirm or deny the death of the President, who is also the flag bearer of their party.
The forecourt of the regional headquarters was eventually turned into funeral grounds after the official confirmation of the death.
The late President’s demise seems to have calmed the political tension in the Municipality, because for once, The Chronicle observed that almost every Ghanaian, regardless of one’s political inclination were united in grief to mourn the late President.
The Regional Executives of the NPP yesterday visited the NDC regional Secretariat to express their condolences to the party for the calamity that has befallen them and the entire nation. The Regional Secretary, Mr. Alfred Ofori Annye noted that the death was unfortunate and the opposition party would join their NDC friends to mourn the departed President.
He explained that NPP took the decision not to talk for now in other not to give room for some people to read political meanings to whatever they say.
Mr. B.K. Ameyaw, Brong-Ahafo Regional Chairman of CPP, on his part said the demise of President Mills should unite the nation as one people, calling on every Ghanaian to set aside personal, religious and political difference to mourn the President.
He called for total support for the newly sworn-in President, John Dramani Mahama, so that he could continue effectively to lead the country to the desired destination.
The Municipal Chief Executive of Sunyani, Kwasi Oppong Ababio commended Ghanaians for exhibiting a true sense of unity to mourn the late President, saying “Ghana needs such an attitude and oneness to flourish in it development agenda”.
Volta Region, Ho
Correspondent Samuel Agbewode reports from the Volta regional capital, Ho, that the Municipality has been thrown into  a state of moaning following the announcement of the death of President John Evans Atta Mills, as most people were seen wearing red and black clothes and bands, indicating their sad moments of grief in almost every part of the Municipality.
The sudden death of the President had become a topical issue for discussion in the Municipality, as most of the people who spoke to The Chronicle expressed shock about the sad event, which is the first to be experienced by the country.
A businessman, Mr. Bazooka, said since he heard the news, the whole household started mourning and that he could not even eat. According to him, the last time he (Bazuka) personally heard about the President was when he went to the USA for medical check, and was very happy when the President came back looking healthy.
Madam Vida Adzotor, a business woman said God knows best by taking the life of the President at this crucial time in the history of the country.
Mr. Kafui Asem, a retired Communication expert and an elder of Tsito-Awudome at a meeting of traditional rulers at Awudome–Avenui prayed for the late President, after the gathering had observed a minute silence in his memory.
The Ho-East Chairman of the New Patriotic Party (NPP), Mr. Raybon Evans Anyadi on behalf of the entire membership of the Ho East Constituency of the NPP and on his own behalf, expressed heartfelt condolences to the National Democratic Congress, the family and Ghanaians for the sudden death of the President, and prayed that his soul rest in perfect peace.

Taxation, Global Economic Crisis and the poor

Posted on March 8, 2012 

Topics: Domestic resource mobilisation, Tax justice

By Lord Aikins Adusei (taken from Eurodad partner TJN Africa’s Quarterly Newsletter Africa Tax Spotlight), 

The article below looks at the current global economic and financial crisis, its impact on firms, governments and the poor. It argues the crisis has generated new kinds of tax policies in both developed and developing countries that in the long run will lower inequality between the rich and the poor. The article concludes that although the poor appear to have been badly hit by the crisis they will end up being the final beneficiary if the taxes and other policies being implemented begin to bear fruit.

Taxes play an important role in the economy of many nations. In many countries taxes paid include but are not limited to Personal Income Tax, Corporate Income

Tax, Value Added Tax (VAT), Fuel Levy and Windfall taxes. These taxes help build and maintain public goods and infrastructures such as roads and railway networks, schools and universities; pay salaries of teachers, nurses, doctors, police, and soldiers; maintain law, order, peace and security of the country; and improve economic and social wellbeing of citizens; and pay debts owed to creditors. In short, taxes are essential for the running of every country. Over the last three or four years, the world has gone through and is still going through tumultuous and painful financial and economic crisis. The crisis, which began in the United States and quickly spread to Europe and other Organisation for Economic Cooperation and Development (OECD) economies, was as a result of a combination of factors including under regulation and over supply of financial products; too much public and private sector debt; near-zero interest rates that

fueled cheap credit; and asset prices that boomed and then busted. The crisis has had devastating impact on ability of firms to secure credits as banks are unwilling to lend. In fact, a number of banks have failed and with it the assets of companies and individuals who did business or saved with them. Additionally, demand for goods and services produced by firms has gone down forcing companies to close down completely or lay off workers to cut down cost. The result is that many small and major firms have seen their profits slashed and so are their taxes to government. Governments’ bailouts and efforts by Central Banks around the world to stimulate the global economy by injecting additional

liquidity have not yielded the desired results. Governments’ efforts to raise revenue through taxation have also suffered severe setbacks. As exports and imports in advanced economies slow down and businesses collapse or underperform, governments are losing corporate income tax, personal income tax and other taxes that could help them maneuver through the storm. In a recent op-Ed titled “Globalization of Protest” Columbia University Professor Joseph E. Stiglitz put the impact of the crisis this way: “Around the world, we have underutilised resources – people who want to work, machines that lie idle, buildings that are empty – and huge unmet needs” (Stiglitz, 2011). Stiglitz was referring to the cost of the crisis on the poor. Governments’ inability to raise revenue to implement social and economic programmes has been borne largely by the poor, low wage and middle class workers. In both private and government institutions there is freeze on wage increase.

That not withstanding, the crisis has elicited positive responses from people around the Globe. In India, demonstration against corruption has forced governments to act to prevent corrupt politicians and their business associates from taking bribes and evading tax. The crisis has seen the United States, Franceand Spain acting in a coordinated fashion to stop corrupt African leaders from looting their coffers and depositing their loot in Europe and America. One illustration of such actions was the fact that Teodoro Obiang Nguema, son of Equatorial Guinea’s dictator, had his cars confiscated by French police. If auctioned the proceeds of the $5million worth of cars could help provide schools, hospitals and improve sanitation for the people in that country.

In several African countries, the soaring prices and profits for the gold, copper, oil and gasoline industry in the past years have seen governments receiving a boost in the their balance sheet. Zambia for instance has seen revenue from copper increase tremendously. African governments that have not benefited from the windfall profits from oil and minerals are proposing or have proposed a windfall tax that will bring additional revenue to the state.

In 2007, a report prepared for South Africa Treasury, Dr. Zavareh Rustomjee and his team defined windfall profits as “excess profits, of which conceptually there are two possible types: those of a temporary or cyclical nature (called “quasi rent” or “economic profits”), or more structural or permanent (called “economic rent”)” (Rustomjee et al, 2007). Thus taxes on these excess profits constitute windfall tax. According to James Muyanwa (2011) windfall tax is a tax levied by governments on certain industries when economic conditions allow those industries to experience above average profits. Companies who benefit from massive profits due to a favourable economic condition are targeted. In October of 2011, the Reuters news agency cited Ghana’s Finance Minister Kwabena Duffuor as saying. Ghana is in talks with gold miners about extra taxes, including the possibility of a windfall tax. In May of 2011, media houses inNamibia quoted Mines and EnergyMinister Isak Katali as saying that the government was looking to introduce a minerals windfall tax to enable the state to benefit more from the country’s vast mineral resources. The Energy Minister said: “It is my view that as the custodian of the mineral resources, the state should also benefit in good times beyond normal taxes and royalties” (Dontoh, 2011). Algeria, South Africa,Chad, Gabon and Angola have already indicated that they would want to implement some kind of windfall tax that would target massive profits and use it to implement social and economic programmes to benefit the poor. Although the poor have been badly hit by the economic and financial crisis, there is hope that they will turn up to be winners if the policies begin to bear fruit

References

Buffet, W. E. (2011) “Stop Coddling the Super- Rich” New York Times, August, 2011

Dontoh, E. (2011) “Ghana Not Planning Windfall Tax on Gold” Bloomberg, 2011

Muyanwa, J. (2011) “Pitfalls of Windfall Tax” Times of Zambia, 2011

Reubens, E. (2006) ‘The Great Oil and Gasoline Dilemma’ Challenge December 2006

Reuters (2011) “Namibia to hit miners with windfall tax” Tue, 17 May 2011

Rustomjee, Z. et al. (2007) “Windfall taxes on the liquid fuels industry”

 Stiglitz, J. E. (2011) “The Globalisation of Protest” Project Syndicate, 2011

JJ leaves NDC divided & shaken

While President John Evans Atta Mills and the remnants of the National Democratic Congress (NDC) leadership  were singing in the rain and frantically extolling the virtues in party unity and its democratic credentials at Mantse Agbona, just at the entrance of the James Town Mantse's Palace in what used to be called British Accra, at the week-end, the wife of the founder, Nana Konadu Agyeman Rawlings, was busily unmasking the Head of State and his political edifice as pretenders who  stole the vote at the Sunyani  congress.

'People who were not delegates were voting as delegates. I know all the delegates; more than one thousand who voted were not delegates,' she told the Akuafo Hall Ladies wing of the Students Representative Council of the University of Ghana, at Legon.

'I let it be, because if I wanted to deal with it, I would take the whole bunch of them to court. I just decided, no, it's not worth it, let them steal it. If that makes them happy, let them steal,' she said, cheered on by the students.

At a time the NDC is clamouring for unity as a sign of strength to tackle the formidable force of the New Patriotic Party (NPP) and its leader Nana Addo Dankwa Akufo-Addo, the wife of the founder's exposé at Legon puts the party and its leadership on the defensive.

According to the former First Lady, she had been silent over the issue in order to protect the unity of the party founded by her husband, observing that the internal bickering and disunity among party members were some of the fall-outs of the Sunyani congress.

'In my heart of hearts, I felt sorry for the party I belong to, because it was like cracking the party in the middle, and for me it was said because we have built a party for more than 19 years, and then suddenly, 'boom' is not good.'

Reports of a crack in the NDC front after the Sunyani congress have been rife in the body politic for some time, but the statement from the office of Jerry John Rawlings on the eve of the rally in Accra, that he would not be at Mantse Agbona with a warning that the party should not use his name to campaign towards the 2012 elections, was the major song that all may not be well with the party he founded.

As the President and the remnants of the NDC leadership basked in their glory of leading this nation to their own ideas of what constitute prosperity, the Chairman of the party, Dr. Kwabena Adjei, revealed on television on Friday, that his private and confidential letter to the President, calling for a meeting to patch up with the Rawlingses, was leaked from the Castle.

He tried frantically to absolve the President from blame by insisting that at the time the letter got to the Castle, Prof. Mills was out of the country. But the revelation from the party chair that his letter was leaked, rather feeds into the general notion that the orchestrated attempt to exclude the Rawlingses in matters pertaining to the NDC might be the handiwork of the occupant of the Castle.

Political analysts believe it is a means of carving a niche for himself, after being brought in by the founder, who has remained his bedrock and source of legitimacy all along.

At the rally at the weekend, President Mills mocked those he claimed were disappointed in his leadership.  'Let us be positive and not listen to the cries of those who are disappointed, because they will remain disappointed,' he mocked.

Political commentators are reading different meanings into this particular statement. Some political analysts believe the President was referring to the opposition, who are bitterly contesting his claim that the achievements of the party in government were unprecedented.

Others believe the President was further widening the gap between his Presidency and the Rawlingses, who have criticised his style of leadership since occupying Government House three years and a quarter ago.

This school of thought holds that by that statement, President Mills was sending a powerful message across to Boom Junction that he was thriving better without being talked down upon, and that the Rawlingses could do nothing to influence his leadership of government and the party.

If that is the intention of the President, then he would have already offended many in the party who look upon the former President as the man whose sacrifices brought the party into being in the first place, and who nurtured the NDC with his charismatic leadership.

Across the country, billboards and posters are emerging with the effigy of President Mills and former President Rawlings poised to propel the NDC to victory in the 2012 presidential and parliamentary elections.

If the founder is chalked off the scene, many are those in the NDC who would know where to pinpoint if the elections fail to go the way of the party in power

Ghanaian Chronicle