A survey conducted by the Institute of Economic Affairs (IEA) has revealed that Ghanaians do not think corruption could be eradicated in the country and that the canker has become part and parcel of the Ghanaian society.

The survey, which sampled 1500 people from all parts of the country, quoted 24% of them as saying that corruption is like DNA in the blood of Ghanaians.

At a forum to discuss the findings in Accra yesterday, Joseph Atsu-Ayee, Professor/Adjunct Senior Fellow at IEA said of the 1500 respondents, 60% and 40% were females and males respectively.

In the report, about 44% respondents said corruption could be reduced to a limited degree. About 19% argued that it could be substantially reduced, while 4.7% believed it could be eradicated completely.

Professor Atsu noted that, corruption attracts attention because of its debilitating and corrosive effects on politics, governance, economy, society and security. According to him, effort to bury corruption has not been successful because of how people understand the root cause of corruption.

"Strategies to curb corruption have failed, because we have misunderstood the roots of corruption. Understanding the root causes of corruption is key in dealing with corruption," he remarked.

He further noted that, the problem with Ghana had to do with the individual, citing that "Ghanaians are acquisitive and materialistic. If you want to live good, work for it."

His comment follows argument by some of the respondents that the corruption in the system was as a result of low salaries paid workers in the country. But the Professor debunked that assertion, saying "if you increase the salaries they will still be corrupt."

Ironically, the police are alleged to be the most corrupt institution in the country, but the survey revealed that Ghanaians still have confidence in them. According to the report, 87% of the respondents stated that they would report any case of corruption to the police before any other person or institution.

The survey, which was conducted amongst Ghanaians aged 18 and above indicated that 52% of the respondents got their information on corruption from the media. However, 35% of the respondents, between the ages of 18 and 24 said they would give bribe to make sure they got what they wanted.

At the same programme, Former Commissioner of the Commission for Human Rights and Administrative Justice (CHRAJ), Justice Emile Short, who was the chairman for the event, said corruption, seemed to have lost it stigmatization.

He said living good and living in poverty does not create room for corruption. "The poor can survive without corruption. Those surviving are rather those engaged in serious corruption," he noted.

He, therefore, kicked against the limitation of corruption to only bribery and that must also it includes embezzlement and others.

"Corruption arises when the systems are weak. So to fight corruption, there should be a robust system where leaders are able to work in the interest of the country," he opined.

The Libyan Investment Authority (LIA) has taken two international banks to courtseeking to recover over $3.3 billion (11 trillion shillings) that the oil-producing country lost in 'bad deals' that were initiated by the banks during former President Muammar Gaddafi's reign.

LIA is attempting to recover $1.2 billion (about 4 trillion shillings) from a U.S investment bank, Goldman Sachs and another $2.1 billion (almost 7 trillion shillings) from French bank, Societe Generale. The country's Sovereign Wealth Fund alleges that the two banks advised it to enter risky deals in 2008 that ended up being worthless. The hearing of one of the cases resumed in London in June 2016, with LIA's lawyers accusing Goldman Sachs executives of taking its officials on luxurious trips to Morocco and Dubai in order to influence their investment decisions. One witness in court claimed that the trips were laden with 'heavy drinking and girls'.

Key in the case is Goldman Sach's relationship with Haitem Zarti, a brother to Mustafa Zarti who was LIA's second-in-command at the time. The bank is said to have paid for Zarti's lavish trip to Dubai and later offered him an internship placement at their headquarters in New York. The Fund's lawyers now argue that the Bank's treatment of Haitem Zarti biased his brother to stake the fortunes of the $67 billion Fund in a series of bad deals.

Happier times: Late Col. Gaddafi's son, Saif-Al-Islam Gaddafi.

The second case against Societe Generale is expected to commence in early 2017 but there are indications that the Fund's lawyers will attempt to link the bad deals to bribery and influence peddling involving the first family, particularly Gaddafi's son, Saif Gaddafi.

But what made Libya's Sovereign Wealth Fund so susceptible to manipulation? During Col. Muammar Gaddafi's four decade reign, opacity dominated management of the country's Petroleum Fund, allowing unchecked corruption to thrive. Patronage, family links and political influence were much more important than institutionalised, competence-based investment decision making. Hence, the Fund was often manipulated into investing billions of US dollars in risky assets managed by political friends or allies of the regime. Transparency, independent oversight, clarity of rules and political will eluded Libya, resulting in mismanagement of the resources and potentially causing avoidable losses that form the basis of the cases in court today.

The Libyan case provides a good example of how Sovereign Wealth Funds can be vulnerable to abuse by overbearing governments, unless they have strong, independent governance structures and sufficient corruption control mechanisms. For Uganda, the case comes at an opportune time, since the country is operationalizing the Petroleum Fund as established by The Public Finance Management Act, 2015(PFMA). In some ways, the law attempts to address key issues necessary to ensure good governance of revenues expected from Uganda's nascent oil and gas sector.

However, a number of loopholes exist in the law which, if not addressed, would expose Uganda to the perils Libya has witnessed. Unless regulations for the Act, once issued, offer more clarity, Uganda's Petroleum Fund could end up like that of Libya.

Firstly, reading through that Act, it is not clear what the objectives of the Petroleum Fund are. While the Act alludes to the Fund helping to support budget stability [Section 58 (a) and Section 63 (2)] as well as providing heritage for future generations [Section 64 (3) & (4)], neither of these is clearly stated as its objective. This lack of clarity of objectives presents difficulty for policy makers in terms of giving policy direction in form of operational rules for the fund. It also remains difficult to decide the sort of assets the savings can be invested in and therefore the nature of restrictions that should be put in place for government to access the Fund.

If, on one hand, the Fund is to play a stabilising role, a significant chunk of the money should be invested in liquid assets that can easily be accessed in case of budget shortfalls, like bonds. On the other hand, if the Fund is to serve as a heritage for future generations, restrictions for accessing it have to be made tighter, for example by requiring that the money be invested in long term assets like real estate. Where the Fund has a dual function, this should also be clearly stipulated in law or the regulations.

Secondly, the PFMA presents a possibility of conflict of powers between the Minister of Finance and Bank of Uganda or an external Fund Manager appointed by the Bank over the choice of investments into which the Fund's money may be committed. Whereas section 63 (2) (C) gives power to the Minister to prescribe an instrument into which the Fund's finances may be invested, section 64 (1) vests operational management responsibilities in the Bank of Uganda. Again, Section (64) (6) also leaves it to Bank of Uganda to establish risk management arrangements for the instruments to be used in the management of funds in the Petroleum Investment Reserve. This could result in conflict in the case of Bank of Uganda rejecting an instrument prescribed by the Minister for investment of the Fund's money, even if that may have been done on a technically sound basis.

In addition, the Act falls short of clarifying, in terms of jurisdiction, where funds in the Petroleum Revenue Investment Reserve shall be invested. Although Section 63(2) mentions that the money shall be invested in internationally convertible currency deposit or a debt instrument denominated in internationally convertible currency, it remains silent on whether these investments are to be made in the domestic economy or abroad. Different lessons from the Management of the Government Pension Fund of Norway show that investing petroleum revenues abroad protects domestic industries (and economy), diversifies risk and maximises returns.

However, the choice of that 'international investment' and how the decision to invest in it is made, are very crucial and that is where the Libyans got it wrong. They now claim that they were hoodwinked by street smart bank executives to invest in risky ventures that resulted in billions of dollars in losses.

Yet the Fund should have had their own professional advisors to assess the risks and decide accordingly. In any case, Norway invests the bulk of monies in her Fund in stock markets in the USA. However, because of a more streamlined investment decision making mechanism, when Norway lost hundreds of millions of dollars in the 2008 economic downturn, it was easier to attribute the losses to the global economic downturn and not mismanagement. Uganda should, therefore, consider investing in more developed financial markets abroad to secure the best returns and protect her economy against over-heating, while ensuring that independent investment decision making procedures are followed.

However, Uganda's PFMA (2015) lacks provision for independent third party oversight over the Fund's operations, a cardinal principal in ensuring transparency and accountability in the way funds are managed. Third party oversight is critical in exerting public pressure on policy makers and fund managers to ensure open decision making as a guarantee for integrity in the way natural resource funds are managed.

In Ghana, the Public Interest and Accountability Committee's (PIAC) May 2012 report revealed that the Ghana National Petroleum Company (GNPC) was retaining large amounts of petroleum revenues that threatened to grow the petroleum sector at the expense of other sectors. The report also revealed that the Ministry of Finance had overestimated corporate income taxes by nearly 100 percent in order to create extra fiscal space for government and legitimise greater spending under the country's laws.

Although Ghana's PIAC has been constrained by lack of funds and mandate to implement its recommendations, its experience underscores the need for Uganda to ensure third party oversight if our revenues are to be managed in a transparent manner.

Globally, Norway offers the best lessons given that they have been exemplary in running their extractives sector. Several similar funds around the world have been successful as well. It is estimated that worldwide, sovereign wealth funds hold assets in excess of three trillion dollars. Information on some of the natural resource funds globally is shown in the table below:

Country Fund name Year established Estimated value of assets

Norway Government Pension Fund Global 1990 $850 billion

Saudi Arabia SAMA Foreign Holdings 1952 $730 billion

Public Investment Fund 1971 $5.3 billion

Abu Dhabi (UAE) Abu Dhabi Investment Authority 1976 $773 billion

International Petroleum Investment Authority 1984 $68.4 billion

Mubadala Development Company 2002 $60.9 billion

Kuwait Kuwait Investment Authority 1953 $400 billion

Qatar Qatar Investment Authority 2005 $175 billion

Russia National Welfare Fund 2004 $87.9 billion

Reserve Fund 2004 $87.3 billion

Algeria Revenue Regulation Fund 2000 $70.9 billion

Dubai (UAE) Investment Corporation of Dubai 2006 $160 billion

Ghana Ghana Heritage Fund 2011 $0.13 billion

Ghana Stabilization Fund 2011 $0.32 billion

Botswana Paula Fund 1994 $5.7 billion

Nigeria Nigeria Sovereign Investment Authority 2011 $0.98 billion

Adapted from Andrew Bauer, 'Managing the public trust: How to make natural resource funds work for citizens', 2014.

Uganda too can join this elite club in a decade or so. However, the politicians need to let the proposed Petroleum Fund function independently and only allow for independent third party oversight over its operations.

Chris Musiime is the Managing Editor, Oil in Uganda while Gerald Byarugaba is a Research Associate, Advocates Coalition for Development & Environment (ACODE) and a 2014 PETRAD Fellow.

What struck me most was his analogy of how many lives and properties could be lost if Ethiopia and Eritrea were to embark on yet another atrocious war at a time when both countries have other more urgent responsibilities to carry out. I am not sure if we have forgotten the 1998-2000 Badime conflict, when Ethiopians from all parts of the country were shoving shoulder to shoulder, queuing up forcibly to be taken to the war front, when the short recruitment time was finished. I have never seen such kind of voluntary dedication and commitment to reply to the call of the motherland.

Ato Abay, it can be said, has become the real navigator, sitting on the navigational tower behind the pilot to guide the plane. This is only to be expected from the chief guide, rather than the Prime Minister sitting behind the steering wheel.

War is never as cheap and simple as a luxurious weekend pastime or something one can do away with. The Badime engagement was a civil war in which over 70 thousand people paid with their dear lives. What was regrettable was the agreement signed in Algiers as a lasting agreement that is never to be appealed.

The decision of the agreement was rather difficult to understand. Would that kind of a national call be met with a similar response?

In this regard, Ato Abay's speculations about the consequences could be taken as a wiser guess. There are many political observers who tend not to believe what he says judging from previous experiences. But then there are chances that he could prove what he says to be true if he could convince some of the other high notch TPLF officials. He could then use the leverage of his advisory post to progress step by step towards resuming negotiations with Eritrean officials as soon as possible.

Sixteen years is too long a period of time to tolerate waiting in a "no war, no peace" deadlock. Ato Abay should carefully review where things went wrong. On the part of the President of Eritrea, Isayas Afeworki, he should try to keep up with the present situations and be able to make good for the generation of tomorrow. It is about time that leaders of both countries came to their senses and realised that the demands of the 21st century are not yet obsolete. There is still enough time to make unforgettable history for both their peoples, respectively.

The basic heritage

our forbearers have bequeathed us with is not only the goal to be free from the yoke of colonialism and exploitation by our former colonial powers. but to be completely free to form a United States of Africa.

There are no countries better than Ethiopia and Eritrea to take the first practical and reliable step towards an integrated political and economic union in this part of Africa. This could be in the form of a confederation or some kind of union, to be agreed upon.

The way to start this move could simply be sitting around the table and working out some kind of road map to revitalising the ministerial commission, comprising political and trade commissioners, while discussing the possibilities of finding common ground in settling outstanding problems.

Should the two neighbouring countries decide to start negotiations, there is no better situation than the structural readiness of the two countries. There is the 1,080km road between them; Ethiopian Airlines could revive its former daily flight to Asmara; Ethiopians and Eritreans could make direct telephone calls between them.

The people along the border of both countries can exchange trade between them. Whether it is for emergency freight or the strength along the coast, the two nations can use the Assab and Massaw ports for the benefit of the two nations. We should ensure that the Red Sea is kept free from pirates, as was the case some time ago.

The United States government has brokered peace with Cuba after 60 years of isolation. I see no reason why Ethiopia and Eritrea cannot make peace between them.

Plans for the construction of a 2,190-kilometre central railway line to standard gauge form are now up for implementation as Chinese Exim Bank has agreed to give a soft loan of 7.6 US dollars (about 16 trillion/-) to finance the project.

According to a statement issued yesterday by the State House, the amount is enough to cover construction of 2,190 kilometres. The project is expected to start this financial year as the government has also set aside about 1tri/- from the current budget for the purpose.

Once completed, it is expected that the project will revolutionise Tanzania’s economy and other countries in Eastern and Central Africa including Burundi, Rwanda and Democratic Republic of Congo (DRC). The first phase will constitute the construction of the railway line from Dar es Salaam to Mwanza via Isaka and Tabora.

Exim Bank gave a nod yesterday over financing the construction after its president, Mr Liu Liang, met President John Magufuli at the State Lodge in Dodoma.

Mr Liu said apart from the funds, the bank would cooperate with Tanzania in exchanging experience and skills on the construction of the railway and its management. He praised Dr Magufuli for what he termed “his true desire to bring development to the country,” including fostering the construction of the central railway line. “On this central railway line project, we have a positive view. We see it as good project.

We will accord the needed cooperation,” Mr Liu pledged.

According to him, the bank is ready to support the railway project and other development projects. President Magufuli assured Mr Liu that Tanzania desires to implement such projects by using funds from its own budget and foreign sources.

The talks between President Magufuli and Mr Liu were held in the presence of Chinese Ambassador to Tanzania, Dr Lu Youqing, the Minister for Works, Transport and Communication, Professor Makame Mbarawa, Finance and Planning Minister, Dr Philip Mpango and Deputy Minister for Foreign Affairs, East African, Regional and International Cooperation, Dr Suzan Kolimba.

Recently, Ambassador Lu assured President Magufuli that the Chinese government, its financial organisations and other companies will give their total support towards the implementation of the project.