THE OUTLOOK FOR GHANA
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NIE ? 5 7
27 December 1957
18
N?
2 JAN 1958
NATIONAL INTELLIGENCE ESTIMATE
NUMBER 74-57
THE OUTLOOK FOR GHANA
Submitted by ''2the
DIRECTOR OF CENTRAL INTELLIGENCE
The following intelligence organizations participated in the
preparation of this estimate: The Central Intelligence Agency
and the intelligence organizations of the Departments of
State, the Army, the Navy, the Air Force, and The Joint Staff.
Concurred in by the
INTELLIGENCE ADVISORY COMMITTEE
on 3 December 1957. Concurring were The Director of Intelli-
gence and Research, Department of State; the Assistant Chief
of Staff, Intelligence, Department of the Army; the Director
of Naval Intelligence; the Assistant Chief of Staff, Intelli-
gence, USAF; and the Deputy Director for Intelligence, The
Joint Staff. The Atomic Energy Commission Representative
to the IAC and the Assistant Director, Federal Bureau of
Investigation, abstained, the subject being outside of their
jurisdiction.
290
FIA 2_
DOCUMENT NO. /
NO CHANGE IN CLASS. 0
yr DECLASSIFIED
CLASS. CHANOED TO: 13 S C
NEXT REVIEW DATE;
AUTH: HA 70-2
DATE4t4ai piEviEwER: 00651 4
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CENTRAL INTELLIGENCE AGENCY
DISSEMINATION NOTICE
1. This estimate was disseminated by the Central Intelligence Agency. This copy
is for the information and use of the recipient indicated on the front cover and of per-
sons under his jurisdiction on a need to know basis. Additional essential dissemination
may be authorized by the following officials within their respective departments:
a. Director of Intelligence and Research, for the Department of State
b. Assistant Chief of Staff, Intelligence, for the Department of the Army
c. Director of Naval Intelligence, for the Department of the Navy
d. Director of Intelligence, USAF, for the Department of the Air Force
e. Deputy Director for Intelligence, Joint Staff, for the Joint Staff
f. Director of Intelligence, AEC, for the Atomic Energy Commission
g. Assistant Director, FBI, for the Federal Bureau of Investigation
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Agency
2. This copy may be retained, or destroyed by burning in accordance with appli-
cable security regulations, or returned to the Central Intelligence Agency by arrange-
ment with the Office of Central Reference, CIA.
3. When an estimate is disseminated overseas, the overseas recipients may retain
it for a period not in excess of one year. At the end of this period, the estimate should
either be destroyed, returned to the forwarding agency, or permission should be
requested of the forwarding agency to retain it in accordance with IAC--D-69/2, 22
June 1953.
4. The title of this estimate, when used separately from the text, should be classified:
FOR OFFICIAL USE ONLY
WARNING
This material contains information affecting
the National Defense of the United States
within the meaning of the espionage laws,
Title 18, USC, Secs. 793 and 794, the trans-
mission or revelation of which in any manner
to an unauthorized person is prohibited by law.
DISTRIBUTION:
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THE OUTLOOK FOR GHANA
THE PROBLEM
To estimate Ghana's prospects for political stability and economic progress, and
its probable orientation and policies over the next few years.
SUMMARY
1. Ghana's basic problems, temporarily
disguised during the independence cele-
brations last March, are coming to the
fore. The country has considerable
political experience and economic re-
sources. Nevertheless, Prime Minister
Nkrumah and his Convention People's
Party (CPP) government are encounter-
ing increasing opposition and internal
party dissension as they try to make
Ghana into a modern unitary state.
2. Ghana's fortunes will have a consid-
erable impact both on the evolution of
Africa and on the West's interests there
for several reasons. Ghana wants to play
a leading role among emerging African
areas and its example and experience will
affect developments beyond its borders.
It will seek economic assistance from the
West and also from the Soviet Bloc. It
offers opportunities for the Soviets to ex-
tend their influence in Africa.
3. Nkrumah probably will maintain his
leading position for several years through
shrewd maneuvering and more authori-
tarian measures. But his currently ill-
organized parliamentary opponents, as
well as extreme leftists and other dissi-
dents within his own party, are likely to
give him increasing trouble. Despite
sporadic disorders, internal security will
probably not present unmanageable prob-
lems in the next few years. However, if
Nkrumah should disappear from the
scene, a probable CPP split would soon
result in political instability.
4. While Nkrumah will try to play a ma-
jor role in Africa, particularly in West
Africa, Ghana's attention will be taken
up with domestic problems and its ambi-
tions blunted by the opposition of other
African states. Furthermore, it will need
to avoid serious conflict with the UK and
other Western countries important to its
trade.
5. Ghana's long-term prospects for devel-
oping and diversifying its economy are
not favorable. Unless it receives foreign
aid or investment, the government may
not be able to support its current rate of
development beyond the next two to
faSeikaillM 1
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.assageliter- 2
three years without drawing down for-
eign exchange reserves required for other
purposes. Ghana's search for such as-
sistance and wider markets will probably
be accompanied 'by shifts ? rather than
sharp alterations ? in its present West-
ern-oriented trade pattern in the absence
of a major Bloc effort in the area. Pros-
pects for financing the Volta River proj-
ect in its 'entirety are uncertain, and
Ghana probably will have to continue to
depend on cocoa for its major source of
income.
6. In foreign affairs, Nkrumah is likely to
copy Nehru's policy of "non-alignment."
Relations with the US and the UK are
likely to remain friendly in at least the
short run while Ghana makes large re-
quests for aid. However, diplomatic and
economic relations with the Soviet Bloc
will almost certainly develop, and at least
some aid will be accepted from that source
if offered. The Bloc over a period, by
using its opportunities for economic and
subversive activity, might achieve a sig-
nificant measure of influence in Ghana.
DISCUSSION
7. The British colony and protectorate of the
Gold Coast on 6 March 1957 became the sov-
ereign state of Ghana within the Common-
wealth. Despite two years of rising internal
dissension and sporadic minor violence, this
transformation was accomplished in an at-
mosphere of general celebration. A last-
minute, British-sponsored compromise on the
proposed constitution warded off a serious
threat from the various regional and minority
groups opposed to the concentration of powers
in Prime Minister Kwame Nkrumah's govern-
ment. That government, formed by the Con-
vention People's Party (CPP) in 1956, took
office with a better than two-thirds parlia-
mentary majority. However, the appearance
of harmony disguised basic conflicts both in
the country and within the CPP.
8. We believe that developments in Ghana
? the first Tropical African colony to achieve
independence ? will have a considerable im-
pact both on the evolution of Africa and on the
West's interests there for at least three main
reasons: (a) Ghana's experience will influ-
ence nationalist aspirations and movements
elsewhere in Africa, (b) Ghana is likely to try
to obtain substantial foreign assistance from a
variety of sources including the US, and (c) it
provides an opportunity for the expansion of
Soviet influence in Africa.
9. The brief euphoria attending Ghana's
achievement of freedom is now over. The new
nation is being confronted with the difficulties
inherent in its geographical, political, and so-
cial divisions.' Ghana's national boundaries,
generally established by colonial annexation
at the end of the 19th century, cut through
tribal areas and separate a number of peoples,
notably the Ewes along the Togo border. The
government is facing the problem of trans-
lating into reality the expectations aroused by
the prospect of independence. These are for-
midable obstacles for a country which is still
largely underdeveloped. Much of the North-
ern Region is generations behind the coastal
areas in the ways of the modern world. More-
over, some attachment to tribal customs and
beliefs can be found among even the most ed-
ucated and urbanized Ghanaians. Ghana in-
herited from British colonial rule the outward
forms and procedures of Western political in-
stitutions. These institutions have changed as
Ghana is divided into five regions: Eastern,
Western, Trans-Volta/Togoland (including the
southern portion of former British Togoland) ,
Ashanti, and Northern (incorporating the re-
mainder of Togoland) . About 4,700,000 people
live in a country roughly the size of the UK.
Perhaps 15 percent of them are Christians and
there are some Moslems, mostly in the North,
but the large majority are animists. A wedge-
shaped, heavily forested rainy area narrowing
toward the east covers most of the Western Re-
gion and about half of Ashanti and the Eastern
Region; much of the rest of Ghana is savannah.
See attached map.
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they have been used by varied and often mu-
tually antagonistic social groups in differing
stages of modernization. However, they re-
main the framework within which the develop-
ment of Ghana will take place.
10. Nkrumah and the CPP have three pri-
mary objectives ? the creation of a modern
unitary state, the development and diversifi-
cation of Ghana's economy, and the exten-
sion of its influence throughout West Africa.
Ghana, however, has only a limited potential
for economic development, and is deficient in
people with administrative or managerial ex-
perience. Venality is widespread among gov-
ernment office-holders, and the influence of
the remaining British civil servants is being
minimized. There is spreading internal re-
sentment over the rough-shod treatment of
regional, tribal, and traditionalist opponents
of the CPP. Nkrumah not only has been un-
able to subdue the longstanding opposition in
Ashanti and the North, but has recently been
faced with disaffection in his own stronghold
of Accra. He apparently is also under increas-
ing pressure from militant left-wing elements
within the CPP and its affiliates to carry out
rapidly the more radical aspects of the CPP
program. The odds are that he and his gov-
ernment will have to rely increasingly on re-
pressive, authoritarian measures to retain
power and put into effect their currently vague
ideas for the creation of a modernized and
united Ghana.
11. Political Trends. Nkrumah continues to
dominate the political scene in Ghana, as
he has since shortly after his return to that
country late in 1947. A self-described "Marx-
ist socialist" and "non-denominational Chris-
tian," the relatively youthful prime minister
(in his late forties) has been exposed to a
multitude of imperfectly assimilated influ-
ences. Although trained in both Catholic and
Protestant theology, he still consults fetish
oracles ? probably to some extent for political
reasons. He can act either as the benign
father of his country or as a ruthless ward
boss as the occasion demands. Despite his
educational attainments (including four de-
grees earned in the US) , his talents are ex-
pressed in terms of organizing ability, per-
sonality, and flamboyant oratory rather than
Aiestatiri
3
of intellect. Contemptuous of the parliamen-
tary opposition leaders, he seems convinced
that he has correctly interpreted the will of
Ghana's masses, on whom he has based his
political party and his fortunes, as giving him
a mandate to establish a unitary, secular, so-
cialistic state by whatever means he considers
necessary. At the same time, he relies heavily
on the advice of those whose views he finds
congenial or whose knowledge he respects. His
real views are not easily determined, but there
can be no question of his anticolonialism, his
socialist approach to economic questions, his
deep admiration for India's Nehru, and his
determination to manipulate all issues ? in-
cluding the conflict between the Soviet Bloc
and the West ? to the betterment of Ghana's
position.
12. Nkrumah still commands the loyalty of
most CPP leaders, the admiration of much of
the party's rank and file, and the respect of
many other Ghanaians, although his follow-
ing is far greater in the coastal regions than
elsewhere. However, much of this support was
gained through personal contact and easy ac-
cessibility; with his increased responsibilities,
the prime minister has been forced to become
more aloof and formal. Nevertheless, his
quasi-mystical identification with the struggle
for independence is likely to preserve his popu-
lar support for at least the next year or two.
13. Under Nkrumah's leadership, the CPP
since its formation in 1949 has appealed to the
masses, particularly to urban workers and to
the many small farmers who look to the gov-
ernment for assistance in raising and market-
ing their crops. Unlike earlier nationalist
groups led by intellectuals, professional men,
and traditional authorities, the CPP has pulled
in the unemployed, the illiterate, and the
youth of the country. This essentially inex-
perienced membership is one reason why the
CPP government is having such difficulty in
filling administrative and technical posts with
competent people. The CPP has the status
of a national party, with 72 of the 104 seats
in the unicameral parliament.2
The CPP holds all 44 seats of the Eastern and
Western Regions, 8 of the 21 Ashanti seats, 11
of the 26 Northern seats, and 9 of the 13 Trans-
Volta/Togoland seats.
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14. In addition to its organizing work
throughout the country, the party has gained
considerable control over important voluntary
organizations ? notably the Trades Union
Congress (with a claimed membership of over
90,000) , the Farmers' Council, and the Ex-
Servicemen's Union. Nkrumah has created
a National Association of Socialist Students
Organizations (NASSO) to act as a cadre of
party intellectuals charged with "ideological
and political education." The recent organi-
zation of the unemployed into a "Builders
Brigade," patterned on the US Civilian Con-
servation Corps of the 1930's, may also pro-
vide a channel for the exercise of CPP political
control. Moreover, despite constitutional pro-
visions to the contrary, the civil service and
the judiciary are susceptible to CPP influence.
15. There has been a decline in the internal
unity of the CPP during the period since
Ghana achieved its independence. This loss
of cohesion, however, has not gone far enough
to have any measurable effect on the govern-
ment's strength. Prior to March 1957 the
CPP, although it had broad popular support,
lacked strong internal discipline and to a large
degree was held together by the drive for inde-
pendence. Dissension within the party has
recently developed as groups and individuals
have sought to advance their personal status
or ideas. Since this shaking-down process is
continuing, the relative strength of the vari-
ous leaders and groups within the CPP and
its affiliates cannot be fully assessed. Never-
theless, the possibility of a split in the CPP
seems to constitute the most serious threat to
Nkrumah's position.
16. While the CPP and its ministerial lead-
ers seem loyal to the prime minister and share
his basic socialist orientation, ideological di-
visions are beginning to appear within the
cabinet. Finance Minister Gbedemah and
Minister of Justice Ako Adjei increasingly
appear to stand for relative conservatism.
Kojo Botsio (recently named Minister of State
and virtual deputy prime minister and CPP
leader) and, to a greater extent, Interior Min-
ister Krobo Edusei and Information Minister
Kofi Baako represent a seemingly more po-
tent and dynamic element. Nkrumah him-
self appears to incline more toward the latter
4
group, which includes his closest personal
friends. Although Gbedemah is said to be
personally loyal to Nkrumah, they disagree
in many respects and allegedly are barely on
speaking terms. Loyalty to Nkrumah is less
strong below the ministerial level. A hard
core of extreme socialists dominates NASSO,
particularly through Secretary-General James
Markham. It is also influential in the labor
movement and has a powerful advocate in
Attorney General Geoffrey Bing, an extreme
left-wing former British MP. This group op-
poses the relatively cautious approach to do-
mestic reform and international relations
which it considers the Nkrumah government
to be adopting.
17. The various regional and traditionalist
groups opposed to the CPP have recently
formed a loose coalition as the United Party
(UP) , but this does not seem to portend any
immediate change in their relatively weak
parliamentary position. 3 The merger resulted
more from the government's decision to ban
political parties with regional, tribal, and re-
ligious bases than from any newfound identity
of views. These parties, led by the NLM, have
had little in common beyond their opposition
to Nkrumah and the centralizing policies of
the CPP. Although advocating parliamentary
democracy, they have fomented and threat-
endd violence. Through such tactics the NLM
caused the UK to persuade the CPP govern-
ment to accept concessions to the regions in
the 1957 constitution. However, the CPP not
only is opposing the full implementation of
those concessions (i.e., creation of regional
assemblies and houses of chiefs with substan-
tial powers) , but has sent out regional com-
missioners with cabinet status to assert the
authority of the central government. For the
foreseeable future, the UP, unless it can profit
from a split in the CPP ranks, is likely to re-
3 The UP consists of five opposition groups repre-
sented in Parliament; the most important are
the Northern People's Party (NPP) with 15 par-
liamentary seats, and the National Liberation
Movement (NLM) based on Ashanti, with 12
seats. The UP is also supported by a Ga tribal
movement, which resists the threat to local cus-
toms and land rights posed by the influx of out-
siders into Accra.
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main powerless to arrest by legal means the
trend toward centralization.
18. The few score identifiable local Commu-
nists now play no independent political role.
Such influence as the Communists possess is
exerted through NASSO, at the lower levels
within the labor movement, and through their
association with the extreme left-wing social-
ists, who have easy access to government lead-
ers. There is no organized Communist party
and little prospect of one being formed so
long as the Communists continue their ap-
parent course of attempting to influence the
CPP government from within the party and
its affiliates, and so long as Nkrumah con-
tinues to oppose any organization which
might escape his control. In the likely event
of Soviet Bloc missions being established in
Ghana, local Communists will probably gain
some increase in influence and are likely to
become increasingly troublesome to Nkrumah.
However, the Communists are unlikely during
the period of this estimate to win sufficient
strength to determine basic government pol-
icy.
19. Unless there should be defections among
the CPP members of Parliament so large as
to destroy its majority, national elections will
probably not be held until required in 1961.
Whether or not the political scene will have
basically changed by that time will depend
largely on these factors: (a) the government's
ability to satisfy aroused popular expectations
of economic benefits, (b) the degree to which
job demands by CPP members can be met
without a critical loss of efficiency in official
services, (c) the reaction to the government's
attack on opposition leaders, and (d) the abil-
ity of the government to prevent significant
defections from the CPP. On all these counts
the prospects are for some deterioration in the
present situation.
20. We believe that Nkrumah through shrewd
maneuvering will be able to prevent any basic
split in the CPP or substantial defections from
its parliamentary majority over at least the
next year or two. If such a split should oc-
cur or seriously threatened, Nkrumah might
maintain his authority by suspending the con-
stitution. In any event, we believe there is a
better than even chance that Nkrumah will
5
remain in power as head of the government
by one means or another over the next several
years. His personal power has already been
heightened by his assumption of many pre-
rogatives formerly associated with British rule.
Although he may not wish to become a dicta-
tor, his own character and future political de-
velopments in Ghana in time might force him
to take increasingly authoritarian measures
if he is to continue as prime minister. He
could probably only avoid such steps if his
policies had meanwhile proved sufficiently
successful to maintain his personal prestige
and popular support for the CPP.
21. Should Nkrumah die (violently or natu-
rally) or give up his position, his followers
within the CPP would probably remain in con-
trol for at least the short term. But the
party's centrifugal tendencies would acceler-
ate, with the probable result of a split and a
consequent high degree of political instability
in Ghana.
22. Internal Security Prospects. The CPP over
the short term will press on with its efforts
to unify and modernize the country with every
weapon at its command. Deep-rooted region-
al and tribal loyalties will, however, delay this
process. Sporadic outbursts of civil disorders,
especially in the unruly Ashanti Region, will
occur during the next few years ? their fre-
quency and intensity depending on the meth-
ods and extent of government moves against
the opposition and the nature of the economic
situation. Both the CPP and the NLM have
strong-arm squads. A violent outbreak could
take place next spring when the government
is scheduled to make clear its position regard-
ing regional institutions, since that position
will almost certainly be aimed at minimizing
their powers.
23. The government has available for main-
tenance of internal security a police force of
about 5,500 , men ? roughly half of them
trained in riot squad operations ? and an
army of approximately 4,500. There are no
known plans for other types of armed forces.
The army is largely officered and equipped
(with small arms and light cannon) by the
British, while nearly half the senior police
officers are British contract employees. The
effectiveness of these forces will be adversely
vvetlitengE
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affected by the gradual withdrawal of British
personnel. However, for at least the next
year or two, the government probably will be
able to cope with almost any disturbance
which the opposition could produce. One pos-
sible exception might be a situation in which
the Northern Territories were deeply involved,
since a large percentage of the army and
police comes from the North. Another might
be a case in which the government took some
extreme action which touched off a general
Ashanti uprising. In the event of a flagrant-
ly unconstitutional repressive move by the
government, the British officers in the army
and police might refuse to act. Even in such
a situation, however, the government would
probably be able to enforce its will save in the
exceptional circumstances described above.
24. Economic Conditions and Trends. The
CPP government's success will depend in large
measure on progress toward its second objec-
tive : the development and diversification of
Ghana's economy. The outlook for the avail-
ability of sizable funds for development is
superficially good, but only for the short term.
Ghana over the past few years has been able
to finance the major portion of its develop-
ment from its own resources ? outlays since
1951 have been roughly $300 million. How-
ever, this was accomplished mainly as a result
of inflated world prices for cocoa in the period
1951-1955; those prices fell sharply thereafter.
Thus Ghana's economic position-is heavily de-
pendent on an export commodity which is vul-
nerable to severely fluctuating prices and to
limitation of production by various diseases.
Over half of the country's export earnings
were derived from cocoa in 1956.4 Timber,
diamonds, gold, and manganese each ac-
counted for roughly 10 percent of those earn-
ings. But future prospects for greater yields
of these commodities are not bright. Ghana's
most important known potential resources are
its bauxite deposits, ranked third in terms of
world reserves. Their full exploitation, how-
ever, will be very expensive. While there may
be undiscovered mineral resources, particu-
larly in the North, Ghana's economic pros-
Cocoa production is the major factor in Ghana's
national income ? estimated in 1955 at $654
million, or $142 per capita.
6
pects are now dependent on development of
the bauxite deposits, agriculture, and second-
ary industry.
25. The government has a number of instru-
ments through which it is attempting to ful-
fill demands created by the rapid transition
from a subsistence to an exchange economy.
Despite Nkrumah's professed encouragement
of free enterprise and foreign investment, the
government is extending its control over an
ever-widening sector of the economy. While
foreign interests (mostly British) still dom-
inate such fields as commerce and mining, all
public utilities are owned by the government,
which also engages in commercial banking
services and owns various enterprises. The
government exercises considerable control
over the industrial and agricultural sectors
through the Cocoa Marketing Board, the In-
dustrial Development Corporation, and the
Agricultural Development Corporation. The
growing scale of government economic opera-
tions is resulting in the operation of many
public projects at a loss, due to their uneco-
nomic nature and the lack of managerial
talent.
26. The government's immediate economic
objectives are being pursued under the First
Development Plan of 1951, which stresses
basic facilities and social services. A two-
year consolidated Development Plan is now
envisaged which will include new schemes as
well as uncompleted projects from previous
programs. About $50 million in development
expenditures are scheduled to be spent in FY
1958, ending next June. Aside from these
plans, a high priority is being given the pro-
posed Volta River project. Its primary pur-
pose is to provide electric power sufficient for
production of over 200,000 tons of aluminum
annually. However, the most recent assess-
ment of the full project placed its final cost
at about one billion dollars, mostly in foreign
exchange. In addition, prospects for market-
ing Ghanaian aluminum have been dimin-
ished by the changing world aluminum sup-
ply position.
27. There is some doubt as to the govern-
ment's ability to support even its current rate
of expenditures for development beyond the
next two to three years without drawing down
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4aVein T
foreign exchange reserves required for other
purposes. When Ghana became independent
last March cocoa prices had reached the lowest
level since 1948, with consequent repercus-
sions throughout the economy. The country
in 1956 experienced an unfavorable trade bal-
ance on current account of $50 million, the
first serious payments deficit in recent years;
this was met by drawing on overseas balances
(which stood at about $550 million at the be-
ginning of 1957) . As a result, certain econ-
omies have been made in the current ordinary
budget of about $125 million, but they are
largely offset by new expenditures for foreign
relations and internal security. At the be-
ginning of FY 1958, Ghana's sterling holdings
earmarked for development were equivalent to
$110 million ? adequate to support the cur-
rent planned' rate of expenditure for at least
the next two years. Although cocoa prices
have risen considerably in recent months,
they do not promise any large addition to
development funds.
28. Thus the government is now seeking for-
eign assistance from various Western sources
to supplement its development funds and
obviate the necessity for drawing heavily on
stabilization and currency reserves. It has
received Soviet emissaries with whom expan-
sion of trade and credit relations and estab-
lishment of diplomatic relations have been
discussed. It has announced that it will ask
the USSR and Communist China, as well as
Free-World nations, to receive Ghanaian
trade missions. The government is also tak-
ing soundings of possible foreign financial
assistance for the Volta River project, which
is far beyond its own means. The most that
Ghana could invest in the project would prob-
ably be about $250 million; this would require
the virtual elimination of all other develop-
ment projects and, as mentioned above, a
serious drain on reserves needed for other pur-
poses. Although Ghana will make every ef-
fort to undertake the full project, it /nay set-
tle for a part (i.e., the processing of bauxite
into alumina) if sufficient financing is not
forthcoming. In any case, it is likely to move
cautiously on the issue in the near future to
avoid the risk of a political setback if it is un-
able to obtain assistance.
7
29. Since Ghana's foreign trade is largely
oriented toward the UK, the OEEC countries,
and the US, it would probably prefer to receive
external aid from Western sources ? for prac-
tical rather than ideological reasons. How-
ever, the government will try to insure that
in approaching the West it does not preclude
the possibility of economic benefits from the
Soviet Bloc; even moderate Ghanaians are
urging that all possible contributors of for-
eign capital be given a chance to bid against
each other. Ghana is particularly concerned
about the effect of the proposed European
Common Market duties on cocoa, which favor
imports from the French and Belgian colonies,
and therefore wishes to expand its trade rela-
tions with the dollar area, the Bloc, and Japan
in order to reduce its dependence on Western
European markets.
30. While trade with the Soviet Bloc in 1956
was only about two percent of Ghana's total,
the USSR's heavy cocoa purchases on the eve
of Ghana's independence (taking advantage
both of favorable buying terms and of the
propaganda opening) were probably a har-
binger of increased trade or barter arrange-
ments with the Bloc over the next few years.
There will almost certainly be some shifts in
the future trade pattern with the West, but
sharp deviations are unlikely over the next
few years in the absence of a major, Bloc effort
involving long-term credits for development.
31. Ghana's long-term prospects for develop-
ing and diversifying its economy are not fav-
orable. Local private investment funds are
virtually nil, and foreign private capital is un-
likely to be attracted to the area because of
limited opportunities, increased government
controls, and the fear of political instability.
Even with another period of high returns for
cocoa, Ghana's rapid expansion would be
hampered by the traditional living pattern
and the shortage of educational facilities,
skills, and incentives for saving and invest-
ment. Until these problems are overcome, a
large share of expenditures will continue to go
into consumption, and the provision of social
services will strain government resources.
Ghana probably will have to continue to de-
pend on agriculture for its major source of
income.
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4SAttterr 8
32. Probable Foreign Policies. The CPP leaders
probably will do their best to adapt Ghana's
external policies to these economic considera-
tions. Such policies thus will be based on
pragmatic rather than ideological grounds.
Nkrumah has forcefully proclaimed a policy
of "non-alignment" in international affairs,
and is likely to copy Nehru's attitude to-
ward the great powers. Hence, his govern-
ment will tend to appraise foreign countries
by the degree of sympathy they display for
Ghana's aspirations. The neutralist attitude
of Ghana's leaders, their acceptance of au-
thoritarianism, their propensity for bargain-
ing, and their wish to maintain a purely
African outlook will lead them to explore the
possibilities of playing the West off against the
Bloc.
33. Nkrumah's pan-African sentiments are
likely to promote a particular effort by Ghana
to play a major role in the continent's affairs.
His proposal for a conference of independent
African states ? now scheduled for April
1958 ? indicates his likely tactics in this re-
gard. On such occasions, Nkrumah will seek
recognition as a primary spokesman for Afri-
can nationalism. The very fact of Ghana's ex-
istence heightens the pressures for independ-
ence in other African territories, but there is
as yet no indication that Ghana is ready to
give more than diplomatic and propaganda
support to other nationalist movements, ex-
cept perhaps to those in contiguous areas.
Furthermore, while the rank and file of na-
tionalist movements in Africa south of the
Sahara acclaim Nkrumah's achievements,
many leaders ? especially in nearby West
African areas ? are his potential rivals and
are suspicious of the possible effects of his
influence in their countries.
34. Nkrumah has an interest in promoting a
West African federation initially composed
of Ghana and the several British colonies in
the region as they achieve independence.
However, most Ghanaians are now preoccu-
pied with domestic questions. Nkrumah will
be further inhibited from any action in this
realm by the present need to avoid conflict
with the UK for economic reasons, and by
fears of the eventual supremacy of Nigeria,
which has a far greater economic potential
and population than Ghana.
35. In at least the short term, Ghana's atten-
tion is likely to be directed toward the French
territories which surround it. While officially
supporting independence for the Trust Terri-
tory of Togo, which is already an "autono-
mous republic," the CPP is likely to foster a
policy for its union with Ghana.' This, and
other possible covert moves, probably will re-
sult in controversy with France and some un-
rest in the region concerned. Elsewhere in
the area, Ghana's relations with Liberia are
likely to be marred by rivalry and mutual dis-
like. Despite its seemingly friendly relations
with Egypt, Ghana will be sensitive to any
attempt at domination. Its recent contacts
and agreements with Israel show that Ghana,
while maintaining close ties with the Arab
states as fellow members of the Afro-Asian UN
group, will not necessarily endorse all their
views.
36. Ghana's relations with the UK will be fre-
quently subject to mutual irritants, but there
is little likelihood that Ghana will leave the
Commonwealth as long as it expects to bene-
fit from the association. However, Nkrumah
might make himself Governor-General or de-
clare Ghana a republic within the Common-
wealth. Any major problem that might arise
with the UK would probably be of an economic
nature, and would specifically concern
Ghana's large holdings of sterling or its pro-
posals for Commonwealth protection against
loss of cocoa revenues. The outlook for sub-
stantial British assistance is dim.
37. A conflict with the UK over defense mat-
ters is unlikely, since the British have viewed
with equanimity Ghana's current withdrawal
from West African defense arrangements.
The UK now seems to believe that Ghana's
attachment to a policy of neutrality will pre-
clude any future contribution to area defense.
The principal installation in Ghana of mili-
tary significance, the Accra airfield, would
probably not be made available to the West
5 The southern part of Togo is dominated by the
Ewe people; the majority of Ewes reside in
Ghana'.
4094W- WW1
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in the event of hostilities with the Soviet Bloc
unless Ghana itself were involved. Whether
or not transit facilities might be available in
other cases would largely depend upon
Ghana's relations with the countries con-
cerned.
38. Attitudes and policies toward the US will
probably be shaped largely by economic in-
terests. A growing number of Ghanaians
have visited the US, where they have been
particularly impressed by technical achieve-
ments, but repelled by the racial discrimina-
tion which they encountered. Both on the
latter count and because of the extremes in
which its anticolonialism is expressed, Ghana
does not find moderate US policies very ap-
pealing. Ghana nevertheless is favorably dis-
posed toward the US at present, especially
since it is regarded as the logical source of the
foreign capital and technical assistance essen-
tial for the Volta project, and Ghana is likely
to make large requests for aid in the near
future.
39. However, even if offered substantial West-
ern assistance, it is highly unlikely that
Ghana would undertake to forego ostensibly
9
profitable trade relations with the Communist
Bloc. Economic relations with the Bloc will
probably increase. Some degree of Bloc dip-
lomatic and commercial representation is al-
most certain to be accepted by Ghana, thereby
giving the USSR a foothold in West Africa.
The Bloc over a period, by using its oppor-
tunities for economic and subversive activity,
might achieve a significant measure of influ-
ence in Ghana.
40. The extent of Soviet influence will depend
in large part upon the degree to which Ghana
may become dependent on the Bloc for tech-
nical and financial assistance or for markets
for its exports. We believe that Ghana's de-
sire to avoid close alignment with any, great
power and to act independently in African
affairs will limit both Soviet and Western in-
fluence in at least the short run. However,
the practice of the Bloc of taking positions on
"colonial" and racial matters similar to those
of the former colonies will often result in
Ghana's lining up with the Bloc on certain _
issues before the UN. These relationships are
likely to develop regardless of any countering
Western actions.
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10
8
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Declassified and Approved For Release @50-Yr 2014/01/15: CIA-RDP79R01012A010200020001-7
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