NPP faces Rough Ride

Weaving his yellow taxi through the traffic-choked streets of Accra, James Osie says Ghana's ruling party has grown fat on the money of the people. That's why he wants it to stay in office after December's elections. "The guys in power have already chop (eaten) so they won't chop too much more," said Osie, slipping into West African pidgin English. "The others, they are too hungry. They will spend a long time stealing before they think of us."

The centre-right New Patriotic Party (NPP) had been expected to romp home in this year's presidential and parliamentary polls, thanks to an economic boom during its eight years in power.

With Africa enjoying its strongest growth in four decades, Ghana's prospects are amongst the brightest on the continent.

As the world's second largest cocoa exporter and Africa's second biggest gold producer, high commodity prices have boosted investment. Whoever succeeds President John Kufuor, a tall Christian known as the gentle giant, will oversee Ghana's entry into the oil club as offshore fields start up in 2010.

But storm clouds -- from soaring international food and fuel prices to power shortages and allegations of corruption -- are threatening to overshadow the NPP's record and leave it fighting to stay in office.

"Ghana's government is growing more concerned about its prospects in December," said Sebastian Spio-Garbrah of consultants Eurasia Group in New York. He noted, however, that the NPP's large war chest and splits in the opposition could prove decisive. "The NPP is still likely to win in the end, but it's likely to go to a second round."

Lavish spending during the NPP's presidential primaries has tarnished the government's image in a country where most people scrape by on a few dollars a day, said Emmanuel Gyimah-Boadi, director of the Center for Democratic Development.

The NPP was also shaken by an acrimonious public spat in April when failed presidential candidate Alan Kyerematen briefly left the party alleging discrimination against his supporters.

"People may be overestimating the ruling party's lead in the coming election. It's much smaller than people assume," Gyimah-Boadi said. "If there is a peaceful changeover of power for a second time in Ghana, it would be a milestone in Africa."

NPP CONFIDENT

Struggling to make ends meet, many Ghanaians are becoming less phlegmatic than taxi-driver Osie about persistent graft, which the NPP had promised to tackle. In the lively bars of Accra's Osu district, the air reverberates to the sound of local singer Sidney's hit "Africa Money", whose chorus 'Our money o, oga dey chop' translates as 'bosses are stealing our money'.

Sidney says his song is not just about Ghana, but it has resonated here.

Nana Akufo-Addo, the NPP's presidential candidate and a former foreign minister, said his party's record on the economy, education, health and good governance give him confidence. "The general statement that there is corruption in Ghana is something anyone can make, including the government," said the British-trained lawyer, the son of a former president.

The first black African state to win independence in 1957, Ghana has emerged as a pin-up for democracy in volatile West Africa since it returned to multiparty politics in 1992 after decades of coups and short-lived military governments. Compared with its West African neighbors, Ghana scores well on transparency.

It ranked as the 67th least corrupt country in a 2007 index of 179 nations by Berlin-based Transparency International, making it one of Africa's best performers. The economy is on track to grow 7 percent this year and foreign investment has jumped from 1 percent of gross domestic product in 2000 to 4 percent last year, with investors focusing on banking, oil and telecoms.

After debt relief in 2004, a maiden $1 billion Eurobond last year was oversubscribed. Whoever wins the elections, Ghana's liberal economic reform agenda is unlikely to change, analysts say.

With blocks operated by UK-based Tullow Oil and private equity-backed Kosmos Energy due to start pumping 120,000 barrels of oil a day in two years, the government hopes Ghana can escape the low-income bracket by 2015.

"A mass transformation is within reach," said Akufo-Addo, pledging to use future oil revenues to industrialize an economy reliant on primary materials and drag the former British "Gold Coast" colony out of poverty.

Some analysts have warned that joining sub-Saharan Africa's club of oil producers, headed by Nigeria and Angola, could be as much a curse as a blessing if it brings the kind of corruption, inequality and conflict that have plagued those other producers.

In the short-term, the government also needs to weather an economic storm. Like many African states, Ghana is dependent on food and fuel imports and soaring international prices have driven inflation to nearly 17 percent, sparking public anger.

Kufuor, who steps down in December after two terms, unveiled an unbudgeted raft of tax cuts in May to mitigate soaring prices. With government officials saying this could cost up to $1 billion, it will increase a budget deficit forecast at 7 percent of gross domestic product this year.

ETHNIC TENSIONS

Home to seven main ethnic groups, Ghana robust economy masks social divisions. After the tribal conflict this year triggered by disputed polls in once-stable Kenya, opposition candidate John Atta Mills says ethnic rifts in Ghana need attention.

His centre-left National Democratic Congress (NDC) draws heavily on the Ewe ethnic group in the east, while NPP strongholds are in the homelands of the Akan, which makes up roughly half of the 23 million population. Kufuor is from the Ashanti tribe, which is part of the Akan group.

"There is certainly no doubt that top positions are occupied by people from one region," said Atta Mills, who lost the 2000 and 2004 elections to Kufuor but alleged fraud.

"We must all be made to feel that we belong to one country." Former coup-leader-turned-president Jerry Rawlings, who ruled from 1981 to 2000 and founded the NDC, accuses the NPP of registering phantom voters in its Ashanti heartlands and has warned of popular protests if the polls are not fair.

"The West keeps on whitewashing Ghana's image because ... Ghana has done so well that it can be used as a showcase for Africa in spite of the dirty, malicious, wicked, vindictive things Kufuor is doing," said Rawlings, accusing the government of politicizing the judiciary and tribalizing the armed forces.

In response to opposition allegations of abuses and corruption, Akufo-Addo says that "Ghana has never been so free in its history as it has been in the period of NPP rule".

CDD's Gyimah-Boadi said there were signs of growing independence among Ghana's civil society, media and judiciary.

He predicted generally free, fair and peaceful polls. "Each election in Ghana has been an improvement on the previous one. The question now is whether we can better the elections of 2004."