Ghana recently discovered large quantities of oil and there are a lot of expectations around that. But even before that, Ghana, the 'Gold Coast', was Africa's second-largest gold producer and still a poor country. Why have these resources not benefitted Ghanaians?

You can't discuss this issue without referring to history. Serious gold mining in Ghana started in colonial times in the 1890s when Ashanti Goldfields was formed by the British. Then, 100% of the gold was theirs.

So in the 50 or 60 years leading up to independence, all they did was pay royalties and land rights to the traditional rulers in the area they mined. None of the gold went to the people.

But then Ghana became independent.

This situation continued until the 1970s, when the military government decided to take a majority share, with a slogan about capturing the commanding heights of the economy. Then another military regime came into being only to sell off the majority equity of the state to foreign companies; I believe Lonrho and some German group. The state was reduced to a minority shareholder.

The deal with AngloGold was struck when you became president in 2001. Are you happy Ghana got a fair deal? The perception is that the gold is just shipped out, with foreign companies and others benefitting more than the citizens.

When I took over, the equity of the state was just under $125-million.
The government I succeeded had sold off a chunk of the equity just before I came to power, for what they declared to be $600-million. I remember people asking about where the $600-million was and the then-finance minister told the government that it had been used to balance the budget [laughs]. So no one really saw how this money benefitted the state.

Initially, AngloGold offered something like $179-million to merge with Ashanti. My government refused. AngloGold is the number-one gold producer in the world, so it came powerfully, with transaction advisors and so forth. We made up an equally powerful transaction group, which we got from the Societé Générale of France. We then went into negotiations that lasted several months.

We managed to conclude negotiations with the offer raised to $350-million and retain the share the government had before AngloGold came on board, as well as the name Ashanti. AngloGold is now AngloGold Ashanti wherever it is quoted, in London or New York or Frankfurt or anywhere.

What will happen to the gold deals in the future?

This deal was struck around six years ago. I am sure Ghana's equity should now be, if not a billion dollars, not very far from that.

Governments in Africa were initially at a disadvantage because we inherited many concession agreements from colonial times, when the authorities took whatever they wanted. But succeeding regimes have now become quite adept at tackling contractual relations professionally. Now I believe many governments are waking up. And in Ghana's case, depending of course on the government of the day, no concession should go without due negotiation, with the best skills and practices that would pertain anywhere on earth.

A lot of people are now looking to Ghana after the big oil find offshore. Can Ghana get more benefit from this?

The oil was struck in my time. Ghana had been searching for commercial quantities of oil for a hundred or so years, since colonial times. We didn't succeed until late 2006 on the eve of Ghana's golden jubilee, when a company called Kosmos struck this oil in quite large quantities.

We've been told that this field contains about one and a half billion barrels in reserves. From the little I've learnt from these concessioners, they never tell you the real truth. I believe this estimation to be very conservative and that the reserves could be upwards of three billion barrels. The terms we used to negotiate are terms that I believe to be international, because Ghana had struck oil before and a succession of powerful companies had come to our shores and all had left saying there wasn't any oil.

But are there institutions in place to make sure that if a good deal is struck, the money doesn't go into the pockets of an elite?

Let me speak for my government; I can't speak for the present government or any other government. When we learnt we were oil-bearing we immediately approached Norway, because everyone was saying this was the best system to ensure that the benefits were passed down to the people.

Norway kindly sent a government minister to come to talk to us and we staged an international conference with Norway, Britain and, I believe, some people from our sister country Nigeria.

The whole purpose was to show us the framework by which we could dedicate funds for specific social ends like education to make sure no one person would dip into them and begin to cheat the rest of the people. We did all that and from that we prepared a draft law for our parliament. Unfortunately we couldn't finish with the law before we found ourselves out of power.

In other countries, Chad for example, there were also negotiations, and civil society and institutions like the World Bank participated to make sure the oil money was used transparently. Yet here the ruling party and those in power have just gradually discarded these agreements.

Well, as I said, it was under me that Ghana struck commercial quantities of oil. Within two years I was out of power. I don't know what this new group is going to do, but I pray it will follow up where we left off with the framework and the enactment of the laws effecting the rule of law and transparency, to make sure all the people of Ghana can be beneficiaries of this find, so it can be a blessing rather than a curse.

Can your party, the NPP, do anything in parliament to make sure this happens?

My party is quite strong and articulate in parliament. We try to keep the government on its toes. The bane of democracy is that the opposition may express themselves and talk, but the government, the majority, has its way at the end of the day. So we just hope the people of Ghana will be awake and demand that government acts transparently for the good of the people and this civil society. They don't have to be political, but all Ghanaians and the friends of Ghana should be looking to ensure that the right things are done for the benefit of Ghana. Fortunately the extractive industries initiative is now in place, and I believe the US Congress has also enacted a law to strengthen the watchdog role of ensuring that oil companies act transparently. There are also other international organisations coming up to strengthen the watchdog role.

There seems to be some dispute with Côte d'Ivoire over whether some of the oil belongs to it?

Ghana and Côte d'Ivoire are bound together both onshore and offshore.
Côte d'Ivoire struck oil much earlier and has been pumping oil over the last few years. Ghana is a new entrant. We have struck near the border with Côte d'Ivoire. I don't think we're straying into Côte d'Ivoire territory at all, but it is good for the two sister countries to anticipate all the possibilities because, after all, this thing is happening below the ground. Since it is liquid, one country's reserves may stray into the other's and we hope we can adhere to a gentleman's agreement and the relationship between the two countries stays as friendly as possible forever.

Looking at the issue of leadership in Africa, you are one of the few African leaders who left power after your two terms in office. Weren't there people around you who said, "Don't step down, it's not in our interest"?

I didn't have that in my tenure as president. If we look again at history, most of the leaders were the ones who more or less forced their countries out of the dominance of foreign powers. That's what catapulted them into leadership. Unfortunately for them and for Africa, they had not been exposed to managing societies and governments and business.

They weren't exposed to the workings of international relations.

The first 30 years of independence displayed a series of strongmen and coups d'état and uprisings. Naturally when people like those get into power they display a kind of messianic mentality. They believe that without them everything would collapse. By the turn of the century and the end of the Cold War the strongman syndrome started petering off.
Constitutionality came into ascendance, not only in Africa but all over the world.

What about you personally?

I was privileged to have entered politics when I was fairly young, in the 1960s, first as a member of parliament and then deputy minister of foreign affairs for Ghana. I had been educated in some of the best institutions you can find anywhere, in law, philosophy, politics and economics.

By the time I became president under the 4th Republic in 2001, I was set on respecting the constitution. That year marked a wave of change in Africa where the leaders themselves said that Africa was about good governance, respect for human rights, respect for property rights, the private sector and partnerships between the African nations and the outside world on the basis of a win-win situation. So the fact is that Africa has moved from the phase of strongmen to the phase of constitutionalists. I was a product of constitutionalism, and even if pressure was put on me to extend tenure, I wouldn't. And if I did feel it necessary to extend tenure, I would do it by constitutionally provided means.

And not change the constitution?

I don't have the power to do it.

What is your message to heads of state who believe there is no life after being a president? How is your life as a former head of state?

I took power knowing I would step down, whether for a good life, a bad life or whatever. I knew the law was binding on me.

Now I feel like a free man. I go camping. I accept invitations when I want to and reject them when I want to. My message to my brothers is that since all of us come to power through a constitution, respect the constitution as an article of faith. Respect the constitution, otherwise we betray Africa.

You were chair of the African Union in 2007 and 2008. Some say the AU is just a huge bureaucracy and to move things faster we need a small informal group of countries like the G8?

If you measure the AU against other institutions, like the European Union, you see that perhaps it is over-anxiety over Africa and its difficulties that makes people want a magical change overnight. I believe the African Union has taken its first few steps correctly with Nepad, the African Peer Review Mechanism and with the regional groupings. In East Africa they now have the common market in place and the parliaments are working together. In West Africa we have Ecowas, but you know the challenges we are confronted with: one is language; another is the connection with our former colonial masters. They are affecting even the currencies, transportation, communications and many other things.

So if we have these challenges within regions, you can imagine what they are like when we talk of the continent. Yes, I wish things could go faster, but the institutions are yet to mature.


You seem critical of Ecowas and yet politically it has been perhaps the most successful, in the case of Niger for example?

I was chair of Ecowas twice successfully and I think everything should be put into perspective. Ecowas has been there for 20 or 30 years, but how long has it been so successful? The intervention in Niger was just recently and yes, Ecowas boycotted, but it took a domestic coup d'état to effect the change that Ecowas was advising. And I believe it has been done elsewhere on the continent, not only in Ecowas. Much as we all want the vision to be realised quickly, a bit of realism will help.

There seemed to be an effort to elevate the status of the AU commission chair in 2003, when former president Alpha Omar Konare was appointed. Why didn't that work? We are back to a former foreign minister as chair.

Governing requires trial and error from time to time, especially when institutions are so young. Konare was given the chair. He was a longstanding president of his country: a very powerful man, a brother and colleague of the presidents. So naturally it wasn't easy to see him as he should have been seen, as the administrator. In a corporate environment you have the board more or less sitting on the chief executive to account, to work out the programmes and effect the decisions of the board. So here the distinction between the board and the chief executive was blurred. I believe this is why, next time around, the summit decided to move a step down for a foreign minister who would ordinarily stand to attention when addressing the summit. It might be better for the development of the African Union
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South Africa's role as a powerhouse was prominent during former president Thabo Mbeki's term, but even then some people said it should play a stronger role. Do you think SA should be a leader in the AU?

The union is a union of equals. No doubt South Africa is a powerhouse economically and developmentally, but politically it is just one of 53 countries. I believe South Africa is behaving properly. It should lead by example, in terms of good governance and the partnership between the public and the private sector, to ensure development for all the people in terms of human rights and of relating with the rest of the world.

South Africa is one of the emerging nations, it is a member of the G20.

Not many of us have access to these international forums, so SA should use these institutions and should be the advocate for Africa. But South Africa should not become a policeman just because it is powerful and violate the sovereignty of the rest of us. People struggled for centuries and decades to gain independence, so whether they are big or small, their rights should be respected.