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The politics of local content legislation in Ghana

Working paper 104

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Ishmael Ayanoore
The resurgence in local content reforms in most oil-rich Africa countries is broadly understood within the elite-political projects of creating opportunities for domestic capitalists to accumulate rents. New insights from an extended political settlements framework (incorporating ideas) help offer a more explicit understanding of this drive and go further to situate the current local content commitments in Ghana within deeper forms of politics and power relations. The paper asserts the critical role of not only the rents accumulation interests of politicians and domestic capitalists in driving the surge in local content, but also key political settlement tendencies (partisan policy making, coalition building and clientelist politics), underpinned by a linked array of elite interests and ideas. This paper offers deeper political economy insights into the drivers of elite commitment to governing oil in the national interest and argues that current debates concerning the factors driving local content reform in oil-rich African countries could be stronger with a focus on the entwining of interests and ideas generated by the configuration of power within political settlements.