Elections in Africa have become some of the most expensive in the world.

A major part of the reason is deep mistrust among the participants leading to levels of paranoia about rigging that would make an Afghan politician squirm.

But at the heart of the matter is the simple reality that, with the atrophy of most of its pillar institutions, democracy has been reduced to elections in most of Africa. When elections are all there is, the vote attains sacramental significance in the ritualised state, and all fiscal logic must be sacrificed on its altar of convenience.

Hence the reason why the UK spent $150 million on its 2015 general elections, whilst its former colony and democratic imitator, Ghana, splurged $212 million on its 2016 version (the budget was in fact $278 million, but due to constraints about 40% could not be disbursed). Looking at it from a cost per voter perspective, Ghana spent $13.5 whilst the UK spent about $3.2. Put another way, elections relatively cost Ghana more than four times what they cost the UK.

The mistrust and paranoia alluded to above have endowed African countries like Ghana with some of the most advanced electoral systems in the world. Roughly half of African countries have deployed state-of-the-art biometric technologies to prevent cheating at the polls; nearly no Western European or North American country has.

In those places where democracy has led to sound institutions, voters can rely on identification established by other state institutions. In Africa, electoral bodies and the political parties insist on a separate, watertight, identification system just for elections. Everything else can keep using the leaky, messy, systems, but not elections. Elections are holy ground that must not be profaned.

But paranoia-driven, bleeding-edge, technology is not the full story. African electoral management bodies are not the efficiency paragons their political party enablers would have them be. They are as wasteful and disorganised as many of the other atrophying democratic institutions in your typical African country. Once again, let’s use the case of Ghana.

Though the Electoral Commission (EC), Ghana’s elections management body, charges considerable filing fees when political candidates seek to stand for office, and also rents out its services to various political parties and institutions for their own internal elections, it refuses to consistently report its “internal generated funds” (the jargon in Ghana for earnings made by state institutions, usually from commercial services) for financial planning purposes. Expenditure planning datasheets used by the Ghanaian Ministry of Finance to map out spending over the medium-term horizon have in recent times spotted blank spaces where the EC’s internal generated funds data should be. State auditors report spending on capital infrastructure at a level ten times what the legislature approves. They also lament failure by the institution to submit accounts for auditing by statutory timelines.

At one point, the EC even sold access to voters’ data on the electoral roll to a private fintech startup called BSystems and promptly forgot, or so it claims, to collect the revenue.

The 3x growth in its budget from circa $65 million in 2008 to circa $200 million today is thus not all due to the “escalation in sophistication” of the electoral process as a result of paranoia. A significant proportion of the cost escalation is due to sheer waste. And nothing exemplifies that fact more than the EC’s ongoing effort to rip out the existing biometric system used for identifying voters, along with its accompanying electronic infrastructure, and spend as much as $150 million (inclusive of contingency) building a brand new one.

When the EC started its campaign, its claims seemed rather reasonable. It anchored its arguments on apparent facts that the existing biometric system was largely obsolescent, having been implemented for the 2012 elections and used since then for two general elections and multiple district level polls, by-elections, mop-up registration exercises, referenda, and council of state elections etc.

According to the EC, the Israeli contractor responsible for procuring key components of the biometric system – BVRs, used for voter registration and BVDs, used for verifying voters on voting day – had informed them that all the equipment are at the end of their serviceable life and ought to be replenished and upgraded. The vendor had, according to the EC, quoted $74 million for this activity. Buying a brand-new system on the other hand would cost “just” $56 million.

Who can argue with such logic. If throwing away $60 million of existing equipment would lead to cost avoidance of $74 million and replacement expense of just $56 million, then surely this makes sense? Even if doing so would also mean an additional $70 million spent registering and collecting biometrics of all 17 million voters afresh.

Except that the whole argument betrays a mindset of such perverse wastefulness that were the account to be true, every one of the eighty-one information technology (IT) personnel on the organisation’s payroll, who shall be responsible for this new setup, would need to be whipped. And they might deserve it since previous state audit inspections have found equipment gathering dust in various stores, and an absence of even a rudimentary asset register.

But in this instant case of “throwing away millions to save millions is cheaper” though, a certain historical rite comes to mind: the Florentine Bonfire of the Vanities.

A Dominican Friar, called Savonarola, emerged on the scene in Renaissance Florence whose art of persuasion was so strong that he convinced some of that epical city’s most famed artists and scholars to turn over priceless works of art and scholarship to be burned in massive bonfires as acts of edification. Irreplaceable valuables, rare manuscripts and fine ware, were collected from many eminent citizens and brought to the bonfire to be consumed before chanting crowds. Until, finally, the Church began to fear Savonarola’s excessive influence, and had him excommunicated and executed.

Ghana is in the throes of a similar seduction. Many people watch on helpless, and some have even been seduced by the rhetoric, as the EC prepares to rip out $60 million worth of equipment and burn them (for that they must, as there is no market for second-hand electoral technology).

Yet, the EC’s arguments do not pass the most basic of common-sense litmus tests, much less expert review. Those seriously interested in this topic may consider reading this document issued by IMANI on behalf of a large group of civic organisations in Ghana opposed to the EC’s plans.

This simple table below provides a snapshot of the state of the current system by focusing on the key question of wear and tear.

Fig. 1. Ballpark Asset Wear & Tear Analysis*

Biometric Voters Registration Machines (BVRs)  
  Class Baseline

Valuation

Number of times used Depreciated Value  
  A $10.5 million 8 times $5.5 million  
  B $7 million 4 times $5.5 million  
  C $5.25 million 2 times $4.75 million  
Biometric Voters Verification Devices (BVDs)  
  Class Baseline

Valuation

Number of times used Depreciated Value  
  A $12 million 10 $4 million  
  B $4.2 million 4 $3 million  
  C $5.25 million 2 $4 million  
  D $5.25 million 0 $5 million  

*For ease of analysis, the software and communications peripherals (such as ground satellites) also costing millions of dollars and scheduled for destruction were not considered in this analysis. Thus, not all the $60 million worth of assets to be “bonfired” are represented in this table.

One analogical framework that has brought this fairly complex technical subject home to people is referring to the BVRs as “laptops with fingerprint sensors and webcams” and the BVDs as mobile phones or POS payment terminals. When people are then asked to imagine the wear and tear rate of such devices if they are used only once or twice a year, their eyes light up, the scales fall off, and the con suddenly becomes very clear. The pictures below should make visualisation even easier.

A Biometric Voters’ Registration Kit (BVR) 

Image result for bvr biometric"

Credit: Laxton Group

Image result for bvd biometric"

Credit: Isidore Kafui Dorpenyo

The trick to understanding the con is realising that the BVRs and BVDs were not all supplied in 2011 or 2012 and that not all of them are used for each registration or voting exercise.

The mid-term registration programs (called “limited registration” in Ghana) for instance typically require half of the overall portfolio of BVRs and there is usually an excess margin of about 15,000 BVDs that are not deployed during even general elections, not to talk of smaller-scale elections such as the Council of State elections or by-elections. Meanwhile, about 60% of the system dates from just 2016. Some equipment has, in fact, never before been used.

Furthermore, continuous purchase of fresh equipment from the original Dutch vendors, HSB, has always involved an upgrade of the auxiliary software both on the devices as well as in the datacentre, including the critical fingerprint matching technology, known as the ABIS, supplied by another Dutch vendor, Genkey.

Thus, as is amply clear from the table, it can easily be shown that millions of dollars’ worth of equipment has been used much too infrequently to be damaged beyond repair. And many of the devices were bought too recently to be end-of-lifecycle or incapable of being refurbished except at cutthroat costs.

If the EC were to continue buying replacements for only truly worn out devices, it would also avoid the $70 million it intends to splurge on fresh biometric enrollment of 17 million voters plus many other middleware components.

By buying an extra 3000 BVRs and 10,000 BVDs in a truly transparent and competitive tender, in continuance of the current continuous upgrading regime, it shall be entitled to an upgrade of the auxiliary software as well. It’s total expenditure shall be in the region of $15 million (throwing in datacenter and communications systems upgrades) and not the $150 million it plans to spend.

The EC commissioned an audit of the biometric system in 2016, the only time it has done so. The findings provide no support whatsoever for the obsolescence theory. In fact, the EC’s current claims about how much it will cost to refurbish or upgrade the system are all based on what it claims it was told by a self-interested contractor whose agreement with the EC had been abrogated a year ago. No other independent audit of the biometric system has been conducted since 2016. Requests for even internal equipment audit reports that recommend this drastic, wholesale, replacement action are met by blank stares and stonewalling by the EC.

The costs related to the complete replacement of the system, the EC’s preferred cause of action, on the other hand, seemed to have emerged from a shadowy tender that could qualify as the opaquest tender ever conducted in the world. The hints the EC has given about likely pricing following the sham tender ($3000 for a BVR and $400 for a BVD) suggest costs almost double what countries like Zimbabwe, Kenya and Nigeria have been able to obtain in the market in recent years for one component or the other.

Very untypical of a public tender, neither the Expression of Interest nor the Request for Proposal was published on the EC’s website or exposed to the press. (Mysteriously, the EC’s website went down on January 12th as soon as the controversy over its plans to build a new register and biometric system flared up again and has since not come back up.) Despite the tender having closed in April 2019, not a single press release has been issued by the EC to provide information on the bidders, the longlist, shortlist, or winning bids. Naturally, no evaluation reports have been seen.

The EC’s claims of being motivated by savings are thus as ephemeral as the purported divine benefits of Savonarola’s famed bonfires.

The Bank of Ghana (BoG) on November 29th, 2019, released a document justifying the need for the introduction of “higher-value denomination” currency (HVD) notes.

The question of whether HVD notes are warranted at any point in time is not a merely conceptual one. It is, in fact, a highly empirical enquiry to be approached from a careful analysis of considerable amounts of data about the proportional use of different notes and the differential costs of security and distribution. One cannot have random opinions about such a subject and expect to be taken seriously.

I don’t have any data on the contemporary usage patterns of the different Ghana Cedi (GHS) notes in circulation or about the costs of printing different notes. Like most Ghanaians, therefore, I did not have too much difficulty delegating all thinking about the issue to the fine technocrats at the central bank. Until now.

A bunch of controversies arising from the refusal of major supermarkets and even banks to accept the new notes because they lack the means to validate their authenticity compelled me to finally take a look at the BoG’s explanatory documents today. After all, item authentication has been a decade-and-half interest of mine.

Having now read the BoG document and subsequent BoG press releases on the subject, I am suddenly completely unsure of my earlier faith in the central bank to do all our thinking for us in this matter. I will simply lay out the worrying things I found and let readers of this blog judge for themselves.

  1. The most problematic element of the BoG’s analysis is the central reason it offers for introducing the HVD notes. In the very first paragraph of the original Q&A-formatted release, it states as follows:

 High levels of inflation and currency depreciation in the past have eroded some of the gains from redenomination. The deadweight burden, reflected in high transaction cost has re-emerged.

In this one statement is contained all the alarm bells about the depth of technical preparation that should have gone into this exercise.

  1. Except in cases of hyperinflation and hyper-depreciation requiring a new currency series, high-value denomination notes are almost never justified by the need to counter or offset routine inflationary pressures over time. For example, when the $100 was first introduced in the US in 1869 (and reintroduced as a federal reserve note in 1914), it was for a time the highest in circulation. In due course, larger denominations surfaced, mostly as a result of wartime and other contingent exigencies. By 1946, a firm decision to stop the issuing of HVD notes had been taken and, by 1969, all currencies higher than $100 were being removed from active circulation to reduce the costs of fighting counterfeiting and money laundering. Today, the $100 bill is worth only $4 if measured against its original value as a result of cumulative inflation. It remains the highest denomination in circulation purely in keeping with contemporary policy. An alternative policy of trying to preserve the face value of the $100 note at the time of the 1969 currency reforms would have required an introduction of $1000 and $2000 bills in the United States, something that cannot be countenanced in today’s anti-terror and anti-narcotics climate.
    •  It is easier to understand the argument when one recalls that in a floating exchange regime, currencies can rise and fall over time. Is the logic here then that should the Ghana cedi strengthen against the USD consistently over time, that would dictate the retirement of the largest of the HVD notes?
    • Things are even starker in a managed exchange rate regime. Consider this fact. By the time of the 1984 budget, the official cedi – USD exchange rate was 35 cedis to the dollar. Governor J.S. Addo lowered the value to 38.5 cedis to 1 dollar, in a conclusive reversal of the last peg from 1978 (of 2.75 cedis to the dollar) then in effect. Yet, ahead of the latest round of managed devaluations in 1982, the highest note, the 50 cedi note, had been removed from circulation (or “demonetised”) ostensibly as an anti-corruption measure (echoing an earlier currency confiscation in 1979).
    • When in 1984, the HVD notes of 50, 100, and 200 cedis were introduced (or, in the case of 50 cedi note, reintroduced), with no serious explanation as to why fears of corruption were no longer an issue, the effective worth of the highest-value note was officially $5. By the time of the 1985 budget, it was $3.7. More interestingly, the parallel unofficial, in actual fact market, rate was about 156 cedi/USD suggesting hence that the 50 cedi note that just 10 years earlier had been nominally worth $50 was now worth just 32 US cents ($0.32) whilst the highest circulating note was worth just $1.28. In short, the history of “face value preservation” tactics and politics in Ghana betrays a ridiculous mixture of arbitrariness and confusion. Trying to bulwark the face value of Ghana’s benighted national currency notes against depreciation and inflation trends is clearly to court absurdity, and also distrust in view of this messy track record.
    • At any rate, the historical record clearly shows that Ghana’s highest-value notes have for the most part generally exchanged for low dollar amounts. In the 1985 to 1990 period, the 500 cedi note moved from $5.5 to $1.5, peak to trough. In the 1990 to 2000 period, the 10000 and 20000 notes emerged as the highest-value notes, yet at their strongest they were about $1.4 and $2.7 respectively.
    • The dramatic change of affairs represented by the introduction of the 50 Ghana cedi note in July 2007, with its debut value of $54 marking the high point of Ghanaian currency face-value politics in 30 years, was a break with the past precisely because it also marked the start of a new series, effectively a new currency. Such an exceptional development cannot set a precedent for the routine preservation of the currency’s purchasing strength at some arbitrary USD rate by printing larger and larger notes to approximate the continuous appreciation of the highest notes’ nominal value(s).
    • By the time of the introduction of the 100 and 200 Ghana cedi notes in late 2019, the value of the 50 Ghana cedi note in USD terms was about $9. In comparison with other HVD notes in Ghana’s history, adjusting for both US and local inflation, this amount, as has already been shown above, was big enough.
    • The largest Nigerian Naira note is exchanged today for $2.75. The largest Kenyan Shilling note is exchanged for $9.91. The largest South African Rand note is exchanged for $13.8. By the time the Government of India removed HVD notes out of circulation due to purported fears about money laundering and crime, the highest Rupee note was exchanging for $14. Simply put, economies comparable to Ghana’s in various characteristics have HVD notes well within the value range of Ghana’s last version, the GHS50 note.

2. The BoG makes plausibly persuasive points about an expansion of incomes leading to an increase in preference for the then highest-value notes, the GHS20 and the GHS50. In the European common market, for instance, it is the 50 euro note, not the higher value 100 and 200 euro notes (or the 500 euro notes that are being demonetised over the usual concerns) that are in widest circulation. In the US, the highest circulation bill is the $20, whilst the highest value ($100) bill is mostly preferred outside the US. Thus, the preference for higher value notes in Ghana is a significant point. However, the point in the way it was put in the BoG release, that “GHC50 and GHC20 account for about 70% of the total demand”, is completely vague. Is this “demand” being expressed in monetary value or quantity terms? If in value terms, then it is completely unremarkable since the face value being several multiples of the face value of the lower denomination notes, their quantity could well be tiny and still constitute 70% of usage. In such a scenario, the need to print larger quantities would be far from clear, and user preference may well tilt to a medium portion of the value spectrum as is the case in many other countries.

3. It is important in connection with the above point to note that convenience is affected by both the concern about carrying large sums of low-value notes and the, almost converse, concern about finding change when counterparties pay for goods and services with large notes. Thus, preference is an entirely empirical matter and rather technically complex to compute. If the BoG wished to educate the public in this matter by releasing that statement, it ought to have been clearer.

4. Most strangely, the BoG chose to provide none of the critical information that would have best assisted curious persons in evaluating the propriety of its decision to introduce high-value denominations against the global trend of demonetizing high-value notes. At the heart of any sound analysis would be a trade-off between printing less money (and the concomitant result of users carrying less money) and creating highly tempting targets for crime.

The cost of printing higher quantities of money in the face of a rising average size of transactions in the economy reduces the seigniorage revenue of the central bank. Thus, if the average size of transactions moves upward, it makes sense to introduce more HVD notes. At the same time, such notes are more expensive than lower-value notes because they require more security features to prevent counterfeiting and more policing to suppress money laundering. For example, in the US, the most expensive notes (such as the $50 bill) can be as much as four times (4x) costlier to print than the cheapest ones (such as the $1 bill). The right balance between transactional convenience and policing cost is, as always, entirely empirical. By refusing to provide a breakdown of the costs of printing the different bills and the quantities in circulation as well as the average velocity per class and other critical monetary parameters, the BoG shows a complete disinterest in helping analysts come to any sensible conclusions about the need for these new HVD notes.

5. The weirdest of all the claims in the BoG document is the assertion that, somehow, printing high value notes will reduce the “deadweight burden” associated with current transaction costs. This claim is manifestly erroneous. There is no welfare loss context here to even warrant use of the “deadweight burden” term.

6. Lastly, we live in a time of great cynicism about the procurement practices of governments. The introduction of a new class of currency notes represents a potentially major procurement opportunity for agents and representatives of the mints and printing presses in Europe and America with whom the Republic of Ghana deals on these matters. Where the new bills are significantly more expensive than older bills, commissions may be in order, opening the door to unpleasant allegations about the real motives impelling the procurement action. It would have been reassuring had the BoG provided information about the procurement terms of this new production, whether by De La Rue, the loss-making, financially struggling, security printing firm or Crane Currency, the controversy-plagued contractor, now embroiled in corruption allegations in Liberia.

The decision to shroud all these important matters in silence, including even the name of the printer/mint, is doing very little to dispel lingering doubts and confusion about this whole HVD notes printing business.

My friend and colleague, Selorm Branttie, forwarded to me snippets of a Facebook thread about my recent comment on the Year of Return, in which he had been tagged and expressly asked to forward to my attention.

My inclination was to ignore the thread, for obvious reasons.

First, it is Christmas for Christ’s sake! Second, I have had to switch off Facebook because it was taking too much of my time. Facebook is designed to compel conversation. I simply don’t have hours in the day to spare for casual banter anymore; the daily hustle has made sure of that. Twitter, which I have been using more and more, is, on the other hand, a broadcast medium that allows me to disseminate random thoughts with far less expenditure of time. Lastly, I recognised the key discussants on the thread as strong partisans of the ruling party in Ghana with whom I share a bit of a history.

In the past it has been virtually impossible to have a sincere debate about anything since they seem sworn to see any dissent from positions of the ruling NPP government as motivated by “cynicism” and “ill will”. In my brief and occasional dealings with such people, sincere and mutually respectful discussion of facts and figures consistently degenerated into motive-questioning and other such base exchanges.

Frankly, I have neither the time nor ability to understand what it is that make some people so loyal to political parties to the point of losing all capacity for objectivity, but, well, we live in a complex world.

I have decided to respond to the Facebook thread for only one reason: a debate over data is always worth having in the peculiar circumstances of Ghana’s development.

Having chosen to mount what amounts to a mini-campaign about the issue of the Government’s reliance on bad data to appraise the generally successful Year of Return initiative, I feel obliged to address reactions, even if they are accompanied by insults accusing me of “cynicism” and statistical ignorance, so long as they present themselves as offering counter evidence.

The “counter evidence” presented in the said Facebook thread was along these lines:

  1. In the thread, I was accused of presenting data covering all “international arrivals” instead of just “tourist arrivals”.
  2. My data is thus, according to this framing, a superset. The more relevant subset of tourist arrivals is much smaller. The data that I had culled from the CEIC and IATA datasets, and which was corroborated by Ghanaian Civic Aviation Authorities disclosures (some of which are openly available on the Ghana Airports Company website) could thus, in the view of my Facebook accusers, not be relied upon since not all international visitors are tourists.
  3. If the smaller tourist arrivals dataset is used, the claims by Government functionaries that $1.9 billion has been generated from the Year of Return would be justified.

This is the coherent part of the argument. How exactly the exponent of this theory jumps from these premises to satisfy the requirement of showing that $1.9 billion has been generated by the Year of Return initiative is both murky and confused.

Here is an extract from the thread so that the reader can judge for herself:

At the beginning of 2019, the Ghana Tourist Authority (GTA) projected that they were expecting 150, 000 more tourists from the African diaspora, thus making 2019 tourist number 500,000 compared to 350,000 of 2018. They estimated total spending by tourists to be about $925m.

Then in September 2019, with arrival data, the actual number was calculated at over 750,000, surpassing the 500,000. Based on the rate of arrivals, and the peaking of activities in December, they estimated 1 million tourists by year end. Note that due to the doubling of the numbers, the expected spending by tourists, also doubled to $1.9bn.

Recall that my argument was very simple:

  1. In 2018, international arrivals were about 984,000.
  2. In 2019, the most optimistic projection suggests 1 million arrivals.
  3. The most optimistic allotment of any increase in arrivals due to the Year of Return cannot thus exceed 15,000 extra visitors in 2019.
  4. Because we have a reasonably strong estimate of average spending per visitor (about $1800 in 2018), we can confidently project an additional measurable revenue gain of $30 million if we use average spending of $2000 per visitor. This of course does not account for any qualitative gains, which are almost impossible to measure in this case due to paucity of data.
  5. Based on both the mean rate of arrivals for the last decade and the mean rate of projected arrivals for the decade after 2017, we have no evidence that the Year of Return has boosted arrival numbers beyond anything other than the mere increase in arrivals in 2019 over the figure recorded in 2018. And even that boost is only to the extent that the growth rate exceeds the average growth rate in visits over the last couple of years, which, sadly, it does not.

The counter-argument being canvassed in the Facebook thread is that we need to use figures preferred by the Ghana Tourism authorities and that if we do we shall record 650,000 extra or additional visitors in 2019 over the 2018 figure. Presumably, the interlocutor has no objection to the use of a spend-per-tourist figure closer to the $2000 number, which should give us $1.3 billion extra yield supposedly attributable to the Year of Return. Still, no $1.9 billion in sight though.

Except that all of this seeming “analysis” is actually empty of both research value and statistical fidelity. The process of determining whether an intervention has had an “effect” is a very elementary one, taught to everyone who has ever taken the most elementary of introductory courses in statistics. It is standard “hypothesis testing”. In a situation such as this one where the means and variances are all so well known due to near-complete historical data, there is hardly any need for the kind of quibbling seen on that thread. Which brings us to the central point: data integrity and validity.

If indeed the tourist subset is about a third of the set of total arrivals, such that we had 350,000 tourists out of the 984,000 arrivals in 2018, then one can only expect 2019 to record total arrivals in excess of 3 million for the tourist component alone to hit the 1 million mark, as canvassed by our Facebook commentator. A completely absurd projection that is at variance with several Government projections.

In fact, there is no logic in holding that the arrivals data I used is the superset and that the Tourism authorities in Ghana have higher-resolution subset data that can be used to hone in on tourist numbers with better precision. Simply because such a supposition was both superfluous and easily verified to be false.

Here is the Tourism Ministry’s own set of data available from page 22 of its latest strategic plan:

Min_Tourism_International_Arrivals_2017-2019

This data is actually lower resolution, and includes land border arrivals that are very difficult to process due to the high translocalism of intra-African borders. My decision to focus on data that can be corroborated and triangulated using international aviation stats was driven by this very fact. That data pays as much attention as possible to pruning non-visitor noise wherever possible.

But all that is besides the point really. The most important point here is that this data does not in anyway vindicate any of the strange and statistically perverse claims made by our interlocutor on the Facebook thread. The Ministry’s tourist arrivals figure for 2016, the most recent year for which it had an actual tally is 1,202,200. Its projected figure for 2018 is 1,454,700.

Average visitor spend, according to the Ministry, for 2016, the latest year for which it had complete data, was $1,890, virtually identical to the Ministry of Finance estimate of $1,800 for 2018.

It is important to bear in mind that this average spending amount is comprehensive. To focus solely on spending on tourism activities, strictly speaking, would be to considerably shrink tourism receipt numbers since direct spending on pure tourism in Ghana is incredibly low. According to the Ghana Statistical Service’s “Trends in the Tourism Market in Ghana 2005 – 2014” report (page 15), visitor spending adjusted for inflation has actually been falling for some time:

Visitor arrivals to selected major tourist sites rose from 381,600 to 592,300 over the decade. Real revenue also rose marginally from GHȼ490,000 to GHȼ492,000 over the same period with average spend per arrival falling from 1.3 GH¢ to 0.8 GH¢. Both arrivals and real revenue grew positively in the first half of the period, at an annual average growth rate of 10.7% and 6.1% respectively, while during the second half, both categories fell every year on average by -1% and -3.3% respectively.

We are seriously talking about total earnings in the hundreds of thousands of dollars for the whole country here, and average spending in tourist sites of about a dollar and cents over the course of a full decade. One has to employ a broader definition of visitor spending for tourism revenues to make any sort of statistical sense, which points to the absurdity of trying to use a lower-resolution spec for defining “tourist arrivals”.

So, where did our commentator on Facebook find his numbers? Surely not from the Tourism Authorities, despite purporting to be filtering out tourism data. How did he construct his hypothesis that the “tourist arrivals” number used by the authorities is lower than the “international arrivals” number widely used by global observers and by the Ministry of Finance to compute tourism revenues in Ghana? Surely not from any reputable or defensible data source.

But even if we are to use the lower-resolution, looser, dataset employed by the Tourism Ministry for strategic planning, the fact remains that there is no mechanism to “extract” this strange $1.9 billion figure from any statistical manipulation known to the science.

For instance, we can use the 1.45 million arrivals projection for 2018 (as made by the Tourism Ministry in 2017 in the table reproduced above) and also use the most aggressive projection for arrivals in 2019, which is 1.5 million, and we will still only be able to come up with $100 million as the level of tourist receipts in 2019 in excess of the figure recorded in 2018. But we would then need to address the hurdle of this “increase” being lower than previous year-on-year increases. For example, the last three years has seen arrivals growth rates in the magnitude of about 10% per annum. The apparent increase in numbers in 2019 compared to 2018,  would however, if we are to benchmark against the Ministry’s data, be less than 7%, suggesting lower growth in 2019 compared to the trend over the last couple of years.

In short, rather than contribute to the debate in a sincere effort of enhancing policymaking in Ghana through a promotion of facts, figures, data and analysis, the Facebook thread I referred to earlier was primarily concerned with pushing a partisan agenda, and a partisan agenda alone.

From what I can see on social media, many Ghanaians are now completely tired of this inability of politically engaged people to rise above petty partisan squabbling. I share in this frustration.

Ghanaian officials are basking in glory and ecstasy following a very successful marketing and branding campaign for the “Year of Return”, an initiative of the President of Ghana marking a major timeline in the sordid history of black slavery.

So far, impressive feats of national showcasing are there for all to see: tons of positive international press, great mentions and fabulous celebrity endorsements, most of it at no cost whatsoever to Ghana.

So why is Ghanaian officialdom so keen on selling the success of the initiative on the tabletop of incoherent statistics and woolly numbers instead of better cataloguing these clear achievements? It is a very strange sight to behold. Is this sad spate of fuzzy arithmetic just another example of how as a country Ghana struggles to master data-driven policymaking or is this an isolated case of mere overexuberance?

I know that no malice is intended, but before I am pummeled to pulp for being a killjoy, let me hasten to point out that sound data is important for drawing accurate inferences.

Unfortunately, various government agencies and supporters of the Year of Return program have bandied figures such as “200,000” extra arrivals, “1.5 million” total visitors and “$1.9 billion” extra tourist spending as measurements of outcomes related to the Year of Return with zero commitment to using actual, widely available, statistical data.

This means that instead of focusing on what so spectacularly went well – the brilliant coopting of African American celebrities like Steve Harvey as informal brand ambassadors – we shall soon be luxuriating in fictitious numbers bearing no resemblance to reality.

Here is the data we do have. As at last count, 750,000 international visitors had made their way to Ghana in 2019. (https://mobile.ghanaweb.com/GhanaHomePage/NewsArchive/Year-of-Return-Ghana-Tourism-Authority-reveals-the-number-of-diasporan-visitors-815566) The Authorities are projecting total arrivals for the year to hit 1 million. This is however doubtful considering the proximity to year-end.

But even if the numbers do hit 1 million, that would only mean a tiny fraction more than the 984,250 visitors who showed up in 2018, in fact a mere 15,000 more.

According to Ministry of Finance computations, average spending per tourist was $1512 in 2014, rising to roughly $1800 in 2018. Let’s pad this to $2000; though with Cedi exchange rate depreciation outstripping inflation, foreigners should actually find Ghana about 5% cheaper than last year and might spend less. Be that as it may, the “extra spending” that could conceivably be attributed to an increase in arrivals due to the Year of Return (if the projected 1 million visitors estimate holds up) would amount to about $30 million in this scenario.

By what conceivable mechanism can a $30 million optimistic projection mutate into $1.9 billion?

As already hinted, growth in tourist numbers in 2019 may well be below the average 3% per year rate seen over the last couple of years (and certainly below the 5.1% annual growth rate trend experts have projected between 2017 and 2027). There is further grounding for such speculation in the author’s estimate of a rise in hotel and short-stay apartment rooms inventory and a fall in average room rates based on an analysis of several weeks of Booking.com (a major travel site) data.

But all this should really be beside the point since no data-conscious person would insist that every successful marketing exercise must necessarily bear fruit even whilst it was still underway. There is almost always a timelag before results materialise. The danger in elevating phantom figures to the level of truth is in the complacency they can breed. So that instead of girding our loins to build on this successful marketing exercise and translate the increased awareness about Ghana and its enduring international goodwill into tangible tourism gains, we would instead declare victory on all fronts, relying on shaky, unchallenged, numbers and then promptly relapse into business as usual.

The only reason, therefore, for sounding the alarm about these widely publicized and widely believed numbers is the wish to forestall such a bad outcome and to motivate the authorities to see their successful marketing and communications strategies as merely the foundation on which to erect a truly effective sales plan for Ghana’s tourism and investment climate potential.

And we absolutely have their back.

 

 

This week, some telecom operators came under consumer fire for sudden, unannounced, hikes in their data tariffs, prompting parliamentary intervention. At least one of the telcos involved has blamed the incidents on system glitches.

As a longtime consumer rights activist, naturally my sympathies are with ordinary mobile subscribers who have had to endure the loss of value through no fault of theirs.
Ghana’s regulatory agency, the National Communications Authority (NCA), has been swift to order the telecom operators to fix their issues and compensate consumers. All well and good, but are we going to see similar speed in addressing the value for money problems that have been created by extractive and exploitative regulations over the course of the last decade?

You don’t have to take my word for it. In May 2018, the sitting Minister of Communications went to Parliament and boldly announced to a stunned chamber that according to the records available to her all the money paid to various companies in the name of revenue assurance, revenue protection, revenue optimisation etc, over the last decade – some $200 million thereabouts per my rough calculations – is good as wasted since the only thing these companies have been doing is taking data from the telcos and passing on to government in exchange for fat cheques.

According to the Minister, in the absence of what she calls “real-time monitoring”, all the previous efforts could not have detected any malfeasance on the part of the telcos and were thus unnecessary. Having served us this shocking confession from the government system, the Minister then briskly went on to justify even more spending in furtherance of similar money-wasting initiatives, such as the ongoing Kelni GVG project and its claims of using telecom traffic measurement to more accurately estimate telco revenue and thereby uncover tax fraud.

In a recent appearance on TV3’s Hot Issues, hosted by Stephen Anti, I could hardly hide my angst when Stephen, in the service of balance and objectivity, read on air a portion of a recent statement from the Minister purporting to justify the Kelni GVG contract.

Let me summarise for readers in the briefest way possible the comments I made on Hot Issues about why the Minister’s statement is dangerously wrong and ought to be retracted.

1. Telecom Signals & Traffic Volume Estimation Cannot Accurately Determine Revenue and so Cannot Uncover Tax Fraud

The genesis of all this “telecom tax revenue monitoring” business was a decision in 2008 to set a “floor price” for international inbound calls of $0.19 of which roughly 32% or $0.06 was to be paid by the telcos as a tariff to the Government (attempts to charge tax on the remaining 13 cents as “Communication Service Tax” was however defeated in the courts in 2013).

By imposing price control on this segment of the industry, a huge artificial arbitrage opportunity opened up for crooks to bypass the official channels and terminate international calls over the internet on local SIM box installations for as low as $0.04. This meant they could charge unscrupulous carriers a much lower price than the official minimum price of 19 cents and still pocket a substantial markup. “SIMbox fraud” had been born.

To fight this problem, needless as you would recall in the first place, the government engaged GVG, a Haitian company to provide a solution to monitor all inbound calls and to use random pinging methods and geolocation to identify SIMbox installations and take them down.

Whilst the problem itself was self-inflicted, there is a faint logic to the idea of monitoring call volumes to ensure that tax evasion is minimised. Given a fixed rate and charge and a fixed amount of tax to be collected per call, volume estimation becomes a sensible way of benchmarking revenue.

Unfortunately, when the decision was taken to extend revenue monitoring to domestic call traffic, as part of a wider CST imposition, and Subah came into the picture in 2012, common sense went out of the window and the principle of using volume benchmarking remained even though there is no price control in the domestic call market, and rates and charges vary considerably from period to period.

Since CST is based on a percentage of the charge value (“ad valorem” in the jargon) the revenue generated from it is tied to how the telcos “rate” (or price) each call or data session, making a linear map between call volumes and total revenues, much less tax take, completely arbitrary.

Unless the Government imposes its own pricing regime on the industry and substitutes its rating software for that of the telcos, any monitoring shall still be based on rating data supplied after the fact by the telcos, making the idea of monitoring call volumes “in real time” as a way of benchmarking revenue completely flawed and illogical.

2. But Even if Volume Fraud is an Issue, There is a Cheaper Way to Detect it

But even if, contrary to all sound technical analysis, the government still wants to find out if the telcos are lying about the volume of traffic on their networks, there is a cheaper way to go about it: using a method similar to the “random pinging” approach currently used to fight international inbound call fraud.

In a brief essay written during the heat of the initial Kelni GVG controversy, I demonstrated how with less than $100,000 a solution can be built to initiate thousands of random calls to the mobile networks so that the call records provided by the telcos can be examined for deliberate or accidental omission of these test calls. The percentage of missing test calls shall map directly to the likely percentage of undisclosed calls in the wider sample.

No one has been able to show why this is not a vastly superior solution costwise to the $1.5 million a month ($178 million over 2 x 5 year terms) Kelni GVG monitoring contract. This is a solution that can cover all the purported four services provided by Kelni GVG at less than 5% of the total cost of the Kelni contract over its life cycle.

3. Let’s Be Clear: this Contract Implies No Savings on Previous Ones

One of the most earnest cases made by the Minister of Communications in her public statement of last month is the claim that the extant contract with Kelni GVG represents an improvement on the Afriwave and Subah ones.

In the Minister’s analysis, the Kelni GVG contract has saved the country 1.1 Million USD per month by bundling the Afriwave and Subah contracts, costing a total of $2.6 Million a month, into one contract: the Kelni GVG contract costing $1.5 Million a month.

This is plain obfuscation.

First, the Afriwave contract is very much with us, contrary to plain untruthsserved to us by officialdom. I have confirmed personally its existence and continued operation.

Considering that the interconnect clearing house (ICH) concept was justified on the same premise of blocking telco underdeclarations, one would have thought that the Minister would actually make the ICH project redundant as promised. But, no, like so much of the posturing of politicians in Ghana, it was was all mere theatrics. Since early 2019, the nearly moribund ICH has been receiving a major lease of life because of Huawei supplier credit arrangements and a significant proportion, by some estimates 25%, of call traffic now traverses the ICH. Afriwave is thus getting paid at least the $1 Million a month it last negotiated during the Subah-NCA impasse.

In effect, there has been no $1.1 Million savings. Even worse, the Government had to buy off Subah in order to bring in Kelni GVG. By our reckoning the legal costs of doing so amounted to at least $40 Million. So, rather than saving the country $1.1 Million a month, the Kelni GVG decision is costing the country (using crude amortisation over the period of the Kelni GVG contract) an extra $233,000 a year compared to the Subah-Afriwave combo.

4. No, There is No Evidence That Kelni GVG Has Detected Any Tax Fraud

The reader might be of the stock of pragmatists who believe that notwithstanding all the back and forth debate, the proof of the pudding is in the eating: has the Kelni GVG program more than a year on uncovered any major tax fraud or not?

The Minister says, yes: to the tune of $85 Million over a period of three years examined. She goes on to claim that a total of $250 million would have been saved by the end of the contract with Kelni GVG. How did she come by these numbers? She doesn’t say. Why hasn’t any telecom executive been arrested and why is no telecom company under tax fraud investigation? She doesn’t know. Has she filed a formal complaint to the Police and the GRA? No.

Some readers may recall that in 2018, as part of the effort to mobilise public support for the Kelni GVG deal, the Deputy Minister of Communications said that as a result of the real-time monitoring regime, revenue from CST shall jump to $200 million a year.

If any of what the two Ministers are saying is correct then all we need to do is chart the growth rate of CST revenue from 2008 when it was introduced (annualising the 2008 half-year outturn) to end of 2018, when according to the Minister “real-time monitoring” commenced, and then compare with the revenue recorded at end of 2019 to see if there has been a sudden jump in revenue as a result of the introduction of said “real-time monitoring”.  Seeing as the entire logic of the need to spend nearly $180 million on this endeavour is premised on the notion that only real-time monitoring can safeguard revenues we ought to see a sharp upward turn in the curve from 2018 onwards.

But what do we see? Nothing. All the evidence shows that the growth rate of CST revenue only tracks such macrostructural trends as inflation, exchange rate movements, GDP growth, subscriber growth, and growth in the CST tax rate or coverage (as in when the rate was jacked up by as much as 50% in late 2019 or when the government insisted that domestic interconnect charges should be subject to CST only to be rebuffed by the Courts a couple of years ago).

CST_Revenue_Outturns_2008_2019
Real-time traffic monitoring has had no discernible statistical effect whatsoever on the growth rate of CST revenue and any multi-variable regression analysis should bear this out. In fact, considering the Q3 2019 increase in rates by as much as 50%, the current trend is one of underperformance, as the Minister of Finance freely admitted to Parliament during his budget speech.

So, in short?

Simple: every month that the government continues to hand over our scarce resources to Kelni GVG and tries to address clear shortfalls in CST revenue. Instead of the $200 million promised by the Deputy Minister, the country is struggling to make even $80 Million from CST this year.

Jacking up CST rates, as the Government has been doing recently however, is clearly and painfully contributing directly to the falling value of data and voice vouchers that consumers all over Ghana keep lamenting about.

Two days ago, I received, courtesy of friends in the Ghanaian media, one of the strangest pieces of political communication I have seen since I started paying attention to public affairs.

The strange object was a one-page statement of the Ministry of Communications’ view of the value generated by the KelniGVG contract since it was signed in 2017. You remember that fight, right?

As everyone who follows this page knows, I was a very vocal critic of the KelniGVG contract from its sad inception to its unfortunate implementation. My position then was, and remains, that not only is the entire Common Monitoring Platform (CMP) which the agreement is meant to execute useless, it is fundamentally illogical.

The simplest way to describe the CMP’s logic is to use an analogy. Supposed the Government of Ghana suspects that Unilever or Nestle is cheating on excise duties. Would the appropriate measure be to implement cameras on Unilever’s production lines to count excisable goods in order to establish an independent record of production volumes as a way of gauging revenues, and by implication pass-through duties?

The answer, of course, is that this would be absurd. Pricing, discounts, returns, inventory levels, receivables, expenses, and a myriad of other factors obfuscate any serious link between production volumes and revenues.

Moreover, superior methods like bank account ledger scrutiny, forensic auditing, unannounced visits to examine financial software and other records, and various such measures exist for tax fraud control.

The case against the CMP is virtually identical. Independent monitoring of mere transaction volumes is a very poor substitute for tax auditing, and as a complementary process, it remains wholly redundant and distractive. Especially, when the government is also being charged $178 million over ten years for this hopeless exercise.

Even if one seriously needs a complementary tool to backstop the main strategy, some of us have shown how with less than $100,000 such a solution can be designed to test for fraud in the data freely submitted by the telecom companies using random sampling techniques.

Being a true critic requires the humility to learn from hindsight, and contrary to perceptions about social critics in Ghanaian civil society, many of us who wear this hat very often hope that we might be proved wrong.

So, my curiosity upon learning that the Minister of Communications will finally account for the results of the huge expenditure she has imposed on the state through her championing of such a controversial project knew no bounds.

Imagine my horror then when I saw the one-page press release announcing massive benefits supposedly derived from the CMP with nary a shred of evidence to back the claim.

More frighteningly, the Minister casually accuses the licensed telecom companies of having cheated the country out of $85 million over the course of the three years prior to the launch of the CMP, here again without a single iota of evidence.

Mark her words:

The introduction of the CP has uncovered that, prior to the introduction of the CP, GHS 300 million in taxes was lost from potential under declarations between 2015 to Q1 of 2017. An estimated GHS 470 million in taxes was saved between Q1 of 2017 to date as a result of the announcement of the implementation of the CP on March 8th, 2017 and its actual implementation to date. There would have been a potential loss of a total of GHS 1.5 billion through to the end of the CP contract, had the CP not been implemented.

No telecom company is named in this allegation of massive tax fraud. No methodology has been provided as to how these tax under-declarations were measured. Nothing. And, to crown it all, not a single hint of pending prosecutions for entities and individuals who have been so emphatically accused of stealing $85 million from Ghana.

Even more bizarrely, not a single telecom executive has been asked any questions by the Ministry to understand why they were on course to cheating Ghana out of a whopping $250 million by March 2027. This is a lot of money to “steal” from a country as strapped for cash as Ghana.

Recall that this is an amount nearly 3x what the State is likely to obtain from its ongoing tussle with Woyome. Yet, a Minister of State has levelled a more damning allegation against corporate citizens of this country and not a single announcement has been made that the relevant authorities plan to institute civil action in the Ghanaian courts to retrieve these proceeds of tax fraud that have allegedly gone to enrich private business people. I am lost for words.

KelniGVG was for me the biggest dent in any confidence I had that the new Administration upon taking over from the previous administration intended to do anything different in the public contracting and “value for money” arena.

The evidence I saw of pure and barely disguised procurement rigging seriously traumatised me.

The recent performance of the Minister of Communications has succeeded in prying open old wounds. The casualness exhibited so far in dealing with the very critical matter of showing value for money in a contract costing this country nearly $200 million when all is said and done has deepened my trauma.

Luckily, the Minister’s statements can be subjected to a measure of independent verification. Not only has she not provided evidence that the CMP has blocked tax fraud of $85 million from recurring due to the heightened vigilance, the available evidence in fact shows that nothing of that sort could have happened.

Commenting on the underwhelming performance of revenue mobilisation in the first three quarters of 2019 (January to September), the Finance Minister in his budget statement to Parliament had this to say in paragraph 125:

Lastly, taxes on Goods and Services were impacted mainly by shortfalls in Excise Duty and to lesser extents, Domestic VAT and Communications Service Tax (CST).

Recall that the primary tax evasion fears that drove the ramrodding of the CMP project through were related to CST. It was to measure CST proceeds that the CMP was proposed and justified. All the talk about mobile money transactions in the Minister’s strange press statement were diversionary since the CMP has nothing to do with phantom mobile money tax measurements. The Minister of Finance, who should know more about revenue performance metrics, has openly admitted CST revenue underperformance and the records are available for all to check.

So, what were these “shortfalls” in CST collection that the Finance Minister was talking about?

The committed enquirer needs to dig deep into successive budgets for the period under consideration to make headway in understanding the Finance Minister’s concerns.

Let’s start with paragraph 118 in the current budget where we are told that:

These fiscal measures [to address ongoing revenue shortfall challenges] included the upward adjustment in the Communication Service Tax (CST) rate from 6 percent to 9 percent…

That means that in comparing 2018 – 2019 CST proceeds to what prevailed before the March 2017 commencement of CMP activity, we need to discount proceeds from Q3 2019 by as much as 50%, else we will not be comparing apples to apples.

Next, we need to examine the raw numbers.

In the first full year following the implementation of the CMP, CST proceeds were 420 million GHS.

In view of the extensive delays following the launch of the CMP and the long lull before actual implementation, it is fair to assume that whatever impact it must have had would have been felt beginning from 2018. And indeed there was a climb from the year-end estimate of 343 million GHS in 2017 to 420 million GHS by year-end 2018. This is indeed more than 20% growth in proceeds.

From the current provisional returns of 292 million GHS in CST revenue from Q1 to Q3 witnessed in 2019 (the serious “underperformance” hinted at by the Finance Minister), it is safe to say that it would be a miracle for CST revenues to outperform the 423 million GHS originally projected in the budget.

But even if one allows the 503 million GHS projection that is riding on the 50% increase in rates, the growth rate would still be 20% year on year. Taking the 50% increase in the rate into account and applying a suitable discount formula would show an actual growth rate of less than 12.5%. The composite growth rate for CST proceeds since the CMP was introduced is thus about 16%, roughly, most of it attributed to a growth in rates.

In short, assuming that there has been no real growth whatsoever in the amount of money Ghanaians are spending on communications, and that all growth in taxes is thus due to the CMP, would yield only 160 million GHS (optimistic) in increased revenue, which brings us to “potential underdeclarations”, or to discard the euphemism, potential tax fraud of $29 million on the part of the telcos uncovered by the CMP, a far cry from the $85 million being alleged.

But we all know that such crude analysis would amount to patent nonsense.

The telecom industry reports its revenue growth, and industry analysts take note. MTN alone has been recording on average above 20% topline revenue growth, and whilst the others are not as profitable as MTN (in fact, some of them barely make any profits), that is due more to the cost of doing business than it is to topline performance.

The best way to make the point I am pressing is simply to present the Ministry of Finance’s own projections for CST revenue growth:

Ghana_CMP_Projections_2020_2023

The growth of CST revenue from circa 340 Million GHS in 2017 (before the CMP became fully operational) to the estimated level of about 440 Million GHS through 2020 can be explained completely and without any handwringing by two factors: the 50% increase in the CST rate from 6% to 9% and the ongoing growth in consumption of telecom services by the Ghanaian population which analysts believe shall continue to orbit the 9% compound annual growth rate despite a slowdown in subscriber growth.

In fact, by some measures the growth in CST revenue is somewhat below the long-term trendline, but by every measure it is completely static. The CMP introduction has had no discernible statistical effect whatsoever.

In any serious country, one would have expected Parliament to bring the Minister before the relevant committees to explain all these strange discrepancies and confusions emanating from her statement, and also to tell the whole nation why she is making allegations of massive tax fraud against companies without a single shred of evidence or inclination to seek justice for the nation. And all this from a position of such extreme privilege.

 

 

 

The general belief is that it is almost unheard of for an African politician to resign over principle. “Resigning in disgrace” is likewise out of the question too.

African politicians, so the stereotype goes, will simply not resign, even when their values clash with the character of the government they serve, much less because of a loss of confidence by the public or their peers in their ability or integrity.

If, as the ethicist Patrick Dobel claims, the act of resignation marks the moral boundaries of personal responsibility, then African politicians, if the extensive anecdotal evidence is correct, are quite shameless. And the spectacle of a cabinet resigning en masse as a result of a policy failure, as was recently the case in Finland, would be as rare as the dodo on the continent.

The problem with anecdotal evidence, and frankly most qualitative evidence, is that outliers shake our confidence in their value more than they should.

Anyone can throw examples at us, such as the mass resignation of the Malian cabinet, the famous feat of Nkosana Moyo, and the sacrificial lambs of the EFF campaign money scandal.

The apparent challenges posed by outliers notwithstanding, it is actually not all that difficult to track resignations at the very top of public life and compare trends across societies.

Every such resignation is published by the Press, and the reports always make their way to the internet. We can actually make even more headway analytically if we narrow our investigation to resignations in the wake of scandals. Particularly, where the scandal relates to allegations of incompetence, corruption and/or moral wrongdoing.

On this much narrower score, I selected seven of Africa’s large democracies: Kenya, South Africa, Ghana, Nigeria, Ivory Coast, Zambia and Senegal.

The selection was arrived at by adjusting rankings on the EIU’s Democracy Index to reflect cultural, economic and political weight in Africa.

Despite the crudeness, I am satisfied that political practice in these countries reasonably reflects the tenor of democracy on the continent. Authoritarian regimes present unnecessary complexity hence the decision to focus only on major democracies.

Next, I scoured political intelligence portals such as EIU, Africa Confidential, and IHS Country Intelligence Monitor to collate a list of incidents in these countries over the last three years matching a working definition of a “political scandal”. Incidents with such attributes as sustained, adverse, press reporting; intense protests by civil society; and widespread calls for investigations.

Ghana’s ongoing PDS debacle, Nigeria’s Babachir Lawal fiasco, and Kenya’s CMC di Ravenna spectacle are some of the incidents that made the cut.

Using similar sources, I selected comparable incidents in 12 major democratic countries from North America, East Asia, and Europe as controls.

Scandals such as South Korea’s Media Blacklist incident, various expense claims and property speculation fiascos in the United Kingdom, and the FPO contract for cash affair featured on this latter list.

As usually assumed, a few outliers notwithstanding, the African incidents were far more notable for failing to elicit resignations from senior political leaders and public figures.

Popular opinion on the matter seems right after all. The notions called “losing face” in East Asia and “falling from grace” in the Euro-American tradition do not appear to operate with the same degree of force in Africa. What might account for this seeming shamelessness?

It would be rank nonsense to assume that “shamelessness” is somehow culturally ingrained in African public life. Traditional philosophies abound with reasons to suppose otherwise. Among the Asante of Ghana, a popular saying goes, “Better death than shame”.

In fact, Asante Princes who failed to bring honour to the kingdom on the battlefront had the good sense to blow themselves up with gunpowder, and the standard course of action open to a Zulu war chieftain who failed the martial code of honour was exile. Shame, whether as a sociological construct or as a psychological phenomenon, is unlikely to be the issue.

Is it then an issue of a “bifurcated audience” to crudely invoke Peter Ekeh? I am repeating the usual argument of the modern state in Africa being made up of little more than colonial relics, substances and ideas still alien to the majority sentiment in Africa.

A “scandal” carried in the African press would usually be woven from references to arcane matters of “administrative malfeasance” and esoteric yardsticks of incompetence: contracts bungled, procurement rules breached, asset declaration forms mangled, etc.

The bifurcated audience thesis holds that for the average African politician, these matters cannot be properly framed as a “real scandal” in the way that cowardice in war, adultery, neglect of rituals, and several other violations of norm in traditional society easily presented as scandal to the native African social mind.

The small, college educated, audience for whom procurement breaches present a scandal as outrageous today as adultery did in traditional society is not the “real audience” for whom public figures and those in high society are really performing.

Whilst intriguing, the argument doesn’t completely survive scrutiny. It is true that rural voters in Africa tend to be more tolerant of incumbents than urban voters, suggesting perhaps a degree of reticence about the so-called scandals daily agitating the more “westernized” publics of Africa.

The evidence doesn’t show however that African public figures demonstrate a greater willingness to undergo the ritual remorse of resignation over violations of norms more recognizable in traditional society, such as publicized fornication and allegations of plain embezzlement, which is not all that difficult to construe as theft, a sin equally abhorred in traditional society.  That christianisation and islamisation of rural Africa have reinforced some of these values is further cause for suspicion of this viewpoint.

Another variation of the “impunity due to audience blindness” argument relates to notions of “merit”.

The broad contours of that position cover several reasons why success in public life has been delinked from merit: monetization of politics, ethnic co-feeling, plain use of violence, and weak civic institutions, particularly the Press.

According to this thesis, people who have risen to the top through a process of selection that emphasizes factors far removed from the quality of one’s character or depth of one’s abilities cannot be expected to be shamed into vacating their unearned privileges if eventually they are found to lack such qualities.

It is a beguiling point, but a simple roll call of senior public figures in Africa would show that many leaders, whether or not they rose to their position on merit, or due to some other filtration process, are among the most qualified in their societies and professions. More to the point, such objectively qualified individuals do not show any greater propensity to resign than their objectively underqualified peers.

I wouldn’t however dismiss the “merit” point completely. Rather, I will modify its content. I argue that rather than the absence of meritocracy accounting for the seeming shamelessness of African public life, what is really at work here is “raw meritocracy”, meritocracy unrestrained by norms. So, in effect, “excessive meritocracy” or, even better, “antinomian meritocracy”.

Certain politically advanced societies – especially those in East Asia, Europe and America – have constructed their “public life elitism” around several pillars of “rites of passage”. Passage to the top requires jumping through a diverse range of grooming hoops and assent to a number of unwritten charters regardless of how actually brilliant, competent, or decent the public figure aspirant might be.

These strict gatekeeping codes impose a set of behavioral norms, one of which is the responsibility to resign in order to uphold the sanctity of the system as a whole.

Failure to resign draws unnecessary attention to these elite structures of privilege and discredits the entire membership. In this regard, resignation is not about individual merit at all but the preservation of group privilege.

Peer pressure to resign on even the mere perception of a violation of the gatekeeping rules, no matter how hypocritical the rules themselves might be, is ruthless and unrelenting.

The lack of institutionalization of elite structures and the poor regulation of entry and egress into elite circles in Africa has, conversely, created a situation where competition is raw and brutal and based on prevailing selection criteria, which of course change constantly with shifting political and economic dynamics.

In these circumstances, success is driven entirely by one’s ability to navigate the here and now with the help of a few allies here and there, nearly all of whom are also in the same precarious boat in the same choppy waters.

Because the peer circle has no timeless collective heritage and group privilege to uphold, one confronts, not a bifurcated audience, but an amorphous mist of media-capital city bubble-outrage with limited capacity to terminate one’s social status.

How can shame work effectively in such circumstances?