Rejoinder: Mahama’s 24-Hour Economy: A Hollow Slogan or A Solid Policy?

My younger brother from Bongo and celebrated journalist, Mr. Manasseh Azure Awuni, along with notable figures like Vice President Dr. Mahamudu Bawumia, has expressed skepticism about Mr. John Dramani Mahama ‘s 24-hour economy programme. They argue variously that the policies cannot compel businesses to extend their hours of work [see attached article by Mr. Awuni] or that some businesses are already operating 24 hours [check clip of Bawumia’s video]. For instance, Mr. Awuni argued in his article that “no body or policy can force businesses to extend their working hours of operation…”, concluding that “before we join the cheerleading of pointless slogans, let’s ask our politicians to tell us how they will maximize productivity in the current 8-hour schedule.” Mr. Bawumia had earlier made similar pronouncements in his infamous “chop bars are already operating 24 hours” speech. A number of other NPP and government spokespersons on the economy including one of Bawumia’s key economic advisers, Mr. Evron Hughes, have said the same thing in varying ways and platforms. Initially, I flagged these off due to a combination of time constraints, and a belief that as more is read about the policy, a better understanding of what the 24-hour economy is, and is not will arrive naturally. But Mr. Awuni’s, a highly respected journalist across our country and continent, latest article from his Cambridge, Massachusetts based office suggests the misconception might be real than I initially thought!

My curious task here is to demonstrate to my brothers and the rest who hold similar views about the policy how wrong or little they really know about what they imagine they know about Mr. Mahama’s 24-hour economy. In particular, their perspectives not only overlook the nuanced and comprehensive nature of the 24-hour economy envisioned by Mr. Mahama, but conflate it with night-time economy. In this brief article, I clarify what the 24-hour economy is and is not, its feasibility, and its potential impact on Ghana’s development. I explain why positions such as those of Mr. Bawumia and Awuni’s represent a misunderstanding, and what the key drivers of the 24-hour economy really are!

Misconceptions and Clarifications

Critiques such as Mr. Awuni and Mr. Bawumia conflate the 24-hour economy with a night-time economy. However, these are distinct concepts. The 24-hour economy encompasses a broader spectrum of activities and sectors, extending beyond nighttime entertainment or service industries. It is about expanding industrial activities, services, and job opportunities across all hours, thereby enhancing productivity and economic growth. Consider the United States for example – where Mr. Awuni draws a lot of his examples from – where only 27% of the workforce operates at night, yet the synergy between daytime and nighttime economies fosters one of the world’s most dynamic labor markets. This illustrates that a 24-hour economy is not solely about nocturnal activities but about creating a continuous, integrated economic environment.

Building a 24-hour economy thus does not mean the end of the day-time economy (or chop bars at dawn) like Mr. Bawumia somehow infamously proclaimed! Nor does it mean MDAs or local Assemblies will work in the nights or on shifts. No, it does not mean that if “ in Keta-Krachi or Bongo the economies of private enterprises does not travel past 10 pm” as argued by Mr. Azure, there is no a 24-hour economy. Actually, it does not mean a lot of the stuff listed in Manasseh’s article. The 24-hour economy is not solely about night-time economic activities. It is a purposeful expansion of industrial activities, such as manufacturing and allied services like trucking, as well as high-value technical services like ICT, architectural services, and financial services, beyond the day into the night to meet rising domestic and international demand through deliberate application of various economic incentives and interventions. In the US, for instance, some banks provide regular banking services in the day and process passport applications and other services for the federal government overnight. Exclusively night-time economies, mainly of the entertainment kind, are favored by cities to complement other day-time activities (industrial or services) and to promote tourism in particular. These too have their place, especially for local governments, in the 24-hour economy with a more diversified tourism strategy, supported by a modern and globally competitive hospitality and travel industry, supporting the 24-hour economy across Ghana, not just Accra.

The 24-hour economy will not be about haphazard financial handouts to businesses by the Mahama government. In the past, especially in the current government, funds meant for “distressed businesses” have been misused by unscrupulous beneficiaries, some of whom bought homes abroad with the funds. Another “entrepreneur” reportedly donated 10% of a subsidized loan to a church as tithe before spending even a pesewa on her business. Government assistance to businesses in the building of the 24-hour economy will be a prudent mix of the financial and non-financial, with the objective and rigorous criteria for selecting beneficiaries. A Conducive Conditions Strategy (CCS), which places emphasis on reliable utility and other (public) services to allow the greatest number of entrepreneurs to rise and to thrive on their own anywhere in the country without government handouts will guide the policy.

The strategy for creating the 24-hour economy is informed by Ghana’s recent economic history, its collective aspiration to become a high-income country by 2057 (as outlined in the 40-Year Plan), and the need to build economic and institutional resilience in a global economy that is in perpetual turmoil. The broad key drivers for the 24-hour economy which are supported by simultaneous policies for social development (such as education and training); environmental development (such as spatial planning and the preservation of the natural environment); and institutional development (such as better public safety, effective decentralization, and a credible assault on public sector corruption) are outlined below:

Key Drivers of the 24-Hour Economy

I detail here the strategic elements of the 24-hour economy, including infrastructure, energy, export strategy, local economic development, etc.

1. Aggressive Investment in Power/Electricity
– Ensuring a stable and reliable power supply is crucial for businesses to operate around the clock. This will involve strategic investments and governance reforms in the energy sector.

2. Infrastructural and Logistics Development
– Improving Ghana’s infrastructure is vital for efficient goods and service distribution. This includes enhancing road networks and logistics, essential for a competitive 24-hour economy. While the decline of Ghana’s physical infrastructure over the past eight years makes this task daunting, it is possible with leadership, and Mr. Mahama has the track record and policy leadership when it comes to infrastructural development. A typical cargo truck in Ghana, for instance, crawls at only 18 mph, instead of the optimal 55mph, which partly accounts for Ghana’s weak global competitiveness. Strategic short-term interventions will mitigate these challenges enough to facilitate the beginnings for the 24-hour economy, while medium- to long-term solutions are pursued.

3. Aggressive Exports Development

– Ghana’s export policies and strategy have been weak, plagued by inconsistencies, crass politicization, and corruption. This will change under the 24-hour economy! Expanding Ghana’s export capacity is key aspect of the 24-hour economy policy, involving strategic approach to open up international markets and create jobs.

4. Local Economic Development (LED)

– Fostering economic growth at the local level will be instrumental under the 24-hour economy. This will involve distributing resources and opportunities beyond the capital to stimulate nationwide economic activity. Over the past 7 years or more, this has been lost on policymakers, who disproportionately direct national development resources to center (Accra), to the neglect of the rest of the country (Over 85% of foreign direct investment, for instance, goes to Greater Accra Region alone (mainly Accra and Tema), while nearly 70% of all finished goods in Ghana are produced in the same region). The result is a region/city operating beyond its capacity and choking on its inefficiencies.

5. Support for SMEs and Large Firms

– Small and medium-sized enterprises will play a crucial role under the 24-hour economy programme. Tailored support and reduced bureaucratic hurdles will enable these businesses to thrive and contribute significantly to economic activity round-the-clock. Government support for SMEs in Ghana also tends to be unduly centralized and fragmented, undermining the constitutional role of district assemblies to lead the economic development of their communities. Capacities of local actors will be built to champion the case of LED under the 24-hour economy.

6. Creation of An Employment Act

– Introducing legal frameworks to support job creation and formalize the economy will facilitate the transition to secure employment, enhancing overall economic stability.

7. Markets Modernization
– Modernizing and streamlining market operations will improve efficiency and sanitation, benefiting the retail sector and the economy at large. Markets constitute the core of Ghana’s retail economy, and in many districts, they (along with their associated lorry parks and petty traders) are the main sources of local revenues. They also constitute the critical link between what will be produced under the 24-hour economy and how to get them to consumers (wholesaling and retailing). They tend, however, to be chaotic, inefficient, and bedeviled by sanitation challenges, despite the fact that traders pay daily tolls to their assemblies. Fortunately, Mr. Mahama has a head start on this, with his transformation and modernization of the Kumasi Central Market. He has vowed to expand his Market Modernization Programme to the rest of the country if re-elected. This would form a major building block of the 24-hour economy.

8. Public Sector Reforms
– An efficient, responsive civil service is key to supporting private sector growth and the successful implementation of the 24-hour economy. There can be no productive private sector, least of all for a functioning 24-hour economy, without a civil service that is apolitical, efficient, accountable, robust, and responsive to the needs of the people, businesses and institutions. The disconnect between the two has been the bane of Ghana’s economic growth and transformation over decades. In the take-off phase of the 24-hour economy, there will be targeted reforms in the civil service, key state institutions and sectors to facilitate various catalytic initiatives from the government – at the national and sub-national levels.

9. Agricultural Modernization
– Enhancing agricultural productivity through modernization will support the economy by providing food security and raw materials for industries. Agricultural policy that focuses on efficiency, which increases productivity (farmers using less inputs or better techniques to produce more), with the objective of increasing output (for food self-sufficiency and industrial inputs), raising rural incomes, and reducing rural poverty will be key element of the 24-hour economy. This means government, among other things, will provide critical support services, including extension services, farmers centers, in a fair, transparent and efficient manner. For the youth, employment-creation opportunities would focus on “secondary agriculture,” or agro-processing, which has a greater potential for growth to meet both domestic and external demand and create the kind of high-paying jobs that are not readily available in “primary agriculture”.

10. Stronger Economic Policy Framework

– Coherent and focused economic policies that align sectoral strategies with macroeconomic goals, essential for sustained growth will be key pillar of the 24-hour economy. The framework for economic policy-making in Ghana has always been fragmented and ill-focused, with disproportionate attention to macroeconomic policies (fiscal and monetary), and very weak, sometimes even counter-productive, links to sectoral policies, which directly drive economic growth and create jobs. The current obsession with a deficit- and debt-GDP ratios and misguided efforts by the Bank of Ghana to fight inflation by needlessly punishing businesses with killer interest rates is a classic case of a disconnect between macroeconomic policies and sectoral policies, which in turn must be shaped by sound development planning. The 24-hour economy will build in a revolution in economic thinking and policy-making, including planning, implementation, and monitoring.

11. Productivity Revolution

– Emphasizing productivity improvements will be critical in maximizing the benefits of the 24-hour economy, ensuring sustainable growth and competitiveness. Mindful of the fact that without purposeful growth in productivity, none of the drivers discussed above would be fully effective, productivity enhancements catalytic initiatives will be roll out to unleash the creative and entrepreneurial spirits of Ghanaians. A recent World Bank report indicates that productivity is the single biggest determinant of differences between rich and poor countries, a fact which has gained greater global attention since COVID-19. Spio-temporal productivity will be critical aspects of Mahama’s 24-hour economy!

Conclusion
The 24-hour economy policy proposal by Mr. Mahama is not about nocturnal activities but a comprehensive multifaceted strategy to enhance Ghana’s economic productivity and resilience to significantly salvage out bedridden and faltering economy and contribute to our country’s aspiration to become a high-income country. It is a transformative vision that deserves thorough consideration and informed debate, far beyond the simplistic critique of it being a mere slogan or for night-time activities. This is why Mahama’s 24-hour economy is a game changing programme, and everywhere dense. It is not about selling or not selling in the night, please brothers!

By Luke A. Atazona,

Barcelona School of Economics,
Former Research Economist, Office of the President.

P.S. Article materials drawn largely from a related article by Nii Moi, my former boss.