Ghana Wrestles With Conflict Between Austerity and Democracy : Africa: While international lenders demand fiscal discipline, the nation’s leaders are under pressure from voters seeking prosperity.

A man stands on the median strip of a busy Accra boulevard and relieves himself in full daylight. An ordinary occurrence in Africa, but this man is conspicuous. He wears a pressed business suit and holds an expensive leather briefcase.

Elsewhere, two Ghanaians try to digest the meaning of May’s bloody riots here; they discuss the aftermath via an expanding network of cellular car phones.

Near downtown, there is a room that looks like a small-town school auditorium, with 21 chairs, a ring of tables and a small board where numbers are written in felt-tip marker. The young men and women gathered here are not students, though. They are traders in Ghana’s $2.3-billion stock exchange.

If the developed nations of the world have their way, this West African nation of wet-cotton skies and sultry green landscapes is destined to be the model for economic and political success on this continent--a place where the world’s costly support of formerly colonial, sub-Saharan Africa finally pays off and where Africans find their way from being aid recipients to global consumers.

It is a heavy responsibility for a nation of only 17 million people.

This year, the United States, Britain and other developed nations will pour $800 million into building a modern Ghana--nearly $50 for every man, woman and child. Roads and power grids are penetrating the country’s most primitive outreaches. School pavilions are sprouting.

The reason is repeated so often that it has become a maddening cliche here: Africa needs a success, and Ghana promises to be it.

But the first tastes of prosperity, of democratic empowerment, of the promised good life are no more fulfilling than the first bites at the banquet table. In 1995, Ghanaians smell the feast, and they are hungry.

In their craving, they are rattling the dinnerware and threatening to upset the table.

“What you see here is not our progress. It’s our potential. . . . This constitutional experiment will be aborted if we can’t accelerate our economic growth,” says A. Kwame Pianim, chairman of Ghana’s leading political opposition, the New Patriotic Party.

“We have to build our middle class to protect democracy--because only a middle class has something to protect,” he adds.

This itself is part of a novel debate. Other West African countries, such as Nigeria, Liberia and Sierra Leone, are in various stages of chaos and collapse. By contrast, the politics of economic growth seem rather so-what.

Yet Ghana led the way for African independence, gaining freedom from Britain in 1957. If it cannot lead the way toward modernization, who can? And if there is no success in Africa, how long before a restless United States and a squeezed World Bank tire of helping?

*

“The donors won’t wait much longer before asking: ‘We’re putting so much money in these kinds of places, what do we have to show for it?’ There is an institutional imperative to come up with something, somewhere that works,” says one Western economic adviser.

The challenge can be found in the lives of Ghana’s people.

Michael Hammond is 28. After more than three years, he has obtained his travel agent certificate. He works on a street lined with ancient tropical shade trees in an air-conditioned office. He wears a silk tie, shined shoes and discreet cologne. He rents an apartment, watches CNN and cable movies on television, keeps his beer cool in a refrigerator and eats out many nights.

He earns the equivalent of $150 a month.

Compared to his parents, compared to millions of other Africans, he says, “Sure, I can say life is better.”

But Hammond also faces this: Inflation is more than 30% a year, and the Ghanaian cedi, once worth 36 to the dollar, is now 1,000 to the dollar. The government just raised the price of fuel. Bank loans, if you can get one, command 40% annual interest. Unemployment in the city is at least 25%.

“I’m working and getting paid, that’s good,” he says. “But I can’t save. I look at the future and ask, ‘How much can I accomplish?’ ”

At this rate, Hammond will never afford a home. A car is a distant dream. Around him, people with better connections and more luck are getting rich. Merchants raise prices practically every day. And the government says he must be patient.

“They tell us they want things to go faster, but then they ask us to tighten our belts,” he says with a sigh.

*

Erik Baisie went to school and studied automotive engineering. At age 30, he now has a small car service, is planning his wedding with his fiancee, and is known as one of Ghana’s “Mobitel men” because he carries a Mobitel cellular phone. By living with his parents, he banks the equivalent of $1,500 to $2,000 a year. By age 40, “Oh sure,” he says, he will own a home and his business will be expanding.

The turbulence in Ghana’s society worries him, but not to the point of despair.

University professors have been on strike for most of the year. Civil servants began 1995 demanding a 70% pay increase. Then in May, the government imposed a 17.5% value-added tax on goods and services. Merchants, because of greed or confusion, raised prices as much as 300%. It was too much for Ghanaians. Some 10,000 protesters took to the streets. Five were killed and 17 wounded in a clash with authorities.

“Look, this was the first time democracy actually worked in Ghana. The government dropped the tax. The government responded to what the people are saying,” explains Baisie.

And that could be Ghana’s undoing, at least in the eyes of the World Bank and other donors.

That’s because Ghana is attempting two miracles at once. As it creates a foundation for economic development, the nation also is trying to institutionalize a system of multi-party electoral democracy. And democracy means courting voters, whose urgent needs are different from those of the World Bank.

Ghana’s president is retired Flight Lt. Jerry J. Rawlings, a onetime socialist who has become one of Africa’s best-known promoters of international investment. Twice, in 1979 and again in 1981, he seized power here with a gun. And now, also for the second time, he is trying to hold on to it in a contested election.

*

In his first campaign, in 1992, Rawlings appeased his restless country. His government pumped up the money supply 40% to give civil servants big raises and shower the economy with short-term gains. He won the election. Ghanaians now are paying with inflation, impossible interest rates and barely marginal economic growth. One serious dry season and people will be listening to growling in their bellies.

In preparation for elections next year, Rawlings faces equally impossible demands from Ghanaians.

At the top of the economic scale are men such as Appiah Menka, whose King Soap company employs 257 workers. Considering his antiquated machinery and the cost of borrowing capital, Menka says he cannot compete with imported soap that is “dumped here cheaper and perhaps even better.”

“There must be some sort of protection for local industry,” he insists.

At the bottom of opportunity’s ladder is Ofri Quaye. He lives--barely--on odd jobs. He cannot afford the cost of books, tuition, a chair and desk, shoes and a uniform to put his 6-year-old son into school.

“Rawlings, he’s done OK. But he’s got to give us more. We’ve got to have jobs, and now,” says Quaye.

The president concedes his dilemma. The policies of his 13-year tenure “improved many aspects of our daily lives,” Rawlings says. But “few of them actually put extra money in the pockets of the ordinary man and woman.”

*

For now, Rawlings has promised not to back down from his pledge to international bankers and donors. He promises a “cautious approach” to wage and employment demands by the underpaid and overstaffed civil servants. He promises the continued, steady undoing of Ghana’s old socialist state in the hope that investors can be coaxed here just as they moved in and helped transform the once aid-dependent countries of Asia and Latin America into coveted “markets.”

“If there is a success story in sub-Saharan Africa, it’s Ghana,” says one Western diplomat. “But I guess you could say the toughest challenge is right now. Rawlings is being asked to do things that could get him driven from office. The old days, when you just mounted a coup and shot a few people, are over. Democracy isn’t that easy.”

Around the old colonial town square, Ghanaians wait in the gauzy heat of the seaside capital. Women carefully stack hundreds of peanuts on plates, which they carry on their heads. They sell nuts, a handful at a time, just as they have each day for most of their lives. Men peddle jump ropes, dog leashes, razor blades, cheese knives and 100 other things at busy intersections. These merchants are known as “go slows” because traffic goes so slowly as to permit casual shopping.

Up the road at the six-story building that is Ghana’s financial center, Faake Kwapong leaves her chair on the stock exchange floor. The three-times-a-week trading session has just concluded. Volume: 15,400 shares in 17 listed companies. Index: Down 0.04%.

Kwapong is 26 and the chief trader for the largest brokerage in the country. She works six days a week, earns no vacation and is of no mind to go slow.

“Satisfied? Well, we’re satisfied. But we want more. We know there is more out there,” she says. “Our country is fragile, but I think deep down people feel we’re going to pull through.”