Economic implications of Ghana's oil discovery in Takoradi

Organization Behavior

The Economic Implication of Ghana's Oil Discovery

Ghana's Oil Discovery

The Economic Implication of Ghana's Oil Discovery: the Case Study of Takoradi Community

This paper presents a research proposal which have been prepared for the future research on the economic implications of oil discovery in Ghana. It starts with a brief introduction to the whole case scenario by introducing Ghana and its recent oil discovery and proceeds by explaining the research questions and highlighting the major research objectives. The major part of the paper consists of a comprehensive literature review which has been done to discuss the aforementioned business issue in the light of most recent articles, news, and research publications. The literature review completely focuses on discussing the economic implications of this oil discovery for Ghana from both positive and negative perspective. The research design and data collection section presents the techniques and ways in which the researcher will collect and analyze the data in a specific time span. The final section gives some ethical considerations which the researcher will keep in mind throughout the research process.

INTRODUCTION

Ghana -- the fastest growing economy in the African region and among the top ten fastest growing economies of the world has been blessed with various natural resources. Ghana has seen a recent oil discovery in an oilfield when Anadarko Petroleum, Kosmos Energy, and Tullow Ghana Limited officially announced that 3 billion barrels of light oil have been discovered in Ghana which will continue to increase in the future (Institute of Statistical, Social and Economic Research 2012). It was news of great pleasure for the whole African community that this discovery can make them more energy sufficient as compared to many other regions of the world. In this research paper, an effort has been made to highlight all the major benefits and issues which can arise due to this oil discovery (Howard University 2010).

This paper presents a research proposal for doing research in this specific business area and applying business research methods and tools that are relevant to this research. This oil discovery can impact the whole economy of Ghana in both positive and negative way. While Ghana can reap numerous benefits from this oil discovery on one side, it will also see negative consequences on the other side (Tullow Ghana Ltd. 2009). This research proposal will suggest areas which can be researched in order to analyze these benefits and negative consequences.

This topic has been chosen because it directly relates to various areas of Business Management and Economics. For example, by looking at the benefits and drawbacks of the oil discovery in Ghana, the implications on different sectors of the economy can be analyzed which will be helpful for future studies and analysis by business professionals, economists, financial analysts, and business management students. The findings of this research study will not be limited to future studies in Ghana or African region; the business professionals, economists and students will find extensive research material and literature review for relevant research studies.

RESEARCH QUESTION AND RESEARCH OBJECTIVES

Research Question:

The main research question for this paper relates to the implications of this oil discovery for the whole economy of Ghana. That is; what benefits Ghanaians can reap from this oil discovery in different sectors of their economy; including manufacturing and industrial sector, oil, petroleum, and mining industry, services sector, and agriculture sector. In a single sentence, the overall one research question can be presented as follows:

What economic implications will Ghana observe as a result of oil discovery? Can it be a potential contribution to the economic growth of this country or will it lead to greater corruption and worse political conditions in the future.

The Three Main Research Objectives:

The first primary objective of this research study is reflected in its research question, i.e. what impact will this oil discovery bring on Ghana's economy. This research aims to assess the positive and negative impacts which Ghanaians will see as a result of this oil discovery in their country. The second research objective is to find and critically analyze the relevant literature on oil discovery in Ghana in order to fulfill the requirements of the first research objective. For this research objective, an extensive research will be made from the most recent publications, articles, and newspapers since the discovery of oil in Ghana. This research objective will be fulfilled by exploring and critically analyzing the relevant literature.

The third research objective is to contribute to the existing literature for this specific business management and economics issue. By meeting the requirements of the second research objective, an effort will be made to present critics and thoughts that are unique and can be useful for future researchers in a totally different way from previous available researches. All these three research objectives along with the main research question are completely focused on the literature review which has been done specifically for this oil discovery issue.

Can this Oil Discovery be a curse for Ghana's Economy?

While oil discovery in Ghana will improve the economic conditions and boost up the industrial sector, its negative consequences can also be a curse for the Ghanaian habitants. The very significant impact will be on the energy sector. The change in the consumption patterns of general and corporate consumers will directly hit the prices of alternative energy resources (Boateng, David, & Mieza 2010). The demand for these products will decrease in the local market while supply will remain the same. It will result in a significant shift of their prices to some lower level. Macro-Economists and analysts are of the view that the new oil discovery will negatively impact the alternative energy resources in the long run (World Bank 2009). It means the alternative energy producers may have to bear heavy losses for a long period of time (United Nations Environmental Programme 2009). The energy producing companies in the public sector may survive with the help of the Ghanaian government, but the small producers in the private sector will not have any means to survive from this recession. It may result in increased firing of employees, cutting or shutting down of operations, and a decrease in the demand for suppliers and distributors (United Nations Conference on Trade and Development 2007).

Secondly, a large number of analysts and economists argue that oil discovery has not shown favorable results in all the cases in the past (Aryeetey, Barthel, Loehr, & Ossei 2008). They are of the view that oil discovery may lead to greater level of corruption and inequitable distribution of resources at the Government level. The best way to protect Ghana from such curse is to ensure transparency and efficient utilization of resources at all Government levels (World Bank 2009).

The purpose of finding and critically analyzing this literature was to highlight the areas where the main research question for this proposal falls. It is clear from the above discussion that researchers have written a lot of material on this specific business issue but they have failed to support their arguments with specific examples from Ghana's history or from similar cases with other economies of the world where oil have ever been discovered in the past. Therefore, the purpose of this research proposal is to contribute some unique research material to the existing literature by making research on both positive and negative implication of this oil discovery on Ghana's economy.

METHOD

1. Research Design:

For this specific research, the most effective research design would be to collect evidences from similar cases from the past, i.e. The positive and negative implication of oil discoveries which are officially reported and the steps which different economies took in response to these oil discoveries. For this purpose, it would be an effective technique to collect data from business professionals and economic experts that are associated with this field.

2. Data Collection:

As the research will be done from business professionals, economic experts, and analysts in the oil and energy sector, the best way to collect data is through focus group interviews. There are also other methods of data collection, but they may have certain drawbacks for this particular business issue. For example, if the researcher uses a questionnaire to collect data from these professionals, there are chances that they do not fill these questionnaires on time or totally refuse to respond to the questionnaire. On contrary, the focus group interviews will be based on face-to-face meetings with these professionals after taking appointments from them.

A major advantage of interviews is that the researcher can also ask some related questions which are not written in the question paper or even ask their personal opinion on any other related issue which may not be possible to ask in a structured questionnaire. The researcher will arrange his meetings with at least 50 professionals who will give their opinion on the economic implications of oil discovery in Ghana.

RESEARCH ETHICS

1. Time Scale:

The whole research will be carried out in a number of steps. First of all, the researcher will prepare a comprehensive list of all the potential respondents who can give their precious time for this research project. The research will contact all the respondents and request for an interview after explaining the research question, objectives, and the whole business issue. The maximum period within which the interviews should be competed is six months. After this period, the researcher will have to arrange the collected data and give it a concise form so that it can be analyzed in a more efficient and well-organized way. After data collection and arrangement, the researcher will analyze it using some suitable statistical tool or technique. This analysis phase may take one to two months. After analysis, the conclusion will be drawn which will be totally based on the responses given by the respondents and the results of the analysis.

2. Resources:

In addition to the time resources, this research project will also need financial resources to make different expenditures like travelling, accommodation, and other daily necessities. It is because the researcher may have to travel to farther destinations to meet his required business professionals and analysts. It is also possible that he may not get positive response from some professionals which will further increase his expenditures when he will have to arrange meetings with more professionals in the comprehensive list.