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Hello and welcome to Business Daily from the BBC World Service where today I'm in Ghana for the first of two programmes going deep into the world of those involved in cross-border smuggling. I started driving in 2012 between Ghana and Burkina Faso in Togo. Everyone has to be afraid because if they catch you doing this you will be arrested.
How big is this illicit trade and what's really driving it? Smuggling is massive. All the three frontiers that Ghana has with Burkina Faso, Ivory Coast and Togo are highly porous. Cross-border smuggling and the real cost to Africa. That's Business Daily from the BBC. A gunfight at a border checkpoint in northern Ghana.
But this isn't a straightforward cops and robbers shootout. This exchange occurred bewilderingly between different factions of Ghana's own security forces, between the army and the police.
It is something that really baffled many people. Up to now, it's difficult to tell exactly why the military would intervene in a case like this. That's local investigative reporter Edward Adeti, who says that he and other reporters are still struggling to understand what really took place at this checkpoint in the border town of Musiga in northeast Ghana. The police command received a tip-off that some people were trying to smuggle some bags of cocoa beans.
So after the police stopped the vehicle, the commander dispatched the vehicle to the police division headquarters for search and interrogation. Now, when they got to another checkpoint, another military squad, numbering about 50 we are told, blocked the road. The military asked that the police hand over the truck. The police disagreed again, saying the military had no authority to direct them. Then at that point, gunfire erupted. The police and then the military started firing at each other.
So what do we think was going on? Clearly this was a police case and there was an accusation level against the commander that actually was the one who was trying to aid the smuggling of the cocoa beans to Togo. All these bags were kept under a consignment of biscuits, soap, cooking oil and other items. And it is clear that one of the security agencies may be aiding
Luckily, no one was seriously hurt in the incident. The smugglers were eventually prosecuted and the army officer who created the standoff, he denied any connection with the smugglers by the way, he was reassigned to a new post, although the official investigation into the incident has never been published.
While gunfights between different wings of the security forces are thankfully rare, smuggling in this part of West Africa is not. Smuggling is massive. All the three frontiers that Ghana has with Burkina Faso, Ivory Coast and Togo are highly porous.
That's the Ghanaian political and economic commentator, Bright Simons. What kind of goods are we talking about? It's primarily consumer goods. So people are bringing a lot of cosmetics, food, canned foods and things like that, alcohol. And then increasingly, we also see high value smuggling of gold and other things, cocoa. We estimate maybe $2 billion of Ghana's gold.
leave the country undeclared. So that is the high-value segment of the trade. So we're here now. We're driving north, right up to the border between Ghana and Burkina Faso. It's a town called Paga in the north of Ghana. And here, up ahead, is the actual frontier of
The customs officers are looking closely for people smuggling things in the vehicles? Yes, they look out for this, but those who smuggle mostly will not even want to use this road. They prefer using the many unapproved routes dotted around to outsmart the system.
This is journalist Edward Adeti again. So this is where we stop? We stop here. Edward has brought me close to Ghana's northern border with Burkina Faso to meet drivers who say they are personally involved in this illegal trade. It took us a while to persuade them to meet us on the record. One did eventually speak to us, but he would only answer questions over the phone and on condition of anonymity. We are here to talk to you.
I started driving in 2012 between Ghana and Burkina Faso and Togo. How much cocoa are you carrying then in each consignment? When the vehicle is full, it can be 300 bags, so that's a lot of cocoa.
OK, so basically what you're saying is you are a smuggler, you are committing a crime, right, and stealing from your country. I mean, aren't you afraid of doing this, of getting caught? Yes, sure, everyone has to be afraid because if they catch you doing this, you will be arrested. But it's not just us, it's everyone. It's the politicians, the leaders in Ghana, they're all doing it.
Before we leave the depot with the lorry loaded, they have already paid off the customs at the border, so when we get there, often nobody even checks the car. As we've heard, allegations of bribery at customs are widespread, and it's not just limited to Ghana, but all across West Africa. A second man we spoke to in his late 40s
told us he'd been driving heavy goods vehicles for 20 years and was now paid double the normal rate for carrying illicit goods over the border. He refused to have his voice on air at all, but he wrote answers in response to my questions. Aren't you afraid of getting caught, of getting arrested? You are committing a criminal act here. True, but I'm not too afraid because the people who are buying the cocoa are very, very rich.
They're often people from the government, and I don't think anyone can jail them in Ghana. How many years have you been doing this? I've been doing this for seven years, since 2018. So how exactly does this illegal trade work then? In Ghana, a bag of cocoa is worth around 3,000 siddhis, around $200. But in Togo, one bag is more than twice that. And in Benin, it's two and a half times more, around $500.
So that's why they're taking this cocoa over there. They make more money. When we load the cocoa inside the car, the bags are concealed at the bottom with maze sacks placed on top of them. Either that or we take an empty fuel tanker and we create a door at the top where we hide the cocoa so it looks like there's nothing there. Or we use shipping containers like the ones they bring into the port in Ghana. They put cocoa bags in there and they padlock it up. Then everyone thinks it's a shipment coming from abroad and they let it through without checking.
The people who are buying the cocoa, they're all working with the big politicians in Ghana. OK, which politicians? Who are you working with? I can't tell you who, but I do know they are powerful. All I know is there are business people and politicians involved. The people I work for, one man out of Boupe in Ghana, another, she's a woman in Tumu. They're business people, but I know there are politicians who are bankrolling and supporting them.
I've asked the Ghanaian government for a comment in response to these claims. They've yet to reply. But the head of Ghana's official cocoa board last year did estimate that as much as a third of Ghana's cocoa crop, one of its biggest cash exports, is now being smuggled out of the country illegally, costing the government hundreds of millions of dollars in lost revenue.
Well, I've now come to a livestock market up in northern Ghana. Herds of skinny cows, goats, chickens, pulled, cajoled and bullied onto vehicles in front of me before being whisked off for slaughter. It's the sound of a small cow being loaded onto the back of a motorbike trailer and strapped on...
Life is pretty brutal and short around here, I think, for the animals that get traded. And the traders here are telling me that even some of the livestock here may be contraband. There are many people smuggling from Burkina Faso into Ghana, from Togo into Ghana.
The Islamists and also the bandits, local criminal gangs, they are all involved. When the jihadists steal the animals from local communities up in Burkina Faso, then they bring them down here or they hire traders like us to carry them into Ghana and to the markets. He's referring there to the al-Qaeda affiliated Islamist groups who have for some 10 years been fighting for control north of Ghana's border in Burkina Faso.
Tens of thousands of people are said to have died in battles with government forces there. Rights groups describe terrible atrocities on both sides. And there are fears in Ghana that these Islamists and their illicit cross-border trade could yet be feeding insecurity in Ghana itself. Here's Edward Adeti again. The insurgents are targeting mining communities to do what they call gold for arms attacks.
So we want your gold from this mining community, then we supply you arms. It is already going on. So arms are coming in, which is destabilizing for Ghana, I guess. I mean, is there a concern that that might be fueling an insurgency inside Ghana? Well, some have said so. You have government officials also dismissing these claims. But one fact remains true, that the National Peace Council
has always warned that if the pockets of conflict or violent conflicts dotted around Ghana are not resolved as soon as possible, these violent extremists or insurgents will take advantage of this unresolved conflict by meeting maybe one faction or the other and telling them, we are ready to supply you arms. This is already going on.
It's clear that local conflicts in Ghana's north are being fed by the massive flow of weapons over the border. This is the sound of gunfire in the northern Ghanaian town of Boku. A long-standing dispute over the local chieftaincy has spiralled in recent months, putting the town's two main ethnic groups at each other's throats and leading to a sense of desperation amongst many Boku residents themselves. I reached a few of them by phone.
The evenings in Boku are always gunshots and fierce exchanges. People use AK-47s, people use M16s, these automated weapons. You know, the sad thing is that we have married each other. We know each other very well. We are losing the young ones, those are the people that are dying.
It's a work of terrorists. I'm afraid of the future of Boku and the future of our children. People are scared. People are afraid. Women are not able to take their children to school. Why is our government unable to control Boku to ensure that the lives of innocent people are saved?
In the last four months, dozens have been killed in the fighting. The recently elected president, John Mahama, says he's making peace efforts in Boko one of his top priorities this year. Sami Jamfi is a spokesman for the ruling party. What is happening in Boko is a very serious national security crisis for us. People are being murdered like animals in the area as we speak. What the people of Boko need now is peace.
And for peace to be restored to Boko, the law must take its course. But is there not a risk, sir? I mean, is there not a risk that the flow of arms that we're seeing from the north is going to mean that the violence we're seeing in Boko could spread to other communities in Ghana as well?
It's already spreading. Now it's spread from the Upper East Region. We are having clashes in the Northeast Region. That is why this is a great concern to us because if care is not taken, we're going to have a spillover. And like you yourself indicated, it's likely that insurgents from the sub-region can't take advantage of these conflicts.
So far, though, the peace efforts haven't stopped the killing. And it raises a question about what countries like Ghana might do to reduce the overall amount of smuggling that's taking place. Political and economic commentator Bright Siemens says some of the answers lie not in better policing, but in economic management. African governments, he reckons, have become just too dependent on the income they get from these consumer and border taxis.
We do depend a lot more on tariff income. We do depend a lot more on indirect taxation or consumption taxes than is the case in the West. So, for instance, VAT in a place like Ghana or Kenya will often be double what the relevant proportion would be in the UK or France. So, yes, it's true. We're very reliant on consumption taxes, which are also regressive.
And therefore, the poor bears the brunt, which makes them very sensitive to the tax, which encourages them to try and evade. So, for instance, when a decision was made to impose a tax on mobile money,
There were people who, instead of paying their 1.5% or so, they would rather get on a car and drive an hour to pay their money, to evade that 1% tax. Because people are highly sensitive. Their incomes are so low. People are living on the margins of survival. $2 a day or $3 a day. Every single cent, every single penny matters enormously.
And that sensitivity tax can lead to almost irrational behaviours around evasion. And that is why I think that cost calculations have to be paramount if you do want to prevent smuggling. Are there economic factors, do you think, that are exacerbating the problem of smuggling for Ghana and other sub-Saharan countries? Yes, there are several. I mean, the high cost nature of Ghana's jurisdiction keeps coming up.
There was a time when the country decided it was going to apply a 3% withholding tax on small-scale mining output. And that led to a 92% drop in the official volume of exported gold from the small-scale mining sector. So essentially, you add this 3% tax, immediately declared volumes of exports go down by 92%. That's about one-third of all gold production in Ghana, the small-scale sector.
That is interesting, but also it indicates that paying taxes and doing things legally is pretty much discretionary for these companies. They do it if it's easy, but when it becomes too expensive, they just drop out and figure out some other path.
That means, therefore, that informality is not only in the production level. The informality pervades the society in the nature of law enforcement. The point, though, is informality is the real context of the economy. It's the abiding formula of the economy. It's the deviance. It's in the formality, not in the informality.
Well, in tomorrow's programme, I'm going to be examining in more detail not just the forms of smuggling affecting the region, but also the ways in which governments could and perhaps should be tackling the problems they face. I'll see you then.
When you have bars in the sky, onboard showers and award-winning in-flight entertainment, it's no surprise that Emirates was recently named the best airline in the world. We fly you to over 140 destinations, and with partners across the globe, we connect you to another 1,700 cities across six continents. So when we say we're also the largest international airline, what we really mean is...
If you're going there, so are we. Book now on Emirates.com. Fly Emirates. Fly better.