Created: 12/18/1965

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DIRECTORATE OF INTELLIGENCE Office of Current Intelligence


CENTRAL INTELLIGENCE AGENCY Offico of Central Intelligence5


Implications of Ghana's Diplomaticthe UK

Ghana's severance of diplonatlc relations with the UK over Rhodesia, on called for by tho ro-cent OAU Ministers meeting In Addis Ababa could lead to an erosion of important substantive ties which still link Ghana with the West despite Nkrumah's long leftward drift. The damage will be greater if Nkrumah breaks away from the Commonwealth as well, an action he now seems bont on taking at an oarly date. At present, however, both London and Accra appear anxious to minimize the practicaland keep existing non-poLlticalIntact as much as possible.

There is ample evidence that Nkrumah to take the plunge out of concern the pries his financially hardprossed country might ultimately have to pay. In the end, however, his determination to keep himself In the Africanappears to have been tho overriding The final decision apparently was takon only on tho eve of the ecember deadline, after heconvinced that at least some other states--he had sent special emissaries to Guinea and Tanzania--were KOliig ahead. Initial domestic reaction to the broak suggests that it is one of the most unpopular decisions Nkrumah has mado.

Although Nkrumah's speech in the National Assembly on ecember kept open tbe door for Ghana to participate in any early Commonwealth meeting on Rhodesia, such as Nigeria has proposed, he hadInformed British Prime Minister Wilson onecember that a break with Britain "would mean Ghana's withdrawal from thoanzania's

Nyerere specifically affirmed his present intention to remain in the Commonwealth despite his rupture with London and no other Commonwealth state seems to be seriously contemplatingtep. Nkrumah's assembly speech revealed that his basic motivation for getting out in front in this regard flows from his unique preoccupation with schemes for earlypolitical union. By ridding himself of the embarrassment, in this context, of his Commonwealth link, he evidently hopes to step up prossure on other African leaders to cut their ties to special political or economic groupings with their Mex-colonialain target would be the associate membership in the European Economic Community maintained byfrican states and long denounced by Nkrumahajor barrier to African unity.

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Nkrumah has so far not taken the same pains as Nyerere to reassure London of his continuingin receiving its various forms of assistance.

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eign Minister Quaison-Sackey assumed an offensive tone in communicating the rupture decision onecember

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5. Nevertheless* there are signs that the Nkrumah regime will try to circumscribe the scope of its break with Britain in an effort to avoid disturbing basic bilateral relationships enable the UK to keep most of its


wisneo to retain its trade personnel education officer in London. lon thisregarding maintenance oicorisuTar opora tions went unanswered, but such an arrangement appeared to be under active consideration last week, at least by some of Nkrumah's more responsible advisers. Nkrumah stated publicly onecember that the rupture does not affect British business interests or British technicians and military personnel directly by Ghana.

6. The extent to which Britain's presence and aid programs in Ghana (see Annex I) will be affected

by the diplomatic rupturo will depend In large part on London's reaction. British officials tn Accra last week, in their unsuccessful effort to forestall Ghanaian implementation of the OATJ resolution, wore specifying in low key some ot the elements of UK-Ghana relations that might be damaged. They pointod particularly to the Brit lab-subsidized militarywho currently provide vital assistance to Ghana's air force and navy, as well as to teachers and technicians. They also raised the possibility that some UK nationals performing key commercial and other functions might be unwilling to remain in Ghana in the absence of diplomatic protection.

to Ghana's break, Highexpressed doubt that the Britishteam could remain In place, but thereno clear indication of London's intentionsto these advisers or its other programs.government will probably seek to preserveof its substantive llos with Accra as possible,

in part so as not to provido new opportunities for possible further inroads by Communist countries. Ghana's departure from tho Commonwealth would becomplicating factor, however, as most British aid Is provided under legislation authorizing assistance to Commonwealth countries. No new economic aid is likely to be advanced while diplomatic relationssevered.

tho present Ghana's extensive with the UK and the sizable privatein Ghana probably will not beto any significant degree. Loss of trade preferences would presumably lead shrinkage of Ghana's trade with tho UK, butdifficulties for Accra. Should thoprotractod andhas saiddepends on Britain's crushing the Rhodesianand establishing majoritymight well be imperiled. It is not for example, that at some point theNkrumah regime might start harassing some of

the Important remaining British commercial interests.


ANNEX I: UK-Ghana Economic and Military Ties

1. Almost nine years after becoming politically independent, Ghana still has Important economic andties with tbe UK. The latter has remained, thoughiminishing margin, the major trading partner under Commonwealth trading arrangements which provide for reciprocal preferences. Britain has also continued to furnish significant development grants and credits and technical assistance. Moreover, British private Investment in Ghana remainslthough tho large wholesale firms are gradually holng replaced by tho Ghanaian Government's trading company. ember of the sterling aroa, Ghana enjoys access to the London money market and aforeign exchange clearing systom.

bout ono-fourth of Ghana'swas withercent of all exportspercent of its imports. Ghana sells itsof its mineral output, and some of its cocoa UK. However, because Ghana sells around halfto tho US and the EEC, it has less neodsterling zone system than many other members

and is, inot dollar earner for the zone.

The UK provldod the first and probably the bulk of the numerous suppliers' credits Ghana is using to finance its development program. British firms have granted0 million in such credits, on which Ghana still owes at0 million. Britain also loaned Ghanaillion for the Volta project. Tho unused balance stands4 million and Ghana is seeking release of those funds for other development projects.

While the UK did not respond favorably to Ghana's year-long search for sizable new development loans, it did recontlyillion short-termGhanaianin January or6 and is conditionally renewable for another three months.

British technical aid to Ghana is provided under the Special Commonwealth African Assistance Plan and under tho Commonwealth Education Cooperation scheme. In tho UK spent less illion




dollars on technical aid for Ghana. here were ovnrtudents on scholarships In the UK--mostly In scientific and technical fields--and aboutritish exports In Ghana under these agreements. The majority of these experts fiLl cadre posts in government and quasi-government cocoa research, railroads, harbors, customs and excise, economic planning, and civil air, for example.

Aa of there were aboutritish teachers in Ghana, not including theSO's (Peace Corps types), most of whom teach. The UK "tops-off" the salaries of some of the keyal present.

2 a British Joint Services Training Team has provided Important military assistance, lo Ghana'B embryonic air and naval forces. The team currently numbersfflcors

and men and is by far the largest foreign military advisory group In Ghana.

ANNEX II: Canadian Aid to Ghana

aid to Ghana includostechnical assistance, and two suppliers' contracts had been signed as

of their value totalledillion. The major contract was for five Caribou aircraft, and most of this loan has been repaid.

Technical assistance and scholarships are provided under the Canadian Commonwealth aid Canada suppliesersonnel, includingoilitary instructors; the military hospital in Accra is heavily dependent on Canadians. There are also abouto 50 teachers, andn such fields as television, road transport, medicine, agronomy and irrigation.

Canada has nearlyechnical vocation center1 million grant, and has0 in development loan funds which are as yet unallocated. In addition, there are overhanaian trainees in Canadaariety of subjects .

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