In 1994/1995, HipLife, a musical genre that integrates indigenous vernacular with African-American pop culture, broke new grounds when a leading advocate, Reggie Rockstone burst on the scene with a new approach to story-telling and commercial entertainment. Unfortunately very little thought or structured analysis has been invested into understanding why HipLife became such a successful model of import substitution when, in fact, a substantive public policy of promoting local production and consumption had failed since Economic Recovery Program (ERP) in 1983. Fast forward to 2015, Cedi volatility continue to be a bane for fiscal and monetary policy management, due in large part to Ghana’s high Marginal Propensity to Import (MPI). The perennial trade account imbalance is driven, to a large extent, by Ghana’s unyielding appetite for goods and services produced by other nationals. This phenomenon is not helped by the relatively expensive and low quality local outputs in Ghana, albeit there may be counterfactuals to this narrative, in all sectors ranging from Agriculture to Services. Within this context, the commercial success of HipLife as a Ghanaian product and export, merits serious intellectual inquiry in order to serve as a pivot for shaping Ghana’s import-substitution strategy at the policy level.

What Happened?

I recollect with fondness, my personal experience around 1993/94, whilst in Secondary school while preparing for my GSCE Ordinary level certificate examination. The “fashionable” preoccupation of most young adults at the time (myself included, unfortunately) was baggy jeans, fake accent and the ability to entertain with the latest rap song, R&B or breakdance moves. Boy, was I good at it. The ecosystem that had created these peer pressure points included the emerging role of radio stations such as Radio I, Joy FM and a host of related entertainment event organizers, two of which I remember so vividly; V103 and Prime Cut. By then Internet penetration was very low so e-channel portals such as Sound Cloud had not even been imagined. The entire supply chain in the nascent HipLife (then hip-pop) music market relied on entirely on entertainment event organizers who sourced music of varying genres from abroad through personal connections, in order to promote events and to also sell them as merchandize (analogue tapes) to mostly youthful consumers between 13 and 25years old. Looking back, there are striking similarities between then then and now, at least on the macro level. We consume almost everything from toothpick to tomatoes sourced from China and Burkina Faso respectively, just as the case was when the youthful generation then (spurred on by a hegemony of African-America culture) consumed hip-hop music and related merchandize to the detriment of local High-Life music and its chain of economic relatives.

The Rockstone Factor

The ingenuity of Reggie Rockstone’s HipLife innovation, was not really, by careful design, a disruption of an entire supply chain but a constructive challenge of conventional business models that had proven successful in the market up until that time. In real commercial sense, the success was a product innovation that was strongly marketed using the magnetic appeal of Reggie Rockstone. Mixing magnetism with advocacy, the initial HipLife vanguards were able to shift the demand curve in favor of a Ghana-made, but a competitively packaged product that promised better value propositions than what Jay Z or Tupac would provide to the youth market at the time. First, the language was local, so there was cultural convergence. Secondly, the packaging still came with baggy jeans, American accent and funny haircuts. This helped preserve that air of coolness and panache that appealed to youthful audience and consumers. It is important to mention here, that success and survival of HipLife as a genre was not wholly a result of innovative entrepreneurship but also an incidental emergence of democracy. There is no doubt that media proliferation and the emergence of Internet contributed immensely in creating a robust ecosystem that allowed creativity to flourish and helped to align private enterprise with public policy in a way that was unintended. By re-orienting consumer taste away from African-American rap music to focus on a new local output, HipLife as a genre, made a staggering transition from being a commodity to being a differentiated musical export. Today, I dare say that Sarkodie or Kwabena Kwabena would pull more concert crowd in Ghana than Buster Rhymes or Ace Hood.

Undoubtedly, there are still market rigidities in the local music sector that ought to be addressed through regulation and intellectual property right protection. There are also issues of accounting (for GDP purposes), artist’s rights, efficient distribution channels and scaling. That notwithstanding, the contribution of HipLife to youth employment and its role as a credible model for import substitution cannot be contested.

Implications for International Trade Policy

Ghana’s seasonal external current account pressure obviously cannot be sustained by redirecting part of the country’ Gross Foreign Asset to intervene in the local currency market, a practice the Bank of Ghana finds itself doing currently. A more sustainable approach must encompass the following:

  1. A progressive reduction of non-oil merchandize import in the medium to long-term.
  2. Coordinating an institutional collaboration between local authorities and sector regulators to improve, transport, hotel accommodation and sanitation, in order to drive tourist traffic.
  3. Enforcing local content laws in insurance, financial services and downstream oil and gas, in order to improve flows through the Services sub-account.
  4. Changing Ghana’s international tax exemption regime from being import-favorable to being export-favorable.

The journey of HipLife from insignificance to its current state of economic relevance clearly provide learnable lessons for Government in shaping a trade policy that is aligned with Ghana’s growth and macroeconomic objectives. The building blocks of the Hiplife success are; entrepreneurship, innovation, global competitiveness, conscientious advocacy and a supportive ecosystem. Of all the variables in this growth model, entrepreneurship, innovation and global competitiveness are considered to be the core foundation since its sets a framework for growth and employment that is driven by the private sector.

The Way Forward

The Cedi’s volatility, much more than being an immediate policy concern, is the most compelling indicator of self-reliance and confidence in our own creative capacity and power of self-determination. It is absolutely imperative that economic policy formulation takes into account this remarkable feat achieved in the area of musical art in other to improve external sector outcomes and also create sustainable employment. No nation has developed without fundamentally addressing the stronghold of cultural and economic dependence on other nations. Ineffective public and private collaboration at the policy and sectoral levels, in emphasizing entrepreneurship education and training, contributes immensely to poverty and social marginalization.

Changing Ghana’s trade pattern must first begin with mental emancipation from the shackles of self-degradation by both the political elite and the general population. That is what Reggie Rockstone brought to HipLife; a cultural renaissance through a careful tinkering of a new narrative. Public policy must be bold in activating this process.

Even though global economic growth is projected to pick up marginally from 3.4% in 2014 to 3.5% in 2015 (IMF WEO Report, April 2015), unemployment and inequality remain major policy concerns. With unsustainable debts and increasing fiscal pressures, jobs are going to be lost and the gap between the haves and the have-nots would get wider. The unfortunate aspect is that those at the bottom of the economic ladder, the vulnerable, are the ones that would get hit the hardest. Entrepreneurship, self-reliance and economic empowerment are no longer policy prerogatives but critical imperatives for the preservation of social order.