Ghana hopes to shield economy from African oil curse

* Economists cite risks of fiscal laxity, Dutch disease * Nigeria saw agricultural sector ravaged, corruption soar * Ghana wants to increase investment in cocoa sector * Ghana has strong democratic institutions, oil wealth funds By Matthew Mpoke Bigg and Kwasi Kpodo ACCRA, May 21 (Reuters) - Oil brought riches to Nigeria but also ravaged its economy and fuelled corruption and conflict. Now nearby Ghana has begun production and wants to take the wealth but dodge the oil curse. Ghana is used to resource riches: it is already the world's number two cocoa producer and Africa's second-largest gold miner. But there are signs it is struggling to manage the new oil money and some people are disappointed. A budget deficit last year which soared to 12 percent of gross domestic product (GDP), nearly twice the targeted level, raised fears among economists of fiscal laxity, a classic symptom of the resource curse that often feeds corruption.

Investors are also watching the strengthening cedi currency . An inflation-adjusted rise due to an influx of petro-dollars can signal "Dutch disease", where the competitiveness of farming and manufacturing is eroded, as in Holland in the 1960s. "The government seems to be very much wary of the dangers of Dutch Disease," central bank governor Henry Kofi Wampah said. "Oil will continue to attract attention but not at the expense of cocoa or gold." continued