NPP's Was Reckless in Final Years - Duffuor

The Minister of Finance and Economic Planning, Dr. Kwabena Duffuor has described former President Kufuor’s New Patriotic Party (NPP) government in the last regime as reckless government. Speaking at a press briefing as part of 100 days activities of the NDC government, the Finance and Economic Planning Minister averred that the NPP government recklessly managed the economy in their last two years in office thereby destroying almost all the economic gains they have achieved as a government.

Dr. Duffuor explained that the current economic challenges confronting the country including the depreciation of the cedi, increasing rate of inflation and the supposedly lost of confidence in the economy were all attributed to former President Kufuor and his NPP government’s reckless management of the economy within their last two years in office as a government. Citing examples, Dr. Duffuor disclosed that the NPP government’s 2008 budget deficit of 14.9% of GDP, the introduction of the new Ghana cedi, the liberalization of the country’s capital market to foreigners and the Central Bank policy of spending over $1.2billion to support the new Ghana cedi was some of the major reckless polices of the past government.

The finance minister has therefore debunked as false a notion by the opposition NPP members that the NDC government was responsible for the depreciation of the cedi and the increasing rate inflation, which has resulted in the rising cost of living being experienced currently in the country. Providing details, Dr. Duffuor disclosed that the new Ghana cedi was introduced in July 2007 and fixed at GHC.920=$1, and that the government realizing that it faces serious depreciation instructed the Central Bank to intervene in the foreign exchange market to sell the country’s hard earned dollars to support it.

For example, the finance minister disclosed that between July 2007 and December 2008 the Central Bank sold over $1.2billion in the foreign exchange market just to support the new Ghana cedi yet it depreciated over 31% during the period. Dr. Duffuor averred that the NPP government recklessly opened the market to foreigners, as a result by December, 2008, foreign investors were holding 46% of government of Ghana 3-year fixed bond and 87% of the 5-year bond.

The finance minister however disclosed that the new government was working very hard to put the economy on sound footing. Some of the policies being implemented in the NDC government’s austerity budget include the weeding of wasteful and fruitless public spending and enhancing government revenue through significant improvement in tax policy and tax administration. Concluding, Dr. Duffuor stated that the fiscal adjustment measures currently been implemented will help to restore the macroeconomic stability, debt sustainability and create further room for sustained private sector growth. These according to the Finance Minister together with the fundamentals of the economy will combine to strengthen the confidence and credibility in the economy and the government of the country.