Economy has shrunk - Prof Gyan-Baffour

For the first time in 14 years, Ghana’s economy has shrunk and growth has declined from 8.4 percent in 2009 to 4.2 percent currently, Prof Gyan-Baffour, Member of Parliament (MP) for Wenchi has indicated.

He disclosed this on the floor of Parliament during a debate on the 2016 Budget.

Prof Gyan-Baffour said such negative growth in the wake of oil resources had significantly affected the country’s gross domestic product (GDP) and per capita income.

“Mr Speaker, according to the Bank of Ghana data on page 213 of this budget, the economy is shrinking. The GDP was $39.517 billion in 2011; it went up to $41.459 billion in 2012 and $48.678 billion in 2013 and has since started falling to $38.775 billion in 2014 and further down to $36.068 billion in 2015,” he emphasised.

He also pointed out that with an increased population and shrinking GDP, the per capita income has reduced from $1,884 in 2013 to $1,346 in 2015, stressing that the budget’s theme of ‘Consolidating Progress towards brighter medium term’ should change to ‘Consolidating mediocrity and incompetence.”

He said government has mastered the art of borrowing such that the country’s total debt has ballooned from GH¢9.5 billion to GH¢93 billion in seven years with most of the borrowed money going into consumption instead of investment as indicated by the IMF.

The MP said industries had suffered greatly under this government, especially in the wake of the current power crisis.

“Mr Speaker, positively transforming the economy will mean adding value to our raw materials that is converting bauxite into aluminum, gold into trinklets, producing more chocolate from cocoa and the rest.”

He also added that government could also increase the fiscal space by revisiting the Oil Revenue Management Act and re-organizing EDAIF into a commercially viable bank to support manufacturing and export.