Former Minister Challenges Gov’t on Economic Gains

Former Minister of Finance & Economic Planning, Yaw Osafo-Maafo has disputed claims by the current administration that it has improved the economy and attained single digit inflation.

According to him, the decline in working capital and turnover of businesses and industries as a result of currency instability showed that the economy has not improved since 2009.

Speaking on Angel Fm, a Kumasi-based radio station on Monday, the former Finance Minister raised several questions about Ghana’s economy.

“Between 2004 and 2007 while banks were chasing people to come for credit, the opposite is what is happening because there seems to be no correlation between the government’s single-digit inflation and interest rate.”

“Why is it that people are complaining of hardship in the country and prices of goods in the market keep on going up when inflation has remained single digit for about 30 months?” he quizzed.

Mr. Osafo-Maafo disclosed that an improved economy with single-digit inflation would cause the nation’s currency to stabilize and interest rate to fall since those indicators move hand in hand.

According to the econometrist, since government does not believe in its own interest rate policy, it moved the 91-day Treasury Bill from 10.2 percent in January, this year to 22.95 percent.

“The stability of the Cedi is the worst over a long period in Ghana. President Kufuor left a healthy economy than what it is today,” he declared.

The former minister criticized the Vice President, Paa Kwesi Bekoe Amissah-Arthur for stating during the IEA’s debate that “the Cedi always depreciates during election period.

Mr. Osafo-Maafo stated that Vice President Amissah-Arthur demonstrated during the vice-presidential debate that he was not astute while leading the Bank of Ghana aside lying to Ghanaians.

According to the economic guru, the Cedi depreciated only 2.2 percent in 2004 as against the current depreciation of about 25 percent.

“What the Vice President alluded to only happens when they are in power. Single-digit inflation must force interest rate to come down and the Cedi to stabilize. We are not getting this because the figures are incorrect and unreliable,” the Minister pointed out.

Mr. Osafo-Maafo, in November 2001, was named Finance Minister of the year alongside his Canadian counterpart, Paul Martin by the World Economic Forum and Finance Minister of the Year 2001 Africa by the “Banker Magazine,” a Financial Times publication.