Government bets on Ghana Card, digitization to leapfrog economic growth

Vice President, Dr. Mahamudu Bawumia, has indicated that the country is executing a plan to meticulously digitize and integrate all persons on the National Identification Database, popularly known as Ghana Card into the economy, as it holds a great potential to leapfrog the fortunes of the country to heights never imagined.

As a result, in addition to digitizing the economy, which is greatly reducing human interaction in the provision of government services, by the end of this year, government would champion the integration of the Ghana Card with key installations as it would help for easy identification of every Ghanaian – a development that holds huge returns for the economy.

Already, the Ghana Card has been merged with Social Security and National Insurance Trust (SSNIT); National Health Insurance Scheme (NHIS) and Tax Identification Number (TIN) of the Ghana Revenue Authority (GRA). There are ongoing efforts to merge it with the Driver and Vehicle Licensing Authority (DVLA), Controller and Accountant Generals Department (CAGD), banking and financial systems, Criminal Investigation Department (CID) of the Ghana Police Service, among others.

According to Dr. Bawumia, each of the key installations that the Ghana Card would be merged with would provide a unique economic advantage that would culminate in leapfrogging the economy in a short time to provide some respite to citizens.

Speaking at the Ghana CEOs Summit 2021, Dr. Bawumia said, a careful understanding of African economies has made him realize that efforts that go into fixing the micro economy will come to not if the macroeconomy is given little attention.

Recalling his past, Dr. Bawumia said: “After I left the Bank of Ghana in 2009, I went as a visiting scholar to the Oxford University where I wrote a book on monitory policy and financial sector reform in Africa. That period gave me a lot of time for reflection on what we had done since independence.

I looked at the effectiveness of all that we were doing, the question that kept ringing at me was, how come the interest rates that we want to decline are not declining? For the most part, the monitory policy rate would bring down the interest rate, but lending rates would remain stubbornly high.

At the conclusion of the book, it became obvious that getting the macroeconomy right was not sufficient, getting inflation down was not sufficient, getting exchange rate stable was not sufficient; there was a certain microsystem that needed to be in place for the economy to be able to deliver the low-interest rate that would drive business and economic activity.”

He added that: “for the longest time as we interacted with the IMF and World Bank, you realize that nobody is coming to tell you that put in place these micro-foundations; nobody will tell you that if you do not put in a digital address system, we will not give you a loan, or the National ID is a key condition for capital. There were all these things that I referred to as unwritten rules of the game.

These rules are not written in our economic textbooks; but you know that if you are in an economy and you do not have a working address system, you are not going to go far. If you cannot uniquely identify your population, you are not going to go far as an economy. You can have exchange rate stability and lower fiscal deficit and so on, but you are going to just operate in a low-level equilibrium, you are not going to move to a higher level and moving up to the higher level is what we want to do,” Dr. Bawumia said.

He noted that it is on the back of these, that government pursued an aggressive digitalization of the economy that has resulted in the introduction of mobile money interoperability system, paperless port, passport office reforms, among others. Also, the Ghana Card would be an economic game-changer when the integration is fully completed.

The aim is to formalize the economy and accelerate growth by increasing government economy, reducing corruption and provide government services more conveniently and efficiently to citizens.