View 5.2 GDP growths, with caution - ISODEC

Accra, Feb 11, GNA - The Centre for Budget Advocacy (CBA) of the Integrated Social Development Centre (ISODEC) has called for a cautious appreciation of the 5.2 per cent Gross Domestic Product growth target for 2004 since the figures seem mystical.

??? It also called on government not to put too much political weight on the current GDP growth since not all the figures, some of which are estimates, have been completely verified.

???? Mr Vitus Azeem, Programme Coordinator of the CBA, said this at a forum on the 2004 budget in Accra on Wednesday.

???? He noted that much of the growth was in the cocoa sector with the remaining sectors showing mere marginal growths.

??? "This shows that nothing significant has happened and what has happened does not represent a broad achievement that we should be so proud of."

????? He explained that the overall growth of the economy should be spread fully and should necessarily be pro-poor.

??? He said given the importance of the GDP figure, "there is surprisingly little illumination about how this figure is arrived at".

??? Mr Azeem said in other countries, the formula for arriving at this figure is provided in the technical appendix to the budget so that those who want to investigate its validity could do so. "This is not so in Ghana, adding, "this is particularly worrying given that IMF's projections which we rely so much on, do not generate growth figures from real productive side of the economy."

?????? He said the fact that the Ghana Statistical Service does have problems, which impacted negatively on the quality of national income statistics and their ability to conduct surveys regularly was another major problem.

?? On the macro front, Mr Azeem said the 2004 macro-economic targets were conservative, as they were pegged at the same levels as the achieved ones last year. Some were even reduced, with exception of the desire to achieve single digit inflation.

??? "The macroeconomic problems we face today are exactly the same ones we have been dealing with since the on-set of structural adjustment programmes in the 1980s.

?? "These have been addressed over the years, from the PNDC, NDC to the NPP by very similar stabilization packages, with contents suggested by the International Monetary Fund."

?? Mr Azeem said these packages had components, which were cuts in government spending, increases in taxes, introduction of floating exchange rates and currency depreciation, tight credit and high interest rates.