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Opinions Mon, 12 Nov 2018

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Ghana's economy: Dead, but now alive

The elections of 2016 was an indication that Ghanaian are voting on issues and that they did not have the patience to tolerate the incompetent manner the National Democratic Congress (NDC) managed the economy of Ghana during 2009 to 2016.

It baffles my mind as to what the then Finance Minister, Bank of Ghana (BoG), Governor and the NDC economic management team were all doing when bank directors and shareholders were excavating money out of their own banks as if they were engaging in galamsay?

It should be noted that these were tax payer’s monies of ordinary Ghanaians given to these banks as liquidity support by the government to stabilize their books and operations. This needed some strict supervision and accountability measures from theBoG then but they failed.

It took the NPP government just under 12 months to identify these massive rots that had been negligently left to persist in the banking sector. The pragmatic steps and tough measures taken by the NPP government prevent another DKM (an NDC trademark of mismanagement) from happening.

Today, based on the imbalances created by the above actions of the previous government; some banks and financial institutions are willingly lining up and pleading for a bailout from the BoG.

As a result, this government has sacrificed a whopping 8 billion plus cedis meant for development and economic growth to prevent a catastrophic disaster to over 1.2 million depositors funds in the 7 banks as a result of NDC's negligence and incompetence over the 8 years under the leadership of John Mahama as chairman of the economic management team and as President.

In just 20 months of the NPP government has achieved significant success in the management of the economy;

1. Inflation has moved for 17% to 9%.

2. Treasury Bill rate has moved from 24% to 13%

3. BoG prime lending rate has moved from 26% to 17%

4. Ghana's economy grew by 8.5% in 2017 one of the highest growth in the world.

5. Ghana's economy is projected to grow by 8.5% in 2018 which would be again one of the highest growth in the world.

These indicators clearly show that the NDC never had the capacity to manage Ghana's economy.

It is so surprising that the biggest problem in Ghana between 2013 to 2016 "dumsor" has been forgotten totally. This power crisis collapsed many businesses and rendered the economy useless and unproductive.

Dumsor actually determined the time one sleeps and wakes up as if we were under an oppressive curfew.

About this Dumsor, the NPP said the problem was liquidity (lack of funds) and not capacity (generation power), but the NDC called their bluff. As it stands today the country is currently using less than the installed capacity and still we are not experiencing dumsor.

The NPP government solved this power crisis in less than 6months after assuming office.

To show that they had control of the power situation and also understood power problem and the hardship of Ghanaians under Dumsor, they further reduced the tariffs of residential and Non-residential users by 17% and 30% respectively.

This clearly shows that Ghanaians were being punished because of the incompetent management of the economy.

The most significant and phenomenal issue is that all these achievements have been accomplished under 2 years of the NPP government which is under an International Monetary Fund (IMF) programme.

This is a situation where Ghana's revenues and expenditures have been under the strictest restriction and scrutiny by the IMF. By the end of 2018 Ghana would be going out of the IMF programme, and with this strong economic foundation built under the strict supervision of the IMF means Ghana is out of the abyss of austerity to tackle the high expectations of Ghanaians.

In 2019 the transformation agenda of President Nana Akufo-Addo will be manifested in its full scale. Ghanaians should fasten their seatbelts and get involved as we witness the grand vision of infrastructural developments and job creation unfold in all sectors of the economy.

Columnist: John Hall Jr

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