There was a certain sense of both liberation and jubilation in the air, when the NPP government was elected to power in the year 2000, the country which hitherto had been governed by the NDC government decided to move on, thus bringing the days and era of Jerry John Rawlings to an end. The air was charged with euphoria and great anticipation, because to many this meant a new beginning for the country and its people, this was independence day all over again and president elect John Kuffour and his NPP party were on course.
The first thing that they set out to do after being elected to rule was to fix the economy and how?
Well, the inflationary status which was speculated around 22.8% was going to be dealt with, together with the gross domestic product which was $ 3.94 billion. The nation also had a national debt stock of $7.5 billion, out of this amount $ 5.8 billion was external and $ 1.7 billion was considered domestic. Under the enhanced HIPC initiative program by both the world Bank and the IMF, Ghana was able to secure $3.7 billion in debt service relief for its Ghana Poverty Reduction Strategy program also known as the GPRS. The $ 3.7 billion had an equivalent net present value of $2.31 billion. A net present value which is also known as NPV, is an indicator which measures the excess or shortfall of cash flows in present value terms once financing charges are met, it's also the discounted sum of all future debt-service obligations (interest and principal) on existing debt.
The Ghana Poverty Reduction Strategy draft indicated that the HIPC Initiative relief will be directed primarily on education, health, programs to improve services, infrastructure in the rural sector and improved governance. A portion of the relief will be used to further reduce the heavy burden of the domestic public debt. The International Development Association promised to deliver an estimated amount of $718 million in debt relief to Ghana over a 20 year period, with the IMF promising to deliver an amount of $112 million with an immediate effect.
Now let's see how well the NPP government performed in the various sectors like education, health, infrastructure and governance with the debt relief firmly in place.
Our education system is more of a loss to our nation than an asset, because it's an institution which seems to produce graduates who are able to read and write, but who cannot contribute anything significant to the developing process of the country, because of the nature of the education itself. In other words, what's the use of having a university which specializes in higher learning, if at the end of the day, the process of turning milk into cheese is still a mystery to the nation? Our country spends most of its gross nominal income importing foreign commodities into the country and I mean commodities which this country could manufacture with the right form of education in place. And so instead of the NPP government taking drastic measures to upgrade the quality of our educational system, so that the theoretical knowledge acquired at these schools and institutions could make practical sense, it opted for a more subtle approach, by for instance making basic education tuition free and also introducing the school feeding programme, like that would help anybody.
The NPP government also decided to set up a non profit organisation called the NHIS, which would provide free health care to the citizenry, now how free is it? well it's free, but you would have to pay to register, which means your registration fee is actually your health care payment and so it's not free at all.
The government also decided to improve the nation's infrastructure and this they did by contracting foreign companies, because they believed in the superior skills of their labour force, thus blatantly insulting our local contractors and taking bread from the mouths of our nation's already impoverished labour force.
Because of our perennial dependency on exported raw material to support the inflow of cash into our economy, our nation's economy has pretty much fallen into the hands of external market forces, which have the power and potential to destabilize our economy and this is very dangerous. Our import ratio surpasses our export ratio, statistics have it that the NPP government which successfully managed to increase the nation's GDP from $ 3.94 billion in 2001 to $16.1 billion, registered a budget income revenue of $ 4 billion, but also recorded a $ 5.5 billion on expenditures, thus leaving a budget deficit of $1.5 billion at the close of 2008 as compared to the budget deficit of $300 million which the previous NDC government left in 2000.
Ghana's reserves of foreign exchange and gold was registered at $2.301 billion in 2008 and so if one was to subtract the budget deficit of $ 1.5 billion from this figure, the total of Ghana's reserves of foreign exchange and gold would amount to a mere $ 800 million, which is a disgrace, but then who said that the NPP government was good in adding up, let alone in the proper management of a economy?
The nation was camping with an inflationary status of 22.8 % when the NPP party came to power, however job creation and the increment in both salaries and wages led to the automatic increment in the purchasing power, the heavy rotation of imported commodities in the system also played a very significant role in the overall decrement of the inflationary status to 11.2 % in 2006, however it rose again to 18.1 % at the close of 2008, but then again the NPP government should've known that, the best way to control inflation is to wean the economy from the external market forces, which control the prices of imported commodities and industrialize the nation's economy from within.
In year 2001 our GDP was $ 3.94 billion, however due to the high demand in our raw materials, this figure was significantly improved from $ 3.94 billion in 2001 to $16.1 billion at the close of 2008, thus realizing a gross nominal income difference of $12.16 billion, however at the close of 2008, $9.816 billion of this income had been spent importing commodities, plus an additional amount of $1.2 billion being used to re-denominate the Cedi, thus leaving the NPP government with only a net profit of $1.16 billion after all this trade to bank, whilst this amount could've much more.
There are those who would applaud this performance, because after all Ghana under the NDC government had no reserves, but let's ask ourselves this question, which government in its right mental faculty, would make $12.16 billion from trade and instead of investing this money on domestication, actually winds up using almost all of it on import to literally weaken the very economy, which it seeks to embetter?
Source: MP
