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26.11.2007 Business & Finance

Gov't's records of failed budget policies revealed

By Public Agenda
Gov't's records of failed budget policies revealed
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For two consecutive years, Government has failed to implement more than half of the policy initiatives that were outlined in successive budgets.

Out of 53 policy initiatives listed in the budget for the 2007 fiscal year, 29 (54.7%) had not been implemented as at October 30. Also, out of 29 policy initiatives scheduled for the 2006 fiscal year, 19 (65.5 %) failed to take off.

Mr. Tony Oteng-Gyasi, AGI President disclosed this at the 47th Annual General Meeting (AGM) of the Association of Ghana Industries (AGI) held at the Ghana International Trade Fair Centre (GITFC), Accra last Thursday.

He played up concerns by several analysts that a greater number of government's policies have not seen the light of day. He however, gave no details of the policy initiatives.

According to Mr. Oteng-Gyasi, these anomalies were detected when the association carried out an audit on the 2006 and 2007 Budget Statements.

"In line with our tradition, AGI has continued to make inputs into national budget preparation. We have in recent submission added a new dimension which involves an audit of the status of implementation of policy initiatives in preceding budgets," he told the industrial fraternity in his address.

The 47th AGM of the Association formed part of the celebration of the 7th National Industrial Week which was celebrated from November 20 to 22 under the theme: "Financing Alternatives for Industrial Growth."

The three-day programme also featured the Anniversary Celebration of the Africa Industrialization Day (AID) which was observed under the theme: "Technology and Innovation for Industry."

Concerning the Association's proposals for the 2008 budget, as well as, previous budgets, Mr. Oteng-Gyasi said, "It is worthy of note that a number of proposals made by the Association had been incorporated in Government's proposals to Parliament."

He indicated, "Some of these policies are at various stages of implementation and others seem to have been ignored. No explanations have been offered for non-implementation of some policies even in successive budget statements."

In a key note address, Mrs. Mary Chinery-Hesse, Chief Adviser to the President, noted that AGI's contribution to the formulation of budgets and further engagements with the government attested to the "true spirit of public/private partnership."

She commended the AGI for initiating the Business Climate Surveys (BCS), which have provided unique information and da¬tabase of indicators about current business conditions.

"These help to broaden the discourse on current economic development priorities and policies in a timely manner, and complement the work of challenged Statistical Agencies. They also provide in~ formation on investor confidence level and consequently about investment and employment forecasts."

Mrs. Chinery-Hesse mentioned that through the BCS, information made available "has brought a great deal of value to Government policies formulation."

She therefore welcomed the AGI's plan to carry out a regional-based business surveys which will provide information about investment conditions prevailing in each region.

She pointed out that credible information from regions and districts is necessary as a guide to development and planning since it draws attention to disparities in development.

The association conducted its first BCS in October 2006, two months after the year-long energy crisis forced the Volta River Authority (VRA) and the Electricity Company of Ghana (ECG) to institute the National Load Shedding Programme (NLSP).

In that edition, three quarters (75%) of private sector businesses in Ghana described the NLSP as the premier challenge to doing business in Ghana in 2006.

It was carried out in the Accra/Tema, Ashanti, Brong Ahafo, Central and Western Regions where 226 face-to-face interviews were conducted with Chief Executive Officers (CEOs) of AGI member companies. The interviewees answered questions on "challenges to doing business in Ghana, by giving a value on a scale of 1-10 (or 0-9).

The second BCS took place in the second half of August, 2007. This time 451 CEOs were asked to give their assessment of the performance for the past year and their expectations for the next twelve months.

They had options to judge their situations as "good", "fair" or "poor" and their business expectations as "better", "unchanged" or "worse".

In the end, competition from imported goods ranked second on the top ten list of challenges to doing business in Ghana. The issue jumped two places, from the fourth position in 2006 to become number two in this year's edition of the BCS though the NLSP remained as the premier threat to businesses.

Precisely half (50%) of business executives from all sectors in Ghana saw imported goods as the most threatening factor affecting their businesses as at the time after NLSP which recorded 61 %.

More importantly, nearly two-thirds (59%) of businesses in the manufacturing sector ranked competition from imported goods as number one threat apart from the NLSP which is a bother to 62% of them.

In sum, the second BCS indicated that business confidence in 2007 has dipped, com¬pared to 2006. "Optimism is still strong, but less than in 2006."

The overall Business Climate Index (BCI) fell from +46 in 2006 to +38 in 2007, the report indicated.