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22.07.2013 Business & Finance

'Make NDPC Autonomous'

By Daily Guide
Dr John KwakyeDr John Kwakye
22.07.2013 LISTEN

The poor socio-economic performance recorded by the country in recent times has been attributed to the lack of a national development plan or vision.

The Institute of Economic Affairs (IEA), an independent policy think-tank, has consequently called for an autonomous Commission, which would carry out its mandate effectively.

Dr. J. K Kwakye, Senior Economist at the institute, addressing the media on the state of the Ghanaian economy Thursday in Accra, stressed the need for a national development agenda or plan that is long term, integrated, bottom-up and based on a widely-consultative process that would be implemented by successive governments.

He said Ghana has had several post-independence development plans, noting that with the exception of the seven-year development plan (1964-1970) that was aborted after the 1966 Coup d'etat, none of Ghana's long-term development plan has been implemented.

He said the 1992 constitution established the NDPC and mandated it to formulate a long-term development plan from which medium-term plans and annual budgets could be derived.

However, the NDPC does not have the resources to carry out its work effectively.

'It has become the norm for each government to use the NDPC to formulate its own development plan only to be overturned by the succeeding governments,' he said.

Dr. Kwakye said key sectors of the economy are not growing due to the lack of a focused national development plan.

 
Unemployment
He said the recent oil production has boosted the growth of the country's economy, but the growth has not generated many jobs as expected.

The public sector is already over bloated and employment in the sector is virtually stagnant to the extent that the private sector is not able to make up for the slack in public sector employment, thereby constraining job creation. The issue of businesses and industries complaining about a mismatch between available jobs and skills needs to be addressed by reviewing the school curricula so as to produce industry-relevant skills and give graduates more employment, he indicated.

 
Diminishing Manufacturing Sector
Dr. Kwakye further observed that the manufacturing sector, which has the highest potential not only to engender growth but also to create jobs, has been stagnant with its share of the Gross Domestic Product (GDP) declining to seven per cent.

'The sector is really in crisis facing numerous challenges, including high cost of financing, poor infrastructure support, unreliable and high cost of power and water, reliance on obsolete technology and also the inability to compete with cheaper imports,' he noted.

He said the decline of industry needs to be arrested as a matter of urgency, adding that sustained growth and development is inevitably dependent on a vibrant and robust industrial sector.

'State financial and material support is needed for the manufacturing sector. Appropriate trade policy interventions are necessary to support domestic industries,' he said.

Infrastructure, poverty and income inequality

The Senior Economist stated Ghana's infrastructure has deteriorated to a level that does not befit its status as a middle-income country.

He added that Ghana has a large infrastructure deficit in respect of power, water, roads, railways, ports, housing and sanitation.

This, according to him, increases production costs, reduces, competitiveness and inhibits economic growth.

Dr. Kwakye therefore called for budget prioritization in the infrastructure sector to ensure that adequate resources are devoted to capital expenditure while curtailing non-essential recurrent expenditure.

By Jamila Akweley Okertchiri & Maddy Crowell
 
 

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