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STUNNING REVELATIONS: Ghana's Economy diagnosed

By Public Agenda

Professor Tony Killick, a professor of economics with extensive research experience on Ghana spanning over three decades, has described Ghana as a Neo-patrimonial state in which there is only a weak sense of the public good or public service, and where the resources of the state are at the disposal of the president and his ministers.

Speaking on the topic, 'What drives change in Ghana?' at a three-day international conference on Ghana's economy co-organized by the Institute of Statistical, Social and Economic Research (ISSER) of the University of Ghana and the Cornell University of U.K, in Accra, Tony Killick stated that, the challenge facing the country is not one of inadequate knowledge of the economic problems, or ignorance of the best technical solutions, but rather, the nature of the political system.

Drawing analogy from a slogan: “It's the economy, stupid,” that hanged in the Oval Office of former U.S. President Bill Cliton to remind himself of what his priority should be to keep the electorate on his side, Tony Killick said in the case of Ghana, it would be: “It is the polity, although I'm much too respectful to add stupid”.

The conference, which was to review the performance of Ghana's economy over the last half-century, was attended by researchers, mainly in the field of economics, from over 65 nations, with the Minister of Health, Hon. Kwaku Afriyie, delivering the opening address on behalf of the President, His Excellency John Agyekum Kufuor.

Tony Killick decried the 'Business as usual' attitude to governance, adding that, at the current pace of development, Ghana risks being classified as a low-income country for many years to come, which, according to him, would mean, missing all the target indices under the Millenium Development Goals. “Understanding what holds the economy back, and addressing it”, he said, “is the way to proceed”.

In what was seen by many to be a fitting description of the state of Ghana's economy, Tony Killick said, “instead of the state being an instrument governed by explicit objective and legal rules, it is effectively an apparatus serving the interest of particular groups and individuals”.

He explained that, in a neo-patrimonial state, public resources, the power to allocate rents, provide services and to determine policies and their beneficiaries, are captured and 'owned' by personal or private networks in the hands of dominant 'patrons'.

On management of public finances, he stated that there are regularly large deviations between budget estimates and actuals, with the ministries of education and health having mean deviations of about ±42% and ± 68% respectively.

His revelation on leakages of allocated funds between their release from the center and arrival at the point of service delivery was frightening. He stated that for the two ministries, Education and Health, only 51% and 21% respectively, of non-salary resources released from the center, actually arrived at their desired end. This, he said amounts to leakages of about 49% and 79% respectively.

On the business front, Professor Tony Killick indicated that the 'past is the present'. That investors continue to complain about shortages of credit, uncertain power supplies and high transportation costs.

“ They still complain about excessive regulation and bureaucratic delays, of problem of contract enforcement, of corruption at many levels, and of problems in accessing land with firm titles of ownership”. Continuing, he stated that there are complaints too about politicization of private business, meaning, some businesses have become associated with either the NPP or NDC and that when in office, each party favours its allied businesses and discriminates against those of its opponents.

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