Ghanaians Are Richer Today Ghanaians are about 74 per cent richer today than they were when the National Democratic Congress handed over power to the New Patriotic Party in January 2001.
On Tuesday, President John A Kufuor surprised the nation by claiming, “We are already at $600 per capita income, confirmed by the IMF.”
Whilst his Finance Minister is reluctant to go by the President's preferred figure, calculator-memory Kwadwo Baah-Wiredu referred The Statesman to Page 303 of this year's Budget Statement and drew the conclusion that Ghana's per capita income should end the year at about $525. This is almost half of the middle-income target of $1,000 by 2015.
He, however, cautioned that the actual figure may be higher depending on the points of reference used. Ghana's nominal GDP for 2004 was 79,803.7 cedis. The budget estimates 96.3 trillion cedis for this year. The NPP has consistently performed better than its revenue and growth estimates since 2001.
The Minister came to this 74% rise in five years by using an estimated national population of 20 million, and dividing it by the average exchange rate of the local currency to the dollar this year: 9,100 cedis. This puts this year's GDP estimate at $10.55 billion.
His trusted source, the Minister said, is the Statistical Service Department and since they are yet to come out with the per capita income for 2005, he said “depending on your source you can end up with varying figures – but even the IMF and Word Bank rely on the original figures from the Statistical Service before drawing conclusions, with their Staff estimates.”
The Ghanaian economy, according to the statistics, grew by 3.7 percent in 2000. The NDC government had predicted GDP growth rate of 7%. Sharing the wealth of the country among a population, estimated to be between 18 million and 19 million at the time, the per capita income of the country was $390.
But latest information posted on the Ghana page of the IMF website – specifically - http://www.imf.org/external/pubs/ft/scr/2005/cr05286.pdf - shows marked improvements in various aspects of living standards in Ghana.
For example, the average monthly earnings of employees show a big percentage jump. With the minimum wage at 4,200 cedis and a dollar buying 7,047.7 cedis, the average monthly income of Government workers was 333,924 in December 2000. By December 2004, this had shot up by 369% to 1,122,653 cedis, far in excess of the accumulative percentage increase in inflation for the period.
The private sector also witnessed an above-inflation jump of 173% in average monthly earnings from 524,603 cedis in December 2000 to 1,429,807 cedis by December 2004. The minimum wage was 11,200 in 2004 and the dollar ended with an exchange rate of 9,054.3
Between 2001 and 2004, the combined annual average rates of inflation add up to 86.3%. Inflation averaged 25.2% in 2000.
The document – Ghana Statistical Appendix – was prepared by a staff team of the International Monetary Fund. It is based on information available at the time it was completed (June 9, 2005) from the Ghana Statistical Service and the IMF staff's estimates.
It shows, for instance, that Ghana had a total external debt service of $566 million due this year, which would have had to be paid without the enhanced HIPC initiative. In 2000, the year before Ghana opted for HIPC, the external debt due for service then was $561 million.
However, while the country registered record GDP growth in 2004, the figures show that wealth may not be as widespread as desirable. Indicators show chronic malnourishment among Ghanaian children under five years of age, which increased over the period 1998-2003.
Some key indicators in Ghana's health sector have deteriorated recently, the report says, although health expenditures have risen, reaching 11.8% of total government spending in 2003.
In particular, the report indicates that infant mortality, child mortality, and child malnutrition declined steadily in the period 1998 but have increased since then. Child mortality, for example, increased from 108 per 1,000 live births in 1998 to 111 per 1,000 in 2003. One of the millennium Development Goals (MDGs) is to reduce this indicator by two-thirds by 2015, but, on current official projections by Ghana, it will be difficult to achieve.
Within the country, there is substantial regional variation in the infant and under-5 mortality rate. Upper East, one of the poorest regions, experienced the most significant improvement in these indicators, while Ashanti, one of the wealthiest regions, experienced a significant increase. In fact, upper East becomes the region with the lowest infant mortality rate. The data also show that the rural area, in general, fared better than the urban area in terms of improvement between 1998 and 2003
Two surveys-Demographic and Health Survey and Core Welfare Indicators Questionnaire (CWIQ) survey- indicate that the overall incidence of stunting (representing the long-term effect of malnutrition) has increase especially in the urban area. Two regions, Upper East and Upper West, however, have experience a decline in stunting incidence. The surveys do not agree on the direction of wasting incidence, an indicator of short-term acute malnutrition. Taking a look at the statistics of five regions, in Infant Mortality between 1998 and 2003 Ashanti increased from 42 per 1,000 to 80 per 1,000; Eastern 50 to 64 per 1,000; Greater Accra 41 to 45 per 1,000; Upper West 71 to 105 per 1,000, and Volta 64 to 75 per 1,000
Similar pattern is observed in under-5 Mortality within the same period of 1998 and 2003 except that whereas there were increases in infant Mortality rate for both urban and rural areas, the rural areas recorded reduction of 122 to 118 per 1,000 in under-5 Mortality rate between 1998 and 2003.