Ofori-Atta Needs to Finetune His Spiel

As the national debt has exponentially mounted by some Ȼ 22 Billion, the ruling New Patriotic Party (NPP) is being dogged and peppered with questions of fiscal irresponsibility of the kind that the party’s leaders lobbed at their counterparts of the then ruling John Dramani Mahama-led National Democratic Congress (NDC). It was in the leadup to the 2016 general election. By the time that the NDC was massively but democratically shoved out of the Flagstaff House, presently renamed Jubilee House, on January 7, 2017, the national debt ceiling had shot well past Ȼ 122 Billion. That represented a whopping 74-percent of the country’s Gross Domestic Product (GDP) by the end of 2016. I am no economist, but what the foregoing figure means is that our national productivity, in monetary terms, was only 26-percentage points more in value than our national debt.

In other words, Ghanaians were literally up to our necks indebted to both domestic and foreign lenders and investors. Now, we are being told by economics experts that the country’s debt stock or watermark has precipitously shot up to some Ȼ 198 Billion. When one subtracts the Ȼ 122 Billion in debts bequeathed the incoming Akufo-Addo-led government of the New Patriotic Party from the Ȼ 198 Billion so far racked up by the latter government, that comes up to Ȼ 76 Billion. And the latter volume of debts has been racked in just under three years of NPP stewardship. Actually, it is slightly less than three years; and it is likely to go up a little further. What this means is that on average, the Akufo-Addo government has been borrowing approximately Ȼ 25 Billion every year.

Undoubtedly, this level of borrowing, relative to the country’s fragile economy, is quite humongous. Nevertheless, to get a better sense of the relative frugality or fiscally more responsible Akufo-Addo government, it bears to compare the latter to the Mahama-led regime of the National Democratic Congress, by factoring in the rate or level of inflation presently, as opposed to the inflationary rate some three years ago, which may realistically be envisaged to have inched up quite a bit. What with the sharp inflationary distortion caused by the massive collapse of the poorly regulated banking system under the previous regime? What the latter observation means is that while in statistical terms, the Akufo-Addo Administration may be seen to have borrowed more than the previous Mahama regime, nevertheless, in real value-for-money terms, the Akufo-Addo government may clearly be seen to have borrowed considerably less.

And to be certain, our economists and fiscal experts tell us that the Ȼ 198 Billion borrowed, so far, by the present Akufo-Addo government, roughly represents 57-percent of Ghana’s Gross Domestic Product, or just a little over half of our total national productivity in monetary terms. Now, compare the foregoing GDP ratio of 57-percent to the 74-percent represented by the Ȼ 122 Billion bequeathed the present government by the previous Mahama regime, and it immediately becomes glaringly evident that the previous National Democratic Congress’ regime borrowed nearly 20-percent more than the present Akufo-Addo government. But, of course, there is far more, in terms of material development and/or infrastructural facilities, that makes the Akufo-Addo Administration the far better and more efficient of the two tandem governments.

In terms of quality-of-life improvement index, for example, the havoc wreaked by Dumsor or erratic power supply, Ghanaians are far better off under President Addo Dankwa Akufo-Addo than they were under the protracted four-and-half-year tenure of former President John Dramani Mahama. This is what, I strongly believe, Finance Minister Kenneth Kuntunkununku Ofori-Atta ought to be emphasizing in his heated raging debate with the decidedly jaded and washed-out critics and NDC operatives like Mr. Fiifi Kwetey, the former Deputy Finance Minister under the rag-tag Mahama regime, rather than cavalierly and almost presumptuously insisting in a daredevil manner that “We will continue to borrow,” and that there are still other massive and/or landmark projects to be executed by the present government.

In brief, Mr. Ofori-Atta would be much better off ripping a page out of Vice-President Bawumia’s playbook of bullet-point highlights detailing the legion development projects thus far accomplished by the Akufo-Addo Administration including, of course, uncompleted and long-abandoned projects of previous governments, that President Akufo-Addo has been able to complete in a characteristically determined and timely fashion. Waxing technical and Ivy-League-Suave the way he has been doing recently is highly unlikely to register the desired seismic impact that he needs on the electioneering campaign trail. Of course, I also take full cognizance of the fact that the Finance Minister is far more of a first-rate technocrat and a distinguished businessman than a smalltime run-of-the-mill politician.

*Visit my blog at: kwameokoampaahoofe.wordpress.com Ghanaffairs

By Kwame Okoampa-Ahoofe, Jr., PhD

English Department, SUNY-Nassau

Garden City, New York

June 2, 2019

E-mail: [email protected]