Turning the Corner; Who Pays the Price?

On Monday, 31st July, 2023, the Minister of Finance & Economic Planning, Mr. Kenneth Ofori-Atta, in presenting the mid-year budget review report to Parliament on behalf of President Nana Akufo-Addo, stated, that Ghana’s economy has turned the corner.  He said, “This ‘turning the corner’ is underpinned by the investments and sacrifices we have collectively made during this difficult period since March, 2020.”  He sought refuge in the Holy Bible, “Indeed, as the Psalmist said (in Psalm 118:23) this is the LORD’s doing; and it is marvelous in our eyes.”  Our point, who defined the corner, what’s the destination and who has agreed what that is?

Our question is, who pays the price?  Our answer, unequivocally is, everybody.

Do we all have an equal opportunity to pay the price being demanded by Mr. Ofori-Atta, the Administration’s spokesperson?  Shouldn’t some people pay a higher price, take a greater share of the burden?  We did not see any specifics to show that those in privileged positions especially the people our taxes take care of are being asked to make more sacrifices than the rest of us.  We want the representatives of the people in Parliament, together, without political colouring, to deal with this and give us some answers.

In its 2022 Annual Report & Financial Statements, the Bank of Ghana (BOG) reported a Loss of GHC 60.8 billion. The main reason the Central Bank gave for this huge loss is “…the impairment of the holding of marketable Government stocks and non-marketable instruments of Government all being held in the books of the Bank of Ghana.”  We ask, who and what convinced the BoG to give the gargantuan credit to the Akufo-Addo Administration? Was the loss passed on to BoG caused by excess spending, fiscal pressures on the part of the Administration or inadequate revenue due to non-payment of taxes by individuals and companies?  Or are we simply overtaxed in this country so that the only plausible response is to reduce the size and cost of the Administration?

Minister Ofori-Atta said to Parliament: “Mr. Speaker, 2022 was the most difficult year for me as Ghana’s Finance Minister. On July 1st 2022, we took what was then a very difficult but necessary decision to request support from the IMF to implement our Post-COVID-19 Programme of Economic Growth (PC-PEG). The country was going through a dire period of economic uncertainties and despondency.”  Correction:  it was the most difficult year for ALL OF US Ghanaians.

So how have we turned the corner?  Voluntary and forced sacrifices.  Indeed, Ghanaians have been good.  We have picketed, demonstrated, protested.  Only that and nothing else.  Pensioners, banks, insurance companies, investment houses, all have had investments impaired (lost value).  Prices of utilities have gone up.  The Ghana Revenue Authority has been unrelenting in going after companies to squeeze the last drops of cash they have left.  But we have laid down quietly and paid the price. 

So, what is Minister Ofori-Atta promising?  “Mr. Speaker, Government is, however, committed to pursuing a robust growth strategy within the limited fiscal space and our fiscal consolidation programme. This will be done by attracting domestic and foreign private sector investments and expanding production, which will be encouraged and stimulated by Government policies and agencies.”  Sounds familiar?  We have been there before?  So Parliament should make him tell us why we should believe him this time.

Furthermore, he told Parliament on behalf of President Akufo-Addo, “Mr. Speaker, overall GDP Growth is, however, projected to rebound to 2.8 percent, 4.7 percent, and 4.9 percent in 2024, 2025 and 2026, respectively. This is a result of implementation of growth-oriented and structural transformation strategies in the PC-PEG. We have, however, been charged in the PC-PEG to develop an enhanced Growth Strategy supported by crowding in of private domestic and foreign investments to further boost growth. We are confident of a private sector outlook to boost growth and jobs.”  We are asking Parliament to find out specifically, how the Administration is going to support the indigenous Ghanaian private sector to grow and provide more jobs.

We support the call for the restoration of banks, savings and loans companies and investment houses whose licenses were wrongfully revoked.  We support the call to pay Ghanaians contractors and their financiers.  Minister Ofori-Atta knows too well that poor liquidity is a big enemy of business development and growth.  When businesses don’t grow or collapse, government revenues go down and with it the inability to fund the state’s activities.  The Minister must be seen to join the struggle to restore licenses wrongfully revoked.

We support the objective to turn the economy around.  But it requires the Akufo-Addo Administration to restore faith in government’s ability and commitment to honour its financial obligations to its creditors.

The implementation of this mid-year budget must bring positive dividends to the people.

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