The Caucus for Democratic Governance, Ghana (CDG–GH), has observed, with interest, that Ghanaians are increasingly suggesting that many of the promises made by Nana Addo and Dr Bawumia during 2016 election; have not been realized, especially the theories on the economy.
Nana Addo an average-class economist, actually never practiced that profession. He however takes pride in a law profession he never quiet studied; He has a long standing practical experience as a lawyer. Some of those he trained, are walking in the corridors of power with juicy appointments making complete the family and friends Government.
Dr Bawumia with PhD in economics, seems to lack the fundamentals of his profession. He fails to appreciate the causal relationship between theory and the practice of economic fundamentals. Currently he prides himself in his studied theories on borrowing to arrest depreciation. Unfortunately the same Dr Bawumia in 2016, vigorously contended that borrowing is not a solution to depreciation. After raising our indebtedness to $80 billion, he recklessly calls for a “kenkey” party to celebrate the last trench of indebtedness from the IMF; amidst wasteful expenditure and plethora of misplaced priorities. More damming is that the $80 billion borrowed so far, has been used to support the budget and to stabilize the cedi; thus shifting the emphasis from productivity to consumption; a mistake which is one of the many reasons for the rapid depreciation of the cedi. Dr Bawumia insists that weak fundamentals lead to depreciation of currency. If this is true then there is everything wrong with the one digit inflation, since prices are very high on the market.
COLLAPSE OF 7 BANKS
The collapse of 7 indigenous banks, cost the taxpayer over GHc 7 billion. As a result of this needless collapse of banks, over 75% of over GHc2 billion of the annual average profit of the banking sector was appropriated by foreign banks in Ghana; leading to rapid repatriation of the 2 billion profits by the foreigh banks to their countries of origin and elsewhere. Dollar became scarce, followed by the rapid depreciation of the cedi. Moreover, the use of militia during the by-election in Ayawaso leading to blood shed, ironically, led to speculation and capital flight. Is Dr Bawumia aware? This is practical economy not theory.
As I write, the EXIM bank of India has just signed a deal that would export $180 million worth of goods and services into Ghana. This like many others will increase our imports leading to cedi depreciation. Dr Bawumia, these are the things you should innovatively change to prevent the depreciates the cedi, not your arrest of the dollar.
ADVICE OF CDG-GH
The CDG-GH advises the President to restructure the economy, reducing drastically the imports ; by putting into operation the Aveyime rice factory, the Komenda sugar factory, the Kumasi Jute factory and the Pwarungu tomato factory. Mr President, we are heavily indebted, because a whole year`s cocoa production can only pay for our imported sugar, rice and tomatoes. Therefore reactivate these factories and release the dollar to cushion the cedi during depreciation.
Chief Convener CDG-GH