Ghana’s economic “fundamentals” have been met, according to Vice President Dr Mahamudu Bawumia’s, remarks at the Economic Management Team (EMT) town hall meeting held on Wednesday, April 3, 2019, but a senior finance expert disagrees.
On Joy FM yesterday, which was monitored by Weekend Today , Professor Godfred Alufar Bokpin, an economist and Professor of Finance at the University of Ghana (UG) , denounced Dr Bawumia’s observations, suggesting that the country was going far below its potential.
“There is an increasing inequality in Ghana,” said Bokpin, who is also an IMANI fellow.
He explained that most capital in the country comes from foreign investors.
In exchange, he said, Ghana provides them with resources, but that return on capital is low.
“Foreign investors are benefiting but we are lacking,” he said. “Growth is driven by internal sectors and job creation.”
Hydrocarbon production, mining, oil and gas were economic drivers for the economy last year, but because of foreign interests, “we recorded growth that we were unable to sustain.”
But of all the issues rattling Ghana’s economy – even more than the cedi, which is currently being eaten alive by the dollar – resource allocation has been the country’s biggest challenge”, he added.
This year, Ghana is hoping to generate GH¢45 billion through tax revenue, but “we will fail to maintain those funds if the government spends it similarly to how it spent revenue last year”, he insisted.
“Twenty-three billion cedis went to wages and salaries alone. Eighteen billion went to debt management. Capital spending, Eight billion, he claimed.
“[Government] is imposing restrictions on growth. It is unacceptable”, he bemoaned.
However, at Wednesday’s town hall meeting, Bawumia applauded his economic team for exceeding sub-Saharan Africa’s economic growth rate.
In 2017, Ghana’s economy grew by 8.1%, “one of the highest in the world,” he said.
He boasted that the country’s GDP rate was robust, and mentioned that, non-oil growth had increased from 4.6% – 5.8%, increasing the per capita income to GH¢9864 – 30% higher than in 2016.
“Our challenge is to make the distribution fair,” he said. “
Story: Franklin ASARE-DONKOH
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