Economic management involves movement from one stage of growth to the other and this is achieved through implementation of strategic policy decisions.
Lack of strategic focus and weak policy initiatives bring about degeneration of the economy, cause stunted growth and put the economy under pressure. This situation encourages corruption and underutilization of resources and consequently does not give breathing space to the managers of the economy to provide social services to the people.
Due diligence and value for money are essential ingredients in project evaluation to ease pressure on the economic resources and fast forward economic progress of the nation. It is important to note that government always resorts to borrowings from both the domestic and the international markets to finance these projects. When projects execution is characterized by corruption, costs go up, delays set in and the country suffers. This kind of project administration overloads the economy and consequently leads to stunted growth and stagnation and sets the economy on the slippery slop to lack of progress and development.
The above situation sums up the current economic situation Ghana finds itself today. Transparency is lacking in economic and projects management under this government. The economy is currently on a critical life support mechanism because of the deficit spending. The least deviation from this kind of support system will drive the economy aground. The excessive borrowing has become toxic element in the economy thus creating a situation of high debt portfolio for the country. Most of these loans are expected to finance commercial projects but the consumption component for purposes of recurrent expenditure takes the greater chunk.
The blood-curdling economic situation of the country results from cloak-and-dagger fiscal management policies of the NDC government. The minority is always up in arms against these intrigues every time any loan agreement is presented to the House but for sheer numbers their opposing views are drown in the noisy seas of narrow partisan consideration of the majority.
The stiff opposition of the minority has driven the majority to use other means to contract loans on the blind side of Parliament; for instance, the resort to domestic borrowing which is always sanctioned by the Bank of Ghana. Under this situation, the government competes with the private sector for loans and thus overcrowding the space and deprives the private sector. Consequently, the private sector finds it difficult to have access to funds to run and expand their businesses which will lead to job creation and revenue for government.
It is imperative that the government knows the sources of funding for the projects before the presentation of the budget statement to Parliament. With proper revenue forecast and projection, the government must be able to know how much revenue will accrue. Poor forecast and projections are responsible for the reckless borrowing. For instance, the 2015 Budget Statement projected an expenditure of GH¢44 billion as against a projected revenue of GH¢32 billion leaving a financing gap of GH¢12 billion. Why not live within our means?
Formulation of appropriate mix of policies to drive the economy is sorely missing due to blithering lack of skills and deep dyed incompetence. The leadership of the country has no focus and direction. The President must lead the way. A President is not President if he/she does not understand what it means to be a President. The term “PRESIDENT” may be used as an acronym to mean Primarily Responsible for Executing Social Initiatives to Develop the Economy of a Nation in Totality. Every President must understand this acronym to be able to appreciate the enormity of the tasks associated with the Presidency. If you were lucky to be President as a result of the truncated term of a former President you must be a fast learner so as to be up to the game.
The task of President is no-brainer. Presidency is ‘no fly zone’. Not everybody can fly there and pitch camp with cronies, underperformers and mediocre. The economic conditions after 2008 were propitious for rapid growth and stability. The NDC propagandists who know nothing about economic policies and fiscal management always feel proprietorial about the economy and rough shod over all pieces of advice freely proffered on economic management.
The exacerbation of the economic situation is also the result of lack of deftness on the part of the managers of the economy. For instance, contract management under this government is very poor and reckless. One case in point is Achimota-Ofankor road project whose cost has tripled. The Ghana Highways Authority (GHA) redesigned and re-awarded the project without seeking authorization from the Ministry of Road. This was done without recourse to the Public Procurement Law.
Another instance of recklessness is the Turkey Barge Deal intended to arrest the ‘dumsor’ situation. Without due diligence, the government is going for deals for ten years to provide a short term solution to the energy crisis. Parliament is being sidelined again. The poor contract management reflects in debt management position of the government.
At this point it is important to express gratitude to Dr. Bawumia for demythologizing the economic theories and jargons to aid our understanding of economic issues. If President Mahama had listened to Dr. Bawumia his tasks would have been a clock work. Any time Dr. Bawumia expresses his views on the economic management of the country; the funnel-web spider NDC communicators spew propaganda and distort the fact to the admiration of President Mahama who believes the spin. Well meaning Ghanaians become gobsmacked when the NDC condemns Dr. Bawumia for bringing the reality to the public. The NDC has the penchant for distorting the facts until the direction of the economy is fully distorted and brought us to where we are today.
We can see the rejection of the NHIA cards in health facilities across the country. Ashanti region NHIA owes GH¢16m. The Regional Director for Volta region threatens to stop accepting the NHIA card in the health facilities in the region. Some health facilities in Ashanti region are resorting to the collection of electricity fees to run their generators because of the dumsor. Electricity supply to the Ridge Hospital will be disconnected on account of GH¢33,000 debt to the ECG.
It is important to observe that just in a matter of four (4) months the NDC government contracted GH¢10 billion yet they could not raise about $50m for VRA to purchase crude to fire its plants to generate electricity. Before I conclude, I want to know how the Minister for Finance feels about the current economic situation since his policies failed to move the economy forward. Is he playing a dissimulator?
To sum up, the economy is under heavy yoke because of lack of strategic policy direction, lack of transparency and corruption in project management, excessive borrowing, recklessness in contract execution, lack of foresight and incompetence.
By Leo-Nelson Adzidogah
Via: -Daily Guide
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