“Almost everybody is feeling the brunt of the current economic hardship driven mainly by food inflation, high fuel prices, callous taxes among others. It goes without saying that parents and households are suffering, public sector workers are suffering, teachers are suffering and teacher trainees are suffering. Nurses are suffering and nursing trainees are suffering. Lecturers are suffering and students are suffering. Market women are suffering and drivers are suffering. NABCO trainees whose fate is unknown are suffering. Police officers are suffering. Even you journalists are suffering and all Ghanaians are suffering- all because of the bad leadership of the Bawumia-led Economic Management Team”.
The National Communications Officer of the biggest opposition party, Mr Sammy Gyamfi, said at a press conference on Wednesday, 3 August 2022 in Accra.
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A PRESS CONFERENCE ADDRESSED BY THE NATIONAL COMMUNICATIONS OFFICER OF THE NATIONAL DEMOCRATIC CONGRESS AT THE HEADQUARTERS OF THE NDC ON WEDNESDAY, 3RD AUGUST, 2022.
THE AKUFO-ADDO/BAWUMIA GOVERNMENT MUST ADDRESS WORSENING ECONOMIC CONDITIONS IN THE COUNTRY NOW!
Good afternoon, distinguished Ladies and Gentlemen of the press. We graciously welcome you once again to the Headquarters of the National Democratic Congress, as we consider it another privileged opportunity to engage with you on issues of concern to our nation. As always, we are grateful for the continuous collaboration we enjoy from you in the fourth estate of the realm and we consider you very valuable partners in our collective quest for accountability and good governance.
Our engagement with you today will focus on the ever-worsening living conditions of the Ghanaian people and the insensitive handling of same by the duty bearers of our country.
Friends from the media, you would all agree with me that we are not in normal times in Ghana and that all of us assembled here today, including you in the media are finding it difficult to live your normal lives. Indeed, it is more difficult to hew water out of a rock or perhaps for the camel to pass through the eye of the needle, than for one to make ends meet in Ghana today. However hard you try, or have mastered the art of living, the economic realities of Ghana today will certainly overwhelm you. Cost of living today is unbearable, leading to many individuals and households going hungry, broken marriages and many falling further below the poverty line. Cost of doing business has gone off the roof, leading to the suffocation of many businesses.
The point has to be made here ladies and gentlemen, that general hardships per se are not a new phenomenon in our country. However, the current economic hardships Ghanaians are experiencing today are unprecedented in their scale, and unbearable in their impact.
Today, the Consumer Price Index which is the barometer for measuring inflation or changes in the prices of goods and services, and all other known economic indicators point to the fact that we are not in normal times. Yet, the Akufo-Addo/Bawumiah government, is not minded to provide relief for the suffering masses. Government has neither demonstrated any sensitivity towards the Ghanaian people who are at the receiving end of this intolerable hardship, nor shown any acumen or ability to ameliorate the untold economic hardships. Alas, to borrow the words of one of Africa’s famous novelists, Chinua Achebe, the center cannot hold, things continue to fall apart, as continuous economic hardship is unleashed on the Ghanaian people on a daily basis.
Distinguished friends from the media, at this juncture, it bears painting a picture of the current state of our economy in order to put the issues into their proper perspective. I therefore invite you to come with me on a journey of the Akufo-Addo/Bawumia economic reality of today.
Friends from the media, the most reliable indicator of the average change in prices of goods and services over a period of time is the rate of inflation. As we speak, inflation rate which stood at 15.4% in December 2016, has galloped to a whopping 30% as at June 2022. This inflation rate is the worst in the sub-region and in fact the worst inflation rate Ghana has recorded in the last nineteen (19) years.
One would have thought that this mid-year period would have at least presented Government with an opportunity to take steps towards arresting the ever-rising inflation rate we are currently experiencing. Sadly, however, the Finance Minister, Ken Ofori-Atta only last week presented the 2022 Mid-year budget Review Statement to the august House of Parliament in which he projected an end of year inflation rate of 28.5%.
What this means is that, President Akufo-Addo and his vice Alhaji Bawumia, ably supported by their Finance Minister, Ken Ofori-Atta, have given up on arresting the current trend of inflationary pressures and have instead thrown their hands up in despair. Simply put, the suffering and excruciating economic hardships we are reeling under will continue to persist for the rest of the year with no end in sight. To be projecting an end of year inflation rate of 28.5% under the current rebased economic regime underlines the crass incompetence, cluelessness and uselessness of the Economic Management Team chaired by the Vice President, Alhaji Bawumia.
Sadly, while the Akufo-Addo government continues to pay lip service to this problem of rising inflation, it is at the same time offering very little in terms of leadership, vision and proactive steps to address the push factors of inflation. Friends from the media, it is trite knowledge, even to the uninitiated, that the main factors pushing up inflation and to a large extent, the economic hardships we are experiencing today, are the exchange rate, fuel prices, payments, among others. A government’s handling of these three (3) things largely influences its ability to stabilize inflation, improve general economic wellbeing, among others. And so, to these factors, we now turn attention.
Distinguished men and women of the inky fraternity, fuel price hikes today have become a frequent occurrence, with prices going up at the pumps sometimes twice or three times a week. This phenomenon has largely been occasioned by the continuous depreciation of the our national currency, the Ghana Cedi under the watch of the NPP’s self-professed Economic wizard now turned comical IT champion, Alhaji Bawumia. There is no gainsaying the fact that fuel prices have a ripple effect on the prices of general goods and services because of their direct impact on transport fares. Therefore, when fuel prices keep going up, it sparks a negative contagion on everything.
Contrary to what President Akufo-Addo, Alhaji Bawumia and their many apologists in government will have us believe, the astronomical increases in fuel prices in recent time have very little to do with the five-month-old war between Russia and Ukraine. On the contrary, it has to do largely with the continuous depreciation of the Cedi against its major trading currencies, notably the US Dollar. This is simply because the fuel we consume at the downstream sector is imported.
Today, the US Dollar which used to trade with the Cedi at GHS4.2 in December 2016 is trading with the Cedi at about GHS9. This has resulted in the deterioration of the capital of most Bulk Distribution Companies (BDC’s) and Oil Marketing Companies (OMC’s). These entities who are struggling to break even are left with no option than to pass on the knock-on effect of the currency depreciation to the final consumer. This is what has mainly resulted in persistent and astronomical increases at the pumps which have moved the price of a gallon of diesel from about GHS14 as at December 2016 to as high as GHS60 as we speak. As a matter of fact, the price of a liter of diesel today which is GHS13.3 is almost the same as what the price of a gallon of diesel used to be in the year 2016- GHS14. This is how bad things have become in this country under the bad leadership of the Bawumia-led Economic Management Team.
CRIPPLING FUEL TAXES
Ladies and Gentleman, I believe you all recall the solemn pledge of President Akufo-Addo and Alhaji Bawumia to move Ghanaians from taxation to production? Well, needless to say that this promise like similar others has become a pipe dream, as we have instead progressed from taxation to more taxation with no effort nor commitment whatsoever on the part of this government to reduce the level of tax payments in the country. Instead of moving us to production like they promised, this government has introduced a raft of needless taxes like never seen before on the price build up of fuel.
SANITATION LEVY (“BORLA TAX”)
One of such taxes is the 10 pesewas Sanitation Levy imposed by the Akufo-Addo/Bawumia government on every litre of petrol and diesel. Never has it been heard in our history that a government has to rely on a special tax handle on fuel to keep our surroundings clean. We insist that the introduction of this levy in this time of extreme economic difficulties is needless, unjustifiable and smacks of insensitivity of the highest order on the part of the Akufo-Addo/Bawumia government.
SPECIAL PETROLEUM TAX (SPT)
Another tax handle that this government has nominally increased and extended on the price build up of fuel is the Special Petroleum Tax (SPT). The 17.5% ad valorem tax was introduced in the year 2015 at a time the international market price of crude oil which was projected at $94 had declined to below $50. The SPT was therefore a temporary tax measure meant to shore up declining oil revenues for development purposes.
You will all recall how the NPP while in opposition berated the erstwhile NDC/Mahama government for introducing this tax, labeled it as a nuisance tax and promised to scrap same if elected. Interestingly, since coming into office, the Akufo-Addo/Bawumia government has changed the SPT from an ad valorem tax of 41 Pesewas as at December 2016 to a straight tax of 46 pesewas per litre of petrol and diesel.
Even though the Special Petroleum Tax has outlived its usefulness owing to the fact that the international market price of crude oil has in recent time risen to as high as $117 per barrel- a situation that has given government huge windfall profit as captured at paragraph 27 of the 2022 Mid-year budget statement, the insensitive Akufo-Addo/Bawumia government continues to charge Ghanaians a Special Petrol Tax of 46 pesewas on every liter of diesel and petrol even in these difficult times.
We submit that the continuous maintenance of the Special Petroleum Tax on the price build up of fuel by the Akufo-Addo/Bawumia government when the reasons for its introduction no longer exist is no longer tenable.
NEW ENERGY SECTOR LEVIES
Friends from the media, one of the taxes on fuel which the NPP while in opposition vehemently opposed and promised to scrap if elected, is the Energy Sector Levies Act (ESLA) which was introduced by the erstwhile NDC/Mahama government in the year 2015 to clear legacy debts that were crippling the energy sector. Instead of scrapping this tax as promised, the tax was increased by about 30% between the period of 2017-2020 by the Akufo-Addo/Bawumia government. To add insult to injury, this government has collateralized ESLA for a loan which has extended the duration of the tax from its original duration of five (5) years to 15 years, that is until 2035.
As if that was not enough, the Akufo-Addo/Bawumia government only last year, introduced a new Energy Sector Levy of 20 pesewas on every litre of petrol and diesel, and a new Energy Sector Levy of 18 pesewas per kilogram of LPG. Here again, we submit that the imposition of these so-called Energy-Sector levies on Ghanaians in this time of extreme economic hardships is callous and totally unacceptable.
PRICE STABILIZATION AND RECOVERY LEVY
Ladies and gentlemen, in addition to the taxes I have enumerated, is the Price Stabilization and Recovery Levy of 16 pesewas and 14 pesewas per liter of petrol and diesel respectively,
which we all as consumers pay anytime we buy fuel. This tax is meant to be used to subsidize the cost of premix fuel and more importantly, to subsidize the prices of fuel at the downstream sector for fuel consumers when the international market price of crude oil goes up like we have experienced in recent times. Per our conservative estimates corroborated by ACEP’s estimates, the Akufo-Addo/Bawumia government has collected in excess of GHS3 billion in Price Stabilization and Recovery Levies in the last five and half years but have woefully failed to apply these funds for their intended use, which is to cushion fuel consumers.
These crippling fuel taxes and other existing margins on the price build up of fuel such as the BOST margin which has been increased by a whopping 200% from 3 pesewas to 9 pesewas by the callous Akufo-Addo/Bawumia government, the Fuel Marking Margin among others, are what have conspired with the continuous depreciation of the Ghana cedi to make the prices of fuel excessively high in Ghana and in fact, far higher than the prices of fuel in neighboring countries.
THE OBNOXIOUS COVID-19 LEVY AND E-LEVY.
Friends from the media, what is even more painful is that on top of the many needless taxes heaped on the price build of fuel, the Akufo-Addo/Bawumia government has imposed certain obnoxious taxes on the Ghanaian people that have escalated the hardships in the country to unbearable proportions.
After receiving more than enough inflows totaling about GHS35 billion (equivalent to about $5 billion) to manage and mitigate the impact of the COVID-19 pandemic, and after spending only GHS12 billion of this amount on the pandemic as reported by the Finance Minister to Parliament few months ago, government last year imposed a 1% COVID-19 levy on the National Health Insurance Levy on VAT, thereby increasing it from 2.5% to 3.5% and another 1% COVID-19 levy on the VAT Flat Rate, thereby increasing it from 3% to 4%.
Friends, at a time responsible governments all over the world are cushioning their citizens in one way or the other to provide them with some relief against the debilitating impact of the pandemic on their businesses and livelihoods, our government is punishing us with this offensive and punitive tax that simply defies logic. This is a tragedy of monumental proportions. No where in the sub-region or in the Africa continent and I dare say the world, has any government imposed a COVID levy on its people. And at no point in the history of this country has any government imposed a tax handle for the management of any disease on the Ghanaian people.
As if the offensive COVID-19 levies were not enough, the callous Akufo-Addo/Bawumia government against good counsel and wide public outcry has stubbornly imposed another punitive 1.5% levy on momo and other electronic transactions known as the E-levy this year. This is after the Vice President and Chairman of the Economic Management Team, Alhaji Bawumia promised Ghanaians in the run up to the 2020 general elections that Momo transactions are mainly patronized by the poor hence must not and will not be taxed by the NPP.
This obnoxious E-levy which is applied on the capital, savings and already-taxed incomes of Ghanaians defies all the known principles of taxation in Ghana. The stealth tax has significantly reduced momo transaction volumes and has become a great disincentive to digitalization in Ghana as it has forced many people to find smart ways of avoiding the use of digital platforms for financial transactions. Little wonder that today, government has only realized a paltry GHS93 million as against a projected GHS1.4 billion from the tax handle for the first half of the year 2022.
Just as we in the NDC argued and predicted during the debate over the passage of the E-levy, it has today become apparent that the E-levy is not the panacea to economic woes of Ghanaians as we were promised by the deceitful and clueless Akufo-Addo/Bawumia government. After displaying dismissive and stonewalled stubbornness, the Finance Minister, Ken Ofori-Atta has now revised his over-ambitious end of year E-levy target from GHS6.9 billion to about GHS640 million, which we doubt would even be realized.
Even more bizarre and pathetic is the fact that the counterproductive E-levy is sometimes charged on the first GHS100 sent by some Ghanaians to their loved ones in a day, despite same being exempted under the E-Levy Act. This naked thievery being perpetuated by the Akufo-Addo/Bawumia government against already-impoverished taxpayers ought to be condemned by all well-meaning Ghanaians.
EVER-DETERIORATING EXCHANGE RATE DUE TO WORSENING FISCAL POSITION
Our worsening exchange rate continues to play a major role in driving inflation and therefore requires further attention. Friends from the media, it has now become clear to the NPP that the Cedi has a mind of its own and can neither be managed nor tamed by empty talk and sloganeering as it continues to stutter quite pitiably against all of its major trading currencies and has recently been rated as the worst currency among top Africa currencies having depreciated by over 17% this year.
Fellow countrymen and women, it is without doubt that this government has been the luckiest and most resourced government in the history of the fourth Republic. They inherited three oil fields with unprecedented oil revenues from the erstwhile Mahama government. They have borrowed more monies than all other governments put together since independence and have had access to over $11 billion in Eurobonds alone, as compared to $3.7 billion eurobonds borrowed by the NDC/Mahama government and the $750 million Eurobonds borrowed by the NPP/Kufour administration. What this means is that, this government has had access to more forex or dollars than any government in Ghana’s history, yet has failed woefully to maintain a stable currency due to their wastefulness and mismanagement of the economy.
The major factor that accounts for the alarming rate of depreciation of the Ghana cedi is the huge capital outflows from our country occasioned by our poor credit ratings and the loss of investor confidence in our economy. In simple terms, our ever-ballooning Public debt and budget deficit as a country has now reached unsustainable levels due to the reckless spending and excessive borrowings of the Akufo-Addo/Bawumia government. This recklessness reach its crescendo in the year 2020 when under the guise of fighting COVID-19, government went on an election-driven spending spree leading to an unprecedented budget deficit of 15.7%. The confessions of one Felicia Tetteh, the NPP’s 2020 Parliamentary Candidate for the Sagnarigu Constituency and Vice Chairperson of the Northern Region captured on tape lends ample proof to how COVID-19 funds were doled out to NPP party functionaries and apparatchiks in the name of covid-19 relief. It is this recklessness that has plunged the country into the bottomless pit we presently find ourselves.
By kind courtesy of the excessive and consumption-driven borrowings of President Akufo-Addo and Alhaji Bawumia, Ghana’s total public debt has ballooned from GHS120 billion as at December 2016 to a whopping GHS393 billion as at June 2022. What this means is that, this government has added a whopping GHS273 billion to our public debt in the last five and half years alone with very little to show for. This has moved our debt to GDP ratio (rebased) from 56% in 2016 to over 80%, while debt servicing (i.e interest payment and amortization) has increased from GHS11 billion in 2016 to over GHS50 billion in 2022 representing a 500% increase.
Ghana’s fiscal position has so much deteriorated under the watch of the Bawumia-led Economic Management Team that today our total tax revenue as a country is consumed by just one budget line item- debt servicing. For instance, for the first quarter of this year, tax revenue collections stood at about GHS12 billion while debt servicing stood at about GHS13 billion. In other words, we spent about 107% of tax revenue on only debt servicing for the first quarter of 2022 alone.
This poor fiscal position of the country created by the recklessness and mismanagement of the Bawumia-led Economic Management Team has tremendously increased our risk of debt default, worsened our credit ratings, led to our downgrade by sovereign rating agencies such Fitch and Moodys, made us lose access to the capital market and resulted in huge capital outflows from the economy thereby causing the Cedi to depreciate at a very alarming rate.
As a matter of fact, Ghana has been ranked number two (2) on Bloomberg’s latest Sovereign Debt Vulnerability Ranking published few days ago. Of all the countries in the world, Ghana has been ranked as the 2nd country with the highest risk of debt default. We only performed better than El Salvador, a country with a population of 6.8 million who have had to deal with a recent slump after adopting Bitcoin as its official currency. What an unenviable feat chalked by the Bawumia-led Economic Management Team. Indeed, the NPP have the men- “what a solid team”!
Ladies and gentlemen, until the Akufo-Addo/Bawumia government learn to live within its means and cut their coat according to the size of their cloth; until they cut expenditure drastically and reduce their rate of borrowing and debt accumulation; until they stop making unrealistic fiscal projections based on cooked data- our fiscal position will continue to worsen, investor confidence in our economy will continue to go down, the alarming rate of capital outflows we are currently witnessing will continue unabated and the Ghana cedi will continue to depreciate and will likely hit GHS10 to the dollar by December 2022.
WORSENING UNEMPLOYMENT SITUATION
Ladies and gentlemen, I am sure you are all aware of the worsening levels of unemployment in our country today. This is a government that came to power in 2016 on the back of a promise to create jobs. This promise has however only yielded lip service and highfalutin sloganeering with next to nothing by way of real jobs created.
It is instructive to note that the rate of unemployment has increased from 8.4% in 2016/2017 according to the Ghana Living Standards Survey 7 (GLSS7) to 13.4% in 2021, according to the latest Population and Housing Census conducted by the Ghana Statistical Service. After inheriting an unemployment rate of 8.4% in 2016/2017 the Akufo-Addo/Bawumia government has created phantom jobs through their so-called flagship programs such as One District, One Factory, One Village, One Dam, Planting for Food and Jobs, NABCO, “Ghana Cares Obatampa” and now “Youth Start”. The result of all these is an unemployment rate of a whopping 13.4%.
The very latest of these grand deceptive slogans, the YouStart program which was supposed to be a $1 billion investment for the creation of one million entrepreneurial jobs has also turned out as a complete fiasco. According to Mid-Year budget review statement presented by the Finance Minister to Parliament only last week, only 46 persons and 8 associations have received support under the so-called “YouStart” program so far.
To make matters worse, trainees under the Nation Builders Corps (NABCO) program who are owed nine (9) months allowance arrears by the government and were deceitfully promised permanent integration into the Public Service by the government have been laid off and asked to join the non-functioning YouStart program.
Even more bizarre is the fact that till date, Staff of the collapsed banks and other financial institutions have not been paid their severance packages, while the private sector which is supposed to be the engine of growth and job creation continues to suffocate under the yoke of high cost of doing business leading to many job losses.
Government’s Misplaced priorities
Distinguished friends from the media, one of the cardinal ‘sins’ of this Akufo-Addo/Bawumia government is their misplaced priorities that have underlined government’s expenditure in the last five and half years. If you are one of those who have been wondering what the billions of tax revenues, borrowed funds, Eurobonds, oil revenues and donor funds totaling about GHS500 billion that have accrued to this government have been used for, look no further at all. Just check the Auditor General reports from 2017 to 2020 and you will be shocked at how this government continue to waste meager state resources on profligacy, corruption, misplaced priorities and other financial irregularities.
Even in these times of excruciating economic hardships, President Akufo-Addo continues to fly around the globe in hyper expensive and ultra luxurious private jets like an Arabian King at a cost of $20,000 per hour to the already impoverished taxpayer.
Fellow countrymen and women, it is totally unacceptable that at a time when government cannot afford to print text books for basic school children three years after introducing a new curriculum; at a time when secondary schools, nursing training institutions and other educational institutions of higher learning are faced with acute food crises; at a time when many Ghanaians are struggling to afford one square meal a day, government will continue to waste the meager resources of state on the rental of luxurious private jets for the President and other wasteful expenditures.
THE COVID-19 AND RUSSIA-UKRAINE WAR EXCUSES OF GOVERNMENT.
Ladies and Gentlemen of the press, we are all too familiar with the numerous excuses that have been canvassed by the Akufo-Addo/Bawumia led administration and their many apologists for plunging our country into this unprecedented economic turmoil.
Despite having profited immensely from covid-19 inflows, this government has sought to blame covid-19 for everything in Ghana today, including even when the sun fails to rise. Even though we admit that like all countries in the world, the COVID-19 pandemic and the Russia-Ukraine war have had negative effects on our economy, they are not the major factors that have plunged us into the economic mess we find ourselves in. For emphasis, neither the COVID-19 pandemic nor the five (5) months old Russia-Ukraine war is to blame for the economic malaise we have on our hands. And we say so for the following reasons:
- First and foremost, Ghana’s economy showed signs of serious challenges even before COVID-19 struck. The World Bank’s country director has been emphatic that our economic challenges persisted even before the COVID-19 crises. For instance, before COVID-19 was recorded in Ghana in March 2020;
I) the Public debt had increased from GHS120 billion in 2016 to GHS225 billion, representing a nominal increase of GHS105 billion in the country’s debt stock;
II) our Debt to GDP ratio had increased from 57% in 2016 to 64% in 2019:
III) Debt servicing had increased from GHS11 billion in 2016 to GHS37 billion in 2019 and constituted about 90% of tax revenue.
IV) the budget deficit had hit 7.5% in 2018 and 7% in 2019 even though government dubiously tried to conceal it from the people by claiming it was 4.8%. It’s instructive to note, that the 2019 budget deficit of 7% was above the fiscal responsibility threshold of 5%;
V) the Ghana Cedi in 2019 saw depreciation of 12.9%. This was before COVID-19. It is worthy of note that that the cedi depreciated by 9.6% in 2016 despite the serious challenges the country was confronted with.
VI) Growth rate for the construction sector had declined from 8.4% in 2016 to -8.5% in 2019 and growth for the manufacturing sector had declined from a growth rate of 7.9% in 2016 to 6.5% in 2019 under the much-touted 1D1F initiative even before COVID-19 was recorded in this country.
- Secondly, even though the COVID-19 pandemic has had some negative effects on Ghana’s economy, its overall impact on tax revenue has been insignificant. In 2019 before COVID, the Ghana Revenue Authority raked in tax revenue of GHS43.9 billion. In 2020 when COVID struck, government projected tax revenue of GHS47.2 billion, revised same to GHS42.7 billion and exceeded its revised target by collecting a total of 45.3 billion at the end of the year. In 2021, government projected tax revenue of GHS57.055 billion but recorded a total of 57.32 billion, that is GHS265 million more than projected tax revenue for that year. In short, unlike other countries, tax revenue in Ghana has seen consistent steep increases despite the advent of COVID-19.
- Thirdly, the Akufo-Addo/Bawumia government has had close to GHS35 billion cedis (equivalent to about US$5 billion) to manage and mitigate the impact of COVID-19, all of which has been largely wasted on election-related expenses. Our peers such as Côte D’Ivoire, Benin, Togo etc. did not get as much as US$5 billion to manage the COVID-19 crises in their counties but have done far better than Ghana in managing the pandemic and mitigating its devastating impact on their economies.
- The Akufo-Addo/Bawumia government has had revenue from three (3) oil fields with daily production increasing from about 70,000 barrels in 2016 to about 170,000, coupled with high commodity (oil, gold and cocoa) prices on the international market. In all, this Akufo-Addo/Bawumia government has had total revenue of over GHS500 billion in the last five (5) years, as compared to the paltry GHS200 billion that accrued to the NDC/Mahama government. Their economic mismanagement and wastefulness is what has led us into another IMF program. Any government, that has had access to over GHS500 billion in revenue and still collapses the economy to the point of needing an IMF bailout, must be the worst government in the history of the world.
- COVID has affected all countries in the world including Ghana. But whereas our peers such as Benin, Togo, Côte D’Ivoire, Burkina Faso, Nigeria etc. were very responsible in how they spent in 2020 to manage and mitigate the impact of the pandemic on their economies, thereby recording deficits of below 8% and Debt to GDP ratios of below 65%, the Akufo-Addo/Bawumia government borrowed excessively and spent recklessly for election-purposes thereby recording a record-high deficit of 15.7% and a Debt to GDP ratio of close to 80% in 2020.
Friends from the media, in the year 2020 when the COVID pandemic struck, Burkina Faso recorded a deficit of 5.7%; Côte D’Ivoire recorded a deficit of 5.6%; Nigeria recorded a deficit of 5.8% and Senegal recorded a deficit of 6.4%. But Ghana alone recorded a deficit of 15.7% because of the reckless election-driven expenses and wastage the NPP-Akufo-Addo/Bawumia government engaged in. Did COVID-19 affect Ghana than it did our neighbors? How come that none of these countries who were all affected by the pandemic are recording double digit deficits and high debt to GDP ratio of about 80%? How come none of these countries are recording inflation rates of 30%? To quote Dr. Bawumia, how did COVID-19 and the four (4) months old Russia-Ukraine war jump over Nigeria, Benin, Côte D’Ivoire and our other neighbors to attack only Ghana? Your guess is as good as mine.
Ladies and gentlemen, the truth of the matter is that the economic mess we have on our hands has largely been brought about the reckless spending, excessive borrowing and crass economic mismanagement by the Bawumia-led Economic Management team.
Friends from the media, the economic hardships Ghanaians are currently reeling under today can be discussed all day, and yet there will be still space to contain the story of the tragic mismanagement of our economy by the Akufo-Addo/Bawumia led government.
The continuous mismanagement of our economy by the Bumumia-led Economic Management Team has borne various negative fruits and occasioned manifest difficulty for the generality of our people. It was clear from day one that Ghana’s economic train was headed for a ditch, yet President Akufo-Addo has watched with complicit indolence for Alhaji Bawumia and his cousin the Finance Minister, Ken Ofori-Atta to keep the steering wheel to a point of no return. Against all wisdom, sound counsel and pep talk from us in the Opposition, Civil Society and you in the media, this government refused to take remedial steps early on and would not repent from recklessness, profligacy and misplaced priorities. Today, our economy is gasping for breath and has finally landed at the door step of the IMF.
In case you want to know the economic temperature of Ghanaians today, just a stroll into one of the nearby markets at Nima or Mallam Atta will reveal this reality to you. Today, an Olonka of Gari which used to sell at GH5.00 in 2016 is going for GHS14.00, while a Paint Bucket of Tomato which used to sell at GHS8.00 in 2016 is now being sold for GHS50.00. Similarly, a bag of cement which used to be sold at GHS27.00 in 2016 is now being sold for GHS62.00 whereas a 1.5mm Cable Metal that used to be sold at GHS78.00 in 2016 is now being sold for GHS222.00. In samilar vein, a bag of Pure Water that used to be sold for GHS1.50 in 2016 is today being sold for GHS8.00. A crate of eggs has increased from GHS12 to GHS36 and a bag of maize has increased from GHS170 to a whopping GHS650. Even common Kalypo, which then candidate Akufo-Addo drunk for fame in 2016 at a cool price of GHS0.50 is today being sold for a whopping GHS2.50. How can parents afford to keep their kids happy when kalypo is now being sold at such a prohibitive price? This is the sad reality of Ghanaians today, where galloping inflation has reduced the purchasing power of people, yet incomes have remained static.
Almost everybody is feeling the brunt of the current economic hardship driven mainly by food inflation, high fuel prices, callous taxes among others. It goes without saying that parents and households are suffering, public sector workers are suffering, teachers are suffering and teacher trainees are suffering. Nurses are suffering and nursing trainees are suffering. Lecturers are suffering and students are suffering. Market women are suffering and drivers are suffering. NABCO trainees whose fate is unknown are suffering. Police officers are suffering. Even you journalists are suffering and all Ghanaians are suffering- all because of the bad leadership of the Bawumia-led Economic Management Team.
Most Ghanaians are now aware that President Akufo Addo doesn’t care about the hardships we are reeling under. Otherwise why would he continue to appoint new Ministers when Ghanaians are urging him to downsize his government? Added to this is the callous and insensitive burdens being imposed on Ghanaians by the Minister of Communication in respect of sim card registration which like other policies concerning recent telecom mergers, are mere measures intended to line the pockets of individuals while Ghanaians groan under the yoke of hardships. The insensitive Akufo-Addo/Bawumia government must understand that there will be a day of reckoning.
DEMANDS AND RECOMMENDATIONS
As a responsible opposition and indeed, a government in waiting, we in the NDC cannot sit aloof while our economy descends into the precipice. Despite the recalcitrance of this government and its sometimes-antagonistic attitude to constructive criticism and ideas, we cannot afford to allow the present state of affairs to continue to fester. It is for this reason that we call on Ghanaians to join us in demanding that the Akufo-Addo/Bawumia government takes urgent steps to ameliorate our suffering and help stabilize the economy.
To this end, we demand:
- the immediate repeal of the obnoxious and counterproductive E-levy Act of 1.5% on momo and other electronic transactions.
- the immediate repeal of the punitive COVID-19 levy of 1% on the VAT Flat Rate and the National Health Insurance Levy.
- the immediate scrapping of crippling fuel taxes such as the Special Petroleum Tax that has outlived its usefulness, the needless Sanitation Levy (“BORLA” tax ), and the new Energy Sector Levy of 20 pesewas per liter of diesel and Petrol and 18 pesewas per kilogram of LPG.
- the suspension of the 9 pesewas BOST margin and the Price Stabilization and Recovery Levy of 16 pesewas and 14 pesewas per liter of petrol and diesel respectively both of which are not being applied for their intended purposes.
- Ladies and gentlemen, the last two puzzles for this government to resolve if it is serious about bringing our economic back on track and restoring investor confidence is to get rid of the two villains who have been at the centre of recking this havoc on our economy.
First on this list is without doubt the finance minister, Ken Ofori-Atta who has proven to be an unmitigated disaster when it comes to economic management. President Akufo-Addo’s cousin has run down our economy through excessive borrowings that his personal company Databank profits from. Today, his name scares away investors and evokes a feeling of insecurity for every Ghanaian. Ken Ofori-Atta has become like stale water in a bottle and the earlier President Akufo-Addo fire his underperforming cousin, the better for the economy and all of us. As the venerable former President Mahama recently said, regardless of our running to the IMF, the only way to begin the process of rebuilding, if we are to get any good deal from the IMF is to sack Ken Ofori-Atta immediately and appoint a fresh, able hand in his stead to lead the IMF negotiations.
The next important thing for President Akufo-Addo to do is to relieve his jocular Vice President, Alhaji Bawumia from his position as head of the Economic Management Team. The once so-called “solid economic management team” has now been reduced to a gaseous team who have deserted their roles are no where to be found in these difficult and critical times . It is about time our tired, clueless and incompetent Vice President is finally relieved for new ideas and competent hands to take over and steer the Economic Management Team at this time of unspeakable hardships.
Distinguished friends, we have no doubt that if President Akufo-Addo, who has so far proven to be headstrong and unreceptive to good counsel, would listen for once, he could begin the process of breathing life back into our ailing economy which is almost at the point of comatose. Until then, our help is in the Lord. May God continue to bless our motherland. Thank you for your attention.
Sammy Gyamfi Esq.
National Communications Officer, NDC