Posted on: www.dailyguideghana.com
By William Yaw Owusu
Tuesday, February 23, 2016
Dr Mahamudu Bawumia, vice
presidential candidate of the New Patriotic Party (NPP), says the Mahama-led National
Democratic Congress (NDC) government is hiding the real costs of the projects it
is embarking on from the public.
“If you sum the cost of all the
loan financed projects listed in the green book (even including those with
artistic impressions) it is less than $7 billion. Meanwhile, the government has
borrowed the equivalent of $37 billion so where is the rest of the money?” Dr
Bawumia queried.
The NPP vice presidential
candidate made the comments when he addressed a National Financial Literacy and
Investment Summit organised by the University Students Association of Ghana (USAG)
at the University for Development Studies, Wa Campus in the Upper West Region,
under the theme: “The Role of Financial Discipline and Investment in National
Development.”
Investment In Infrastructure
According to Dr Bawumia, the NDC
government is attempting to hoodwink Ghanaians with claims of massive
infrastructural investments since “investment in infrastructure has actually
been on the decline.”
Dr Bawumia, an economist of
international repute, underscored: “It is important to note that we measure investment
in an economy relative to GDP and not just in nominal terms. This is a point
that is unfortunately lost on this NDC government and their communicators.
“If as a country your investment
in infrastructure relative to GDP is declining, then your growth is likely to
decline. This background is very important to understand what is happening in
Ghana today. The evidence shows that notwithstanding the massive increase in
the debt stock, capital expenditure as a percentage (%) of GDP has actually
been on the decline from 9.1% of GDP in 2008 to 4.1% by 2015. Capital
expenditure as a percentage of GDP averaged 11% for 2001-2008 (without oil)
while that for 2009-2015 has averaged 5.7% (with oil).
Borrow To Consume
He quoted the Managing Director
of the International Monetary Fund (IMF) as saying that most of Ghana’s
borrowing had been used for consumption and not for investment.
“The overpricing of contracts,
corruption and the absence of value for money considerations are partly
responsible for this,” he said.
Kumasi Airport Runway
Dr Bawumia said for example that
a runway rehabilitation alone at Kumasi airport cost this country $23.8 million
whereas a proposed airport at Ho is estimated at $25 million; and asked sarcastically,
“was the runway in Kumasi paved with gold?”
He insisted that given the
resources at its disposal, one should expect at least four times the quantum of
investment that the NDC claims to have undertaken, saying, “The close to $30
billion of borrowing that was not used for projects could have been used for
other critical sectors of the economy.
He mentioned the rail network
from Accra to Paga, the water problems, energy, many major road projects in
each region, transformation of agriculture particularly in the Northern
Regions, Afram Plains and others through investment in machinery, irrigation
and dams as some of the projects that the huge amount of money could have
covered.
He also said the amount could
have been used to build one world class hospital in each region, buy at least 1,000
ambulances, set up factories with the private sector across the country to add
value to raw materials and create jobs, equip existing health and education
institutions with
state-of-the-art facilities as well as build an additional 600 of the
Senior High Schools the government is currently trying to build.
Over-Priced Projects
According to Dr Bawumia, the
reason why he insists the NDC government is attempting to hoodwink Ghanaians
with claims of massive infrastructural investments is that “Most of these
projects are over-priced as a result of the single source procurement method,
which has become the procurement method of choice for this government, as we
saw in the SADA, GYEEDA, Karpowership, SMARTTYS bus branding, etc.”
He articulated, “I would like to
see for example explanation from the government quantity surveyors of the
costing on the Kumasi airport runway for $23.8 million. However, you and I know
that they would not explain because they cannot explain. ”
He said all previous governments,
especially the NPP, undertook infrastructural projects but the NDC is making it
look like it has done what nobody did, saying, “The real fact is that the NDC
has no real achievements to point to outside the undertaking of some projects;
hence, their resort to mediocrity.”
Pertinent Questions
Dr Bawumia also said
infrastructural investment was not supposed to be for its own sake but to
increase productivity and production in the economy. “If you have indeed
undertaken massive and unprecedented infrastructural investment, then why is
the economy collapsing?
“Why is the NHIS in trouble? Why is
unemployment on the increase? Why are businesses collapsing? Why is
agricultural growth stagnant? Why is manufacturing growth negative? Why is the
government having difficulty meeting statutory payments? Why the high interest
rates? Why the massive exchange rate depreciations? Why are the SADA guinea
fowls flying to Burkina Faso? Why the massive increase in utility prices? Why
the withdrawal of teacher and nursing training allowances? Why all this
suffering in the land?” he asked.
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