Posted on: www.dailyguideghana.com
By William Yaw Owusu
Tuesday, September 13, 2016
The ruling National Democratic Congress
(NDC) is oiling its propaganda machinery to ‘douse’ the flame ignited by the
New Patriotic Party (NPP) vice presidential candidate, Dr. Mahamudu Bawumia,
last Thursday at a public lecture on the economy where he shredded the
government into pieces in respect of the economy.
The distinguished economist and former Deputy
Governor of the Bank of Ghana, delivering a lecture titled, “The State of the
Ghanaian Economy – A Foundation of Concrete or Straw,” rubbished the NDC’s
economic performance saying the ruling party was rather taking Ghana backwards
with its policies, citing declining growth rate from 14 percent inherited by President
John Mahama to the current 3.9 percent.
NDC Dazed
Apparently dazed by Dr. Bawumia’s
revelations, the NDC, led by the former propaganda secretary, Fifi Fiavi Kwetey,
(who is the current Minister of Transport), said he was leading a team of NDC
propagandists to ‘correct’ the ‘untruths’ being ‘peddled’ by Dr. Bawumia in
their “Setting the Records Straight” encounter. The NDC programme was expected
to take place tomorrow at the party’s headquarters, but Fifi Kwetey announced
last night that it had been postponed because of other engagements.
“Enough of the untruths being peddled; we
are going to set the records straight from next week,” he posted on Facebook last Friday.
He said, “You may already be aware that
every election year, The NDC Forum for Setting the Records Straight organises a
number of press conferences to address pertinent issues ahead of the general
election and this year will be no different. On the 14th of September, 2016,
the first in the series of the press conferences will be held at the NDC headquarters
in Accra.”
According to Fifi Kwetey, the
forum would be attended by Elvis Afriyie Ankrah, the scandal-prone former
Sports Minister who supervised Ghana’s worse FIFA World Cup participation in
Brazil in 2012 amid serious corruption claims against him, but shielded by the
president; Samuel Okudzeto-Ablakwa, a deputy Minister of Education; Emmanuel
Armah Kofi Buah, Minister of Energy and Petroleum; Casiel Ato Forson, a deputy
Minister of Finance; Felix Kwakye Ofosu, a deputy Minister of Communications; Kojo
Twum-Boafo of the Free Zones Board as well as Sam George Nettey of the
presidency.
“I know majority of you can’t
wait for the NDC’s “Setting The Records Straight” press conference slated for
this Wednesday.
“But we have had to postpone
it to a later date because the President, John Dramani Mahama is unveiling
highlights of the party’s Manifesto tomorrow evening,” Mr Kwetey stated.
Falsehood
Fifi Kwetey is noted for peddling
falsehood against his political opponents and the possibility of misleading
Ghanaians at the so-called forum once again will not be ruled out.
In the heat of the 2008 general election,
he published that then President John Agyekum Kufuor had stolen all Ghana’s
gold reserves at the Bank of Ghana, but when pushed at the vetting committee to
provide evidence, he admitted he lied.
He may be on another journey to spew out
falsehood for political expediency in support of his paymasters.
Veep’s Challenge
Since Dr Bawumia’s public lecture,
anxious Ghanaians have thrown the gauntlet to Vice President Kwesi Bekoe
Amissah-Arthur, who is an economist and head of the Economic Management Team of
the government - which had succeeded in throwing the economy into disarray. He
is to counter the NPP vice presidential candidate’s claims, especially since he
(Amissah-Arthur) had earlier warned that he was ready to match the NPP boot for
boot.
He
announced at an NDC rally at Ashaiman that he was getting ready to disprove Dr.
Bawumia’s claims, particularly on interest payments on loans, which the erudite
NPP stalwart said were exceeding capital expenditure owing to unbridled
borrowing.
He said that Dr. Bawumia misled the public
on the interest payments issue and justified the high interests being paid by
the country to lenders.
Mr Amissah-Arthur, former Governor of the
Bank of Ghana, said that the money borrowed was purposely for projects so there
was nothing wrong with payments of interests at whatever rate.
“So whenever you take money and pay
interest or repay the amount you have collected, it is for the road that you
have borrowed the money for so that is the one that you are paying, so there is
no way you are paying interest for nothing at all; you are paying interest for
projects that you have borrowed money for.”
“So how can you say that you pay interest
more than capital expenditure? It is that capital expenditure money that you
are paying as interest. This one is a simple thing in primary school; you learn
it. I don’t know how people with higher qualifications cannot understand this
simple context,” he charged.
Classification
The vice
president explained, “In economics we call it classification. You have to
classify that interest payment for the thing you use that money for. You do not
pay money for nothing but you pay interest if you have not borrowed money. When
you have borrowed money you are paying interest for that by saying this one for
this road, for that hospital, this one for the project you have borrowed money
for.”
“You cannot
come and say that interest payment has exceeded capital expenditure so we have
made a mistake.”
Dr. Bawumia has continuously insisted
that the Mahama-led government had over-borrowed and that is why the government
is paying so much to service the interests amounting to GH¢10.5 billion for
this year alone - more than the GH¢9.5 billion inherited by the NDC
administration from the NPP in 2009.
Model
Finance Minister Seth Terkper has
remained largely unwavering in responding to issues about the economy.
Last Friday, Mr. Terkper said Dr Bawumia
‘masked’ the true state of the Ghanaian economy by being selective in his use
of data and said that he (Dr. Bawumia) was using different models in his
analysis of Ghana’s debt to suit a political objective of making the government
unpopular.
“If we are going to use Dr Bawumia’s
model, let us use it comprehensively because he cannot use other data when it
suits his criticism and reverts to his model when it does not suit him,” he
said, adding that the economist’s assertions that government’s debt management
policy is not rational needed to be refuted.
“We have a debt management policy that
has many objectives. We do not have only one objective. Given that the Ghanaian economy has begun to
pick up, it will not make sense to keep a one billion Eurobond debt for ten or
fifteen years,” Terkper said.
Running For Cover
Interestingly, when Mr. Terpker was asked
to provide figures to contradict Dr. Bawumia’s debt to GDP ratio claims, he
said he was travelling and would provide it on his return.
Casiel
Ato Forson, who also tried to pour cold water on Dr. Bawumia’s revelations when
given the chance to provide figures to contradict his (Dr. Bawumia’s) figures, said
he was yet to leave his house for the office.
Public Debt
Dr Bawumia warned that government’s
continuous borrowing would push the national debt to $42 billion in December.
He accused the government of failing
to put to good use the huge loans it had contracted.
“In fact, 66 per cent of Ghana’s
debt from independence has been accumulated under the presidency of John Mahama
in just the last three-and-a-half years.
“By the end of 2008 following the
adoption and implementation of the HIPC initiative, the government’s policy
framework of fiscal discipline, the country’s debt to GDP ratio, had declined
from 189 per cent in 2000, to 32 per cent of GDP by 2008,’ he disclosed.
He added, “In terms of the dollar
equivalent of the borrowed amount, this government has borrowed some 39 billion
dollars in eight years.”
“When I mention this, they either
get confused or pretend to get confused; so for the sake of clarity, I have put
in this document” (referring to the paper he was delivering) “a table that
shows them clearly the dollar equivalence of all the amounts borrowed from 2009
to 2016, in fact by December 2016, the government would have borrowed $42
billion dollars.”
“The government would claim no
doubt, that the book value of the debt is $26 billion dollars; but quite
frankly, that is a weak argument.”
“The only reason why the book value
of the debt is $26 billion is because we are applying today’s exchange rate
which the same government succeed in collapsing to the value of the debt; and
not the exchange rate at the time the money was borrowed. With this major
increase in the debt, Ghana’s debt to GDP ratio has increased from 32 percent
in 2008, to 72 percent at the end of 2015,” Dr Bawumia explained.
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