Somewhere in the literature, I read an extract which says that great but visionary leaders are spotted in times of crisis; the leader’s decisions, his demeanor, his approach to communication and his ability to rally popular support around unpopular decisions are the very traits that ultimately define every leader in the times of crisis.
I will like reiterate this point that, indeed, if this Coronavirus did anything good for Ghana, it is that it has come to expose the so called robust economy and has forced the government to present the actual figures to the IMF and the World Bank. So all of us can now diagnose the economy using the very data presented to the IMF by Mr Ken Ofori on behalf of President Akufo Addo and Vice President Dr Mahmoud Bawumia. No footnotes again! No creative accounting any longer!
Yesterday, 4th May, 2020, intellectual dishonesty got to its apogee, and Dr Bawumia indeed lost most of his admirers. President Nana Akufo-Addo won my heart, although he’s vindictive and intolerant with the way he handles his opponents, and most times shows his tyranny traces, I still think he handled this crisis (in terms of communication) to my liking as compared to what Dr Bawunia did.
HE Alhaji Dr Mahmoud Bawumia, the way you make economics lose its relevance on the political pulpit is same way you make the crave for Phd by young men and women lose its flavor. Don’t you get worried when you speak and get praised by your party footsoldiers ONLY? Don’t you get worried that the likes of Kwame Pianim shake their heads in disbelief anytime you mount that podium with your pettiness? Well, I get worried for academia and I get so worried for my Northern Brother who’s mostly used for dirty jobs that some mere communicators have rejected.
At what point would an Economist of your class start to do a direct comparison between a pandemic such as this COVID-19 which is spreading without prediction and an inherited energy situation? Do you realize that Mahama didn’t just all of a sudden created the energy crisis in 2014? Do you realize that your own NPP government under President Kufour neglected a report that points to the fact that Ghana’s demands for electricity increases by 12% annually and so we needed a corresponding investment in order to save the situation of a generation crisis? Mahama’s only crime was accepting the situation, not to blame any past government, tackle it head-on and ultimately fixing the problem as he promised. One thing that is obvious and can’t be contested it is that Mahama fixed the longstanding energy crisis in the end.
The last time I checked on the website of the Ghana Health Service, we had crossed 2000 positive cases of the coronavirus with about 18 or so deaths. This is what we were told yesterday by Dr Bawumia to celebrate. Ghanaians are getting increasingly scared with the spread of the virus which we could have contained if we had listened to experts advice from the very beginning. As we speak, we are not undertaking any mass testing exercise so, we can’t tell how many Ghanaians are carrying the virus on our streets and in our markets. As we speak, we are uncertain about when the vaccine will be ready, so, we are just waiting for the savior. As we speak we have lost the battle of containment of the virus and we have thrown our hands up already. So what is there to celebrate Mr Vice President?
Well, what HE John Mahama said during his last address which woke our sleeping Vice President up to engage in this needless outburst is the feeling of more than half of the population. Mr Mahama didn’t speak out of context and indeed he spoke to the available data as presented to the IMF by Nana Addo, Dr Bawumia and Ken Ofori Attah for the $1bn loan to fight the Coronavirus.
The data as presented to the IMF projected that Ghana’s economy will grow by 1.5% in 2020. This is an economy that grew by about 7.9% in 2017, although this was oil induced. The growth further declined to about 6.1% in 2019. So if an economy which grew by almost 8% in 2017 is now projected to grow by 1.5%, the worse in the history of the 4th Republic, should it take President Mahama to announce its ailment? Again, between 2018 up to the end of the first quarter of 2020, our International Reserve has performed poorly with 2020 expected to close at 2.7 months of import cover. If such an economy is what Dr Bawunia wants us to refer to as robust, then, I am afraid to say that our woes are worse than our naked eyes can see.
Furthermore, Dr Bawumia and his government told the IMF that “they” have borrowed so much that, if “they” don’t take care by end of 2020, Ghana will join other countries within the debt distress bracket. So, from about 56% of debt to GDP by end of 2016-rebased figures…we have sharply moved up to 63.2% in 2019 and projected to worsen to about 69% in 2020. Note: This comes without ESLA bonds. This will obviously fall within the threshold of debt distress given that other sectors of the economy are not doing well. All these figures were cleverly hidden by our Finance Minister but when going to the IMF with a cap-in-hand, HE Nana Addo and Dr Bawumia needed to behave as “good boys” so they decided to paint the true picture of the economy.
Again, one of the basic determinant of a performing economy is the Primary Balance. It is one of the domestic anchors for debt sustainability according to Prof Gatsi. This has deteriorated from -1.1 in 2018 to -1.8 in 2019 and expected to close the year 2020 with -4.1. Our fiscal deficit is getting worse year-by-year since 2018. We closed 2018 with a fiscal deficit of -7% of GDP, this further deteriorated to -7.5% in 2019 and per Dr Bawumia and his Economic Management Team’s own projections for the year 2020, we are expected to close the year with a further decline to -9.5% of fiscal deficit. This is without Coronavirus. So, Fellow Ghanaians, do your own mathematics, factor coronavirus into the equation and show to yourself the expected results.
Dr Bawumia can’t tell us that all the above data as presented to the IMF “pre-coronavirus” were part of their creative accounting to get the IMF cajoled into believing that Ghana indeed is doing badly. Once we can’t deceive the Big Boy (IMF), we posit that these figures (data) reflect the actuals and are what hold for our economy even before the pandemic. This is why we were described and captured amongst the fragile economies hence, a one-off-disbursement formula adopted by the IMF for the $1bn loan facility we went for. Ghana needs an immediate injection of these funds as oxygen, because the economy per these figures is in the ICU as announced by HE John Mahama.
Let me end with this:
-Mahama’s “worse economy” was able to put in place ESLA which is the savior to the energy sector as we speak with about GHC 3bn generated to pay off legacy debts in the sector and to pay for other liabilities as they mature.-Mahama’s “worse economy” was able to build the Ridge Hospital which has come in handy in the wake of the pandemic.-Mahama’s “worse economy” was able to construct the University of Ghana Medical Centre which has become one of the Centres the current government is relying on in the wake of Covid-19.-Mahama’s “weak economy” was able to purchase and operationalize the Ayololo transport system which was right there to serve the Ghana Health Service Staff within the period of the lockdown.-Mahama’s “worse performed economy” left Ghana with the Atuabo gas (Ghana Gas) which is today saving the country about GHC 500m annually.-Mahama’s “worse economy” left Ghana with Terminal 3 which was recently adjudged as one of the best in Africa.-Mahama’s “worse economy” left us with two additional oil wells which is adding about $2bn worth of revenue to this government.-Mahama’s “worse economy” left us with an additional public university in the Eastern Region.-Mahama’s “worse economy” left us with the Modern Kejetia Market with is one of the biggest in the sub-region.-Indeed, Mahama’s “weak economy” left us with two expanded ports (Takoradi and Tema) which have more than doubled our revenues in the ports.
These are but a few. Mind you, Mahama did this with relatively less revenues, less donor support and less of borrowing. Can Dr Bawunia show us what his government has used the over GHC 115bn borrowed cash for? Just name 1 hospital, one major road, one aiport project you have undertaken with all these borrowed cash. Next time Mr Vice President, don’t come speaking like one of the serial callers, please come as a “SERIOUS VICE PRESIDENT”. We are in 2020 and not in 2016 where propaganda did the tricks for you. This time we want results and not talkers.
Yesterday, I saw a desperate but scared Vice President who was trying hard to convince his boss that, he is ready for the dirty works again in 2020. I dare say that Dr Bawumia’s silence adds more to academia than when he speaks.
Come again Mr Vice President.
5th May, 2020