[ 2019-03-23 ]

Akufo-Addo is a transformational leader - Economist
Mr Habibu Adam, an Economist, on Friday said
President Nana Addo Dankwa Akufo-Addo is a
transformational leader who’s like is yet
to be witnessed in the fourth republic.

“Right from Election 2016 campaigns to his
inaugural speech on January 7, 2017 to the first
budget of the new administration, the rhetoric of
the President has sort to portray him as a
transformational leader not seen in the Fourth
Republic,” Mr Adam told the Ghana News
Agency in an interview.

Mr Adam, who is also a Senior Economist at the
Office of the Senior Minister, said this is based
on the State of the Ghanaian economy and two years
into Nana Akufo-Addo’s Government-
“What are the real issues? And Why Ghanaians
should be patient”.

He said the President came to meet challenges -
coming at a time that the economy was experiencing
low growth, rising rate of unemployment, high
fiscal deficits, high and rising debt, and
increased depreciation of the cedi, high cost of
food, housing and utilities and high
non-performing loans amongst others.

He said President Nana Akufo-Addo also inherited
an economy with symptoms of deeper structural
problems that required a wide range of reforms.

“As usual with the United Party (UP)
tradition, the agenda was set right from the
inaugural speech. However, many doubted the
capability of the government in carrying out its
ambitious plans considering the International
Monetary Fund’s (IMF) programme and the
declining growth of most of the sectors of the
economy.

“It is important to note that virtually all
the targets set under the IMF programme have been
missed as at the end of December, 2016. For
instance, a Gross Domestic Product (GDP) growth
(including oil) of 3.6 per cent was the lowest in
23 years- a deficit target of 5.3 per cent under
the IMF programme was missed.

“The actuals were 9 per cent on cash basis
and 10.2 per cent on commitment basis,” Mr
Adam said.

The Senior Economist said Ghana’s total
public debt from independence to 2008 (52years)
stood at GH¢ 9.5 billion (33 per cent of GDP).

However, by 2016, the public debt had ballooned to
GH¢ 122 billion (73.1 per cent or the revised
figure of 56.6 per cent of GDP). Interest payment
was about GH¢ 14.1 billion 6.2 per cent of
GDP.

Mr Adam said the difficulty faced by Nana
Akufo-Addo’s government was that three
budget items consisting of wages and salaries,
interest payments and amortization and statutory
payments consisted 105 per cent of government
revenue.

“This means that government had additional 5
per cent to meet the three budgetary items,”
he said.

He said the state of the Ghanaian economy was akin
to the ‘HIPC’ economy the Former
President John Agyekum Kufour’s government
inherited in 2001 except that there was no HIPC
benefits this time since Ghana is now a
Middle-Income Economy.

“The only alternative left for the Nana
Akufo-Addo’s government was to borrow
initially to stabilize the economy before pursuing
its growth agenda.

“This is the most popular option among
Keynesian Economists. Hence, the rise in public
debt for the first two years of the current
administration.

“The good news is that while in the past we
could not relate the debts to projects or
programmes in proportional terms, the current
administration now provides the lists of all the
borrowed funds to specific projects and
programmes,” Mr Adam added.

Source - GNA

... go Back