Mahama: NPP using Covid-19 as an excuse for economic crisis

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Former President, Mr John Dramani Mahama has opined that COVID-19  has  become  the  convenient  ‘whipping  boy’  and  has  been  cited  as  the  reason  for  the  crisis  the country is facing now  and  the  attendant  economic  hardships.

He said although COVID-19 affected  the  economy, it  is  however  not  the  main  reason why the country is facing its current challenges.

Speaking at the State  of  the  Economy  Forum,  organised  by  the  NDC  proforum on   Monday, September  06,  2021, the Former President said, “COVID19  only  became  a  pretext  for  reckless  election  related  spending,  which  produced  the  largest  ever  budget deficit  in  the  recent  economic  history  of  Ghana  last  year.”

He continued that, “Our debt has ballooned to  unsustainable  levels-  topping  80%  of  GDP-  exposing  us  to  very  high  risk  of debt  default.  Almost all of  our  tax  revenue  is  used  to  service  our  debt  and  the  effect  has  been  the introduction  of  several  new  taxes. This has  led  to  rampant  increments  in  the  prices  of  goods  and services.  This  is  primarily  responsible  for  the  hardships  Ghanaians  are  going  through  now. “

Mr John Dramani Mahama  said a  comparison  with other countries  in  Sub-Saharan  Africa,  all  of  whom  were  also  affected  by COVID-19, indicated that they were able  to  protect  their  citizens  from  COVID-19  in  ways  that  are  similar to that of Ghana.

However, he said they avoided  increasing  their  debts  and  deficits  because  of  more  prudent management  of  their  economies.

“This  government  must  accept  that  it  is  their  mismanagement  of  the  economy,  their  thirst  for consumption expenditure  and  the  desire  to  spend  beyond  our  means  in  order  to  win  elections  that  have plunged  us  into  the  current  crisis,  not  necessarily  COVID-19,” he said.

Meanwhile, despite the hardship, the Former President asserted that the NPP-Government has been the  luckiest  government  under  the  fourth  republic.

He explained that, “They  have  benefitted  from  60%  of  all the  oil  revenue  accruing  to  Ghana  since  we  began  producing  oil,  they  have  had  more  than  twice  the total  tax  revenue  available  to  us  and  have  enjoyed  unprecedented  support  from  our  development partners.”

Mr John Dramani Mahama  continued that, “Within  a  space  of  12  months,  they  have  received  up  to  GHC11  billion  from  the  IMF  alone  and  over  $200 million  from  the  World  Bank  and  other  donors.  They  had  access  to  over  $200  million  from  the Stabilization  Fund  we  set  up  and  got  Central  Bank  Financing  of  GHS10  billion  whereas  we  had  zero financing  from  the  Central  bank  in  2016  despite  all  our  challenges.”

He alleged that the government has increased  Ghana’s debt  by  almost  twice  the  total  amount  all  previous  governments  put together, adding that, “ All  of  this  notwithstanding,  they  have  the  least  to  show  in  terms  of  tangible  gains  or  capital investments.”

He said another  major  problem in the country has  been  the  unprecedented  levels  of  corruption  and  the  total  lack  of accountability  and  prudence  in  the  handling  of the  public purse.

“According  to  the  Auditor  General,  financial  irregularities  within  the  public  sector  shot  up  from  about GHC700  million  in  2016  to  GHC12  billion  in  2020. This  level  of  leakage  will  definitely  affect  the  ability  of  any  government  to  deliver  on  its  mandate  and guarantee  citizens  an  appreciable  standard  of  living,” he stated.

Mr John Dramani Mahama  said,“ The  nonchalance  and  total  unwillingness  to  address corruption  in  government  is  a  major  worry  and  will  continue  to  affect  our  economic  fortunes  until  the trend  stops.”

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