Ghana's social market economy system is poor - Prof. Jonah

Accra, March 30, GNA - Professor Kwesi Jonah, Head of

Political Science Department, University of Ghana, on

Wednesday said Ghana had not performed well under the

Social Market Economy system. He said instead of adopting a level playing field for private

sector involvement, the system had resulted in ruling red lines

and creating unfavourable conditions for digressing into certain

sectors of the economy that had long been perceived as State

monopoly. Prof. Jonah was addressing participants on the Social

Market Economy and its implications for Ghana at a public

lecture in Accra. The lecture jointly organised by the Konrad Adenauer

Stiftung (Foundation) and the Private Enterprises Foundation,

was to review Ghana's adoption of the Social Market

Economy module. Prof. Jonah said that Ghana would not be able to attain the

needed economic growth if government continued to rule red

lines that placed huge market restrictions on the private sector. He stated that overburdening the private sector with high tax

rates and high inflation levels amounted to indirect robbery by

the State, which would only lead to the collapse of businesses

and stifle economic progress and development. Prof. Jonah reminded government of its huge task of

moving the people from their current state of poverty, saying

this could only be done by strengthening public-private

partnership. He said countries which had attained huge economic jumps

recognised the power of the private sector as a major engine of

growth. Prof. Jonah said Ghana opted for the SME after its

Centrally Planned Economy paradigm and Structural

Adjustment Programme (SAP) had failed to yield the needed

economic growth and development. He cited how Africa's economies had failed due to their

wrong choice of a Centrally Planned Economy paradigm,

where the States owned everything such as airlines, food

distribution services, water, oil refineries as well as electricity

corporations. Prof. Jonah said in Ghana this overstretched and dwindle

government financial reserves, making it very challenging for

the development and management of infrastructure and other

areas of the economy. He said this system failed and the consequence affected all

national nations that practiced this system. Prof. Jonah said introduction of the National Health

Insurance Scheme, Capitation Grant, Free School Uniforms

and the School Feeding Programme were all efforts by

government to correct the mistakes and disadvantages of SAP. Ms Birgit Schnieber-Jastram, German Member of the

European Parliament, commended Ghana for her option for the

SME. She reiterated the critical role of the private sector in

promoting employment, industrialisation, market competition

as well as development of infrastructure of the country. Ms Schnieber-Jastram stated that reforms should not be

imposed otherwise they would not work. She said 93you will have to decide on your own about what

to do. Only you know what you want and what you need". Ms Schnieber-Jastram said the recent financial crisis that

engulfed the world brought to the fore the need for an

economic system that would ensure the necessary balance

between the open market system and the individual citizen's

interest. She noted that inspite of the huge economic progress in

most African countries, the continent still remained the poorest

and the least developed, saying 93approximately one out of

every three of the world's poor live in Africa". Ms Schnieber-Jastram said African countries needed strong

policies and institutions of enforcement and not necessarily

financial assistance all the time. She called for initiatives for strengthening governance and

institutions, especially civil society stakeholders and initiatives

for conflict prevention, saying those initiatives had to be

aligned with pre-existing structures. Ms Schnieber-Jastram said Africa stood the economic

chance if it focused on industrialisation in the agricultural

sector and creative industry. She asked that African countries be given equal access to

the global market.