General News of Saturday, 24 May 2014
Professor of Economics at CEIBS Bala Ramasamy says Ghana must stop blaming external factors for its current economic crisis and rather focus on solving its internal economic challenges.
‘Certainly eternal factors are important and sometimes they dominate but I think it is also important for us to stop blaming them all the time because despite the changing eternal factors there are still others that are making it,’ he stressed.
Government over the past two years has attributed the problems facing the economy, among others, to declining commodity prices and the US tapering programme, which it believes contributed to the cedis decline in the first quarter of the year.
But Dr. Bala Ramasamy speaking on Citi FM’s business edition said Ghana has been badly affected by these external factors because it has not managed its internal affairs well.
‘So I think we need to be careful, just like I think we keep blaming government all the time. The external factors are important, am not disputing that but my point, coming from another developing country, I think I have heard enough where we keep on blaming the US, Britain, Japan etc but we need to get our house in order as well so the external factors become less important to us’.
Some government officials say Ghana’s economic crisis started escalating two years ago following the recession that hit the West.
The development saw a drop in commodity prices among others.
Lower commodity prices for example led to a plunge in the country’s revenue. In 2013 for example according to that bank of Ghana on the commodities markets, crude oil prices slowed down during the second half of 2013, between US$100 and US$105 per barrel, while Gold declined from US$1,525 to US$1,200 per fine ounce, cocoa prices on the other hand was broadly stable at about US$2,470 per tonne.
According to the bank of Ghana the developments in the external environment continued to impact on the domestic economy, as declines in commodity prices affected external sector performance.
But Dr. Bala Ramasamy believes Ghana has itself to blame for the development.
According to him, Ghana must add value to its commodities before export to increase its value.
‘If you can increase the value of, for, example your agric products then you can call the shots. Any country that is only producing commodity is poor and Malaysia recognized this and changed.’
‘Let’s get real 60-70 years after the British have left and we are still blaming the British for our problems the thing is doing that will not change where we are today. The world has changed 60 -70 years later, we cannot blame the British anymore’.
He also blames leadership for Africa’s difficulty in adding value to its agric products over the years and believes a good leader must be able to utilize the market and support the way it works.