President Kufuor Meets The Press

Full text of opening statement by President J.A. Kufuor at a press conference at the Osu Castle on Thursday, October 3, 2002.

Good Morning, Ladies and Gentlemen and welcome to the Castle.
I had hoped when we had our first encounter in April last year that these conferences would be regular. This was not to be so because it took a while to grasp the full scale of the problems government faced. This led to the taking of a number of extremely difficult decisions, some of which, at least, had to mature before being brought to an interaction such as today’s.

This is because, I believe we, that is, the Government and the media, owe it to the long suffering people of Ghana to provide some light rather than the constant heat in dealing with the issues of state. With the gradually improving trends, I hope we can look forward to a regular cycle of press conferences. We shall aim at quarterly conferences. And if and when the need arises in between, I shall make myself available to answer questions.

Today, I intend to address six main subjects in this presentation before I take your questions. These are the Economy, Infrastructure, Social Services, Agriculture, Governance and Foreign Relations. And maybe, a few other things that might go under Miscellaneous.

The Economy

Ladies and Gentlemen, the economy poses the greatest challenge to the nation and government. At the macro economic level, there have been substantial gains and general stabilization. Inflation and bank interest rates continue to fall and the currency has had a measure of stability.

This should enable businesses to better plan their operations and induce confidence in the corporate sector. But it is not enough to stabilize things. To stimulate growth therefore, government has taken a series of measures to strengthen the banking system and increase the supply of long term capital that is available to agriculture and industry.

At the micro level, our small-scale farmers and traders are being given credit on a scale that has not been seen in Ghana for the past thirty years. And they can borrow such monies at the rate of no more than 20% a year, instead of the 100 to 200 % for a short season from moneylenders.

As the divestiture programme takes off, government intends to devote a substantial proportion of the proceeds to build up the supply of capital available to industry. This year, we expect to receive at least 75 million dollars from that source with much more to come in the next two years.

As a result of the bold policy measures taken since last year, these increased volumes of credit are being provided to businesses by a reinvigorated banking system dramatically reduced costs-25 to 30 % in place of the 45% interest rates we inherited. We fully expect interest rates to go down even further,

Government intends to continue to take additional measures to boost the supply of capital to the private sector, in particular to those who are seizing the opportunity of adding value to our farm produce and natural resources and selling made-in Ghana goods to the global market.

Housing, which consumes particularly large amounts of capital has become a critical area for many Ghanaians. For years, the supply of affordable housing has remained stagnant as the cost of building materials and mortgage finance has soared. Government will announce major new programmes and policies in the budget for fiscal year 2003 to boost the housing sector. Between the revived housing construction industry and the forest development programme, greaterഊjob opportunities will be generated,

Government is adopting other initiatives to stir up the demoralized private sector. The President’s Special Initiatives on Cassava and on Textile and Garment Manufacturing have caught the imagination of the people and there is a lot of activity in these sectors. In the fullness of time when these initiatives have matured, it is estimated that they should increase export receivables to the tune of $4b annually and increase employment opportunities as well.

The Ministry of Private Sector Development has sourced for a $40 million facility to support the President’s new Initiative on Salt and Palm Oil production for export. Those who want to go into pineapple, citrus as well as tomato processing can also access the facility, The facility has been lodged with four local Banks and is ready to be accessed by potential entrepreneurs in these sectors.

HIPC BENEF1TS

Having reached the Decision Point in the HIPC Initiative, the economy has realized some tangible benefits. Monies, which would otherwise have been paid as interest on loans, are being made available for use in many areas to reduce poverty, to empower more people through rising productivity, and to improve the social services especially health and education. HIPC has enabled the Minister of Finance to make large sums of money available to the Districts for development projects over and above what is normally available in the Common Fund.

Let me state here that government has been as fair as possible in the disbursement of the monies. I therefore plead with all to stop trying to play politics with it. Our commitment is to improve public services wherever they are deficient throughout the length and breadth of Ghana and naturally, the greater the need, the greater the effort that will be put in.

The dividend from HIPC is not a one-off bonus, but a stream of savings that will accrue to Ghana over the years. We have just made the first distribution of these savings with the recent allocations. The important thing is for each district in Ghana to think through its priorities in the areas of education, health and water supply, and to execute its projects with the greatest efficiency and honesty.

I urge all of you to study the census figures to appreciate the population distribution in the country, and the fact that hard-core poverty is as much a feature of much of the urban areas as it is of the rural areas. This will refute the allegation that government has been unfair in the distribution of the HIPC money.

PUBLIC FINANCES

I am glad to say that public finances are being managed in a more coherent and systematic manner than before. This is helping to keep us on the targets set in our economic vision and the budget.

It is worthwhile to point out that government has been settling many of the debt arrears it inherited. For example, the situation in the road sector was dire, with many contractors not having been paid for a long time.

Thus far, more than 326 billion cedis in arrears in the road sector have been paid to contractors. Arrears owed to SSNIT in respect of government payments and salaries have also been cleared, and I am sure you have all heard that for the first time in a very long while, government has settled its bills with the Electricity Company.

Agriculture

I am happy to note that we are making strides in the production and storage of food. Last year there was a serious political crisis because the price of garri rose to 10,000 cedis a tin. This year, the traditional lean season, known in some parts of the country as the “hunger season”. passed without any crisis and we have the happy problem now of abundance of food and lowering food prices. Indeed, in many parts of the country and especially in the Brong Ahafo Region, there is a glut of food. Now garri is selling at 4,000 cedis a tin and nobody is talking about it. Good news, it seems, is no news.

The challenge is in the marketing, processing and storage to ensure that the bottom does not fall out of the market to the detriment of farmers and food does not rot in the villages. Private Sector operators are being helped with credit to modernize the marketing system, and to buy up and store against the lean season. As you are all aware, the many silos that have been abandoned around the country are being repaired and rented out for food storage. This government will continue to stand firmly behind the farmers of Ghana. Social Services

EDUCATION

Serious problems still exist in Education. I await the report of the Education Reform Review Committee, which, I am told, will be ready next week. In the meantime, work has started on upgrading a number of secondary schools to the standard of the well-endowed schools. All the districts have chosen their school to be upgraded, and work has started on twenty of them.

Our pledge to supply all core textbooks to Secondary Schools is being met, and by December, the ratio of core textbooks to students will be 1 to 1. Of the 50,000 basic schools that needed furniture, we have supplied 20,000 and by the middle of next year, all basic schools will have the full complement of furniture. Thus far, 3,000 classrooms have been rehabilitated and 500 units for teacher accommodation have been completed. Ladies and Gentlemen, I can report that on the infrastructure front in basic and secondary education, we are making good progress.

There is no question but that the tertiary institutions are under extreme stress, with their facilities fully stretched. The expansion of infrastructure is therefore receiving the most urgent attention from government. Efforts are also being made to find ways to improve the conditions of service for the staff. Government welcomes the growing private sector participation in the provision of tertiary education as it helps to ease the pressure on the state institutions.

HEALTH

The phasing out of the Cash and Carry system is on the way. Already 42 out of the 110 districts have adopted a health insurance scheme. We hope to learn from the experience in these districts to choose the most suitable models for national implementation.

The other serious problem that faces the nation in health delivery is the continuous exodus of health professionals from the country in pursuit of greener pastures. I wish to take this opportunity to again make an appeal to all our expensively trained health professionals to stay in the country and help in the development efforts.

It has never been the case that some people have come from outside to develop any country. Ghanaians must therefore resolve to stay and develop their country, no matter the sacrifice. Within its limited capacity, government is trying to better the working conditions for the health professionals and I hope they will appreciate these efforts.

Infrastructure

ROADS
Contracts have been awarded for all four arterial roads out of Accra and work has started on them. Accra-Kumasi, Accra Cape Coast, Accra-Aflao and Tetteh Quarshie Circle to Mamfe. Selected strategic roads in each region are also being tackled, alongside work on numerous feeder roads. Let me mention just a few of the important roads that are being built around the country: Bole-Bamboi in the Northern Region, Bawdie-Asankragwa-Enchi in the Western Region, Nkoranza- Ejura in Brong Ahafo and Ashanti Regions and lasikan-Breweniase in the Volta Region. At last, the critical western corridor roads in the Western Region are receiving attention.

ENERGY

The energy needs of the country have been heightened by the catastrophic drop in the level of the Volta Lake and the volatile international oil market. The Lake level is being managed to ensure that the Dam is not endangered.

I am happy to state that the Effasu Barge has set sail from Italy and will arrive at the Sekondi Naval Base on the 15 th of October. Once installed at the Efasu field, it will ease some of the pressure on power supplies, with its 125 megawatts of capacity.

There is renewed investor interest in Ghana’s petroleum resources. Offshore agreements have been signed with four major prospecting companies and we are confident that the discoveries in neighbouring countries of the Atlantic board will be repeated in Ghana.

Governance

On the question of security, I am happy to report that we have made good progress and the situation is much improved.

The Police Service is being rehabilitated. I am sure you have all noticed the vehicles that have been procured to make the police mobile and boost their morale and help induce confidence among the population.

And by the way, there is no truth in the assertions being made that Ghana has taken a $13m loan from Nigeria to purchase the vehicles. What happened was that at a time when criminality was raging wild in the country and the police had no vehicles. President Obasanjo put in a word with Peugeot Nigeria for Ghana to be supplied on extremely soft terms, 100 Peugeot cars. The total cost of the 100 vehicles is $1.3m, not $13m. So far, 50 of these vehicles have arrived in the country at the cost of 685,000 dollars and government intends to make provisions for payment in next year’s budget. Co-operation between the Army and the Police is also helping to overcome the spate of armed robberies that threatened stability in the past year.

After the period of uncertainty, the Fast Track Courts are back on course and seem poised to modernize the system for the delivery of justice. My hope is that they will become the normal mode of operation in our courts.

Foreign Relations

Let me now say a few words on our foreign relations. On the assumption of office, I made a deliberate decision to actively pursue a policy of good neighbourliness. A nation cannot choose its neighbours, just as a person cannot choose his parents and siblings. If we talk about a global village, it is imperative that we start with making peace with our immediateഊneighbours, and I have tried at every opportunity to make sure that relations between Ghana and her immediate neighbours are the very best think it is fair to say that in the sub-region, Ghana can now claim to have excellent relations with all the ECOWAS nations.

I believe that this policy is paying good dividends. Indeed, in the larger international community, there is an added bonus. Slowly but surely, Ghana is being recognized as a key player in bringing stability and good governance to the sub-region.

I have had to make a lot of visits abroad and I know that many people have expressed concern about these travels. But I believe I am making remarkable progress in getting for Ghana, the exposure and status that she deserves. I can say without fear of contradiction that I have not made a single frivolous journey.

You cannot put monetary value on these travels; but I know they have contributed immeasurably towards strengthening the economic and social foundation for the development of the nation. This is very much in line with the vision and mission of my government.

MISCELLANEOUS

DAGBON CRISIS
I have to talk about the tragic events in the Dagbon traditional area. The shock of those events will stay with all of us for a long time. It is a matter of deep regret to me that some people have sought to take undue advantage of the tragedy to promote their personal and narrow sectional interests.

I feel a deep sense of personal loss myself, because for years, I forged a close relationship with the late Ya Na and he had become a friend of mine.

I have heard a lot of talk about my not having gone to Yendi. When I go to Yendi, it must be to heal wounds. I am well aware that one faction in the dispute has had to literally abandon the town. The question is should I go simply to see members of the other faction? What sort of healer of wounds and pain would I be?

Meanwhile I have dispatched numerous delegations and emissaries to the Dagbon area to try to get all sides to relent in their postures and to see the wisdom of peace and reconciliation for the total traditional area. Other steps have been taken by government all aimed at achieving justice and restoration of peace and harmony in the troubled area.

I will therefore reiterate the statement put out through the Ministry of Information some time ago. I will choose the time to go to Yendi, and when I do, it will be to bring people together and restore harmony to Dagbon. It will not be for public relations reasons. The report of the Commission of Enquiry is expected soon and hopefully it will provide requisite leads to actions that well help establish the truth to form the basis for justice and reconciliation in Dagbon land

IFC LOAN

You have all heard about the IFC Loan and I know you ladies and gentlemen are dying to question me about it. So let me give you some of the facts and background. When government assumed office, it was obvious that the financing needed to bring Ghana’s infrastructure up to acceptable modern standards was not going to be available from our own budgets or from the traditional sources of multilateral lending. We had to call upon the vastly greater resources of the private capital market.

It was with this background that when government was approached, it agreed to talk with the IFC about a $1b loan facility specifically for infrastructure development. Everywhere else in the world, governments have resorted to loans to build their infrastructure. Within the capacity of government, due diligence was made to ensure that the Consortium was made up of serious and reputable entities.

And at every stage of the negotiations, government has taken extreme care to ensure that they were fair and above reproach. The Minister of Finance and the Governor of the Bank of Ghana have been aided by Lawyers and experts throughout. A syndication of the magnitude contained of the proposed loan takes many months to put together and to finalize, and it normally entails great discretion on the part of the negotiators. The important thing to note is that at the appropriate stage, the details will be made public. All I can say now is that government has thus far not encountered any defects that will warrant withdrawal from the negotiations.

I will therefore urge discretion and caution to guide all comments and considerations on the matter. Soon a definitive statement by the government will be issued to the public.

CONFESSION TIME

Now, time for a confession. Having been in office for almost 21 months, I suspect it is fair to ask whether being in office has changed my perspective on anything? The answer is Yes.

While in opposition, my colleagues and I were very critical about the size of the then government.

Since assuming office and having the benefit of the experience in office, I now believe that this criticism was misplaced.

I think we all worry about the size of government and the number of Ministers because of the perceived financial cost to the state. While it is important that we continue to take a close look and try to rationalize the size and keep a tight rein on expenditure, I believe efficacy and efficiency should be the main consideration.

For example, I used to think that a Ministry of Lands, Forestry and Mines was a viable proposition. Now I think each of these three sectors deserves a Minister by itself. The same goes for Roads and Transport. At our current state of development, the Roads sector demands a full time Minister. The same can be said for Transportation. Ghana Airways alone appears to require a Minister, call him Minister for Aviation and I believe the Ports and Harbours can also make a persuasive case for a Minister as well.

It was instructive to learn in India that there is a full Minister in charge of Railways.

And what about Education, it seems to me that we probably need a Minister for Tertiary education alone. We can keep on with other examples. It was a salutary lesson to hear from the Malaysian Prime Minister himself that there are as many as 27 Ministers of State in the Office of the Prime Minister alone in Malaysia. And they are all very busy working to make the office effective. These are in addition to the normal sector Ministries.

I say this not to alarm anybody that I want to open the floodgates and appoint an army of Ministers. But I do want the issue discussed in the public domain; and I was sure you Ladies and Gentlemen would also be interested to hear me make the admission that on this particular issue, the experience of government has shown me that some things look different in opposition. And while we are on the subject of Ministers, I think we must deal with the other subject that has beenഊagitating the minds of many of you in the media currently.

Am I about to reshuffle my cabinet?

On this subject, I beg of you to accept that this is one of the very few prerogatives that the President must have. And so, whom I pick to serve in my Cabinet, and in what capacity, and for how long, will remain strictly, my prerogative.

I shall keep, change, renew, add or subtract to my ministerial team as and when I dedde. But this is not to say that where there is substantive evidence of corruption or misconduct on the part of any Minister, I will turn a blind eye.

So, let us not ritualize reshuffle as something to be expected seasonally. Let us therefore all concentrate on dealing with the matters that will make a difference to the lives of our peoples--. The economy, development of infrastructure, and good governance.

Again I welcome you to the Castle, which, I hope, you have observed, is in a much better state than it was last year.

Thank You And May God Bless Us All.