The economy is far from healthy

The economy is far from healthy. That in short, is the verdict delivered by the Institute of Statistical and Economic Research, University of Ghana read by its Director Kwadwo Asenso-Okyere, Legon?s newly appointed Vice-Chancellor, in Accra, last week.

The State of the Ghanaian Economy Report 2001, did not raise much cheer in the Ghanaian. The GDP growth of 4.5 percent fell far short of the 8-10 percent per annum necessary for the country to achieve the government?s target of doubling the economy by 2010.

While commending measures to stabilize the economy last year, the report warned that this kind of stabilization has been achieved before only for the gains to be eroded. According to the study, not much was achieved in the Government's blue-print, Golden Age of Business, concept.

Though the report acknowledged that inflation fell from 40.5 in 2000 to 21.3 percent, the cedi depreciated by only 3.7 percent compared to 49.5 percent in 2000 and GDP grew by 4.2 from 3.7 percent, the stock of domestic debt, excluding Tema Oil Refinery, increased from c1,455.2 billion to c9,297.5 billion. External debt was estimated at $6.025 bn.

News from the West African Monetary Union front is also far from cheerful. E.K. Addision of the West African Monetary Institute (WAMI) has warned that high inflation and interest rates are threatening to shut the doors to the union on Ghana and Nigeria, the two of the giants in the sub-region pushing for a single currency.

All these put the government and people of Ghana on notice that this country is far in the woods of economic quagmire. But Public Agenda does not believe that solution to the problem lies in iron-fist fiscal measures that do not free capital for poverty alleviation. When the people are perennially poor, they have no means of contributing to uplift this country.

As ISSER clearly identified, the solution to our myriad of problems lies in agriculture. We urge the Government to focus its, Golden Age of Business Programme on Agro-based industries. That would mean reformation of land acquisition process and subsidies on agricultural implements to entice people to the land.

While we are at it, Public Agenda would urge moderation in Government expenditure on its officials. At a time that most of the population are unable to afford meals, education and health expenditure, it is disincentive to the people for them to observe ministers of state and senior civil servants driving around in very expensive saloon cars and four-wheel drives and generally living ostentatiously.

An example of austerity must come from the very top.