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Business News of Saturday, 15 February 2014

Source: The Mirrior

Comment: Ghana’s ‘polio’ economy

The writing had long been on the wall and now we are finally caught up in a web. Over the last couple of weeks, discussions in the country have centred on the depreciation of the currency, the cedi.

News making rounds speak of a gloomy picture confronting the nation as businesses and government agencies clamour for foreign exchange for their transactions.

How it was that we looked on without taking early mitigating measures till this stage is difficult to understand.

Sometimes I get the feeling that the managers of the economy and our fiscal and monetary policy controllers do not read or listen to commentaries that people pass on the economy. If they do, then they probably do not pay any attention or pay little heed to them.

Moreover, it appears that the country has not learnt any historical lessons from happenings in other countries such as Greece and Spain who faced economic crisis a couple of years back.

Now, with the exchange rate (as at press time) going for GH¢2.90 for $1.00, it looks as if a fright button has been pressed, as it is reported that some customers who have foreign accounts with banks in the country have resorted to panic withdrawals.

While it is good that the government has taken a firm stand by coming out with comprehensive strategies aimed at shoring up the fortunes of the cedi, as well as enforcing revised rules by the Bank of Ghana (BOG), these are by no means enough.

I am not an economist and so will not assume to proffer any economic models aimed at salvaging the economy. However, what I do know is that in spite of the introduction of the $20million by the BOG into the economy in an act of douching the system, the temperature still remains high.

Admittedly, there is economic hardship all over the globe, and so President John Mahama’s appeal to our development partners to come and bail us out of our present difficulty, even though is in the right direction, nonetheless may receive muted responses.

We have got to think outside the box and come up with our own innovative ways to get out of the maze.

I tend to agree with Dr Tony Aidoo when he asks ministers of state not to go to sleep but sit up and think for a way out of our current situation.

Come to think of it, hardly has any minister or his deputy been heard saying anything different from what we have all been saying. As Dr Aidoo puts it, a ministerial job is a thinking job. That is why they have all the perks that they enjoy.

It is high time deputy ministers in particular gave meaning to their positions other than attend to duty assignment given them by their ministers, attend conferences and make political speeches at opening and closing ceremonies of selected programmes.

But, they are not to be singled out, it is expected that the larger population will also contribute their bit to ensure that the economy improves.

This is no time for politicisation.

We should mean real business this time and the President should not hesitate to rope in other citizens who he believes can help him achieve his targets, even if they do not belong to the party.

The economy of Ghana was ‘dollarised’ years ago. For a long time, hotel services, school fees, accommodation and many more aspects of the economy have been conducted in dollar terms.

In fact, following the discovery and drilling of oil in the Western Region, accommodation in Takoradi and its environs are charged in dollars. And so it is no wonder that as the economy picked steam, the need for dollars and, in fact, foreign exchanges has risen sharply.

Whatever it is that the country is going through now should serve as an eye opener to the managers of the economy to be very frugal when it comes to the way the country’s monetary and other resources are spent and used.

If the country had exercised circumspection in the way judgement debts were paid to people under doubtful circumstances and we had controlled defiant spending in the run-up to Election 2012, this country would have been able to hold its own, even if for a short while as steps were found to plug loop holes.

As the saying goes: In every misfortune, there is a blessing. The situation now should make us more discernible such that we ensure never to get ensnared in such a quagmire.

If the authorities will only put their ears to the ground and listen hard enough, they will hear the people groan under the weight of poverty, hunger and escalating prices of goods and services.

By: Jojo Sam