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Business News of Friday, 30 October 2015

Source: B&FT

Dev’t plan must be slashed to 20yrs

Dr. Nii Moi Thompson, Chairman of NDPC Dr. Nii Moi Thompson, Chairman of NDPC

Senior Economist of the West African Monetary Institute (WAMI) Dr. Christian Regobeth Ahortor has called on the National Development Planning Commission (NDPC) to reduce the much-talked-about 40-year development plan by half, in order to mitigate inevitable challenges the plan will go through.

In an interview with the B&FT, Dr. Ahortor enumerated some possible risks the plan is likely to suffer in the realms of the political, economic, environmental, technological and cultural -- which will require significant changes in the plan in the future, and thereby posing a big threat to its sustainability.

“Political stability is one of the prerequisites for successful implementation of any long-term development plan. In a multi-party democracy like Ghana, political stability is just a necessary condition. The appropriate condition requires that all political parties must agree to the long-term plan. The plan’s implementation will be in jeopardy if one or more political parties that do not agree with the plan happen to form the ruling government.

“Technological risk is another risk that may take place during the life-cycle of the plan. Any long-term plan will be premised on existing technical know-how and initial socio-economic conditions. However, it is possible that during implementation of the plan, there may be notable technological changes that will alter not only the financing needs but also its social and environmental underpinnings.

“For example, suppose that the 40-year development plan hinges on resources from crude oil production -- but somewhere within the period of implementation, technology has changed in the direction of electric and solar engines such that demand for oil has fallen; this mean revenue flows from oil would dwindle and, thereby, distort the plan’s financing,” he said.

He added that the aforementioned risks are inevitable to the proposed development plan, and as such maintaining its duration at 40 years will prove perilous – hence, it would be prudent if the plan was slashed by 20 years to provide room for corrective measures to be taken in mitigating the risks.

“With all these potential risks to the proposed development plan for Ghana, the NDPC may be careful in the plan’s design. Although the proposal is to sub-divide the 40-year plan into 4-year medium-term plans, the NDPC may consider reducing the life-span of the plan from 40 years to 20 years.

“This will allow the NDPC to follow it with another 20 years plan that takes into consideration all the lessons learnt from implementation of first 20-year plan as well as the changing political, environmental, financial, cultural and technological dynamics within the country and the rest of the world,” he said.

This view is shared by Dr. Akoto Osei, former Finance Minister of the Kuffour administration and currently a ranking member of the finance committee of parliament, who has expressed pessimism about the plan’s sustainability, calling it a hoax.

“If we cannot implement a one-year budget, how can we keep to a 40-year plan? I think it is a hoax,” said Dr. Akoto Osei -- who could be Finance Minister if the NPP wins the 2016 elections and would have significant sway over the fate of the 40-year plan that is expected to span the period 2018 to 2057.

According to the Director-General of the NDPC, Dr. Nii Moi Thompson, the plan “will be the framework for accelerated growth and actual reduction in poverty levels among Ghanaians. It will ensure that national development is not centred on sectional political party manifestos; manifestos must rather be aligned to the Plan.

“It will reduce the party politicisation of our development process. It will serve as a holistic basis for assessing the performance of successive governments,” he added.