Majority, Minority disagree on state of economy

BY: Musah Yahaya Jafaru
Mr Kojo Oppong-Nkrumah (left) and Cassiel Ato Forson
Mr Kojo Oppong-Nkrumah (left) and Cassiel Ato Forson

Majority and Minority Members of Parliament (MPs) have disagreed on the true performance of the economy as they began the debate on the mid-year fiscal policy review of the 2018 budget statement.

While the Majority members stated that the economy indicators were positive with brighter expectations, the Minority members said the economy was doing badly with many Ghanaians going through hardship.

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Setting the stage for the debate last Monday, the NPP MP for Ofoase-Ayirebi, and also a Deputy Minister of Information, Mr Kojo Oppong-Nkrumah, said the positive economic indicators were so glaring that they could not be ignored.

He said although the government had recorded impressive growth in every aspect of the economy, more was needed to be done to bring the expected economic relief to the people.


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Strong economic foundation

Mr Nkrumah said a strong economic foundation was crucial to improving the economy.

He said upon the assumption of office, the government reduced fiscal deficit from 9.3 per cent of Gross Domestic Product (GDP) in to 2016 to 5.9 per cent.

He said the government was targeting to reduce fiscal deficit further to 4.5 per cent.

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Mr Nkrumah said inflation had been on the decline from 15 per cent in 2016 to 11 per cent now, public debt reduced from 73 per cent in 2016 of GDP to 69 per cent.

He said the target in the medium-term was to get it down to 65 per cent of GDP.

"In growth, we have grown from 3.7 as at the end of 2016 to 8.5 in 2017 and we hope to keep our growth above six per cent in this fiscal year.

"We have reduced interest rate from about 16.4 per cent for 91-day bills down to about 13.3 per cent and we hope and expect to carry it down a bit further.

"Mr Speaker, these are facts of our fiscal and macro improvements and denial is not an option", the former broadcaster said to cheers from his majority side.

Minority disagrees

The NDC MP for Ajumako-Enyan-Essiam and also the Ranking Member on the Finance Committee of Parliament, Mr Cassiel Ato Forson said the budget review exercise, which was performed by the Minster of Finance, meant more hardship for Ghanaians as the recalibrated VAT would bring more hardship on the citizenry.

"Inasmuch as capital expenditure is going down, at a rate which is not helpful, consumption expenditure is going up", he said.

Mr Forson said the government was programmed to borrow GHȼ1.122 billion for January to May but had ended up borrowing GHȼ4 billion more, and indicated that "the rate at which this government is borrowing is something we would have to question."

Mr Forson said the government was not honouring payments to the statutory funds such as the Ghana Education Trust Fund (GETFund) and the National Health Insurance, which could run them into debt.