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Economy is in distress - UG Lecturer agrees with Bawumia

By Jeffrey Owusu-Mensah
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A senior lecturer at Economics Department of the University of Ghana, Dr Eric Osei-Assibey, has supported claims by Vice Presidential Candidate of the New Patriotic Party (NPP), Dr Mahamudu Bawumia that Ghana's economy is in distress.

At his lecture on the health of Ghana's economy at the National Theatre on Thursday, Dr Bawumia put forward that “By the end of 2008 following the adoption and implementation of the HIPC initiative, the government’s policy framework of fiscal discipline, the country’s debt to GDP ratio, had declined from 189% in 2000, to 32% of GDP by 2008. Indeed from independence in 1957 to 2008, Ghana’s total debt was 9.5% Billion Cedis; however; in the last seven years alone under this NDC government, Ghana’s total debt has ballooned from 99.5 billion cedis to 100 billion cedis in 2015; and a 105 billion cedis by May 2016. In fact, 66% of Ghana’s debt from independence; has been accumulated under the presidency of John Mahama in just the last three and half years" and  "after eight years of NDC government, today our economy is in decline, and we are a country at high risk of debt distress" because of "the toxic mixture of the John Mahama-led NDC’s incompetence and corruption".

"The foundation of straw cannot hold. Ghana needs a new credible, incorruptible and competent team" to redeem the distressed economy", Dr Bawumia further stated.

Dr Bawumia's claims have been strongly refuted by government that Dr Bawumia used selective data in arriving at his conclusion.

In a reaction, Minister of Finance, Seth Terkper told Citi FM that "If indeed the NDC borrowed 39.9 billion dollars, and we are at 70 percent, even if I grant you 70 percent of GDP which is below 40, then Ghana’s debt  will be 28 billion dollars. Either you have a record performer of the NDC with paying debt in real terms from Dr. Bawumia’s 47 billion to 28 billion that will be a record, or as I said Dr. Bawumia is using information selectively. When it suits him he holds the cedi to the dollar constant, when he goes on attack against the NDC he relaxes that principle".

But speaking on Joy FM's Newsfile on Saturday Dr Osei-Assibey agreed with Dr Bawumia's statements saying that, "I concede that the Macro-economic landscape is unstable [and] almost in crisis, even".

"We indeed are in a difficult economic situation which we need to admit", he added.

According to him, there was no need for the arguments over Dr Bawumia's lecture because "all the facts that have been put out [by Bawumia] are empirical and can be checked; they cannot be disputed".

"The issue about the Debt to GDP depends on the way it was calculated; whether it is at 63% or 71%", he noted.