Odododiodioo University: Ghana; challenge or crisis?

There is a local wise saying that goes like: “If you know your mother is dead and yet you say she is alive, when all your friends go for food from their mothers, you would have yourself to blame”.

There have been several debates on the economy of Ghana, from the day we ushered in a democratic era till this day when our current president took up the reins of government. One clear thing is that, the country is facing some kind of difficulty.

In 2009, the finance minister described the Ghanaian economy as challenged. After that, the mangers of the economy again told us the economy was resilient and ready to take off. Indeed, the year 2011 was declared an ‘action year’, where we will be seeing real progress in the economy of Ghana.

In his 2013 State Of The Nation address, the president told Ghanaians that the economy was in good shape with the right economic fundamentals. Recently, when there was a whole hue and cry about the rate at which we were borrowing, we were told that we had the capacity to borrow.

This came from the president of the Republic. In relation to the debt profile, we were told that even Almighty America owes so this cannot be crisis. There were others who predicted that if we do not discipline ourselves, Ghana would have to run to the International Monetary Fund (IMF) for assistance.

The country has gone through some dramatic events for the past few months. These events are quite worrying but the bone of contention is whether the country is in crisis or merely challenged. The events in the past few months can only help us to draw the apt conclusion.

There has been unequaled number of strike actions, from Polytechnic Teachers Association of Ghana (POTAG), to Doctors through to the nationwide strike action by Ghana Union of Traders Association (GUTA) as well as railway workers.

The nationwide strike action by GUTA was one significant event. This, I have never witnessed in Ghana since I was born and I know I will be told of such events in the coup days of the 70s. Yes, I will agree and that shows that all was not well in the country. That even buttresses my point.

For all local shops to be closed throughout the nation is a serious situation. Even spare parts dealers were not left out. As we speak the University lecturers are on strike. Let me quickly add that statutory payments are just not forthcoming.

It took a young brave Ghanaian to compel government through a court action for some meager amount to be paid into the Ghana Education Trust Fund (GETFund).

Ghanaian students abroad are going through hard times. One student lamented that they could not even afford common soap and tooth paste all because their allowances from government have delayed for nine months.

Also, demonstrations have become so rampant in our country to the extent that single individuals are embarking on demonstrations (one man demo). We must not forget that all these demonstrations were as a result of, but not limited to, the hikes in utility tariffs and transport fairs with their ripple effect being that of untold hardship brought unto the Ghanaian populace.

One cannot deny the fact that other demonstrations, such as those embarked upon by political parties like the Progressive People’s Party (PPP) and the New Patriotic Party (NPP), were politically motivated. However, there have been two significant demonstrations that I believe, speak volumes of how people dislike the way governance is being handled in Ghana.

I am talking about the Trade Union Congress’ (TUC) and the Concerned Citizens’ demonstrations. For an umbrella body like the TUC to declare a nationwide demonstration shows that things are not normal at all. To the extent that even commercial drivers who ordinarily will opt to go to work when people are demonstrating became an active part of the protesters , rendering commercial transport service very scarce on that day.

The ‘occupy the flagstaff house demo’, was to me, another significant event. These were working-class people, made up of businessmen and entrepreneurs; people who were perceived to be relatively secured economically. They were on the streets to demonstrate. They even declared ‘Red Friday’ to express their displeasure about bad economic governance in the country.

The depreciation of the cedi is another issue managers of the economy are grappling with. Initially, we were told by the Bank of Ghana that some GH?20million was pumped into the economy to stabilize the cedi, but there was no result.

Again, the Ghanaian business community was admonished to desist from quoting figures in dollars, which also proved futile. Forex rules were activated, just for the Central Bank to turn around to eat the humble pie. One rule was that no one should withdraw more than $10,000 over the counter.

These rules were met with fierce opposition from some renowned economists as well as members of the business community. Recently, an all important economic forum was held in Senchi to prescribe home grown policies so as to save the economy. However, we are yet to realize its efficacy.

The latest menu served on the table of economic debate that has caught the attention of pundits is the International Monetary Fund’s (IMF) ’bail out’ for Ghana as announced by the president of the Republic. He indicated among other things that the ‘bail out’ was to ensure policy credibility.

Interestingly, while government is saying that it is not a bailout, other economic ‘gurus’ and opposition parties say it is a bailout and that suggest how the current government have mismanaged the economy. The basic question is: Do economies that are resilient and ready to take off go to the IMF for policy credibility, especially looking at the issues that have pan out so far in Ghana?

Another question is: Do we have a credibility problem as a country? IMF support, as we are being told by the government, is sought as last resort. They cannot be options when the economy is resilient and ready to take off. Be it financial or technical support, there is a serious problem in Ghana which requires support.

Remember, the IMF is mostly the last resort when things are not going on well. It’s obvious; we cannot encourage our own to invest in the economy so we are running to the IMF for investors to have confidence in the economy.

We must also not forget that Ghana lives in a community of nations, thus, it is important to find out how our current situation is being assessed worldwide. Recently, Ghana was rated by Forbes as one of the 10 worst economies in the world.

The Ghana cedi is the worst performing currency in Africa as we speak. Richard Quest, a renowned financial and economic journalist with the CNN, has stated that Ghana is going to the IMF for a bailout. Now, whether we like it or not, this is how the international community sees our situation.

From the above scenarios, it is abundantly clear that there is a problem and all is not well with the Ghanaian economy. All efforts to save the economy have proven futile. The cedi has depreciated by 40 %, and there are serious hikes in utility tariffs and petroleum prices, with strikes and demonstrations being the order of the day.

What is more, the Ghana cedi has become the worst performing currency in Africa, with Ghana being among the ten worst performing economies in the world. We can only go for bail out when things get worse. We are clearly in a crisis situation.

The polarized nature of our politics makes it difficult for government to be sincere in such times. It is not my intention to cause an economic fear and panic but I believe it is only when we clearly define our problems that we can solve them. When we see the current economic situation as anything short of crisis, we are only underestimating the problem and that is why we are where we are.

Joab Nii Otoe Brown 0265285424 (The writer is a national service person with the Institute of African Studies, UG-Legon and a freelance broadcast journalist who was formerly with Radio Univers, University of Ghana - 2014)