7 Facts That Akufo-Addo Manages Ghana's Economy Better Than Mahama

General News on Thursday, February 14, 2019

Source: yen.com.gh

2019-02-14

Since the time of Kwame Nkrumah, the economic conditions prevailing in the country have always been a key factor in determining how Ghanaians evaluate government performance.

This way of judging the performance of the government of the day is rooted and has been the subject of heated debate since the beginning of the Fourth Republic in 1993.

In all these debates, one thing has always been very common. There is a polarity between the government of the day and the main opposition (between the NPP and the NDC, depending on who is in power or not).

Although the government praises its economic and other achievements, the opposition will always write with arguments that the announced economic success is not reflected in the pockets of citizens.

This was clearly manifested in the run-up to the 2016 elections, when the NDC claimed that former President John Mahama had been wonderfully well behaved.

The listed achievements were slaughtered by the NPP whose current vice presidential candidate described Mahama as incompetent and described the economy as an economy built on straw foundations.

Bawumia and the Mahama's description of the economy by the NPP seemed to have resonated with Ghanaians and they were overwhelmingly elected to power.

Two years after the beginning of the NPP's administration, Mahama and her NDC are mistakenly claiming that it is the worst economy ever and have even tried to reverse the ruthless Government label of Akufo-Addo.

The question is therefore between the Akufo-Addo-Bawumia and Mahama-Amissah-Arthur governments who were the best managers of the Ghanaian economy?

Obviously, such a question can never be resolved without facts and figures, otherwise it will not be objective.

YEN.com.gh has compiled this list of official statistics from the Ghana Statistical Service (GSS) and the Bank of Ghana, which compares the performance of the two governments to end the debate from now on.

1. Economic growth rate (annual GDP):

Economic growth rate (EGR) is the rate at which the gross domestic product (GDP) of a country, the market value of all goods and services produced in the country during a given period, increases from one year to the next.

In 2016, Ghana's GDP amounted to $ 42.80 billion, a 3.7% increase in GEM. Akufo-Addo achieved a GDP of US $ 47.33 billion in the first year of its mandate, an increase of 8.5% of the RGE.

The latest figures from the GSS indicate that the GEM for the last quarter of 2018 was 7.4%.

2. Inflation rate:

Inflation in simple terms means that the general level of prices is rising. The higher the percentage, the lower your money.

If you have a cedi to spend, for example, a 10% inflation would mean that they can actually buy an item worth 90 pesetas while at the time, inflation was zero percent.

At the end of Mahama's term in 2016, he reached 17.5%. The Akufo-Addo government reduced this figure to 12.4% in 2017. In 2018, inflation was set at 9.47%, according to statistics from the GSS.

3. Tax deficit:

In simple terms, the budget deficit is the difference between total revenues and total government expenditures.

According to the International Monetary Fund (IMF), Ghana's budget deficit was 9% of GDP in 2016.

This figure was reduced to 5.9% of GDP in 2017 and was 2.8% in mid-June 2018 and was well within the 4.5% forecast for 2018.

4. Debt / GDP ratio:

The debt-to-GDP ratio is the ratio of a country's public debt to its gross domestic product (GDP).

This reveals what a country needs in relation to what it produces. It serves as an indicator of a country's ability to repay its debts.

Ghana's debt-to-GDP ratio, which stood at 73.1 percent in 2016, dropped to 69.5 percent in 2017. According to the 2019 budget, the debt-to-GDP ratio was 67.3 percent. in June 2018.

5. Management rate (interest rate):

The monetary policy rate (MPR) simply refers to how the Bank of Ghana controls interest rates.

By setting a low policy rate, commercial banks are forced to reduce their lending rates to make credit (loans) more accessible and affordable.

The Mahama government left office while the MPR was set at 25.5%. A year after coming to power, the Akufo-Addo government reduced the MPR to 20%.

The rate was set at 16% as of February 13, 2019. In addition, interest rates on 91-day treasury bills, which are literally government loans from local banks, increased from 16, 8% in 2016 to 14.7 percent. hundred.

This means that the Akufo-Addo government had reduced the cost of borrowing and government borrowing from local banks to allow credit to easily access the private sector.

6. Balance of trade:

The trade balance is the difference between the value of a country's imports and exports over a given period.

A country that imports more goods and services than it exports in value will have a trade deficit and the opposite will have a trade surplus.

The BOT is known to be one of the main ways to measure the strength of a country's economy. In June 2016, Ghana had a deficit of $ 1.4 billion.

According to the 2019 budget, this surplus has improved significantly, rising to a surplus of $ 1.1 billion in June 2017 and an additional surplus of $ 1.1 billion in June 2018.

This means that the current government has strengthened Ghana's trade position with the rest of the world.

7. Gross international reserves (GIR):

Gross international reserves are the "external badets" of a country – including foreign currency deposits, bonds, gold, among others, held by its central bank.

At the end of December 2016, Ghana had $ 6.2 billion, the amount needed for only 3.5 months of imports. It had been increased to $ 7.3 billion, which corresponds to 3.9 months of imports.

In view of these statistics, it is clear that the government of Akufo-Addo manages the economy better than the Mahama administration.