Ghana at the crossroads of economic development

Ghana is a democratic country located on the west coast of Africa with an estimated population of about 24.2 million inhabitants in 2010. It is the first country in sub-Saharan Africa to become independent of the country. British colonial regime in 1957. Its economy is ranked 85th in the world. in the world with a total GDP of 46.8 billion USD in 2018. The estimate is based on a population of 24 658 823 inhabitants in 2010, with an annual population growth of 2.5 and a GNI per capita of 1 550 USD (World Bank, 2013).

In the ECOWAS subregion, Ghana's economy is second only to Nigeria, accounting for 10.3 percent of the subregion's total GDP. Ghana's economic performance has been fairly robust over the last three decades, during which the country has adopted market-led economic policies and programs with minimal government involvement in direct economic activities. The recovery of the country's economy after the recession of the early 1980s through the program of economic reforms and structural adjustment, as well as the sustained growth since then, have earned the country many praise for its economic achievements. This prompted Leechor (1994) to describe the country's economy as one of the pioneers of the economic reform process.

At the same time, the country recorded a remarkable average annual growth of about 5.2% between 1984 and 2010 and became a lower-middle-income country after a change in the national accounts base in 2010 with a modification of the base year from 1993 to 2006. This change pushed the country to an average growth of 8.3% between 2007 and 2012. In 2011, the country started to produce oil and this development contributed 5.4 percentage points (oil GDP) to this year's 15.0% real GDP growth, with Ghana in an enviable position. as one of six fast growing economies in the world this year.

Concerns have been expressed, however, about the quality of economic growth, particularly in terms of employment, inequality and overall improvement of Ghanaians' livelihoods. In addition, growth figures have not been accompanied by improved livelihoods, which has raised doubts about the effects of growth on growth. In addition, the sustainability of growth is an issue that persists in the minds of decision makers. Like Aryeetey et al. (2001) argue that the perceived lack of appreciation of Ghana's sustained growth performance may be related to the fact that measured growth figures make little sense for Ghanaians' livelihoods.

Indeed, job creation lags behind economic growth, with most jobs being created in the informal sector where incomes are low (Baah-Boateng, 2013). Indeed, the labor market is characterized by many informal and vulnerable jobs, badociated with a high incidence of poverty, particularly in rural and northern savanna regions, which means that the country continues to struggle against the problem of maternal, infant and child mortality. and the high number of malaria-related deaths, indicating the enormity of the challenge of achieving the health goals (goals 3, 4 and 5) of the Millennium Development Goals (MDGs).

While enrollment rates at the pre-tertiary levels have increased dramatically, the school system still faces the lack of high-caliber teachers and teaching aids. At the same time, the higher education system continues to form a large army of unemployed graduates. With the entry of private universities, science, technology and vocation have evolved into history and narratives.

Let's look again at some of the growth figures and see if Ghana's economy is progressing or not. After two years of weak growth from 2014 to 2016, real GDP growth was reduced to 8.5% in 2017 and was estimated at 6.2% in 2018, driven mainly by the oil sector. The budget account deficit has improved slightly, from 5.9% in 2017 to around 5.7% in 2018, just as the current account deficit has gone from 4.5% in 2017 to around 4%, 4% in 2018. Inflation has been reduced to 10%, to 9.8%. and average interest rates on loans decreased by 4.71 percentage points to 16.23% in 2018. The Ghana cedi has stabilized against major currencies, with the exception of a slight depreciation against the US dollar in the second quarter of 2018. In September 2018, Ghana reformed its GDP from 2006 to 2013. The 2017 GDP based on a new base is 24.6 % higher than the previous GDP of 2017. However, private consumption rose by 6.2% of GDP in 2018 and the economy is expected to grow by 7.3% in 2019 and a slowdown in 5.4% in 2020, as the effects of increased oil production from new wells will disappear.

Despite seemingly positive prospects, Ghana faces potential headwinds at the national and global levels. At the national level, the government faces the challenge of meeting its financing needs, with domestic revenues accounting for about 10 percent of GDP and gross financing needs above 20 percent of GDP. To this challenge, adds a high ratio of external debt to GDP, which rose from 40.5% of GDP in 2017 to 38.5% in 2018, but on the external front, the dependence on the external debt ratio. With respect to commodity exports continues to expose the economy to international shocks on commodity prices. which could weaken GDP growth and the current account balance. Domestic private consumption is also expected to slow to 4.9% of GDP in 2019 and 3.5% in 2020. Potential weakness in oil prices could lower export earnings and hence revenues.

Now, let us ask ourselves if Ghana, with all its natural resources, must fight economically as we see it now. What could be the problem? Would it be bad management and control? Or greed on the part of the leaders? It is very surprising that our leaders come with different personalities to present us in the SONA and that they read them aloud to the nations with shame. They are simply deceived by the numbers and refuse to realize that these numbers do not show up in the real growth rate of citizens. It is equally astonishing that the in-depth badysis of the figures provided each time shows that Ghana remains a developing country.

Sometimes, I still think that the continued strengthening of external demand for oil and cocoa will support growth in the medium term. However, years of growth based on extractive industries have not addressed the widening inequalities and the creation of decent jobs. Agriculture remains the main employer of manpower. While low productivity in agriculture has caused a major movement of labor from the sector towards mostly informal services in urban areas. This phenomenon explains the high employment rate but the poor quality jobs of the country.

Ghana still ranks among the top three countries in Africa for freedom of expression and press freedom, with powerful audiovisual media and radio as the largest means of communication. Such factors provide Ghana with strong social capital. It is disputed that after colonialism, Ghana has had a very good political success and has demonstrated that in many cases this is confirmed in the fourth Republic of Ghana, where the transfer of power from a government to the other is done peacefully. Why are we still fighting for economic independence?

Twenty-six months after being elected president following peaceful elections, Nana Addo Dankwa President Akuffo Addo has had some success, but he also faces challenges in fulfilling his election promises, including the creation of new elections. 39, a factory in each of the 216 districts of the country, a dam for each village and offering free education in high school. Although the government is keeping some of its promises, such as planting food and creating jobs, and providing free secondary education, its government has not had the easy task. Free SHS policy further aggravates the situation and jeopardizes quality education. Thanks to the finances, he has not been able to fulfill half of his promises for Ghana. Why are we still economically vulnerable with all our cocoa, gold, diamonds, etc.? Why did not we transform these resources by improving the standard of living of the population? Or are we cursed? Well, Ghana's economic success can not be achieved by borrowing. President Nana said in one of his speeches, "Ghana has the resource, the money is there and we can not have everything and stay poor," but I'm just wondering why it's n & # 39, was not able to give us the change we voted for.

We have an economist, even the vice president is a great economist who has helped other countries to overcome the problems we face as a country. Why could not he do the same for us here in Ghana? Well, we can not blame much, but maybe the problems of Ghana can not be solved by man, because it is obvious that his financial results have seen a general recovery in the last 24 months. The budget deficit was reduced to 5.9% of GDP in 2017, compared with 9.3% in 2016, mainly in the form of expenditure measures, with revenue remaining low. The government continued fiscal consolidation efforts in 2018 despite the revenue challenges. Ghana's budget deficit for the period January to September 2018 was 3% of GDP, just above the target of 2.6%.

At the end of September 2018, the primary balance represented a surplus of 0.5% of GDP, while the target was 0.9%. The data at the end of 2018 should indicate a generally lower expenditure in response to the revenue deficit and the budget deficit for 2018 should reach 3.7% of GDP. The inflation rate has stabilized at levels within the central bank's target range of 6-10%. Global inflation fell from almost 20% in 2016 to 9.6% in July 2018. This decline is attributable to the moderation of food and non-food inflation, the relative stability of the Cedi and the ongoing fiscal consolidation. The moderation of inflation has created room for maneuver to ease monetary policy since July 2017, with the key interest rate falling from 21.5% in January 2017 to 20% in September 2017 and 16% in January 2019.

In addition to high debt and low public and private savings, the government's main recourse for financing its economic transformation agenda is foreign direct investment. Such funding would require a greater focus on sustainable progress in macroeconomic stability and the business climate. Complementing these gains through increased domestic revenue mobilization would accelerate the debt sustainability process and increase the fiscal space for more capital and social spending by the general government.

Leaders need to focus a lot on economic development and ignore the figure, as strong GDP growth does not mean that the country has developed. GDP can not be high, but people's freedoms are economically truncated. We must begin to ban imports in order to boost local industries. These are "operations to revive local businesses" and encourage nationals to produce and consume locally. This is the only way for the cedi to improve and align with the US dollar. We can not measure international economic success with the help of GDP and some economic indicators when poverty is real in some countries and inequality also increases.

I defend the interests of the people and together we can fight for our own future because our leaders have failed us miserably.

Issah Musah Aziba

KNUST, Kumasi

[email protected]