₵61bn loss, ₵54bn negative equity've ' severely impacted BoG's balance sheet' – Kwakye
My contribution to this ‘24-hour economy’ debate emanates purely from my position as an economist. In economics, we know that higher outputs can be generated by engaging more factors of production (or inputs) and increasing the time they are engaged, subject, of course, to the point of “diminishing returns” setting in. As a country, we have excess labour, large unharnessed capacities in agriculture, industry, health, education, infrastructure, etc., and excess natural resources in the form of land and minerals. When I see the growth projections in Ghana’s ECF programs plateauing at 5.0% over the medium-term, I ask myself, is that all that we can grow at? Is that our growth potential? Why should we allow the IMF to condemn us to this low growth when we know that, assuming population growth of even 2%, it will take us at least 20 years to double our current per capita GDP of USD2,500 to USD5,000 if we grow at this rate? I would rather pose the question: what will it take for Ghana to grow at, at least 10% p.a. over the medium- to long-term? And the answer lies in bringing as much of our excess resources and capacities as possible into the production stream. It is true that, already, many economic activities are taking place over 24-hours, but nothing stops us from expanding the scope. Of course, it will require providing additional infrastructure, energy, other facilities, security, etc. as well as fiscal incentives to allow more businesses to get on board.
Some people have said that if there is no demand, there will be no production or supply. But let me quote Say’s Law of Markets (1803) that says “Supply Creates Its Own Demand” to such people. The economic explanation of Say’s Law is that PRODUCTION/SUPPLY creates JOBS that create WEALTH/INCOME that generates DEMAND/CONSUMPTION. Say argued that Government policy must prioritise production and not consumption. If consumption were the important driver of growth, then we might as well print more cedis for every Ghanaian to generate consumption/demand. We know that the consequences would be uncontrolled macroeconomic instability. Therefore, it is important to create conditions that bring more of our excess resources and capacities into production. And if a ‘24-hour-economy system’ would contribute to this, then why not institutionalise it? Even more advanced and more digitized economies like the UK, France and Singapore have embraced the concept, so why cannot we also do so? After all, we should be reminded that, as human beings, we spend a third of our life-time sleeping! We could stagger our individual sleeping times to increase production and human welfare!
3.7 Corruption
Dr. Bawumia posited that transparency is one of the most potent weapons of corruption. He proposed to use digitization as the key instrument in fighting corruption as it removes the person-to-person interface in economic and financial transactions. We agree that digitization is key in preventing corruption in the first place. In terms of preventing corruption before it occurs, we have suggested that Ghana adopt the US Inspector General (IG) system. The IG, who will be independent and report directly to Parliament, will be embedded in every MMDA and monitor all financial transactions within the MMDA. This will contribute to prevent most corruption from taking place. Since we are poor at prosecuting corruption, it would be best to prevent it from occurring in the first instance. Notwithstanding, I believe the accountable institutions—OSP, EOCO, CHRAJ, NIB—have an important role to play in fighting corruption. I will, therefore, call for them to be strengthened and resourced to carry out their mandate of investigating and prosecuting corruption to serve as a deterrent to potential culprits. But it has to be said that the surest way of fighting corruption is to start from the top. The President must demonstrate that he is not corrupt and will not tolerate corrupt acts by his appointees and that will trickle down to the people!
3.8 National Development Plan
Dr. Bawumia called for a consensus National Development Plan (NDP) with “broad contours.” He indicated that Party Manifestos must be aligned with the NDP. This is an appropriate call and it is something that some of us have been suggesting for a long time. With a lack of consensus around an NDP, party manifestos have become the order of the day. However, these manifestos have been characterised by lofty, populist programmes that are meant to win votes rather than having any practical or national significance. This practice has also led to a situation where many projects are left unfinished midstream and often discontinued by successive governments, much to the detriment of national development. We suggest that the NDPC be strengthened, resourced and reconstituted with independent professionals to draw up an NDP with broad policy objects, targets and strategies. The NDP should be updated every four years to reflect emerging economic, social, environmental and spatial circumstances. The NDP should be binding on all governments. In the course of every government’s term, they should be made to submit periodic reports to Parliament on the implementation of the NDP.
3.9 Constitutional Amendments
Dr. Bawumia promised amendments to address some lapses in the 1992 Constitution. In particular, he mentioned the need for amendments in respect of presidential powers and exgratia. Calls for amendments to the 1992 Constitution have gained momentum recently, given broad public dissatisfaction with many provisions, including presidential powers, Article 71 emoluments, Council of State, dual parliamentary and ministerial roles, appointment of MMDCEs, long-term national development plan and gender equality. Dr. Bawumia’s expressed commitment to amendments to the Constitution to cure it of existing pitfalls is, therefore, wellplaced.
4. unanswered questions
Dr. Bawumia’s speech left many questions unanswered. While he stated the changes he would make to some NPP policies and programmes, he seems to have left out many others, including failed or controversial ones like: One Village-One Dam, One Constituency-One $Million, National Cathedral, National Building Corps, YouStart, etc. May be he would state his position on these issues during his campaigning. Dr. Bawumia also left the issue of his running mate hanging. I note that both he and President Mahama seem to be hedging on the issue, ostensibly aiming to capitalise on whoever takes the lead. Dr. Bawumia’s choice will, in part, signal his future political and economic philosophy. It will be interesting to know if Dr. Bawumia will be influenced in his decision by region, ethnicity, religion, gender or age considerations. As Dr. Bawumia claims to be his own man and plans to chart a new path and to tap into the resourcefulness of all Ghanaians, he could also shock his party by naming someone outside the NPP as President Kufuor did at some point!
5. Conclusion
In concluding, I have a word of advice for Dr. Bawumia, as well as other presidential aspirants, especially NPP and NDC aspirants—and I hope they take it in good faith. NPP and NDC have disappointed Ghanaians for 32 years with policies that have failed to deliver tangible benefits to the people. We are rich underground yet poor above ground! We have no business going to the IMF17 times or western capitals to seek aid or reparation. We only need to own our natural resource wealth and leverage it to support transformational policies that would deliver tangible economic benefits to our people and alleviate their poverty. Ghanaians are looking for honest, competent, and non-corrupt leadership. The NPP and NDC, instead of engaging in blame games, must admit their mistakes and tell Ghanaians what they are going to do differently. That is the surest way for them to break the eight-year electoral cycle!
The President of the African Refiners and Distributors Association (ARDA) and Chief Executive of the National Petroleum Authority (NPA), Dr. Mustapha AbdulHamid, has reiterated ARDA’s commitment to work with the Organization of the Petroleum Exporting Countries (OPEC), the African Petroleum Producers’ Organization (APPO) and the African Union Commission (AUC) to deliver a sustainable intra-African oil and gas industry.
He said the industry would be focused on delivering cleaner fuels and value-added petroleum products via a lower-carbon footprint.
Dr. Abdul-Hamid was speaking as a coChairman at the third High-Level Meeting of the OPEC-Africa Energy Dialogue held on 19th February, 2024 in Cairo, Egypt.
The meeting was co-chaired by Haitham Al Ghais, Secretary-General of the OPEC; Dr. Amani Abou-Zeid, Commissioner for Infrastructure and Energy of the AUC; and Dr. Omar
Farouk Ibrahim, Secretary-General of APPO. Building on the successful meetings held in 2021 and 2023, participants conducted open and transparent discussions on a wide array of key topics related to energy and oil, including energy security, risk of under-investment, climate change, and energy transitions.
Dr. Abdul-Hamid also shared ARDA’s objective of developing a consolidated register of investable energy infrastructure projects that would be shared at the first-ever ARDA Investment Forum to be held during the 2024 ARDA Week in Cape Town from 22nd -26th April 2024.
He also looks forward to working with APPO to support the successful take-off of the Africa Energy Bank (AEB) this year, and providing bankable downstream projects for the laudable AEB initiative in the drive to meet Africa’s growing petroleum products demand sustainably.
The NPA Boss congratulated OPEC for its continued leadership in promoting the OPECAfrica Energy Dialogue.
In his remarks, Al Ghais indicated that dialogue with Africa is a key pillar in OPEC’s global energy dialogue programme, which includes many other key regions, countries and international organisations. “We at OPEC firmly believe that cooperation and dialogue among all energy stakeholders are absolutely essential factors in effectively addressing our common energy challenges.” he said.
Al Ghais noted that in terms of climate change and energy transitions, developing countries around the world, including those in Africa, continued to balance priorities between the dire need to support the development of their national economies, while also adapting to evershifting dynamics related to climate change.