Adnan Adams Mohammed
Financial expert and member of parliament, Isaac Adongo has slammed the
government for deliberately declaring September instead of December as the end
of the fiscal year to calculate the country’s GDP as a wrong move while adding
that Ghana’s GDP to debt is 78% and not 68.3% as revealed in the budget
statement for the year 2018.
“You are comparing September to December. December is the actual GDP realized
at the end of the year.
He continued, “So if you want to compare, compare December to December and I
can assure you that when you add October, November, and December, Ghana’s debt
GDP is around 78%. So he came consciously to deceive us by not telling us the
true state. You cannot be comparing mid-year figures with end-of-year figures.”
The Bolgatanga
Central MP, accused Finance Minister, Ken Ofori-Atta and the Akufo-Addo
administration of deliberately concealing the real debt profile of the country.
Reading government’s 2018 budget and economic policy last week, November 15,
2017, Ken Ofori Atta, who stressed on government’s commitment to solidify gains
for as long as they remain managers of the economy, boasted of a return to
robust growth, with a real GDP growth of 7.8 percent in the first half of 2017,
against 2.7 percent in 2016 as one of the achievements under Akufo-Addo’s
administration.
In his reaction to the budget presented, the MP dared government to tell the
truth about the current state of the country’s economy claiming the statement
was a scam. He questioned why the government disclosed the state of the economy
as at June and not now.
“If this is not scam, why are you not telling us the true state of the economy
now but you are telling us that of June?”
Dr John
Gatsi, an economist and lecturer at UCC
has also stated that, the entire report captured in figure 4 in the 2018
budget which gives pictorial view debt accumulation is misleading and does not
correctly analyze the debt accumulation rate.
He explained
that, “On page 30 paragraph 114 of the
2018 budget, debt accumulation rate increased from 47.45% in 2013 and peaked at
49.90% in 2014 but reduced significantly to 25.97% in 2015 and further reduced
to 21.98% in 2016.
“This implies debt accumulation rate between 2014 and 2015 decelerated by
23.93% and between 2015 and 2016 it decelerated by 3.99% meaning debt
accumulation rate has been decreasing significantly since 2014.
“It also means per figure 4 on page 30 , the total debt at the end of September
2017 should be GHC138.9 billion implying that in the 10 months up to September, 2017 the government borrowed
GHC17 billion and with borrowing in October, November and December 2017
including the Energy bond the borrowing maybe more than GHC24 billion in 2017
alone”, he noted. However it should be noted that the energy bond proceeds are
not classified as part of Ghana’s state debt.
He further clarified stating that, “Therefore comparing the average debt
accumulation rate from 2013 to 2016 with 10 months in 2017 is misleading
especially when the 2016 debt accumulation rate was 14.02%, much lower than the
average debt accumulation rate of 36%.
“Note again that the 14.02% is approximately the same as the 13.58% debt
accumulation rate for the 10 months in 2017.”
Also, the former Deputy Finance Minister Cassiel Ato Forson has taken a swipe
at the 2018 budget.
The minority spokesperson on Finance who described the budget as an empty
promise, asserted that figures mentioned by the Finance Minister do not
correspond with the reality on the ground.
“If you look at the budget carefully you will see it’s empty. The promises are
empty and are not supported by the numbers on the fiscal table. Ghanaians will
end the year 2018 without seeing anything tangible.”
Cassiel Ato Forson also questioned the Minister’s decision to extend the
National Fiscal Stabilization and Special Import levy that was enacted in 2013
as temporary tax to avert the economic woes at the time.
“The Minister of Finance said they have turned around the economy, granted that
they have turned around the economy, why then are they extending the National
Fiscal Stabilization and Special Import levy, the temporary taxes that were
enacted in 2013 to deal with the problems the economy was facing at the time?”
Mr. Forson added that the debt-to-GDP ratio is approximately 73.6 per cent but
when the Energy Bond and the UT/Capital banks closure cost is added, the
debt-to-GDP ratio will shoot up to 76.8 per cent.
He said the boasting by the government to achieve 5.9 per cent GDP growth in
2017 and 8.9 per cent in 2018 could be misleading.
That, he said, was because the projected non-oil GDP growth of four per cent in
2017 was lower than the realised non-oil GDP growth of 4.8 per cent in 2016, while
the projected non-oil GDP growth of 5 per cent in 2018 was only 0.2 per cent
higher than the realised non-oil GDP growth in 2016.
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