We took over a ruined economy… -Mac-Manu

By January 2001, this country has gone through years of economic decay, and the economy was in complete mess.

Today, Ghana can boast of a far better economy, and as Ghanaians, we all have to credit for this achievement. We still do not have the strongest economy in the world, but we are definitely better than we were in January 2001 when the NDC government was rightly kicked out of office.

Ironically, at a press conference by the NDC last week, they indicated that the economic achievement have not delivered any achievement in the lives of Ghanaians. What they did not mention at the press conference was the state in which they left the economy in January 2001.

The New Patriotic Party believes in the individual (rather than the state) as the agent for national development. We seek to improve the welfare of individuals and enhance them to develop their God-given potential and capabilities.

When individuals develop, the nation develops and becomes more able to pursue our collective good. This is the most effective way to pursue human-centered development.

Whatever the NDC refers to as socialist approach to development, they and their predecessor PNDC managed this country for 19 years up to the close of the year 2000.By close of that year, the external dept of Ghana has reached $5.8 billion.

The domestic debt stood at $1.7 billion. Accordingly, in the 2000, a third of all government expenditure went into debt servicing. What this meant was that resources that should have gone into the provision of social services (such as health care and education) went into the servicing of debts resulting from economic mismanagement and corruption.

In the same year 2000, our foreign reserves dropped to a low $0.2 billion representing three weeks of import cover. The cedi then depreciated ¢3500 to ¢7000 against the dollar.Inflation, by close of 2000, had hit a suffocating 42%.Bank lending rates were in order of 50% making it difficult for business to borrow, expand and create more jobs.

These are not macro economic indicators. These figures determined the ability or otherwise of the country. That was why the prices of the rose by the day. Yet, the minimum wage by the close of 2000 had dropped to a miserable 0.6 of a dollar. And this wage was taxable.

Today the minimum wage has risen to 2.1 dollars. With effect from January 2006, taxation on the minimum wage was abolished by the NPP administration.if this is not an improved, then we don’t know what it is. But the improvements have not been in just minimum wage.

There has been a general improvement in the public sector wages .The monthly salary of a new certified teacher for instance teacher for instance has risen from $38 ( ¢264,458)at the close of 2000 to (¢1746,776) at the present time.

Now, here is a finding in research on the basic public sector wage in Ghana conducted by Trades Union Congress. It was published in 2006.

“Between 2000 and 2005, the nominal value of the of the basic public sector wage on Ghana Universal Salary Structure increase (in US dollar terms) by 141 percent. The public sector did not increase in nominal terms but also in real terms (when it is adjusted for inflation using annual average CPI).”

The report further found out, “This has been achieved in spite of the huge pressure on government particularly from IMF to cap public sector bill at a certain percentage of the GDP and government revenue. It is therefore fair to say that the recent public sector wage increases could not be attributed solely to union pressure, but also, it is partly the result of government’s commitment to increase public sector wages as a means of attracting and retaining more qualified professionals into the sector.”

In spite of the enlarged waged bill, we have been able to keep the economy stable. The 42% year-on-year inflation we inherited from the NDC has reduced to 10.5% as of April 2007.The bank lending rates that hovered around 50%have come down to about 24%.Today in spite of the substantial increase in crude oil imports, our foreign reserves has hit 2 billion, compared with 0.2 billion in 2000.

This is the highest reserves since the liberalization of the foreign exchange market in 1988.And the cedi is now more stable against our major trading currencies than at any other time in the last 40 years.

Our economy is so stable that we are able to re-denominate our currency to make its use more efficient. This re-denominate is so different from the so-called demonetization exercise carried out by the PNDC in 1982.In that 1982 exercise, Ghanaians were forced to surrender their hard earned money which wasn’t in 50 cedi notes. Many lost their entire life-savings in that exercise. It is an event in our history that many people remember with much pain and grief.

But our achievements have not just been in the macro-economic fundamentals. There have been real investment in the lives of people; investment requiring fresh resources.

The National youth Employment Programme (NYEP), the National Identification Scheme (NIS) the National Health Insurance Scheme (NHIS), the Microfinance Programme,the Abolition of tuition fees in public and basic schools, the Metro Mass Transit (MMT),the impressive infrastructural development and others are all commitments requiring fresh resources.

But we are encouraged by the improvements these programmes are bringing into lives of people. Between 2005 and 2006 enrolment in basic schools increased by 16% as a result of the capitation Grant and related policies. And the money many rural parents would have used in paying tuition fees for their wards is now money in their pockets.

The NYEP Programme has employed about 120000 youth by the close of the first quarter of 2007.The allowances these trainees receive put some money in their pockets while they receive career training for the future.

As a result of the NHIS, there are many households who are able to access health care the cost which exceeds the yearly premiums they pay. I take this opportunity to appeal to the public to register under the scheme and access its tremendous benefits.

No doubt that, being fresh initiatives, there is bound to be teething challenges. But we are definitely on track. It is by addressing these challenges that we would eventually achieve our objectives in full. After all, an imperfect National Health Insurance Scheme for instance is still better than the cash-and-carry health policy inflicted on this country by the NDC administration.

In all this, agriculture has been given its due attention.Cocoa producer price has increased from ¢151755 per bag in the year 2000 to the current ¢571875 representing 73% of net FOB price, the highest percentage in, atleast the last four decades. Additionally, from 2001 to date, a total of ¢608 billion has been paid to cocoa farmers as bonus. These and several other interventions in the cocoa industry made it possible to achieve a record high production of 740 458 metric tones last year.

And to increase fish production in the country, a total of 338 outboard motors have been given to fish farmers under special credit scheme.3000 fish processors and distributors have been supported through micro-credit. And currently, there is a Programme to help individuals construct fish ponds throughout the country

It must be pointed out though that we have come this far not without some initial challenges. The investment we are currently making into energy delivery, we must, for example, were not possible in our initial years in government because our economy was too weak to mobilize the needed funding.

With a reduction in our external debt to $2.1 billion at the close of the last budget year, and an improvement in our credit rating internationally, we are in a much better position as a country to secure funds and continue investing in development projects just as we have done for Bui hydro Project.

We welcome debate and discussions on these achievements; just as we welcome criticism of government’s decision and actions. That is the only way we can fine-tune our policies and maximize our returns. What is disturbing is the attempt to create disaffection for government though the use of lies and deceit. That is unhelpful politics.

Thank you very much.

Peter Mac Manu National Chairman