Statement By The NDC Forum For Setting The Records Straight

Thank you ladies and gentlemen of the media for honouring our invitation once again.

We had earlier dealt with NPP’s chronic lies about having delivered free healthcare and free basic education to the people of Ghana. Today, we intend to deal with a number of misleading statements the NPP has made since 2001 about NDC’s management of the national economy and other claims by the NPP that the economic fortunes of our nation over the last 8 years have been nothing short of spectacular.

Among others, we will take a close look at some of the following:

• Claims of the NPP that it inherited a collapsed economy and empty coffers • Distortions about the causes of the economic difficulties experienced by the nation in the final year of the NDC • Claims that over the last eight years the economic fortune of our people has been moving forward due to the great management skills of the NPP government

Did The NPP Inherit A Collapsed Economy?

Ladies and gentlemen of the Media, the NPP government from 2001 has gone to every length to create the false impression that the economy of Ghana was in a state of ruin when the NPP assumed office. The NPP among other claims, loudly assert that the 19 years of the PNDC/NDC brought Ghana into a state of economic collapse and achieved nothing.

Clearly, the officials of the NPP must have not been in Ghana in 1982 when the Rawlings led PNDC inherited an economy that was in a true state of collapse.

How can any truthful person describe an economy that has consistently registered positive growth rates from 1984 all the way to the year 2000, as a collapsed economy?

Indeed recent appraisals by the World Bank, the African Development Bank, Tony Blair’s Commission on Africa, ISSER etc have all established that Ghana has enjoyed 20 years of continuous economic growth since 1984.”

Anyone who wants to know what a collapsed economy looks like only needs to take a good look at what Ghana’s economy was like at the close of 1981.

We will at a next press conference fully remind the nation about how far we have, as a nation, come from the pre 1982 collapse- we will explain how a massive work of reconstruction was carried out over the nearly two decades of the PNDC/NDC to pull Ghana out of the doldrums. For now, let’s just mention these following brief highlights of the economy the Rawlings led PNDC inherited at the time, in order to educate the NPP about what a collapsed economy really looks like:

• Growth rate prior to the time was continuously in the negative and stood at a massive minus 10 percent at the close of 1981

• There was massive collapse in infrastructure such as roads, bridges, railways, government buildings, hospitals etc

• The cocoa sector was on its knees

• The export sector in general was nothing to write home about

• Electricity was limited to only urban centres and was available to less than 20 percent of the population of Ghana

• Industries were operating at less than 20 percent of their capacity

• The banking sector was on a brink of collapse due to a massive portfolio of bad debts

• The least said about the telecommunication sector the better

• Shops were empty all over Ghana and long queues were everywhere as Ghanaians struggled to obtain basic commodities

Let us hear what NPP’s political guru and former presidential candidate, Prof Albert Adu Boahen had to say about the pre 1982 economy: “By the end of 1981, the economic situation had gone from bad to worse on all economic fronts. The decline in the production of the principal efforts such as cocoa, gold, diamond and timber noticeable in the era of the men on horseback continued. For instance, cocoa exports dropped to 258,000 metric tonnes in 1980 which was the lowest figure since the 1950s; what was worse, even the little cocoa being produced could not be moved from the rural areas to the ports. The rate of inflation also rose from 54% in 1979 to 88% and 121% in 1981. This was caused partly by huge budget deficits, wage and salary increases and printing of more currency.” Source- Professor Albert Adu Boahen’s Ghanaian Sphinx, page 35.

Ladies and gentlemen, the above represents just a partial description of the state of collapse before the PNDC came into power. Does the situation depicted above, even remotely resemble the situation in Ghana at the end of the NDC tenure on January 6th 2000?

The answer is an obvious No.

What the NPP has done is to deliberately ignore all the remarkable economic progress that were chalked over a period of many years by the previous government and zero in on a few isolated negative economic indicators at the close of the year 2000 in order to deceive our people that those indicators were a summary of the way the previous government had mismanaged the economy during the whole of its tenure.

Without even going into the extraordinary external shocks that accounted for the economic crisis that beset Ghana in the year 2000, let us just cite the following example to illustrate the nature of the deliberate distortions and lies the NPP has peddled since 2001.

Inflation

The NPP has constantly shouted over the rooftops that inflation in the year 2000 was over 40% and claimed that this was a manifestation of NDC’s incompetence. That is not the truth! The truth is that the average rate of inflation in the “crisis year” 2000 stood at 25%. Dr Bawumia, the NPP running mate can confirm this fact.

In spite of the unprecedented crisis of the year 2000, the average inflation rate for that year was lower than the average inflation in the year 2003, two full years after the NPP took over. The year 2000 inflation rate of 25% was remarkably lower than NPP’s 2003 average inflation figure which stood at 26 percent.

The deceit of the NPP has been to fraudulently put out the inflation figure of a single month in 2000 and make it appear as though that were the figure for the whole year 2000 in order to paint a picture of doom and collapse.

Meanwhile, anytime the NDC mentions that in 1999, inflation at the end of a particular month was a single digit (a feat incidentally the NPP has not been able to chalk in eight years), the NPP quickly counters that a month end inflation is nothing to boast about because apart from that month, inflation under the NDC was never again below 10 percent.

Ladies and gentlemen, do you clearly see the double standards of the NPP? In one breath they rely on December 2000 inflation figure of over 40 percent and in another breath they discount May 1999 inflation figure of 9.4 percent.

Of course, the NPP will not want the people of Ghana to remember that the previous government competently brought inflation down from a record high of over 120 percent in 1981. In spite of this remarkable success, the PNDC/NDC has not drowned the nation with loud noises of what a monumental collapse it met and competently dealt with. The reason is because, we in the NDC just love to focus on getting the work done to enhance the well being of our people, unlike the NPP that delights in beating its chest at the least opportunity amidst deliberate distortions and fraudulent claims.

The NPP has not faced the scale of the crisis that confronted the NDC in the year 2000. Whereas the NDC faced four separate crises in one, the NPP at the moment is facing just one. The NDC faced the following at the same time- i. Collapse in price of cocoa- ii. Collapse in the price of gold and other minerals- iii. Increase in the price of crude oil- iv. Failure of donors to release critical donor support. We have not mentioned the fact that in the midst of that “Super Crisis”, the NDC government was still faithfully and timeously servicing all the nation’s foreign debts to the tune of about $300 million dollars.

NPP’s problem today essentially consists of only the rise in the price of crude oil. We say this, because in our opinion, the NPP has no excuse citing the recent increases in the global prices of rice and other food items as an excuse when they have had eight long years to ensure food sustainability in Ghana as has been done in some other African countries such as Botswana. Indeed, the NPP promised in the year 2000, that it will significantly reduce the nation’s rice import, which at the time stood at $100 million. Incidentally, the amount we spend on the import of rice alone today stands at about $400 million.

Ladies and gentlemen, the current level of inflation of nearly 20% at the time when the NPP is facing what we describe as a “mini crisis” should reveal the emptiness of the economic boasts of the ruling party. In fact, some of the reasons for which inflation has not gone even higher are the fact that the NPP has, for political expediency, thrown its much vaunted full cost recovery policy in the petroleum sector out of the windows. Additionally, they have also refused to pay contractors and suppliers, newly recruited nurses, teachers, doctors, immigration workers and NYEP workers. Workers of Ghana Railway Corporation have not been paid for several months. In spite of all these “kangaroo tricks”, leading economic experts continue to predict that inflation will reach even higher levels by the close of December. Empty Coffers

The NPP has constantly claimed that it met empty coffers in January 2001. The truth however is that at the end of January 2001, less than a month after the NPP took the reins of power, all public and civil servants were duly paid in Ghana. Some contactors were also paid. It is important to also add that the NPP government found enough monies in those so called “empty coffers” to start the expensive renovations of the Castle, the State House, ministerial and other official bungalows, not to mention works done on the president’s private residence. There was also enough money to start funding President Kufuor’s numerous trips that had already started in that first month of 2001. Moreover, the NDC government gave Jake Obetsebi Lamptey sufficient money to organise the elaborate handing over ceremony on January 7th 2001.

So what does the NPP mean by empty coffers? Why does the NPP lie so much.

Inheriting Unprecedented Foreign Debts

You will recall the extent to which the NPP went to criminalise the previous NDC government because the nation’s foreign debt at the end of the year 2000 stood at 41 trillion old cedis. Of course, the NPP had hidden from Ghanaians the truth that the 41 trillion old cedis (5.8 billion dollars) was the total debt outstanding from independence to the end of 2000. You recall, the catcalls of “opipii piim pii piiim..”.

Ladies and gentlemen, what is the total debt accumulated by the NPP since 2001, even after a whooping $4 billion had been written off? The figure today stands at a staggering 89 trillion old cedis ($7.8 billion) and still “Moving Forward”. That is nearly 90 trillion cedis in just 8 short years compared with 41 trillion in 43 long years.

Need we say more on this? No! The evidence is shocking enough!

Much Ado About Stability Of The Cedi

As said earlier, the NDC government from the second half of 1999 to the close of the year 2000 faced four separate crises simultaneously.

The price of cocoa fell by over 120 percent from $1,500 to $670 per tonne. Gold fell from $650 to $240 per ounce- representing 170 percent drop. As if that was not bad enough, the price of crude oil also went up from $15 to nearly $38 per barrel- a rise of 153 percent.

According to the World Bank, Ghana had lost more than $500 million as a result of external shocks in cocoa and oil alone in 1999, (Daily Graphic of Wednesday, 3rd May, 2000). Since the shocks started in the second half of 1999 and accounted for more than $500 million loss (which excludes millions lost through the collapse in gold price and other minerals), it is not difficult to imagine how much more monumental the loss was in the whole of the year 2000. Let us reiterate that in the midst of that “super crisis” the NDC was still promptly servicing debts to the tune of $300 million even as critical development support from foreign donors was held back at that moment of great need.

Ladies and gentlemen, these were the harsh realities that confronted Ghana in the year 2000. Prior to the onset of that crisis in the middle of 1999, the cedi had shown significant stability. Just as inflation rate had at the time dropped to below 10 percent, so also was the value of the cedi on course towards a second successive year of relative stability after the remarkable 4.1% depreciation it enjoyed in the whole of the year 1998.

The NPP and Dr Bawumia know but would not openly admit that but for the robustness of the economy in the year 2000, the depreciation of the cedi then would have been much more worse, given the extreme challenges brought by the four separate crises the nation was facing at the time.

At the risk of repeating ourselves, let us state again that the NPP has only faced up to one crisis- a “mini crisis” compared to the “shock and awe” that faced the NDC. It is true that the price of crude oil from June 2007 to date has gone up from nearly $60 to about $120 per barrel. Even so, this represents only a 100 percent increment. Compare this with the 153 percent hike in oil price experienced by the NDC from mid 1999 to 2000.

Additionally, whilst the percentage change in the price of oil from 2000 to date stands at about 233 percent (moving from about $60 to nearly $120), the percentage change in the price of gold and cocoa over the same period stands at about 344 percent for cocoa alone ($670 to $2980) plus 240 percent for gold ($240 to $818).

We have not even made allusion to the fact that the NPP government has not, during its “mini crisis” had to put up with the sudden drying up of much needed donor support. We need not also add that unlike the NDC in 2000, the NPP has not had to use about 300 million dollars a year to service debts during its mini crisis. We have also not mentioned the fact that the NPP has had unprecedented resources because of additional taxes such as talk tax, taxes on petroleum, increase in VAT and the lowering of the VAT threshold among others.

In spite of all these relatively favourable conditions, the cedi which started the year 2008 at about 9,600 to the dollar is today trading at 11,500 to the dollar, a depreciation of about 17 percent- and we have four whole months to go. Needless to say that the dollar itself, has over the last few years been in free fall vis a vis other major currencies of the world.

With NPP’s “mini crisis”, the cedi this year has already lost 17 percent against the dollar. Can you, ladies and gentlemen even begin to imagine the scale of the depreciation that would have occurred in the value of the cedi vis a vis the weak dollar, if the NPP had faced the “super crisis” the NDC faced in the year 2000?

NPP’s Boasts About Raising Money In The International Bonds Market

The NPP is busy beating its chest amidst claims that Ghana’s recent successful borrowing of about 750 million dollars at 8.5% on the international bonds market is indication of the great strides the economy has made over the last eight years. The truth however is that Turkey which has about the same rating as Ghana, managed to raise $1.25 billion at a much better rate of 6.85% around the same time last year. Theirs was also three times oversubscribed. So why is the NPP making so much noise?

NPP’s Claims That The Economy Has Moved Forward In Leaps And Bounds

The NPP will want the world to believe that over the last eight years, there has been so much remarkable economic progress that has brought about huge improvement to the lives of our people. Indeed the NPP sums its boasts by proudly declaring that the Nation has moved forward in leaps and bounds over the period of its tenure. But let us ask ourselves the following:

How much forward has Ghana moved from 2001?

• When Kwame Pianim, an economic/financial guru and former NPP presidential aspirant recently underscored the fragility of the economy today when he declared that Ghana's economy badly needed about $130 million injection to stay healthy else inflation would go up, which will greatly affect the poor? (Graphic, July 29, 2008) • When Ghanaian students at the University of Nottingham are on the verge of being dismissed because of government’s failure to pay their fees? • When thesis grants of Ghanaian graduate students have not been paid for a year? • When Ghanaian modern language students are unable to embark upon their year abroad program because the government says there is no money? • When for six weeks all secondary schools in the three northern regions remained closed because of government’s failure to pay feeding grants? • When as stated earlier, so many newly recruited public sector workers have not been paid for several months • When Ghana@50 suppliers and contractors have not, for over a year, been paid? • When waste contractors are being owed several billions of cedis by government • When UNICEF and WHO have ranked Ghana the second dirtiest country in the whole of West Africa?

How much forward have we moved from 2001?

• When the cotton, poultry, textile, timber, rice, local fishing industries have all virtually collapsed with the huge negative consequences on unemployment and crime rate? • When the much trumpeted President’s Special Initiatives have all collapsed not to mention the collapse of Vice President Aliu’s special initiative against indiscipline? • When the Metro Mass Transport is on its knees and on the brink of collapse owing GOIL over 30 billion cedis • When VRA’s indebtedness has reached an astronomical 1.2 billion dollars? • When despite instituting the TOR debt recovery levy, TOR today still owes GCB over $500 million even though the TOR debt recovery levy had yielded about over $512 million. • When Ghana Airways has completely collapsed and its successor, the GIA has become stillborn

Ladies and gentlemen, an improved economy must translate into improved standards of living for the people. Let’s see what the UNDP found out about the standard of living of Ghanaians against the backdrop of NPP’s claims of a vastly improved economy?

UNDP 2007 Ghana Human Development Report shows the following: • Infant mortality which stood at 57 deaths per 1000 live births, now stands at 71 deaths per 1000 live births • Maternal mortality which in 1999 stood at 240 deaths per 100,000 live births now stands at 540 deaths per 100,000 births • In sum the report states that life under the NDC in 1995 and 1999 was better than life under the NPP.

Finally, how can the NPP claim to have improved the lives of the people over the last eight years?

• When a gallon of kerosene HAS MOVED FORWARD from 4,500 to 57,000 cedis • When a bundle of roofing sheets HAS MOVED FORWARD from 350,000 to 2.5 million cedis • When a bag of cement has HAS MOVED FORWARD from 17,000 to 100,000 • When a single room has HAS MOVED FORWARD from 15,000 to 300,000 • When the electricity bill per the first 100 units paid by the average Ghanaian HAS MOVED FORWARD from 10,000 to 122,000 cedis a month • When a sachet of pure water HAS MOVED FORWARD from 100 to 500 cedis • When a loaf of bread HAS MOVED FORWARD from 1000 cedis to 20,000 cedis • When a tin of milo HAS MOVED FORWARD from 3,800 to 42,000 cedis • When a tin of milk HAS MOVED FORWARD from 800 to 85000 cedis • When one olonka of gari HAS MOVED FORWARD from 2500 to 15,000 • When a bag of maize from HAS MOVED FORWARD 100,000 to 850,000 • When a bag of rice HAS MOVED FORWARD from 50,000 to 600,000 cedis • When a ball of kenkey (without mentioning fish) HAS MOVED FORWARD from 200 to 3000 cedis • When fresh coconut HAS MOVED FORWARD from 500 to 4000 cedis • When a bar of key soap HAS MOVED FORWARD from 3000 to 22,000 cedis • When a bottle of Coke (we mean Coca Cola) HAS MOVED FORWARD from 600 to 4000 cedis

Ladies and gentlemen, is it not sad that after imposing all these economic hardships on the people, even when it is time for them to visit the KVIP to attend nature’s call, even there, prices HAVE MOVED FORWARD from 50 cedis to 2000 cedis?

We could go and on forever because the evidence proving that the economic fortune of the average Ghanaian has worsened is super abundant.