One of the biggest epochs in the economic history of mankind was the great depression. History tells us that in 1929 the stock exchange crushed leading to one of the biggest economic downturns in the history of mankind but most importantly it led to arguably the most radical evolution in the role governments played in the management of their economies.
Prior to the great depression governments took a laid back approach to the management of their economies. However this changed radically with the use of the New deal by Franklin Delano Roosevelt to fight the impact of the great depression.
Since the Great Depression and the introduction and application of the New Deal, Governments have used fiscal and monetary policy to influence their economies.
Fiscal policy is simply the use by governments spending and revenue mobilization to influence the economy. This is important because a prudent fiscal policy is capable of creating a strong macroeconomic environment to support economic growth, reduce poverty and create an inclusive economy
Monetary policy on the other hand is the strategy Central banks apply to influence the supply of money through the adjustment of interest rates, bank reserve requirements and the purchase and sale of government securities and foreign exchange.
Ghana like most nations of the world have used fiscal and monetary policies to influence the performance of its economy.
Indeed our constitution places the responsibility of running the economy in the hands of the President. Chapter 8 of the 1992 Constitution of Ghana places the entire Economy into the hands of the President and his Vice. Furthermore Article 60 (1) of the said constitution provides that the Vice President of the Land shall perform such functions as may be assigned to him by this constitution or by the President.
It is instructive to note that throughout Nana Addo’s long campaign to be President from 2008 until he finally became President in 2017 he sold his Vice Alhaji Dr Bawumia as the man to manage the economy in general and specifically create a strong Ghana cedi and macroeconomic environment so the entire economy grows.
Indeed subsequent to the President taking office His Excellency Alhaji Dr. Bawumia was mentioned on so many platforms as being the man in charge of running the economy and he himself held himself up as the main man running the economy of Ghana.
Thus it is beyond contestation that the person in charge of the use of government influence that is fiscal policy and monetary policy is the Vice President.
It was thus contemptuous of the Hon Annor Dompreh in an interview he granted Adom Fm to suggest quiet disingenuously that the current economic malaise we find ourselves cannot be attributed to his Excellency Alhaji Dr. Bawumia and mischievously attempted to lay the blame on Hon Alan John Kwadwo Kyerematen since he Annor Dompreh claims Hon Alan Kyerematen heads the so called Cabinet Economic Committee.
This assertion is not only reckless as to seeks to throw dust into the eyes of unsuspecting Ghanaian but is also crass and exposes the Hon Annor Dompreh as being either ignorant of the Governance Architecture of this country or he is just a vile propagandist who has no value for principle.
The fact is we are in this economic doldrum now because of a fundamental failure of our fiscal policy since 2020.
Since 2017 Ghana has posted record figures in most of the economic indicators. For the first time in the history of the 4th republic we have posted trade balance surplus on more that three occasion, we have posted record GDP levels, record GDP per capital levels. So why is the Economy on its knees?
You only have to look at our Budget Deficit to GDP ratios to get your answer. In 2020 we posted a deficit to GDP of a whooping 15.29 % and 11.11% percent in 2021.
So clearly our economic crisis is sadly a result of fiscal indiscipline.
The big question is in whose hands lie our fiscal destiny?
Indeed it is trite knowledge that the budget of Government does not only indicate how the President and his Vice intend allocating the resources of the land but most importantly determines the fiscal direction the country will be heading.
It his beyond debate that our national budget which essentially contains our fiscal policy is drawn and driven essentially by the President and his Vice President together with the Minister of Finance.
Thus the fiscal part of our economy lies in the bosom of the President, the Vice President and to a smaller extent the Finance Minister.
Furthermore in any analysis of this Presidency a solid argument can be made that the fiscal part of our economy is in the hands of the Vice President because during campaign the President told all Ghanaians that the reason he is running with Alhaji Bawumia is because he Alhaji Bawumia will be tasked with the job of giving a stable macroeconomic environment through the application of prudent fiscal policy.
Thus Annor Dompreh cannot extricate the Vice President from the so called Mess He Annor Dompreh claims the economy is at the moment.
The fact is the decision to borrow at the levels we did, the decision to spend up to 15% deficit of our GDP in 2020 and 11% of GDP in 2021 were made by the President and his Vice President and if we are facing a fiscal crisis we cannot look beyond these two if our desire is to apportion blame.
The dire fiscal crisis we are facing notwithstanding Hon Alan Kyerematen has demonstrated an amazing level of competence and understanding in transforming the nation through industrialization and Trade. Its unbelievable that with a meagre budget allocation of just Four Hundred Million Ghana Cedis he can generate an investment level in excess of Two Billion Ghana Cedis and about 126 factories operating.
With this level of monumental output against the meagre input from the President and his vice one would have expected Annor Dompreh to question the wisdom in the President and his Vice deciding to allocate only Four Hundred Million to the most successful government flagship program 1D1F and a whopping Two Billion Ghana Cedis on NABCO.
The big question is WHY?
Only the President and his Vice will know.
