ECONOMY ROBUST - FINANCE MINISTER DAMNS CRITICS WITH COMPARATIVE ANALYSIS (Front Page) 12-09-08

Story: Kofi Yeboah

THE Minister of Finance and Economic Planning, Mr Kwadwo Baah-Wiredu, has again defended the state of the Ghanaian economy, saying it is expanding tremendously.
Dismissing suggestions that the government was losing grip on the economy, Mr Baah-Wiredu said despite the spiralling price of oil on the world market that reached a high of $147 per barrel, as against the budget projection of $85 per barrel, the country did not experience any shortage in its daily requirement of 60,000 barrels.
That, he said, was a positive indication that the economy was robust and strong.
Mr Baah-Wiredu made the submission in an interview with the Daily Graphic in response to assertions by a section of the public, particularly some members of the minority political parties, that the economy was crumbling.
Making a comparative analysis between the past and present to buttress his claim of an expanding economy under the New Patriotic Party (NPP) administration, the finance minister said between January 1982 and December 2000, spanning a period of 19 years, the price of petrol per gallon increased by 2,800 per cent per annum.
However, he said, between 2000 and now, the price had increased by only 101 per cent per gallon per annum.
On total assets generated, Mr Baah-Wiredu said the total contribution of Ghanaians moved from negative between 1982 and 2000 to positive during the period of the NPP administration.
He said the implication was that in 2000, if the nation had sold all its assets, it could not even have paid its creditors.
With respect to debt sustainability, Mr Baah-Wiredu said at the time the NPP took office in 2000, it stood at 189 per cent, but now it had been reduced to 57 per cent, indicating an improvement in the economy.
He asked all those who might have doubts about such information to cross-check them from his ministry and the Bank of Ghana.
Mr Baah-Wiredu attributed the strength of the economy to the increase in the gross domestic product (GDP) as a result of increased food production, reasonable food prices and a boom in the construction industry.
Furthermore, he said, funds from the Highly Indebted Poor Countries (HIPC) initiative, as well as the growth in the manufacturing, energy, mining and services sectors had all helped to strengthen the economy even in the face of external difficulties.
Mr Baah-Wiredu said the financial windfall from the Ghana@50 anniversary celebrations, the hosting of CAN 2008 and various international conferences, also helped to bolster the economy.
When asked to justify his assertion that the economy was expanding against the increase in inflation, the finance minister said although the government was working towards improving internal factors that caused inflation, it did not have control over external factors like the price of oil.
“Even comparing ourselves to developed countries like the US, we have been resilient and strong. There are signs of the economy moving,” he said.