The Akufo-Addo Regime: Wretched Economy, Monumental Lies

It is no longer news anywhere that this Akufo-Addo government is a big, fat failure. Nobody has any idea where the government is heading to. Everything about the government is based on false narrations and executive lies. It is such that almost everything the President and his ministers tell the public is a lie meant to deceive the people and sway them into seeing it as responsible government. Everything the government says is practically different from what is obtainable and what the generality of the people see.

This is government under which Ghana has dropped from the best place for doing business in West Africa to the 4th, Ghana dropped in Transparency International’s latest rating, World Bank report revealed that investor confidence in the economy has dropped. More people are losing their jobs, businesses are collapsing, market women solicit for special spiritual intervention from pastors to save their businesses, most Ghanaians are living in abject poverty. Ghanaians are now living on the brink of a precipice with more and more people including die-hard supporters of the ruling party, expressing dissatisfaction with the government in various ways.

The most recent lie by the regime was revealed by the Finance Minister, Mr Ken Ofori-Atta, on the floor of parliament where he claimed that Government has started implementing the One district one factory policy, the economy of is booming.

Mr Ken Ofori-Atta dished out some false numbers and information to buttress how the previous administration lacked imagination in the management of the economy.

Information available at the Finance Ministry contradicts this bogus assertion. Listening to the Finance Minister on the floor of parliament, there was only one conclusion that anyone that consider all blunders caused by this administration could come to: the Akufo-Addo government has not only been jinxed and hexed but has also been cursed. They have been badly afflicted with the spirit of error. Take for instance, the promise to fight corruption and protect public purse, which are perhaps the most important task which the administration set for itself.

The mission is now manifestly moribund. And it is possible to say that the crumbling of this had remained predictable from the onset due to the honcho’s evident superficial understanding of the issue candidate Akufo Addo promised to confront. Reckless use of our oil revenue and the administration’s overt dependence on our oil revenue will soon throw us into deep economic waters. This government promised to lead us into a new consciousness in which productivity would thrive instead of relying on taxation.

VAT was increased by 5% contrary to the Finance Minister’s statement that there will be no VAT increase. Government is converting the NHIS 2.5% to a straight levy of 2.5%, converting GETFUND of 2.5% to the straight levy 2.5%.

This was the response from the former Finance Minister Mr Seth Tepker in reaction to the VAT issue:

Ghana’s VAT rate is 17.5 percent and that includes NHIL (2.5%) and GEFund (2.5 %). Removing them from the VAT base and making them specific rates (instead of ad valorem) and increasing that rate to earn more revenue (quoting Hon Kwarteng) is a ruse.

It is a VAT increase in disguise. Businesses should not rejoice yet because they cannot claim Input Tax Credit/refunds on 5% of the current 17.5 percent rate.

Already, the Flat Rate is denying some registered businesses refunds and Input Tax Credit.

The measure amounts to a parallel Sales Tax regime that the VAT replaced. It is a retrogressive step and further mutilation of the VAT regime

According to the Finance Minister, last year government abolished numerous taxes. Traders including importers have rubbished this claim describing it as sheer political propaganda. GUTA, Freight Forwarders and imported have refuted that claim. Spare parts dealers and other importers who rejoiced over the removal of these taxes as was announced in the first and second budgets, have been complaining vehemently over high duties at the ports and other taxes. World Bank’s latest report on Ghana’s economy, revealed that investor confidence in the Ghanaian economy has dropped significantly because of the tax regime and other repressive measures introduced by the administration.

According to the Finance Minister, in 18 months the cedi has performed better than seven years of the previous administration. This is not only false, but unfortunate. Akufo-Addo inherited a cedi which was the second most stable currency in the sub region. When making such comparisons, the Finance Minister must factor in the contribution of oil to the economy. You cannot do a sincere comparison without stating revenue generated from oil sale vis-a-vis a non oil economy. The power situation under Mahama was different from what Nana Akufo-Addo inherited with Atuabo gas saving the state Ghc 500 million annually as against using same amount to import gas into the country. Akufo-Addo inherited a stabilised power sector. The Mahama Administration made substantial investment in the power sector culminating in the stability Ghana is enjoying. The Mahama Administration also invested about $7billion into the oil and gas sector before leaving office. The administration made significant investment in the infrastructural sector reducing significantly our infrastructure deficit creating enough space for the current administration to breath and focus on other areas. When comparing the strength of the cedi at the various stages, all these factors must be considered.

On loans, parliament approved Ghc 1.9 billion loan agreements today before the Finance Minister read his mid-year budget. President Akufo Addo and his Vice in opposition, described borrowing and taxation as the lazy man’s option. They told Ghanaians that Ghana has enough funds at the treasury to go on borrowing spree. Ghanaians voted for them because of these promises. In just a day, the administration borrowed GHC 1.9 billion in addition to the Ghc 28 billion it has added to the public debt stock.

According to the Finance Minister, the reported that the Npp government reduced fiscal deficit from 9.2% in 2016 to 5.9% in 2017 and inflation reduced 16%’

The Minister of Finance did not however tell us why his senior minister described the economy they inherited as fundamentally strong. He ended his presentation with quotes from the Bible but failed to exhibit Christ’s courage during his presentation. The NDC administration was hailed by the IMF and the world bank for adhering strictly to the IMF conditions which culminated in the successes recorded in the economy and revenue generation. The world bank projected an 8% growth in the economy between 2017 and 2018 because of the policies the administration introduced and the investments it made in the oil and gas sector. The Mahama recorded the figure quoted without oil revenue and that must be established.

In an overbearing atmosphere of pervasive corruption and fraudulent minds, no doubt the Finance Minister and his government are facing a sense of confusion. Obviously, there have been some quiet back and forth within the government that may have entailed policy somersaults. We were told by Gabby Asare Otchere-Darko and supported by party and government officials that VAT was going to be increased to enable government give us more roads etc. A few days later, the story changed. Government could not withstand the pressure that emanated from the camp of the opposition, traders, civil society organizations and some progressive forces.

Source: Ohenenana Obonti krow

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