Former Minister of Finance and Economic Planning and now Senior Minister designate for the new NPP government, Hon. OsafoMarfo has indicated that his government has inherited a fundamentally very strong economy from the Mahama administration.
“We are extremely, heavily indebted but not poor,” he said, adding, “the economy is fundamentally very strong. It is the management that has been a problem.”
The senior minister’s assertion is a confirmation of similar position shared by the immediate past Minister of Finance, Mr. Seth Terkper who stated in one of his last media encounter that the NDC was leaving a strong economy for its successor.
9In his interview with Joy Fm’s Elton John Brobbey soon after he was confirmed by President Nana AkufoAddo as a senior minister designate, Mr. OsafoMaafo noted that the new government will put in place the necessary policies which would address the challenges facing the economy.
The former minister rejected the notion that the country could be classified as a Highly Indebted Poor Country (HIPC).
While a minister in the erstwhile Kufuor government, Mr. OsafoMaafo declared Ghana HIPC for almost five years.
Mr. Terkper said the numbers shows that the Ministry’s fiscal consolidation program has worked resulting in inflation reducing significantly, a fairly stabilized Ghana cedi and a budget deficit which has reduced from 12 percent to 6.3 percent in 2015.
“Over the last four years we have been following a path of fiscal consolidation, which has led to an economy that has turned around, and the economic indicators points to a clear stabilized economy”, Mr. Terkper noted.
Seth Terkper added that the necessary foundation has been built for that expected boom to happen from 2017, only if Ghana follows up on the path of fiscal prudence which will result in a growth projection of about 7 percent for next year.
However, Mr. OsafoMaafo observed that in spite of the strong foundation the country’s economic figures inherited from the previous government are not “encouraging.”
According to the former minister, Ghana is “heavily indebted but not poor.”
He said Ghana’s budget deficit is hovering at a worrying rate of 8% higher than the 5% expected under the IMF agreement.
Ghana is currently under a three yearprogramme with the IMF as part of efforts to bring credibility and stability to Ghana’s economy.
As part of the program the country was expected to maintain a budget deficit of 5%, which according to Mr. OsafoMaafothe immediate past government failed to achieve.
Mr. OsafoMaafo purged the country’s debt to GDP at 72% which he claims could be suffocating.
By IMF and World Bank standards when the debt to GDP is above the 70% threshold, the country is said to be Highly Indebted Poor Country.
Senior Minister designate Mr. OsafoMaafo has been has been announced alongside other 12 as ministers designate by the president in the first batch of ministerial nominees.