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The former president John Mahama has said the President Nana Addo Dankwa Akufo-Addo is “recklessly spending” in the name of cushioning the plight of Ghanaians amidst the COVID-19 pandemic.
Speaking at a forum organised by the Centre for Ethical Governance and Administration (CEGA) at the University of Ghana in Accra, Mahama said Akufo-Addo is depleting the national purse, worsening the condition of Ghanaians.
“COVID-19 has become the convenient whipping boy and has been cited as the reason for the crisis we face now and the attendant economic hardships. Yes, COVID-19 affected the economy, and no one can dispute that,” Mahama said.
He added: “It is however not the main reason why we are in the current hole we find ourselves. COVID-19 only became a pretext for reckless election related spending, which produced the largest ever budget deficit in the recent economic history of Ghana last year.
“Our debt has ballooned to unsustainable levels- topping 80% of GDP- exposing us to very high risk of debt default. Almost all of our tax revenue is used to service our debt and the effect has been the introduction of several new taxes. This has led to rampant increments in the prices of goods and services. This is primarily responsible for the hardships Ghanaians are going through now.”
“A comparison with our neighbours and peers in Sub-Saharan Africa, all of whom were also affected by COVID-19, shows they have been able to protect their citizens from COVID-19 in ways that are similar to ours. They have however avoided increasing their debts and deficits because of more prudent management of their economies.
“This government must accept that it is their mismanagement of the economy, their thirst for consumption expenditure and the desire to spend beyond our means in order to win elections that have plunged us into the current crisis, not necessarily COVID-19.
“This has been the luckiest government under the fourth republic. They have benefitted from 60% of all the oil revenue accruing to Ghana since we began producing oil, they have had more than twice the total tax revenue available to us and have enjoyed unprecedented support from our development partners.
“Within a space of 12 months, they have received up to GHS11 billion from the IMF alone and over $200 million from the World Bank and other donors. They had access to over $200 million from the Stabilization Fund we set up and got Central Bank Financing of GHS10 billion whereas we had zero financing from the Central bank in 2016 despite all our challenges,” Mahama stated.
Source: Daily Mail GH
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