…Says NPP Gov’t Policy Dividends Are Yields From NDC Policies
Respected economist, Dr. John Gatsi, has pointed out that improvements in micro-economic indices, which the New Patriotic Party (NPP) government has begun touting as selling points, are actually dividends from the prowess of the previous administration.
In a radio interview yesterday, Dr. Gatsi makes the point that so- called dividends from economic policies of the Akufo-Addo government is carry-forward from the days of the erstwhile Mahama administration.
The lecturer had been responding to claims by President Akufo-Addo at the maiden encounter with the press that measures that his government has put in place is yielding positive results in the micro-economy: “it was not very clear the measures which are yielding the dividends because we do know that inflation was going down since the last quarter of last year, so it is not news to us.”
“We also do know Treasury bill rate for example was going down since the last quarter of 2016 and the only difference we have seen this year is the reduction in the policy rate which has not been able to translate into reduction in lending rate.”
Dr. Gatsi said, so far in 2017, there have been only two reductions, in quick succession, in the Policy Rate and drastic reduction in the Treasury Bill Rate, but these have not happened to the advantage of the private sector.
Rather, he says, they have put the private sector in much more disadvantage as they have led to the situation where government is propped up to gluttonize the local money market to the disadvantage of private businesses and individuals.
“We have seen two successive reductions in the policy rate for 2017, but I do not think that we have seen any significant reduction in the lending rate that meets the expectations of businesses and individuals in the country
“What we have seen so far is that if you look at drastic reduction in the treasury bill rate, what it means is that we are now in a situation where the government is borrowing at a lower rate in the money market, while businesses and individuals are borrowing at a higher rate of between 28 and 30% and that situation is not acceptable.”
“So yes, some indicators are improving like you mentioned, the treasury rate, the Policy rate has gone down but some of them are just carry-over into this year. We are yet to see the true dividends as implementation mechanism of the policies of the government for 2017.”
On the issue of job creation, the respected lecturer said he was willing to give the President the benefit of the doubt that six months into his administration is too early to be expecting jobs from him.
He however thought that the President’s not touching on the ‘Planting for Food and Jobs’ program was rather awkward.
“Well, I think the President says that he cannot say that he has done anything, he has no record to prove that he has created jobs. But I was thinking that we should be focusing on the budget and if you look at the agriculture section of the budget, the government indicated that they were going to raise about 750,000 jobs through the ‘Planting for Food and Jobs’ program.
“I was surprised that there was no question on that and the President did not also focus on that policy. Meanwhile those were the areas that you create the jobs that the President promised the people of Ghana.”
He said the PFJ was promised as a major source of job creation and since it has already been launched, Ghanaians ought to have started seeing the program rearing up to throw up jobs.
“I do not know why he couldn’t talk about that because the program was launched and the program, since it was launched, up to now, it should start creating some job opportunities when people start participating in that program.
“So I was wondering what was the problem that the President could not talk about this all important program that he has actually inaugurated and people are participating in it. There are some important elements in that aspect of the budget.
“The focus was to ensure food security and there should be some supply of fertilizer to farmers, increased production of maize to 30%, soya bean to 25%, rice by 49% and sorghum by 28% and all these things are supposed to cumulatively lead to job creation.”
He pointed out that six months into the administration, many of the promised programs that are supposed to lead to job creation are still on the drawing board, saying the situation constrains him to adopt a wait-and-see attitude.
“I do not know which program is in place, one dam, one village is not in place, one factory, one district, I do not expect that we should expect that to contribute to job creation now. I think now that they are fine-tuning the program when they start full implementation from next year.”