LIAR! Bawumia Caught Pants Down On Voodoo Economics, Blames COVID and Russia

Vice President Mahamudu Bawumia has once more been caught peddling palpable deception in his analysis of the Ghanaian economy as he blamed everything but the glaring mismanagement of the Akufo Addo administration for the near-economic collapse of the country.

However, a couple of months ago, the World Bank Country Director, Pierre Laporte had long dismissed the Akufo Addo administration’s attempt to pile the blame of Ghana’s economic collapse on COVID-19, challenging the government to be truthful to the populace.

“Yes, Covid has not helped but even before Covid, there were signs that the situation was getting a little more challenging,” Mr Laporte had revealed.

To back up the claim, data from the World Bank proved Laporte’s point as it showed in its January 2022 Monetary Policy Report that the public debt stock heralded by the Akufo Addo administration had already pushed Ghana to dangerously unsustainable levels of 76.1% of GDP by the close of 2020 and 78.4% of GDP at the end of 2021.

Yet, during a rather curious public lecture at the behest of the ruling New Patriotic Party (NPP) student’s wing the fumbling Vice President Thursday, Vice President Bawumia, in explaining himself away about the near-collapsed Ghanaian economy, first blamed the delay in the passage of the 2022 budget; the unprecedented negative ratings of almost all international credit rating agencies and the refusal of investors to put in their money in the Ghanaian economy.

He later blamed the COVID-19 pandemic and the Russian-Ukrainian war as part of what had collapsed the economy.

“…Delays in implementing major tax reforms…appeared to support the assessment that the market will have difficulties in passing its programmes. To add to these negative market sentiments, there was a sovereign credit rating downgrade by Fitch and Moody’s as a result of concerns about fiscal and debt sustainability,” said the Vice President.

He further went on to say: “The pandemic which started early 2020 resulted in the greatest economic depression in the world since the 1930s with most countries in the world recording negative GDP growth rate. Supply chain disruption and the rising price of oil, which rose to a high of $130 this year, has resulted in major increases of fuel across the globe with petrol prices doubling in most countries.”

According to the Vice President, Ghana imports 30% of its cereal grains, wheat flour and fertiliser from Russia, 60% of iron rods and metal sheet imports is from Ukraine while it exports 20% of its manganese exports to Ukraine hence the dire consequences the disruptions caused by the war had had on the Ghanaian economy.

The war is barely two months old and it is unclear how significant these supposed supply disruptions had on a Ghanaian economy that had been steered onto a downward spiral by the wasteful Akufo Addo administration way before the COVID-19 pandemic struck Ghana in 2020.

The blame game by the VicePresident further entangles the Akufo-Addo government in another comedy of errors after Vice President Bawumia virtually went against all his previous economic prescriptions while his party was in opposition.

He had famously stated that if the fundamentals of an economy were weak, the exchange rate will expose the managers of the economy. Even though Bloomberg has surmised that the Ghanaian local currency is the worst-performing currency in the world with its galloping depreciation, Dr. Bawumia insists that the fundamentals of the Ghanaian economy were stronger than ever.

Also, in a 2016 Social media post, Dr. Bawumia had taken a jab at then-President John Dramani Mahama for allegedly blaming everything else on the economic challenges at the time, instead of admitting his administration’s failure. “ Rather than admitting their culpability for the dire situation, President Mahama has resorted to providing excuses,” Dr. Bawumia had stated in the post.

Meanwhile, economic experts have diagnosed the fundamental problems in the Ghanaian economy to be the debt conundrum that the Akufo-Addo government has saddled the country with.

With the national debt topping Ghc350 billion, it means the Akufo-Addo government alone has borrowed more than Ghc230 billion after inheriting a legacy debt of Ghc 120 Billion in 2017.

Due to the high debt which is some 86% of GDP investors in the money market are refusing to lend any more money to Ghana because they are doubtful that the country can pay it back.

The resultant knock-on effect is that the dollar has become very expensive and as an economy that imports almost everything, this means that prices of all commodities have shot up.