Don’t blame COVID-19 and the Russian-Ukrainian war for your economic mess — Sammy Gyamfi


He attributed this to external causes beyond the control of CN management.

Dr Bawumia blamed the Russian-Ukrainian crisis during a town hall meeting in Kasoa, in the central region.

“The Russian-Ukrainian war has driven up commodity prices. Together, Russia and Ukraine export 30% of the world‘s wheat. The longer the fighting lasts, the more food supply interruptions there will be. It will also hamper global development.

“The AfDB says wheat prices have risen 62% since the fighting began. Since the start of the conflict, the price of fertilizers has tripled and the price of maize has increased by 36%. In Ghana, 60% of our Total iron ore and steel imports come from Ukraine.

“Russia supplies 30% of Ghana’s grain imports, 50% of the flour and 39% of the fertilizers. The Russian-Ukrainian conflict therefore affects us directly. Unfortunately, we don’t know when it will end. obstacle,” said Dr Bawumia.

Sammy Gyamfi reacting to the development listed five reasons why the government should not blame COVID-19 and the conflict in Russia and Ukraine for its self-inflicted economic woes.

He said, “Ghana’s economy showed signs of serious challenges even before COVID-19 hit. The World Bank Country Director insisted that our economic challenges persisted even before COVID-19.

For example, before COVID-19 was registered in Ghana in March 2020;

I) Public debt has increased from GHS 120 billion in 2016 to GHS 225 billion, representing a nominal increase of GHS 105 billion in the country’s debt stock;

II) our debt/GDP ratio went from 57% in 2016 to 64% in 2019:

III) Interest payments increased from GHS 11 billion in 2016 to GHS 37 billion in 2019;

IV) the budget deficit had reached 7.5% in 2018 and 7% in 2019 even though the government tried to hide it from the people by pretending that it was 4.8%. It is instructive to note that the 7% budget deficit in 2019 was above the 5% budget responsibility threshold;

V) The Ghanaian Cedi in 2019 experienced a depreciation of 12.9%. This was before COVID-19. The cedi depreciated by 9.6% in 2016 despite the serious challenges facing the country.

VI) The growth rate of the construction sector decreased from 8.4% in 2016 to -8.5% in 2019 and the manufacturing sector decreased from a growth rate of 7.9% in 2016 to 6, 5% in 2019 as part of the highly touted 1D1F initiative.

2. Even though the COVID-19 pandemic has had negative effects on Ghana’s economy, its overall impact on tax revenue has been insignificant.

* In 2019 pre-COVID, the Ghana Revenue Authority had revenue of GHS 43.9 billion.

* In 2020, when COVID hit, the government was forecasting tax revenue of GHS 47.2 billion, revised to GHS 42.7 billion, and exceeded its revised target by collecting a total of GHS 45.3 billion at the end of the year.

* In 2021, the government expected tax revenue of GHS 57.055 billion but recorded a total of GHS 57.32 billion (i.e. GHS 265 million additional tax revenue).

3. Akufo-Addo/Bawumia has had close to GHS 30 billion cedis (equivalent to approximately US$5 billion) to manage and mitigate the impact of COVID-19, all of which has been largely wasted in expenditure related to elections. Our peers such as Ivory Coast, Benin, Togo et al, have now secured up to US$5 billion to manage COVID-19, but have done much better than Ghana.

4. The government of Akufo-Addo/Bawumia has derived revenue from three (3) oil fields with daily production increasing from around 70,000 barrels in 2016 to around 170,000, coupled with high commodity prices ( oil, gold and cocoa) on the international market. . In total, this Akufo-Addo/Bawumia government has achieved total revenues of over GHS 500 billion over the last five (5) years, compared to the paltry GHS 200 billion that accrued to the NDC/Mahama government. Their economic mismanagement and waste led us to another IMF program. Any government that has had access to over GHS 500 billion in revenue and is still collapsing the economy to the point of needing an IMF bailout, must be the worst government in the history of the world.

5. COVID has affected every country in the world including Ghana. But while our peers like Benin, Togo, Ivory Coast, Burkina Faso, Nigeria, etc. have been very responsible in the way they spent in 2020 to manage and mitigate the impact of the pandemic on their economies, thus recording deficits below 7% and debt-to-GDP ratios below 65%, the Akufo- Addo/Bawumia borrowed excessively and spent recklessly for electoral purposes, thus recording a record deficit of 15.7% and a debt-to-GDP ratio of 78% in 2020.

“In 2020, when the COVID pandemic hit, Burkina Faso recorded a deficit of 5.7%; Côte d’Ivoire recorded a deficit of 5.6%; Nigeria recorded a deficit of 5.8 % and Senegal recorded a deficit of 6.4% But only Ghana recorded a deficit of 15.7% due to the reckless spending motivated by the elections and the waste in which the NPP-Akufo-Addo/Bawumia government engaged himself.

“How does COVID and the four (4) month Russian-Ukrainian war leave Nigeria, Benin, etc. to attack only Ghana?”


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