Mahama pledges calm after storm

President John Mahama expressed confidence yesterday in the “bright medium-term prospects” of the country in a State-of-the-Nation address that spelt out profusely steps his government will take to build a stronger economy and nation.

The manner of the speech, which was replete with command-verbs such as “instructed” and “directed”, revealed an intention of the President to cast it as different and unique from his first one in 2013 and others presented by past presidents. 

But for the many Ghanaians who recollect last year’s State-of-the-Nation address, there will likely be a feeling of boring familiarity with the President’s promises -- which do not seem to be being fulfilled quickly enough.

In 2013, the President -- amid an energy crisis that had caused electricity to be severely rationed to consumers -- assured of the completion of the Jubilee gas project at Atuabo by the end of that year to lower the cost of power generation and ease supply.

On Tuesday, however, the President gave a new completion date: second-half of 2014. Meanwhile, this year’s address has coincided again with another -- albeit more limited -- “load-shedding” exercise that has resulted in scheduled and unscheduled power cuts across the country.

Mr. Mahama also repeated a promise to transform the 10 public polytechnics to technical universities, together with a pledge to draft legislation that will lead to the establishment of a university for the Eastern Region.

In the address, which was noteworthy for its length -- it lasted approximately two-and-a-half hours -- as well as its breadth -- it covered nearly all the key aspects of national life -- the President said the economic pain Ghanaians have been feeling from tax rises, cancellation of subsidies, wage rationalisation and other fiscal-adjustment policies are “bitter medicine” that must be taken to nurse the economy back to full health.

“While these measures have been unpleasant and difficult to take, ultimately they are necessary to create a good environment in which businesses can continue not merely to survive but also to grow,” he told MPs and other dignitaries crammed into Parliament’s chamber in Accra.

“Despite the short-term challenges we face, our economic fundamentals remain sound and our mid-term prospects are bright. Growth continues to be robust at an estimated 7.4 percent last year, and we still retain our vision to accelerate and maintain GDP growth at above 8 percent, going forward.”

The President also addressed the issue of the falling cedi, which has added to the rising cost of living by stoking already-high inflation that stood at 13.8 percent in January. 

While backing the central bank’s vigorous attempt to build confidence in the cedi through stringent controls on the use of foreign currency in domestic transactions, he also proffered the longer-term solution of curbing the country’s import-addiction. 

“The basic structure of our economy has not changed from colonial times. We’re still largely dependent on the export of raw materials and importing finished goods. We must change the structure of our economy,” he said.

The National Development Planning Commission (NDPC) is preparing a medium-term development plan that will pursue this goal; but in the interim, according to the President, the Export Development and Agricultural Investment Fund (EDAIF) will boost assistance to local producers of rice, poultry and other basic items that Ghana imports annually at a cost of US$1.5billion.

A sugar-processing plant is about to be opened in Komenda, with another to be sited later in Savelugu, he announced. “I have also tasked Cocobod to enter into a strategic partnership to produce jute sacks in Ghana,” Mr. Mahama said.

Other measures include the enactment of a new procurement law that will give priority to local suppliers and a joint venture with Petro Saudi to revamp the Tema Oil Refinery (TOR), which has been moribund for most of the last five years, to reduce importation of finished petroleum products. 

“Government will use its spending power to boost the private sector,” the President declared, adding a pledge to make Ghana a net-exporter of rice “in the near-future”.

There were other themes in the speech yesterday, including the President’s acknowledgement of the challenge of inequality, which he said the Gender Ministry has been confronting with the expansion of the Livelihood Empowerment Against Poverty (LEAP) programme that now provides cash grants to 74,000 of the poorest Ghanaians. By 2015, the number of beneficiaries will double to 150,000, he said.

Initiatives in health, education, agriculture and the fight against corruption were also announced; but it seems if the President’s speech is to have the impact he aimed for, he must achieve a better record of implementation this time.

Source: B&FT