John Mahama
FORMER PRESIDENT John Mahama vindicated Vice President Dr. Mahamudu Bawumia when he finally admitted far away in USA that the COVID-19 pandemic and the Russia-Ukraine war were terribly impacting on economies of countries across the globe.
Even though he had previously blamed Ghana’s economic crisis on the Akufo-Addo-led administration, the ex-president told the 24th African Business Conference organised by the Harvard Business School last Saturday, that data from the Economic Commission of Africa (ECA) indicates that the COVID-19 has created the “continent’s worst recession in 50 years.”
According to him, “The continent’s real GDP has shrunk by an average of 3% in 2020,” and added that “before the pandemic, poverty reduction was already a major challenge in Africa.”
Confession
Mr. Mahama’s confession, which contradicts his earlier assertions on the country’s economy and its management, has proven Dr. Bawumia right, when he recently told the nation that the Russia-Ukraine war had exacerbated price increases and cost of living.
“The pandemic is estimated to have dragged about 55 million more people into poverty in Africa, and exposed another 46 million more to the risk of hunger and malnourishment,” Mahama stated.
The former President added, “70% of hunger in Africa, which had already been on the rise since 2014, is directly attributed to this pandemic.”
He noted that this became necessary for African governments to take action to shield their population from the effects of the pandemic.
“This meant that in many cases, an increase in deficits due to unbudgeted expenditures,” he explained.
The 2020 National Democratic Congress (NDC) flagbearer, who is preparing to stage a comeback, admitted that this has “devastated many African economies, and sunk them deeper into unsustainable debts and economic downturns.”
“This pandemic has had a general deleterious effect on the economy of African nations,” he posited.
Russia–Ukraine War
For him, “Even as COVID-19 still lingers, and African countries attempt to reset their economies, yet another disruption, this time, of a geopolitical nature, threatens to wreck more havoc on an already fragile continent.
“The Russia–Ukraine conflict is said to peg Africa’s growth back by an estimation of about 0.7%. Inflation is expected to rise by at least 2.2% in 2022, and as many as 43 countries that depend on energy and food imports will be confronted with fiscal and current account problems.”
Mr. Mahama said the “global increase in energy prices has escalated the cost of living, and compounded hardships in many countries.”
He emphasised that “the conversation is now about overcoming the twin problems of a pandemic and its aftermaths, and a geopolitical-induced economic crisis as opposed to one that focuses on just post-pandemic recovery.”
Paradox
But back home in Ghana, Mr. Mahama and his NDC members have blamed the general economic hardship on the government, intimating that the COVID-19 pandemic and the Russia-Ukraine war have done little to Ghana’s economy.
Mr. Mahama claimed that some African countries have been able to deal with the effects of the pandemic and the ongoing Russia–Ukraine war better than others based on the resilience of their economies, discipline, and prudent use of their resource envelopes in the period of this crisis.
“In my country Ghana, our economy has emerged in an extremely poor shape from the COVID experience”, and a “ballooning deficit, double digit inflation, a nose-diving currency, increasing debt distress, are some of the symptoms of a very ill economy,” he added.
Mr. Mahama, under whose leadership Ghana’s economy was floundering, told his audience that, “Ghana’s case was easy to predict. With the cavalier handling of the economy by the current administration, unbridled borrowing from the capital markets, created misstatements and other critical fiscal budget, figures were certain to come to a head eventually.
“Ghana went into the pandemic without adequate buffers, and has emerged with a terribly battered economy.
“To make matters worse, a pandemic windfall in excess of GH¢33 billion, which could have cushioned the economy, remains unaudited, and is believed to have been used largely in the quest to win election 2020 at all cost,” he added.
BY Charles Takyi-Boadu