Vice President Dr. Mahamudu Bawumia
Vice President Dr. Mahamudu Bawumia has jabbed the opposition National Democratic Congress (NDC) over the management of the Ghana Cedi, saying “NPP’s worst is better than yours.”
“So our worst is better than your best and then you say boot-for-boot! This one is more like boot-for-Chalewote!” he said amid spontaneous laughter yesterday when he led the government’s Economic Management Team to explain the economic situation at the Town Hall Meeting on the theme: “Our Progress, Our Status, Our Future.”
According to the Vice President, even though the cedi has experienced some turbulence under the Akufo-Addo administration, the ruling party’s performance in terms of managing the local currency has been far better than what the NDC did in office.
“The data on the annual rate of the cedi in recent years shows that the best performance so far under the NPP government – the 8.4 per cent depreciation of the cedi that we saw in 2018 that worst performance is better than the best performance under the previous government between 2012 and 2016 so our worst is better than your best.”
“Within a week, the cedi went up to close to 5.9 to the dollar, and then it retreated to about 5.07 and even was threatening to go below 5. This is really an unprecedented development that you don’t normally see …when the Bank of Ghana had not intervened in the market in fact if you look at it at the end of March 2019 the cedi had depreciated by about 5.18 per cent so far this year,” he said.
NDC
Making a comparison between the erstwhile Mahama administration and the NPP government, he recounted that in 2014, the exchange rate depreciated by 31.3 per cent, fiscal deficit was 10.1 per cent of GDP, public debt rose 70.2 per cent of GDP, inflation rose to 17 per cent and GDP growth had declined from 7.3 per cent to 4 per cent.
“In other words, the economic fundamentals had weakened significantly, and therefore the depreciation was easily explainable. It was not caused by dwarfs or high-rise buildings. The exchange rate in 2014 had exposed the weak economic fundamentals,” adding “you will see we were in a much weaker position in 2014 compared to 2018.”
According to the Vice President, at the end of December 2017, the cedi had cumulatively depreciated by 4.9 per cent compared to 9.6 per cent in 2016, and this was the cedi’s best performance since 2011.”
The cedi, he said, depreciated by 8.4 per cent in 2018 largely on account of the emerging market pressures and increases in US interest rate.
Bawumia Adamant
“Ladies and gentlemen, you will recall that I stated in 2014 that if the fundamentals are weak, the exchange rate will expose you. That was true then and it is true now. It is 100 per cent correct.”
He added that “if the fundamentals are weak, the exchange rate will expose you, but if the exchange rate moves you cannot jump into that conclusion that the fundamentals are weak, that defies logic,” he said.
BY Melvin Tarlue