President Nana Addo Dankwa Akufo-Addo has stated that the macroeconomic strides made over the past twelve months indicate his government is very much on course to turn around the fortunes of a distressed economy inherited from the Mahama administration.
Addressing the press in Accra on Wednesday, the president lauded work done by the Economic Management team led-by Vice President Dr. Mahamudu Bawumia for stabilising the economy while ensuring that growth is not compromised.
According to him, having taken over an economy with weak macroeconomic fundamentals, his government had to find innovative ways of doing things to ensure they got positive results.
“Our macroeconomic indicators have seen tremendous results through improved monetary and fiscal discipline. Real GDP growth has rebounded, recording a 9.3 percent growth in the third quarter of 2017 against the figure of 3.5 percent for the same period in 2016.
“Inflation recorded for December last year was 11.8 percent as against 15.6 percent in the same period of 2016,” the President said
The debt situation, Nana Akufo-Addo said, has improved – with the annual average debt accumulation rate of 36% in recent years declining to about 13.6%, as at September 2017.
“As a result, the public debt stock as a ratio of GDP is 68.3%, against the annual target of 71% for 2017, and end 2016 actual figure of 73.1%,” the President added.
Pensions, arrears et al
President Akufo-Addo said the improvement in macroeconomic fundamentals has led to government being able to transfer some GH¢3.1billion of Tier 2 pension funds into the custodial accounts of the pension schemes of labour unions.
Those funds, he said, have been outstanding for six years, and about which the labour unions had been loudly complaining.
He also revealed that his government is working hard to clear debt owed to road contractors.
“In 2017, nearly GH¢1billion (GOG – GH¢300.4million; Road Fund- GH¢664 million) of the GH¢1.6 billion owed to road contractors was cleared. In January this year, we have disbursed GH¢125million out of the remainder of GH¢600million to the contractors.
Additionally, the President stated, government has paid GH¢826million of the GH¢1.2billion loan contracted by the previous administration, for which the Road Fund was used as collateral.
“It is important to note that all these debts were accrued under the previous administration. I will also point out that much of the statutory arrears that we met have been cleared; that is, debts to the NHIS, the District Assembly Common Fund, and the GETFund,” he stated.
Government, he said, has put in place a regime which is to pay government bills as they come due, and not accrue arrears.
“We are resisting the temptation to award contracts when funds are not available to pay for the certificates as they come up. Those who conduct business with government will find that things are being done differently.
“We have had to subject GH¢11billion of arrears, bequeathed to us in 2017, to a process of audit review and validation. The audit service has certified payments to the tune of GH¢5.5billion, and rejected about GH¢5.7billion cedis – representing a potential savings of 51% on these outstanding commitments,” the President concluded.