Ghana's 2018 Budget And Economic Policy!

Small and Medium Enterprises are believed to be the biggest employers of labor, cutting across divers strata of the labor market. When adequately supported smes can promote entrepreneurship and complement the government in employment. SMEs are therefore engines of growth and catalyst for socioeconomic transformation for any countries. In other words, they are essential to economic success.

November 2017:Accra Streets, Ghana

Developing countries the world over, have over the years attained increased economic growth reduced poverty rates and dependent on foreign aids, by implementing policies favorable to sme development. 

November 2017: Accra-Ghana-Circle Interchange

 

Ghana, formerly known as 'Gold Coast', is a developing country in the Sub-Saharan region of Africa. Despite economic and political challenges faced since independence, the country has over time shown potentials of growth. How far this would go notwithstanding, depends on the feasibility of its policies. This write up takes a glimpse at the proposed 2018 economic policy, the debate about it's ability to bring about growth and transformation. 

 

The country's Finance Minister, Mr. Ken Ofori-Atta, on Wednesday, November 15th, 2017 presented the much anticipated 2018 "private sector-led economic growth and transformation", Budget and Economic Policy of the government, the Parliament; seeking approval to spend 61 billion Ghana Cedi

The aim for this fund-request according to report, is to anchor government's agenda of moving the economy, beyond the reliance on foreign support or aid. The Budget, and Economic Policy is expected to focus on ensuring macro-economic stability, transforming agriculture and industry, strengthening social protection and inclusion, building on economic and social infrastructure and reforming public service delivery institution.

Earlier on, in his speech at the Ghana Industry Quality Awards in Accra, on November 11th, 2017, President Nana Addo dankwa Akufo- Addo, threw his weight behind the economic policy when he hinted that the 2018 budget would set out the road map for the down-ward review of electricity tariffs. This, according to the President, would encourage industries in the fore-front of the government's economic transnational agenda.

The Breakdown:

 

Of the 61 Billion Ghana Cedis proposed 2018 budget:

• About 3.5 Billion Ghana Cedis, is expected to be allocated to the Real Estate sector.  
• About 1 Billion Ghana Cedis, will go into 'Planting of Food and Job program. 
• About 430 Million Ghana Cedis, will be channelled towards the actualisation of government's "One District - One Factory policy". 
• About 100 Million Ghana Cedis, stimulus package is expected to go into distressed but viable industries.
• About 14 Billion Ghana Cedis, is expected to go into the Social sector.

 Under the Social Sector:

•  About 1.2 Billion Ghana Cedis, goes to "free SHS programme".  
• About 468.5 Million Ghana Cedis, goes to School Feeding Programme,
•  Employee Compensation gets about 10.3 Billion-Ghana Cedis.
• About 700 Million Ghana Cedis, is expected to go into what the government termed "Repair & Rehabilitation of Agricultural Roads".
•  Poverty Alleviation Programmes, is expected to gulp about 1.15 Billion Ghana Cedis.

Minority in Parliament think differently on the government's policy. This was upheld when the group got together in country's capital city, Accra, on Monday, November 13, 2017, to review the 2017 budget and economic policy and to reflect on the 2018 budget. Citing an increase in public debt from 122.6 Billion Ghana Cedis, in January 2017, to 138.6, Billion Ghana Cedis, as at June 2017. Ranking Member on the Finance Committee, and Minority Spokes Person on Finance, Mr. Cassiel Ato Forson, said the public-debt figure is expected to increase to about 150 Billion Ghana Cedis, by the end of 2017. The Minority group feared that this increase in debt, might end up reverting the country to the Heavily Indebted Poor Countries (HIPC) status come 2019. 

To find out what the populace think about the economic policy and how it has overtime affected their enterprises, Roving Informant took to the streets of Accra-Ghana, and had chats with small business owners. 

 

November 2017: Accra, Ghana

Having managed the day-to-day administration of a Guest-House in Kokomlemle area of Accra for the 15 years, a Hotel manager, who spoke on anonymity terms, said the previous government saw to the near-collapse of his business due to inconsistent power supplies. According to him, "Previously, inadequate electricity supplies affected our guest-house's patronage. Industries suffered, some down-seized, while those who could not take the heat relocated their businesses to other countries. our business survived that period by purchasing stand-by generators". 

 

Our Interviewee further stated that he preferred the present government. Although he recalled a brief period of power outage. "The new government has been able to restore and pay Teachers outstanding allowances, which the previous government cancelled. Nursing allowances has also been paid. To be frank, business is slow now, everybody is complaining. We hope with the 2018 budget, the economy will improve".

The next business owner our correspondence paid a visit, was a printer who has been in operations for 25-years. He said: "Over all, the NDC party gave me the highest point as a business owner, we paid high electricity tariffs with inconsistent supplies during the last administration, I brought stand-by plant (generator) to manage the situation. That affected cost of my service. Currently, power supply is stable, and tariff is better. However, things are slow now. I will ask that governments should use local printers like us for their printing jobs, instead of sending such works outside the county. That will empower us. Most of us can match some of the international printers in-terms of production quality, so government should empower us by giving us jobs."

Next, was a trader at the popular Markola Market; according to him, the present government is still new, hence too soon to put pressure on, or ascertain if it is ”good" or not, we have to give it two years. "I have not seen any difference between the last and present governments in terms of business. This government should consider bringing down import duties; this is my major concern as a business owner. I will equally like electricity tariff to be further brought down. There is a complain of hike in the price of petrol, it should be brought down. I will want to see construction of new roads, and re-construction of bad roads. In Ablekuma, where I live, we buy clean water. I will like the government to construct clean pipe borne water for us. Ghanaians love education, and the present government has done well, so far in that sector. But I will like this government to invite the individuals pointed in connection to corruption in all previous administrations for questioning".

A Small scales business owner, around Adabraka said: "There is no money in the system. We hope after the budget has been approved, money will be released into the system...so that genuine cheque can be cleared. Interest rates should be stabilised, and electricity tariffs brought lower. There should be access to finance to enable us expand our businesses and employ more people. There are not much visible changes seen yet, but will time, changes will be more visible. So far, I like this policy".  

Conclusively, come 2019, turns of events would either prove or refute the alarm of the nation's minority group on increased debt, which they think could return the country to an HIPC status; Or, roll in favour of the current administration's believe that the Budget and Economic Policy would propel macro-economic growth and stability.

Obianuju Mbanusi writes.