Ghana’s president gives upbeat state of nation address | Africa | DW | 22.02.2013
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Ghana’s president gives upbeat state of nation address

Ghana’s President John Dramani Mahama has assured his countrymen and women of steady economic growth. The comments made in his maiden state of the nation address were meant to calm citizens facing high inflation.

“My vision in this first term is to work to sustain economic growth rates at a minimum of 8 percent,” President Mahama said as he outlined his vision for the West African nation to lawmakers convened in Ghana's parliament. He said this goal was in line with moving the country from a lower middle income status to a full middle income bracket.

For the last two and a half decades, the cocoa, gold and oil exporting country has experienced an economic boom, culminating in an estimated growth of 14.4 percent last year. This makes Ghana one of the world's fastest growing economies.

Energy crisis

President Mahama's speech comes at a time when many Ghanaians are faced with high fuel prices, frequent power outages due to a deficit in power production as well as acute water shortages.

An empty petrol station. Copyright: DW/S. Duckstein.

Petrol prices rose by 20 percent after the government cut fuel subsidies

The president said he was unhappy with the situation and sought to assure the country that work on thermal power producing plants was ongoing. “Work on the West African gas pipeline is now planned for completion in April 2013,” Mahama said. However, he warned that the system would still be fragile.

Turning to the country's public sector, the president decried the huge wage bill which plunged the country into a deficit of 12.1 percent by the end of last year. “While we remain committed to boosting the morale of public sector workers of Ghana, whose incomes were low compared to their counterparts in the private sector, we now face the challenge of ensuring that the effect of the public sector pay reform does not constitute an unsustainable burden on public financing and our macro-economic stability,” Mahama said.

From stable to negative

While analysts predict the expansion of oil and gas production will likely guarantee healthy growth over the next several years, Ghana has struggled to bolster its weak cedi currency, combat inflation and control budget deficits which led the rating agency Fitch to downgrade the country's economic outlook from stable to negative earlier this year.

A man casts his vote at a polling station during presidential elections.REUTERS/Stringer

Ghana's democracy is widely praised as a model for the region

After the speech, Ghana's Gender, Children and Social Protection Minister Nana Oye Lithur told DW correspondent Isaac Kaledzi that it had been meant to unify the country. "What he said is that the people of Ghana have the ability to resolve their problems very easily. If they come together and they are determined, and they pull their resources and they focus," Oye Lithur said. “And he has given us the road map and the frame work for that, so there is room for optimism,” the minister added.

Fritz Baffuor, another ruling party law maker, told DW, she was pleased with what she heard. “He still focused on the four pillars that he has been talking about. He talked about how the poor is going to be cushioned, and then expanding the cash transfer, and he articulated it very well,” Baffour said.

Mixed reactions from the public

The president's state of the nation speech was greeted with mixed reactions in the streets of Ghana's capital Accra. One resident told DW, the address was no different from Mahama's campaign policy. “I felt when I was listening that the address for me was more of an edited version of the manifesto promises he made during the campaign.” Others seemed to agree that the president had fine ideas but had failed to clearly outline how he and his government would tackle the challenges facing the country.

Supervisors from Ghana walk down an aisle of sewing machines, checking on the work of tailors and seamstresses at the Global Garments factory in Accra, Ghana.Foto: EPA/TUGELA RIDLEY +++(c) dpa - Report+++

Ghana's textile industry is relatively advanced compared to other African nations

“If you are spending 9 billion Ghanaian cedis ($4.7 billion, 3.5 billion euros) on wages and salaries, whereby you are only getting 21 billion cedis from revenue, grants and loans, it tells you that you are really in trouble,” was one typical comment.

President Mahama's address was marred by the boycott of a minority group of lawmakers who are challenging the legitimacy of the president in court. They argue that the government has failed to implement vigorous economic policies that can transform the fortunes of the nation. They point to recent analysis by economic experts of the country's fiscal deficit coupled with the negative Fitch rating as proof that the country's economy is not on the right path.

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