Use budget review to set minds at ease
It is no secret that the economic fortunes of the country have been impacted by two main factors – the dwindling price of crude oil on the world market and the current power supply challenges.
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While the reduced price of crude would be advantageous to the country when we purchase oil on the world market, we are bound to lose out when we put up our crude oil for sale on the global market.
President John Mahama alluded to this fact when he recently indicated that Ghana would lose US$700 million in oil revenue as a result of the slump in global crude price.
There is yet another factor that has been blamed for the country’s economic woes – the Chief Executive Officer of Dalex Finance and Leasing Company Ltd, Mr Kenneth Kwamina Thompson, has identified over expenditure by the government as one of the country’s major challenges.
He said the over-expenditure, which was not peculiar to the current government, had resulted in excessive borrowing by successive governments over the years and that the country’s income in 2013, for instance, was GH¢13.9 billion, whereas its expenditure was GH¢21.2 billion.
That, he described as "reckless spending" and an indication that “Ghana is broke.”
It is however, not all gloom, as inflation has reduced marginally from 16.7 per cent to 16.4 per cent, notwithstanding Mr Thompson’s prediction that by the end of the year, the exchange rate would be one dollar to GH¢7.30, due to the pressure the US dollar was putting on the cedi.
Despite the slight reduction in inflation, the situation in the country still remains grim, and Ghanaians are reeling from the effects of the power crisis.
According to the Industrial and Commercial Workers Union (ICU), 350 workers have been laid off since January 2015, as a result of various industrial and commercial concerns that have arisen out of the energy crisis.
The General Secretary of the union, Mr Solomon Kotei, explained that as a result of the erratic power supply, the production cost of many industrial concerns had increased, which had compelled some employers to lay off some of their workers.
He indicated that employers who still maintained their workforce, in spite of the dwindling fortunes of their companies, were just managing under such trying circumstances.
All other sectors of the economy that depend on electricity, including the small and medium-scale enterprises such as cold stores, barbering and hairdressing salons, catering companies and welders continue to have their fair share of dwindling fortunes.
We join Mr Thompson’s call for more financial discipline on the part of the government, as well as prudent and judicial use of the nation’s resources, by all in state enterprises who manage public resources so that we do not crash as a nation.
It is also our hope that the government would use its review of the budget presented last year to let Ghanaians know the reality of the situation and the measures that have been put in place to counteract the challenges, in order to set our minds at ease.
Let nobody be deceived that the challenges of the economy are being exagerated to make the government unpopular.
We all know that the economy is facing challenges, and it will serve our purposes if we are told the difficulties, in order to rally the government for the solutions.