Genesis of the cedi value crises
The cedi’s recent free fall and the accompanying panic measures adopted by the central bank did not just happen. It is the cumulative result of our failure to do what was necessary over the years. Some of us have tried to point this out through articles in the print media over the last few years to no avail. Now it is too late. The pain is upon us and will continue to deepen until we wake up from our slumber to fix our economic mess.
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I wish to remind Ghanaians of what our problem is:
•Our education system is broken.
•Our agricultural sector is broken.
•Our industrial sector is broken.
•We have no national development plan
•We have no idea about how to mobilise our enormous national resources to create wealth.
•We do not practice the nine basic life principles necessary for smooth and orderly development.
•We have a population whose educated folk think that dignified work only happens in air-conditioned offices.
•We have no patriotism and no national cohesion for the purposeful prosecution of our national aspirations.
The result of all these is that:
We import most of our food requirements. Our import bill for perfumed rice alone tops $500 million annually.
We import nearly all our needs of manufactured products from hummers down to toilet rolls and toothpicks.
Where are the dollars coming from to finance these purchases?
If we continually rely on the sale of raw materials of uncertain value and the benevolence of donors to finance these purchases, then we must be prepared to pay the price of being naïve enough to think this could go on indefinitely.
One does not need a PhD in Economics to see the economic hole we have dug for ourselves. It was only a few years ago that we knocked four zeros off the value of the cedi. After that we have failed to change the fundamentals of the economy and we expect the cedi to retain its value?
We have a long hard road to travel before we can stop worrying about the value of the cedi. Confiscating the forex deposits of citizens will not solve the problem. It will only drive the dollars underground and make them scarcer. The danger is that citizens will no longer trust the banks with their dollars or other hard currencies. The matter of fact is that they might not even want to bring their dollars into the country at all. For a country that is so heavily dependent on imported goods to survive, it would be suicidal to thread this path. I remember what happened during the Acheampong regime when a decree made it an offence to possess foreign exchange. Imported goods dried up and the hardship days of Ghanaians began. It was when this policy was reversed that we began to live decent lives. It appears we have very short memories.
The road to economic freedom is simple. We must evolve a national development plan which should have as its pillars:
Education: Place emphasis on scientific and technical education to produce graduates with the skills necessary to transform the economy.
Make entrepreneurship training mandatory in all schools. It would empower Ghanaians to add value to our abundant natural resources to create wealth.
Teach the basic life principles at all levels of our education system to instill discipline, integrity and patriotism in Ghanaians.
Agriculture: This must be the main pillar of our path to development. We have relative advantage to succeed in this area. We have to ensure that our population is adequately fed from within the country. We must aim not to import any food items that can be produced locally.
Industry: This should be the second pillar of development. It is a national disgrace to import things as basic as toilet rolls and toothpicks. The reason for this state of affairs is that our present policies are anti-industry. We must make it more rewarding to produce locally than to import. Presently, policies are heavily in favour of imports. The pressure on the cedi is unlikely to ease with our incessant demand for foreign exchange to finance many needless imports.
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Resource mobilisation: Our country abounds with resources that can be mobilised for development. It is unacceptable that our annual revenue is only sufficient to pay public servants. We are sitting on wealth that is either going waste or being pillaged by foreigners right under our noses.
My recommendations sound like a long hard road and that is what it is. If we think we can find a quick fix to our problems, then we must brace ourselves for the bad news: it won’t happen without following the long painful road to success. We have known this for a long time, but like the proverbial ostrich, we buried our heads in the sand in the hope that we would not have to carry this cross. Our so-called development partners have successfully carried their crosses. If we expect them to carry ours for us, then we should be prepared to remain in squalor till thy kingdom come. The cross is ours to carry and we must start now.
Writer e-mail: norbenne1@yahoo.com