It began on a jolly good note with the Minister of Finance and Economic Planning, Dr. Kwabena Duffuor, blowing his own horn. By the time the Budget Statement ended in Parliament House yesterday, everything had gone stale.
Dr. Kwabena Duffuor began by painting a glossy picture of the economy under the able direction of Prof. John Evans Atta-Mills. Gross Domestic Product, according to the Finance Minister, grew by 4.1 per cent in 2009, compared to 2.0 in Sub-Saharan Africa.
Fiscal deficit reduced from 14.5 per cent of GDP to 9.7 per cent in the fiscal year. The story of inflation has, in recent times, become music in the ears followers of the ruling party, as it tumbled from 20.74 per cent in June 2009, to reach 9.38 per cent in October 2010, “the lowest in the last two decades.”
The Minister patted the back of his government for building up gross international reserves of US$3,973 million at the end of October 2010. The reserves exceeded three months of national import cover.
The cedi has strengthened against the major currencies – the dollar, pound sterling and the euro. With oil money expected to pour in as drilling begins next month, the economic outlook of this nation could not have looked brighter.
Surely, Ghana has arrived in the elusive club of Middle Income earners, a feat that obviously calls for celebration. By the time the Minister finished reading, with taxes increased across board for already hard-up Ghanaians, the budget had lost much of its sparkle.
Not even the majority National Democratic Congress members in the House expressed optimism in a fiscal policy that would obviously increase the economic burden of the already hard-up Ghanaians. To add to the problems, Ghana is still heavily dependent on external support to finance the budget.
We were equally amazed that the Minority did not react to the statement on the floor of the House. It did not look like it was a Budget Day in the House. Budget statements had previously brought the House alive, with the Majority hailing the contents, while the Minority usually did their worst to pooh-pooh it.
The Chronicle is disappointed in the Budget Statement. Ghanaians were made to understand that the Budget Statement was going to lead the way for the consolidation of this nation as a Middle Income earner.
As it turned out, the state has lost the opportunity to stimulate growth in the manufacturing and service industry, to add to the age-old agricultural input.
As explained by Dr. Paa Kwesi Nduom, no nation could stimulate economic growth by over-taxing its citizens. Overtaxed people naturally lose the instinct to work harder. It is as simple as that!