NDC could have built over 1,000 factories — Bawumia

With the unprecedented borrowing the current NDC government has undertaken, it should have been able to build at least 1,142 Komenda-like factories across the country, if it had properly and honestly managed Ghana’s resources, the New Patriotic Party (NPP) 2016 Vice-Presidential Candidate, Dr Mahamudu Bawumia, has observed.

Dr. Mahamudu Bawumia

Dr. Mahamudu Bawumia

He wondered why the government seemed to be bragging about the factory.

Dr Bawumia made these comments at the International Young Democrat Union (IYDU) Freedom Forum 2016 in Accra last Thursday.

Speaking on the topic: “Tackling Africa’s high unemployment rate, a challenge for the New Africa,” Dr Bawumia noted that a proper management of resources devoid of corruption was one of the critical necessities for creating jobs and the right environment for business in Africa.

Good example

He narrowed down to Ghana as a good example of a nation which had abundant resources in the past few years but failed to witness

the transformation of those resources.

“When you look at Africa, the problem often is not a lack of resources; it is the management of resources,” he stated, and said for instance “between independence and 2008, the total debt of Ghana was GH¢9.5 billion (about $8 billion then), now the current government has been on a borrowing spree and has increased this debt from 9.5 billion to GH¢111 billion by March. Now if you look at the money that has been borrowed in dollar terms, at the time of borrowing, it is currently around $40 billion; this is the value of the money that has been borrowed”.

Before proceeding to touch on the number of factories such huge borrowing could have built, Dr Bawumia recounted the NDC’s denials of the actual value of the money it had borrowed and wondered how any government could properly manage funds when it did not even know the value of money it had borrowed.

“Of course, because of the exchange rate depreciation, the actual amount owed is less than the value that has been borrowed, but when I mention it, this government doesn’t seem to understand that you can borrow an amount of $X but because of exchange rate depreciation, you actually owe less at the end of the day because if the exchange rate is GH¢1 to $1 and I borrow GHS100, then it’s $100 I’ve borrowed, but if it depreciates to GHS10 to $1, then that GHS100 I’ve borrowed now will be $10 on the books. But it doesn’t mean that I didn’t borrow GHS100 to start with. So, when I say to the government that they’ve borrowed the equivalent of $40 billion, they will tell me I am wrong because they are using the current exchange rate, and, therefore, they’ve only borrowed about $10.

“So, if you cannot even understand how much money you have borrowed, how can you manage the money? I mean you don’t have a sense of how much money you have borrowed, how can you manage it?” Dr Bawumia quizzed, and added: “It’s mind-boggling but these are the people managing our economy and if you cannot understand simple facts like these, how do you go to the more complicated act of creating jobs?” he questioned.

Dr Bawumia was of the view that with such unprecedented borrowing, the last thing the government should be doing was bragging about setting up one factory since the $40 billion the government had taken could have built 1,142 of such factories.

“Our government was beating its chest a few weeks ago that it had established a sugar factory for 35 million meanwhile you have borrowed some $40 billion, you could have established 1,142 of such factories but after borrowing $40 billion, you are now trying to beat your chest for establishing a factory for $35 million,” he added.

Dr Bawumia stated: “When you spend $40 billion in any African economy, you should see transformation, you shouldn’t have a water problem, you shouldn’t have an energy problem and you shouldn’t have a manufacturing problem. You have to deploy the resources adequately to solve problems and for the benefit of the economy.”

The International Young Democrat Union (IYDU), founded in 1991, is a global alliance of centre-right political youth organisations and the youth wing of the International Democrat Union (IDU). The Freedom Forum 2016 is the first time the IYDU is holding the annual event on the African Continent.

Former President John Agyekum Kufuor and the Presidential Candidate of the New Patriotic Party, Nana Akufo-Addo, are expected to address the forum before it ends on Saturday.

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