You are on page 1of 7



(The Speech was delivered at a National Financial Literacy and Investment Summit
organised by the University Students Association of Ghana (USAG) at the University for
Development Studies, Wa Campus)



Use of Borrowed Money / Resources

The burning question for most Ghanaians is that if the government has borrowed the
equivalent of some $37 billion (at the time of borrowing) in seven years, can they point
to an equivalent amount of projects?
Unfortunately and sadly, the answer is no. The government is attempting to hoodwink
Ghanaians by claiming a massive increase in infrastructure investment. Why do I say so?
First, If you sum the cost of all the loan financed projects listed in the green book (even
including those with artistic impressions, it is less than $7 billion. Meanwhile, the
government has borrowed the equivalent of $37 billion so where is the rest of the money?
Indeed, according to the Managing Director of the IMF, most of Ghanas borrowing has
been used for consumption and not for investment. The overpricing of contracts,
corruption and the absence of value for money considerations is partly responsible for
this. For example, a runway rehabilitation alone at Kumasi airport cost this country $23.8
million whereas a proposed airport at Ho is estimated at $25 million. Was the runway in
Kumasi paved with gold?
Indeed, given the resources at its disposal one should expect at least four times the
quantum of investment that the NDC claims to have undertaken. The close to $30 billion
of borrowing that was not used for projects could have inter alia:
Developed the Rail network from Accra to Paga and transformed many parts of
the country just by this investment.
Solved the water problems in Ghana
Solved the energy problem and not put the country through 4 years of dumsor at
the cost of human lives and collapsing businesses and unemployment

Put in place at least 1000 kilometres of asphalted roads in each region. There will
be no major road problem left in any region after this.
Transformed Agriculture in the Northern regions, Afram Plains and Ghana
through investment in machinery, irrigation and dams
Put in place one world class hospital in each region
Buy at least 1000 ambulances for the Ghana Ambulance service
Set up factories with the private sector across the country to add value to our
raw materials and create jobs. On the issue of jobs, the question is, if the
government has taken a whole 4 years to solve a basic problem like Dumsor, how
long will it take to address unemployment? At this pace, many of the unemployed
youths will be over the pension age before the NDC finds a solution to the
unemployment problem.
Equip our existing health and education institutions with state of the art facilities
Build an additional 600 of the Senior High Schools the government is currently
trying to build.
The second reason why I say the NDC is attempting to hoodwink Ghanaians with claims
of massive infrastructural investments is that investment in infrastructure has actually
been on the decline! Yes, investment in infrastructure in Ghana has actually been on the
decline! I will now explain why this is the case.
Investment in infrastructure is key in any economy to maintain and increase economic
growth. It enhances productivity. In this regard, it is important to note that we measure
investment in an economy relative to GDP and not just in nominal terms. This is a point
that is unfortunately lost on this NDC government and their communicators.
To explain this point, if a person tells you they have invested GHC 1000 in the education
of their children and another tells you they have invested GHC 2000, you cannot conclude
that the second person has invested more in his or her children if you do not compare it
against the number of children in the family. If the first person has one child and the
second has 10 children, then the investment of the person with one child will be higher
(i.e. GHC1000 per child compared to GHC200 per child for the second person).
It is in this context that when we measure the impact of investment, we look at it relative
to the GDP of a country. If as a country, your investment in infrastructure relative to GDP
is declining, then your growth is likely to decline. This background is very important to
understand what is happening in Ghana today.
The evidence shows that notwithstanding the massive increase in the debt stock, capital
expenditure as a percentage (%) of GDP has actually been on the decline from 9.1% of
GDP in 2008 to 4.1% by 2015. Capital expenditure as a percentage of GDP averaged 11%
for 2001-2008 (without oil) while that for 2009-2015 has averaged 5.7% (with oil).

This means that contrary to all the government claims, of an increase in infrastructure
expenditure on projects all over the country, the reality is that Ghanas expenditure on
infrastructure relative to GDP is declining. The numbers indicate that relative to GDP, this
government is investing about half what the previous government invested in
infrastructure. It is in fact a travesty that Ghana before the discovery of oil was spending
a higher proportion of its income on infrastructure investment than after the discovery
of oil and the massive increase in the debt stock. This decline in investment in
infrastructure runs counter to what one would have expected.
The third reason why I say the NDC is attempting to hoodwink Ghanaians with claims of
massive infrastructural investments is that most of these projects are over-priced as a
result of the single source procurement method, which has become the procurement
method of choice for this government, as we saw in the SADA, GYEEDA, KARPOWER,
SMARTYS bus branding etc.. I would like to see for example the government explanation
from the government quantity surveyors of the costing on the Kumasi airport runway for
$23.8 million. However, you and I know that they would not explain because they cannot
The fourth reason why I say the NDC is attempting to hoodwink Ghanaians with claims of
massive infrastructural investments is that in fact, all governments in the past have done
projects. Indeed, in terms of projects accomplished relative to resources available, the
NPP government of 2001-2008 has a very impressive record (including this UDS
campus). In the road sector for example, the NPP investment between 2001-2008 far
exceeds that of the NDC since 2009.
The nations road network stood at 37,321 km at the end of fiscal year 2000, increased to
56,057 km at the end of 2004, moved further up to 67,291 km at the close of year 2008,
increased slightly to 68,134 km at the end of 2012 and as at the close of December 2014
stood at 71,063 km (Table 2).
TABLE 2GHANA ROADS (km) Highways, Urban and Feeder Roads)
12,697* 13,344 14,873
68,134 71,063
*Some trunk roads within the cities of Accra and Kumasi and other major cities ceded to
Department of Urban Roads.
The nations road network increased by 18,736 km and 29,970 km during the four (4)
and eight (8) years of NPP-led administration respectively. At the end of year 2008, the
network size met as at the end of December 2000 has been increased about 80%. In
contrast, the NDC government has thus far added only 3,772 km to Ghanas road network.

This means that the NPP constructed 8 times more roads (km) than the NDC even though
they had 10 times more money. Yet when you listen to Government propaganda, they will
tell you of the massive road investments they are making. Unfortunately for them, the
facts completely disprove their attempt to hoodwink Ghanaians.
Indeed, it was His Excellency President Mahama who told us that any government touting
projects as achievements is conducting an exercise in mediocrity, So what has changed?
The real fact is that the NDC has no real achievements to point to outside the undertaking
of some projects hence their resort to mediocrity.
Ladies and Gentlemen, the fifth reason why I say the NDC is attempting to hoodwink
Ghanaians with claims of massive infrastructural investments is that infrastructural
investment is not supposed to be for its own sake but to increase productivity and
production in the economy. The proof of the pudding, as they say, is in the eating. If you
have indeed undertaken massive and unprecedented infrastructural investment, then
why is the economy collapsing?

Why is the NHIS in trouble?

Why is unemployment on the increase?
Why are businesses collapsing?
Why is agricultural growth stagnant?
Why is manufacturing growth negative?
Why is the government having difficulty meeting statutory payments?
Why the high interest rates?
Why the massive exchange rate depreciations?
Why are the SADA guinea fowls flying to Burkina Faso?
Why the massive increase in utility prices?
Why the withdrawal of teacher and nursing training allowances?
Why all this suffering in the land?

The facts therefore show that the impact of the NDC infrastructure investments have not
translated into increased output, job creation and better living conditions for the people
of Ghana.
Finally, Mr. Chairman, the sixth reason is that the investments being claimed by the NDC
have not actually translated into making our social services better. A few examples come
will clearly illustrate this point. The NDC claims to have put in over a billion dollars in the
area of water infrastructure. Yet, today many places across the country are seeing the
worst shortages of water in decades. On my way to Wa, I passed through Adoagyiri, where
residents are currently facing the worse water crisis in years. School Children have had
to abandon school in search of water. Water supplied by private enterprises have shot up

as a result by over 500% in some instances and the poor have virtually been priced out
of getting portable water to drink and for their daily chores. The situation in Adoagyiri
and Nsawam is currently also in play in many parts of the country Obo, Tamale, to
mention a few.
So Mr. Chairman, what is the essence of the claims being made by the NDC with respect
to investments in water when after seven years, the people are rather seeing worse
shortages than they were before these so-called investments?
The government is also claiming unprecedented investments in the Health Sector.
However, Mr. Chairman, many across the country can attest to the fact that the National
Health Insurance Scheme, which provided relief to many Ghanaians and ensured that
millions could access health care regardless of how much money they had at the time of
ailment, is today on its knees. What Ghanaians can relate to is the many illnesses and
drugs which have been taken out of the NHIS care lists, the Capitation policy and the
situation where patients seeking to be treated on the basis of possession of the NHIS Card
are turned away in favor of patients with money. For many Ghanaians, the sad reality is
that the killer Cash and Carry program, which the NPP worked to cancel, has been
technically introduced back as a result of the failure of the NHIA.
Again, Mr. Chairman, despite these huge claims of investment, our Hospitals across the
country, keep crying over very essential equipment and facilities. I had this sad reality hit
home when a close relative passed away last year as a result of the lack of oxygen at
Tamale Teaching Hospital. The recent closure of certain departments in Korle-Bu also reemphasizes this point.
The latest case which brings this sad reality into focus was the gory Kintampo accident
last week, which claimed over 60 lives. According to the Medical Superintendent of the
Kintampo Government Hospital (where all the victims of the accident were sent), Dr.
Bismark Owusu Ofosu, who spoke to the BBCs Sammy Darko, some victims of the
accident who were brought in alive died because the Hospital lacked some vital logistics
and medicine. There is no supply of oxygen. Even Common Emergency Drugs are not
available, Dr. Owusu Ofosu said while addressing the media on Thursday.
Also, the Acting Administrator of the Ambulance Service in the Brong Ahafo Region,
Samuel Karikari, confirmed to Citi News that at the time of the accident, the only
Ambulance in Kintampo was out of commission. He confirmed that the nearest
Ambulances to where the Accident occurred were all not functioning. These factors
ensured that it took emergency services several hours to get to the scene and save the
lives of the victims.
The Hospital Superintendent, who spoke on Class FM, said We could have saved a lot of
lives because called the National Ambulance and I was told that the National Ambulance

was out of function.. If we had an ambulance which could take five, six people at a time,
(we) would have done better.
So again, Mr. Chairman, what is the point in the claims of massive investment in the Health
Sector when after seven years and with over 200 billion in Resources, we cannot sustain
the Health Insurance Scheme which was functional when Ghana had less than 10 times
the resources this government has had; and cannot provide vital logistics for our existing
Hospitals and service our Ambulances to save the lives of our countrymen?
Lastly, to the Education Sector. Despite claims of unprecedented investments also in the
Education sector, the sad reality most Ghanaians can relate to, is the fact that Education
has become less affordable to access. While Fees and other charges have multiplied
steeply, the government has worsened matters by cancelling / abolishing several
allowances and subventions in Education. The cancellation of Teacher and Nursing
Training allowances, now mean that students are finding it unbearable to keep
themselves in the Teacher and Nursing Training colleges.
Students in our various campuses are also being asked to pay more and more, which can
only mean additional burden on the already burdened student and parent. Education is
increasingly being priced out of the reach of the middle class and poor Ghanaian.
At the Teaching level, Teachers from the basic to tertiary level have also seen the
cancellation of several allowances and pegs which made their all-important work, a bit
more satisfying.
So once again, what is the point in claiming huge investments in the Education sector
when the ordinary Student is today more burdened than ever and when the most critical
factors in Education, Teachers, have seen a worsening of their conditions of service and
have to spend so much time demanding for their due?
Mr. Chairman, it is therefore clear that despite the huge claims of investment, the reality
for many Ghanaians is that livelihoods have worsened and social services are not
One point I would like to make is that investments must be assessed critically on the basis
of what they mean to production and lives and not just on the basis of numbers. For
example, early reports on the Kintampo Accident, which was later confirmed to the
Graphic by the Police, indicate that the Accident could have been caused by a faulty brake.
So while the government may add the recent GHC 3million rebranding of the MMT Buses
as an investment in the Metro Mass Transit Company, the question is, would this
investment not have been more prudent if it was put in the maintenance and servicing of
these Buses? Will that not have saved more lives and improved on the effectiveness of the
MMT, compared to the decision to rebrand these Buses?

In contrast, the NPP government of 2001-2008 undertook massive infrastructure

investment across the various sectors: education, health, roads, energy, etc. but the
impact of this infrastructure investment was felt positively with :

a significant increase in GDP growth from 3.7% to 8.4% without oil

Massive improvement in cocoa production
National Youth Employment Programme providing opportunities and jobs for
the youth to get a start in the job market
The School Feeding Programme to provide food to pupils in basic schools
Capitation Grant to make education affordable and accessible
Free Metro Bus ride for children in basic school.
The National Health Insurance Scheme (NHIS) to provide accessible healthcare to
the population.
The National Youth Employment Programme (NYEP)
Free maternal care for all pregnant women under the NHIS.
Introduction of a Metro Mass Transit transport service for urban areas to provide
subsidized transport for commuters and a free bus ride for basic school pupils in
Introduction of the Livelihood Empowerment Against Poverty (LEAP) programme
under which welfare grants are paid to the extreme poor.
Payment of nursing and teacher training allowances even when HIPC

What this goes to show is that Infrastructure investment alone is not sufficient to drive
an economy. You need to manage an economy with competence and keep corruption
under check if you are going to make progress. Unfortunately, this NDC government is
riddled with incompetent economic management and corruption. It is a toxic mixture that
has exploded into all the suffering that we are seeing.