John Mahama
Former President John Dramani Mahama has admitted the negative impact the COVID-19 pandemic and the two-month-old Russia-Ukraine war have had on African countries.
He, however, added that with better management, Ghana’s economy, though equally buffeted by global and geopolitical events, could have been more resilient.
He made these remarks over the weekend while speaking at the 24th Africa Business Conference, organised by Harvard Business School in the United States.
Mr Mahama conceded that “data from the Economic Commission of Africa”, shows that the COVID-19 pandemic created the “continent’s worst recession in 50 years, with real GDP shrinking by an average of 3% in 2020”, and that even “before the pandemic, poverty reduction was already a major challenge in Africa”.
Necessary action
He pointed out that it became necessary for governments all over the world and, for that matter, African governments to take action to shield their population from the effects of the pandemic.
“This meant in many cases an increase in deficits due to unbudgeted expenditures. This has devastated many African economies and sank them deeper into unsustainable debts and economic downturns. The pandemic has had a general deleterious effect on the economy of African nations,” he admitted.
He said the pandemic is estimated to have dragged about 55 million more people into poverty in Africa and exposed another 46 million more to the risk of hunger and malnourishment.
“Indeed 70% of hunger in Africa, which had already been on the rise since 2014, is directly attributed to this pandemic,” the former president added.
Russia-Ukraine war
Touching on the impact of the Russia-Ukraine war on the African continent, he stated that it threatens to wreck more havoc on an already fragile continent even as COVID-19 still lingers and African countries attempt to reset their economies.
“Yet another disruption, the Russia-Ukraine conflict is set to peg Africa’s growth back by an estimation of about 0.7%. Inflation is expected to rise by at least 2.2% in 2022 and as many as 43 countries that depend on energy and food imports will be confronted with fiscal and current account problems. Global increase in energy prices has escalated the cost of living and compounded hardships in many countries,” he said.
He added: “In light of the above, the conversation is now about overcoming the twin problems of a pandemic and its aftermaths, and a geopolitical-induced economic crisis, as opposed to one that focuses on just post-pandemic recovery”.
Ghana’s story
Clearly seeking to score political points, the former President, however, said this about Ghana: “In my country, Ghana, our economy has emerged in an extremely poor shape from the COVID experience. A ballooning deficit, double-digit inflation, a nosediving currency, increasing debt distress, are some of the symptoms of a very ill economy.
“Ghana’s case was easy to predict. With the cavalier handling of the economy by the current administration, unbridled borrowing from the capital markets, created misstatements and other critical fiscal Budget figures were certain to come to a head eventually.”
“To make matters worse, a pandemic windfall in excess of GHC33 billion, which could have cushioned the economy, remains unaudited and is believed to have been used largely in the quest to win Election 2020 at all costs,” he claimed further.
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