Many mis-guided Afrikans and Westerners believe that countries like Ghana needs so-called aid. What the global financial crises has shown to Afirkans in that the West's prescription of economics is redundant and has failed Afrikan countries like Ghana. This article explains why and how Ghana must inact its own stimulus package rather than looking up to a bankrupt West who themselves are in deep shit.
Following the recent G20 meeting of Finance Ministers in Scotland that advocated more stimulus packages be implemented until in the words of British Finance Minister, Alistair Darling "The job is done", we examine the need for Ghana to have its own stimulus package rather than having to beg for money from the wicked IMF and World Bank.
This too is in the light of the Government of Ghana's budget that was presented to Parliament by Dr. Kwabena Duffour. A budget, it must be noted to the attention of the Ghanaian public, that was sanctioned in London and Washington before being approved by the Ministry of Finance and Economic Planning.
Think about this, if our "development partners" are responsible for up to 60% of our budget, don't you think that they would have a vested interest IN SCRUTINIZING IT and giving it their seal of approval before Dr. Kwabena Duffour presents it to parliament and thus the rest of the country?
The essence of this article is to inform the reader that Ghana, given the new realities in the financial world in the light of the global financial crisis can no longer count on agencies like the IMF and World Bank who have no interest in ever seeing countries like Ghana grow to economic prosperity given their own appalling track record.
What many Ghanaians and Afrikans are not aware of is that the very same institutions like the IMF that Ghana is depending on to help them are the very same institutions that are flat broke. The IMF is broke!!! - As far back as 2001, an article by Kathy Wolfe in the December 7 issue of Executive Intelligence Review stated that the IMF/World Bank was bankrupt and was identifying new ways of modernizing the whole way the IMF/World Bank is structured and organized.
Also as a result of this admission and following the current global financial crisis, Asian leaders met at a conference in August this year at Penang, Malaysia to chart a way towards greater regional cooperation that would insulate them from the IMF and financial crisis.
The conference on effects of the global financial crisis on Asian developing countries, organized by Third World Network and the Consumers Association of Penang, brought together present and former Central Bankers, Finance Ministry Officials, researchers and Civil Society Organizations. A strong theme was the need to develop regional consumption, trade and investment rather than relying on debt-laden consumers in the developed world.
Looking at the recent developments to the Chiang Mai Initiative and the prospect of reviving the idea of an Asian Monetary Fund, Andrew Sheng, former chairman of the Hong Kong Securities Commission and now a chief advisor to China's Banking Regulatory Commission, said there are three choices for Asia: to stick to the status quo; take defensive measures and cooperate to avoid damage; or take an offensive approach including forcing international reforms.
He said Asia is now somewhere between the status quo and the defensive approach. While the Asian financial crisis made it painfully clear to Asian countries that the IMF solution is bankrupt, the present crisis has also shown the lack of creative and collective thinking at the regional level.
Former Governor of India's Central Bank, YV Reddy, agreed with Sheng that Asia should not be defensive, as the region has 67 per cent of the world's currency reserves, 55 per cent of the world's population and a significant share of global production.
He suggested that an influential Asian think-tank be established to provide advice on finance to policymakers, and that Asia should act to rebalance the global financial system." For example, there are only two credit rating agencies and two financial news agencies with global influence, all of which are Western-owned."
Similar agencies should be set up by Asians, using the perspective of developing countries, he said.
Pitchaya Sirivunnabood, from the Fiscal Policy Research Institute in the Thai Ministry of Finance, felt that Asia's financial clout from trade surpluses and high reserve holdings inspired more aggressive ideas for financial cooperation, for example an Asian currency unit.
She noted that one of the priorities of the Chiang Mai Initiative is the development of a surveillance system, independent of the IMF. This would support the decision-making of the initiative's secretariat and could facilitate the eventual de-linking from IMF programmes. Currently, Chiang Mai Initiative funds are still linked to IMF programmes beyond an initial amount of financing.
Given the above and given that the West has spent trillions of dollars bailing itself out of the financial crisis - For example, America has spent so far in excess of 1.6 Trillion US Dollars, Britain has spent in excess of 100 Billion Pounds Sterling and in the process bailing out banks like The Royal Bank of Scotland, Northern Rock and Bradford and Bingley and Germany has spent in excess of 100 billion Euros trying to fix its economy - Added to this there are huge unemployment problems in Europe and America - America has a 26 year old unemployment high registering now at 10% (US Labor Dept), Britain has now 30% of under 25 year olds with no job and countries like Germany, France, Spain and Italy all facing record numbers of people on the dole, Don't you think it is only right, logical and sensible that Ghana too has a stimulus package of its own?
As I have said on many occasions the REAL change that Ghana desperately needs WILL NEVER be realized if it follows wily nilly flawed policies as prescribed by the IMF and World Bank. As we have seen in Ghana over the last 27 years or so from SAP's, through to PRP's, through to HIPC that these policies have created mass unemployment, huge balance of payments deficits, low manufacturing and agricultural output and CREATED A DEPENDENCY CULTURE that is dangerous to say the least.
There are many reasons why Ghana needs its own stimulus package with the main one being the right to self determination and reliance.The time has surely come for Ghana's leadership to accept that stark reality that The West, India, China and so-called development partners are NEVER going to SAVE Ghana.
We must help ourselves and the only way we can help ourselves is by, as I have said many times before, enacting and implementing policies that are in the national interest AND NOT in the interests of our so-called development partners whose real agenda is to stop Ghana from developing at a pace that will make Ghana economically independent and to further continue to exploit, enslave and under develop Ghana.
Therefore instead of looking up to the same Bretton Woods Institutions that have failed Ghana for the last 40 years or so the time has come to chart our own destiny especially our economic destiny .
On the economy, the paradigm should be to move our economy as soon as possible from total dependence on non-Afrikans for capital, technological knowhow, and manufactured goods and instead formulate new economic structures that will specifically be designed to create indigenous industries to produce consumer goods for the local market that would have otherwise been imported from abroad.
This act alone would make Ghana self-reliant and develop an economy able to sustain real growth, development and create full employment. The success of achieving the above goals would be a reality by having a highly educated and qualified pool of workers that would be needed to support these burgeoning industries. Therefore this means that FREE education must be made available to ALL from Kindergarten right through to University.
This is where I fault the Budget that was given by the Finance Minister. The budget was a give and take budget which is a classic IMF sanctioned budget in the sense that it gave with one hand namely in the field of agriculture but took with the other in terms of not finding mechanisms that would put extra money into the pockets of the ordinary Ghanaian.
Although the development in agriculture is welcomed, it does not go far enough - for example it did not specify innovative conceptions like underground solar energy powered irrigation systems and looking into research into organic food production methodologies and techniques rather than importing chemicals and fertilizers that damage the body's immune system whereby organic is natural and good for the body's immune system.
Also there should have been either a complete ban on food imports or severely limit the importation of food stuff into the country because as I have said many times that we as a country need to consume what we produce and produce what we consume and NOT consume what others produce.
As far as education is concerned , that is a major instrument in nation building and development, the budget was not radical enough to bring about a REAL revolution particularly in the further and higher education sectors that is needed to create the well trained and qualified workforce of tomorrow which will usher in local economic development as a well developed and robust education system is the key that paves the way for the true economic freedom.
The budget also failed to highlight specifically
1. Women's' development - crucial aspect in any nation building programme
2. Investment in Science and Technology
3. Investment in innovations in healthcare finding cures to the likes of cancer, diabetes and sickle cell.
4. Housing initiative as there is a shortfall of at least a million homes that need to built in order to ease the housing crisis that currently faces the nation especially in cities like Accra and Kumasi.
The above is why Ghana urgently needs a stimulus package of its own to really stimulate economic growth and development and NOT the piece meal approach dictated to by the IMF/World Bank.
The Key areas where a stimulus package would help achieve rapid development and growth include:
1. Education
2. Health care
3. Public Sector development and reform
4. Agriculture
5. Infrastructure including new motorways, housing developments, comprehensive water systems network and solar powered electrification system.
Aside the above, the most important aspect of the stimulus package would be the creation of efficent and effective profit making state owned enterprises that would lead to the creation of thousands of jobs.
State intervention in a country like Ghana is a MUST especially given the current economic and financial climate and also the fact that Ghana's private sector is not developed and robust enough to be the sole engine of growth and be the catalyst to real economic growth, development and economic emancipation.
The importance of state intervention in terms of formulating stimulus packages that will boost and transform the economy cannot be downplayed - one only has to refer to the likes of Malaysia, South Korea and more importantly China who have ignored IMF/World Bank draconian policies and have decided to go down the route of formulating strategic economic and fiscal stimulus packages that have seen them become masters of their own destinies.
The sooner Ghana follows suit the better or we shall ever remain the hewers of wood and the drawers of water.
This too is in the light of the Government of Ghana's budget that was presented to Parliament by Dr. Kwabena Duffour. A budget, it must be noted to the attention of the Ghanaian public, that was sanctioned in London and Washington before being approved by the Ministry of Finance and Economic Planning.
Think about this, if our "development partners" are responsible for up to 60% of our budget, don't you think that they would have a vested interest IN SCRUTINIZING IT and giving it their seal of approval before Dr. Kwabena Duffour presents it to parliament and thus the rest of the country?
The essence of this article is to inform the reader that Ghana, given the new realities in the financial world in the light of the global financial crisis can no longer count on agencies like the IMF and World Bank who have no interest in ever seeing countries like Ghana grow to economic prosperity given their own appalling track record.
What many Ghanaians and Afrikans are not aware of is that the very same institutions like the IMF that Ghana is depending on to help them are the very same institutions that are flat broke. The IMF is broke!!! - As far back as 2001, an article by Kathy Wolfe in the December 7 issue of Executive Intelligence Review stated that the IMF/World Bank was bankrupt and was identifying new ways of modernizing the whole way the IMF/World Bank is structured and organized.
Also as a result of this admission and following the current global financial crisis, Asian leaders met at a conference in August this year at Penang, Malaysia to chart a way towards greater regional cooperation that would insulate them from the IMF and financial crisis.
The conference on effects of the global financial crisis on Asian developing countries, organized by Third World Network and the Consumers Association of Penang, brought together present and former Central Bankers, Finance Ministry Officials, researchers and Civil Society Organizations. A strong theme was the need to develop regional consumption, trade and investment rather than relying on debt-laden consumers in the developed world.
Looking at the recent developments to the Chiang Mai Initiative and the prospect of reviving the idea of an Asian Monetary Fund, Andrew Sheng, former chairman of the Hong Kong Securities Commission and now a chief advisor to China's Banking Regulatory Commission, said there are three choices for Asia: to stick to the status quo; take defensive measures and cooperate to avoid damage; or take an offensive approach including forcing international reforms.
He said Asia is now somewhere between the status quo and the defensive approach. While the Asian financial crisis made it painfully clear to Asian countries that the IMF solution is bankrupt, the present crisis has also shown the lack of creative and collective thinking at the regional level.
Former Governor of India's Central Bank, YV Reddy, agreed with Sheng that Asia should not be defensive, as the region has 67 per cent of the world's currency reserves, 55 per cent of the world's population and a significant share of global production.
He suggested that an influential Asian think-tank be established to provide advice on finance to policymakers, and that Asia should act to rebalance the global financial system." For example, there are only two credit rating agencies and two financial news agencies with global influence, all of which are Western-owned."
Similar agencies should be set up by Asians, using the perspective of developing countries, he said.
Pitchaya Sirivunnabood, from the Fiscal Policy Research Institute in the Thai Ministry of Finance, felt that Asia's financial clout from trade surpluses and high reserve holdings inspired more aggressive ideas for financial cooperation, for example an Asian currency unit.
She noted that one of the priorities of the Chiang Mai Initiative is the development of a surveillance system, independent of the IMF. This would support the decision-making of the initiative's secretariat and could facilitate the eventual de-linking from IMF programmes. Currently, Chiang Mai Initiative funds are still linked to IMF programmes beyond an initial amount of financing.
Given the above and given that the West has spent trillions of dollars bailing itself out of the financial crisis - For example, America has spent so far in excess of 1.6 Trillion US Dollars, Britain has spent in excess of 100 Billion Pounds Sterling and in the process bailing out banks like The Royal Bank of Scotland, Northern Rock and Bradford and Bingley and Germany has spent in excess of 100 billion Euros trying to fix its economy - Added to this there are huge unemployment problems in Europe and America - America has a 26 year old unemployment high registering now at 10% (US Labor Dept), Britain has now 30% of under 25 year olds with no job and countries like Germany, France, Spain and Italy all facing record numbers of people on the dole, Don't you think it is only right, logical and sensible that Ghana too has a stimulus package of its own?
As I have said on many occasions the REAL change that Ghana desperately needs WILL NEVER be realized if it follows wily nilly flawed policies as prescribed by the IMF and World Bank. As we have seen in Ghana over the last 27 years or so from SAP's, through to PRP's, through to HIPC that these policies have created mass unemployment, huge balance of payments deficits, low manufacturing and agricultural output and CREATED A DEPENDENCY CULTURE that is dangerous to say the least.
There are many reasons why Ghana needs its own stimulus package with the main one being the right to self determination and reliance.The time has surely come for Ghana's leadership to accept that stark reality that The West, India, China and so-called development partners are NEVER going to SAVE Ghana.
We must help ourselves and the only way we can help ourselves is by, as I have said many times before, enacting and implementing policies that are in the national interest AND NOT in the interests of our so-called development partners whose real agenda is to stop Ghana from developing at a pace that will make Ghana economically independent and to further continue to exploit, enslave and under develop Ghana.
Therefore instead of looking up to the same Bretton Woods Institutions that have failed Ghana for the last 40 years or so the time has come to chart our own destiny especially our economic destiny .
On the economy, the paradigm should be to move our economy as soon as possible from total dependence on non-Afrikans for capital, technological knowhow, and manufactured goods and instead formulate new economic structures that will specifically be designed to create indigenous industries to produce consumer goods for the local market that would have otherwise been imported from abroad.
This act alone would make Ghana self-reliant and develop an economy able to sustain real growth, development and create full employment. The success of achieving the above goals would be a reality by having a highly educated and qualified pool of workers that would be needed to support these burgeoning industries. Therefore this means that FREE education must be made available to ALL from Kindergarten right through to University.
This is where I fault the Budget that was given by the Finance Minister. The budget was a give and take budget which is a classic IMF sanctioned budget in the sense that it gave with one hand namely in the field of agriculture but took with the other in terms of not finding mechanisms that would put extra money into the pockets of the ordinary Ghanaian.
Although the development in agriculture is welcomed, it does not go far enough - for example it did not specify innovative conceptions like underground solar energy powered irrigation systems and looking into research into organic food production methodologies and techniques rather than importing chemicals and fertilizers that damage the body's immune system whereby organic is natural and good for the body's immune system.
Also there should have been either a complete ban on food imports or severely limit the importation of food stuff into the country because as I have said many times that we as a country need to consume what we produce and produce what we consume and NOT consume what others produce.
As far as education is concerned , that is a major instrument in nation building and development, the budget was not radical enough to bring about a REAL revolution particularly in the further and higher education sectors that is needed to create the well trained and qualified workforce of tomorrow which will usher in local economic development as a well developed and robust education system is the key that paves the way for the true economic freedom.
The budget also failed to highlight specifically
1. Women's' development - crucial aspect in any nation building programme
2. Investment in Science and Technology
3. Investment in innovations in healthcare finding cures to the likes of cancer, diabetes and sickle cell.
4. Housing initiative as there is a shortfall of at least a million homes that need to built in order to ease the housing crisis that currently faces the nation especially in cities like Accra and Kumasi.
The above is why Ghana urgently needs a stimulus package of its own to really stimulate economic growth and development and NOT the piece meal approach dictated to by the IMF/World Bank.
The Key areas where a stimulus package would help achieve rapid development and growth include:
1. Education
2. Health care
3. Public Sector development and reform
4. Agriculture
5. Infrastructure including new motorways, housing developments, comprehensive water systems network and solar powered electrification system.
Aside the above, the most important aspect of the stimulus package would be the creation of efficent and effective profit making state owned enterprises that would lead to the creation of thousands of jobs.
State intervention in a country like Ghana is a MUST especially given the current economic and financial climate and also the fact that Ghana's private sector is not developed and robust enough to be the sole engine of growth and be the catalyst to real economic growth, development and economic emancipation.
The importance of state intervention in terms of formulating stimulus packages that will boost and transform the economy cannot be downplayed - one only has to refer to the likes of Malaysia, South Korea and more importantly China who have ignored IMF/World Bank draconian policies and have decided to go down the route of formulating strategic economic and fiscal stimulus packages that have seen them become masters of their own destinies.
The sooner Ghana follows suit the better or we shall ever remain the hewers of wood and the drawers of water.
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