Dr Mahamudu Bawumia rose to political fame in Ghana in 2008 touted as a “top notch economist.” His whole base as a politician is founded on his “economic wizardry”. Assuming the enviable position as head of president Nana Akufo-Addo’s Economic Management Team since 2017, Ghana saw sparks of promise in economic management for a while. But now the country reels under a heavy load of bad decisions and it seems the New Patriotic Party’s poster child for economic mastermind has failed. But will this failure affect his chances of leading the NPP in 2024?
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In 2014 when then-opposition candidate Nana Akufo-Addo introduced Dr Mahamudu Bawumia as his running mate for the third consecutive time, he based his choice for the former central banker and University of Buckingham scholar on his economic wizardry.
"I have been very lucky to have Mahamudu by my side since 2008. His credentials as top-notch economist were always known to all and have been reinforced by his analytical work and performance in this sector in the past five years earning him the sobriquet of Dr Prophet,” Akufo-Addo said at the time.
True, Bawumia’s opinions on the economy during his days as an opposition political figure made a lot of sense to the political class. His social media comments were shared many times and his speeches at political and academic events were fodder for the news media competing for the best story angles.
His 2015 lecture at the Central University College titled “The IMF Bailout: Will the Anchor Hold?” delivered a sterling analysis of the John Mahama-led government’s bailout agreement with the International Monetary Fund (IMF). His oratory skills and political jabs on the bailout programme and the overall assessment of the Mahama administration echoed through the months until elections in 2016 when his boss was elected president.
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How The President’s Economic Management Team Works To Shape Policy
Dr Bawumia currently heads the Economic Management Team (EMT) under Nana Akufo-Addo’s administration. In 2019, the team also included the following people:
1. Senior Minister Yaw Osafo Marfo, the Vice Chair;
2. Ken Ofori-Atta, Finance Minister;
3. Dr. Owusu Afriyie Akoto, Agric Minister;
4. John Peter Amewu, Energy Minister;
5. Prof. George Gyan Baffour, Minister for Planning;
6. John Alan Kwadwo Kyerematen, Minister for Trade and Industry;
7. Dr. Anthony Akoto-Osei, Minister for Monitoring and Evaluation; and
8. Prof. Joe Amoako-Tuffour, the Secretary.
The team claims that every week, they invite various government agencies, some members of the private sector and other stakeholders in the economy to deliberate on issues that will shape government's economic policies. The team’s focus has been to shape policies of the government and deliver on key economic milestones of President Akufo-Addo’s government.
In the first term of Akufo-Addo’s administration, the team and Bawumia in particular was lauded for reducing fiscal deficit and inflation.
According to the president, his team of economic gurus reduced inflation from 15.4% to 7.6%, the lowest in two decades. Economic growth figures of 7.6% in 2019 was also attributed to the EMT under Bawumia.
Ghana’s Economic Mess Is A Failure By The Bawumia-led EMT
Ghana is in a deep crisis now. The economic uncertainties cut across every sphere of the economy and deeply. Aside crippling inflation and the cedi-to-dollar depreciation that has eroded business capitals, there is the now-topical Domestic Debt Exchange programme that will hit hard at banks, pension funds, insurance companies and fund managers. According to economic risk analyst Dr Theo Acheampong these institutions and citizens will suffer haircuts (reductions in expected funds invested) under the proposed scheme.
“Many citizens often don’t directly buy government bonds but do so through such institutional schemes such as fixed deposit schemes offered by their financial institutions. Thus, such citizens are also likely to suffer losses on their investments,” Dr Acheampong observes.
In finance jargon, a "haircut" is used to describe a financial loss on an investment. To “take a haircut” corresponds to accepting or receiving less than what was owed.
These Reasons Explain Why Dr Bawumia’s Dream of Leading NPP in 2024 Will Fail
Because of his deafening silence on the raging economic challenges long before the frightening uncertainties hit home, Dr Bawumia has lost the only clout he had in Ghanaian politics. Dr Bawumia’s only claim to political fame, his economic credentials, has been destroyed because Ghana's unprecedented economic crisis is largely self-inflicted. An oversized government, unrestrained public expenditure partly due to uncosted policy initiatives like the free SHS, and excessive borrowing have cited as the triggers of the current economic challenges.
Bawumia stands tall in all these problems because he was introduced to the voting public as an honest academic and the answer to claims to similar economic problems under the previous administrations of John Evans Atta Mills and John Mahama.
But with the crisis at hand, many feel he is a fraud. His tacit switch from macroeconomic super-brain to a champion digital economy is fishy. That switch in focus as not helped to sustain his perceived honesty since many feel the sudden change to digital economy discourse is an admission that, even as head of the EMT, he has failed to deliver on an inferred promise to improve the fortunes of Ghana. But even about his digital economy campaign too, the introduction of the controversial E-Levy has dampened spirits about his competencies.
E-Levy has been criticised as a drawback for Ghana's nascent digital economy and Dr Bawumia himself once said money in electronic wallets should not be taxed. Many are asking, "what changed?" He has not been able to address that U-turn since the E-Levy debate started.
Furthermore, it is not likely that by 2024, Dr Bawumia will have anything to show for his competence as an astute economist because the economy is not likely to improve by then. For Dr Bawumia to make a headway in his campaign both at the primaries and national election, he will need prove he followed through his flamboyant economic lectures with true works. Under the circumstances, when he mounts the podium to address NPP delegates (who are equally angry about the economic mess) to convince them to choose him as the party’s candidate in 2024, what will be his message?
Perhaps, just like he has done many times in the past, he may mention the brief economic glory that lasted for barely three years after Akufo-Addo took over power and blame the rest on Covid-19 and the Russia-Ukraine war. But that excuse has been exhausted. Many policy analysts point to viable threats to Ghana’s economy caused significantly by insatiable borrowing sprees (that he spoke against under the previous administration) before Covid and the war in Ukraine.
Also, it doesn’t help also that there is a strong opposition to his presidential ambitions within his party. While some influential elements within the current government and the party favour him, there is also a wider disillusionment among party supporters. The fact remains that the party delegates would want to present a candidate untainted by the current crisis to the Ghanaian voting public. While Alan Kyerematen, his closest contender, is also a member of the EMT, he has not been in the eye of the storm. Bawumia, however, remains a conspicuously blotted figure amid the economic crisis.
Dr Bawumia recently showed to the world that he has hidden skills in juggling football with his feet. That is nice, but he will need a bit more than soccer skills to sail through this one. If Dr Bawumia’s presidential ambition hits a snag, he will not be the first vice president to suffer such a fate – which in the past has been blamed on the unspoken ethnicity factor and backroom functions reserved for veeps. But he is likely to be the only vice president who came so close to breaking that jinx and still failed.
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