Dr Botchwey's press conference
On January 2, Dr Kwesi Botchwey, Secretary for Finance and Economic Planning, reviewed the PNDC's Economic Recovery Programme at a Press Conference in Accra.
QUESTION: (MR KWESI PRATT)
Your Excellency, the Secretary for Finance, in fact a lot of statistics have been pushed down our throats this morning, and I am only hoping that the answer to my question would not be loaded with statistics because it is always irrelevant to the suffering that the people of this country are faced with.It is strange that at this time when sick people are running away from our hospitals instead of going into the hospitals; it is strange that at this time when the majority of our people are dropping out of schools because of the imposition of not "cut-throat" but "crush- head" school fees, we are talking of economic recovery in this society of ours.
We are talking as if everything has improved, but the real condition on the ground is that people are dying, people are starving and that they do not get access to social services because of the senseless policy of devaluation, retrenchment of labour, etc.
I would like the Secretary to react to this situation on the ground: The suffering of the ordinary people in the streets. I am not talking of the profits of the big companies. I am not talking about the profits of the multinational corporations. I am not talking of the praises which come from the imperialist controlled IMF and the World Bank.
I am talking of the concrete situation of suffering on the ground that it is where we should address ourselves to and this cannot be done with empty statistics.
ANSWER: DR KWESI BOTCHWEY
This is a very good question. It is not put in the most agreeable way but I think it summarises a certain sort of tendency in this country which I find to be disagreeable for many reasons.Now, we have said over and over again that criticisms of our economic recovery programme and of the policies actually being implemented by this government is not only welcome, it is necessary but that for it to be positive such criticisms must at least have at its point of departure facts about our national situation. Emotional outbursts we are all capable of.
The question is, how are the very concrete problems that Mr Kwesi Pratt himself has identified, namely: The squalor, the poverty and the disease, the unemployment etc, how are these going to be addressed, leaving aside the external resource mobilization. Let's start from, say, we don't want any money from the IMF.
Now, in the last three weeks, we have got $600m from the IMF, another at least $200m from the World Bank, including the IFD and IDA. Even with all these in- flows of over one billion dollars from multilateral sources and from so-called donors, in addition to our own meagre ex- port earnings, the situation you described is still prevalent. It does not take the imagination of a genius therefore to see that without these inflows, our national situation and the state of the poverty of the majority of our people would have been much weaker than what Mr Kwesi Pratt has just spoken about here. So let's start from the factual situation.
I get amused when people bemoan statistics. When the statistics are bad, they quote them. When they're good, they don't want to hear them. Now, if you don't want statistics how are we to measure the improvements or deterioration in this economy? Do we take a vote of everybody? Subjection? This man says it has improved. That man says it has not improved. Isn't it science, whether it is social or natural, based on some quantification. And without quantification, am I supposed to believe that the economy has improved or deteriorated by any single margin.
We are talking as if everything has improved, but the real condition on the ground is that people are dying, people are starving and that they do not get access to social services because of the senseless policy of devaluation, retrenchment of labour, etc.
There is no country in the world, east or west, which does not spend money actually calculating its national accounts and providing statistics, religiously, and annually, to tell the people how things are going. So I am sorry for those who do not want statistics at all. I am unable to help because I do not want to slide back into just empty subjectivism which everybody says what we have done well is. It is quite another thing to say you don't believe in statistics, but to say you don't like statistics is quite nonsensical.
We cannot proceed on that basis. We must know statistics. If you have some- thing that you do not like in the statistics, say so, but there is no other way of measuring economic performance than by some objective standards that go beyond everybody's heart and some people's heads. So let's all join the masses.
Is there anybody here who will in all truthfulness, statistics and IMF apart, imperialists apart, is there anybody who can really stand up here and tell me that he has seen no improvement in this economy. Please stand up. To be on the safer side, it is one thing to admit that there has been improvement and to go for- ward and say that we need more improvement. That is the message of this statement.
It is quite another thing, totally irresponsible and unacceptable to me, to say that there is no improvement because that flies in the face of the facts, because in 1983, when we started, about 70% of our vehicles were off the road for very basic needs like tyres, batteries, even contact sets. They were parked off the road, and people were begging to stand in articulators to pay hefty fares to travel from one distance to the other. Today, the transport situation has improved, not to the point that we all want to see, but it has improved.
There are more vehicles on the road today, that is a fact which is not controvertible.
Agriculture in 1983, we were begging for food aid. Most of our people were so emasculated. In our usual raucous humour, we coined the term "Rawlings chain"
The human mind is a most interesting instrument, but it forgets very easily. It is good, but three years ago, we were begging on our knees. We appealed to the Head of the United Nations to give us food aid. 192 metric tonnes, isn't that correct, for the year.
We were suffering. Even gari could not be found, and could not even be afforded if found. Today, we are producing more food. There are some who want to argue that we are not producing more food, but for those, I cannot help them. That singular blindness cannot be cured. But for those who can see, we can see more food in the market. Thanks to the hard work of our farmers and the timely and adequate provision of inputs, paid for in foreign exchange. Even cutlasses, the materials used in making cutlasses, we import it.
I never said here or anywhere that the improvement is so comprehensive that there is room for complacency. On the contrary, if Mr Kwesi Pratt was listening to me, I would think he came with a set question, so he wasn't even listening. What I said in my statement was I did not want to dwell on improvement. Whatever happened I believe there have been setbacks that need to be addressed.
Nobody is saying that we should all be in an accord, but it is equally disagreeable. It is bad enough to be complacent, but just as bad to be so inwardly blind as to be unable to see and to acknowledge the little bit that has been achieved.
As for this problem of devaluation, I would like to leave the IMF out for the moment. I think, and without fear of immodesty, say that I understand the workings of the IMF and the World Bank quite thoroughly. If I may say so myself, that I took a course on that in the University. Rather than lambast the IMF emotionally, we have always insisted on a scientific analysis of whatever they are doing or not doing with us. But leave the Bank out for the moment.
I just finished saying in my statement that when we went round to the timber sector, gold mine operation, diamond mining, to actually go through the books, not sitting in the Ministry and making figures, and by the way, let me remind you, the figures that the CBS gives us, nobody sits in the Ministry to cook up. Men are actually sent to the market, not as Ministry of Finance officials, but as ordinary people in the market so that they can get the actual prices. They gather information on prices, bring it to the CBS and we go through these things and determine the rate at which inflation is rising, just got through telling you that what they found was that for the most part, many firms in the export sector are not able to export or are not even yet interested in producing for export because it costs them, frankly speaking, more than C60 to produce a dollar.
You see, if I give Mr Kwesi Pratt $100 for whatever you can get, I am certain that in spite of his well-known saintly qualities, he will not take that money to the bank and get C60 to a dollar. No, when he knows that if he takes it somewhere else he gets C150. The question I want to ask you is this:when you, as an individual, you make your dollars in whatever way you do it, legal or illegal, when you want to ex- change it for cedis you demand C160 as the real value of the dollar you earned.
Dr Kwesi Botchway
Are you telling me that when the cocoa farmer, the miner has sweated and produced that dollar for the state, we should sell it cheaply? That one, it is alright, but yours, C150. Can anybody tell me one rational reason why this should be so?
Miners are dying in the mines, cocoa farmers who can hardly walk, but get up at the crack of dawn to go to the farms, as some lazy folks sit in here.
But you want to say that when we have produced those dollars, we should ex- change it for the cheapest possible price and if we do not do it, we are lackeys of imperialism. You see when the argument is put this way, then the real complaints we have against imperialism are vulgarised beyond recognition. So we need more foreign exchange, so that we do not go begging every day. We do not go telling the donors that we want $600m. We have to increase our own foreign exchange earnings. Now, how do you increase our foreign exchange earnings or cut down on our foreign exchange consumption?
It is easier to increase our foreign exchange earnings I can assure you, than to cut down on our foreign exchange consumption. A friend of mine is fond of giving this example. You look around you, every one of you, from your head to the bottom of your feet, your hair, you put pomade inside it, imported usually. Your face, you put pomade. Every aspect of your body, whatever your class origin, is very heavily foreign exchange dependent. I just finished saying even the little things that we can do to reduce our foreign exchange dependence, like finding some other way of making gari, so that we can preserve gari and use the cassava that is produced in excess of it, we are still bogged down with even our science and research techniques.
The key element in the ERP is precisely a restructuring of industry and its better integration with agriculture. We have plans for cotton; not new plans, the in- tensification of efforts of doing this, so that we can grow our own cotton. Fortunately, we found out that we have made more progress. We used to import tallow to make soap. Even "don't touch me" needs something.
Now we are producing more palm oil and we have found that we may even be exporting it in the years to come. I am saying it is easier to increase our export earnings to reduce our consump- tion. That will take some time. How do you increase your export earnings? Now, we have done this work objectively. If you find that the man who is producing the exports for you to increase your exports is no longer producing it for exports, on the contrary, you find that he is producing it less and even then selling it on the local market, as some timber firms are doing. It does not take the IMF to tell you to do something about it.We are not bugged down.
Sure, the IMF does very crazy things in many places. But let's talk about Ghana programme and what has happened with the IMF and the Ghana Programme.
