Story: Della Russel Ocloo
Minister of Foreign Affairs, Alhaji Mohammed Mumuni, has announced the government's decision to redouble efforts at mobilising non-aid resources to fund its development agenda.
In that light, the reformation of revenue institutions and procedures in revenue collection has commenced to ensure an increase in domestic revenue.
He indicated that non-tax revenue measures, including rationalising the minerals and energy sectors by reviewing fees and charges, as well as automation towards paperless operations of government, were similarly underway.
The minister was speaking at a validation workshop on Ghana's Middle Income Status(MIS) organised by the Institute of Economic Affairs (IEA) and the United Nations Development Programme (UNDP) in Accra. The programme was on the theme, "Moving towards middle-income country status: Potential implications for development assistance and achievement of the Millennium Development Goals (MDGs)".
Participants were drawn from the Association of Ghana Industries (AGI), civil society organisations (CSOs), academia, political groups and a cross-section of members of the Diplomatic Corps.
The workshop addressed the implications of the new status for development assistance and the challenges arising therefrom and how to go forward. Alhaji Mumuni indicated that the attainment of a middle-income status would not automatically vanquish poverty and other development constraints.
"It is for this reason that any immediate and significant cut in aid flows to the country may hamper the gains already made," he stressed.
According to him, although Ghana had attained a middle-income status resulting from indices from relevant parameters, the status might come with a cost, as foreign assistance might decline and sometimes end abruptly.
He indicated that substantial poverty continued to thrive, while the generation of domestic resources remained quite low in relation to the level of resources required to end poverty, saying, "Many countries, including Ghana, which have achieved a middle-income status continue to face some structural problems afflicting low income countries (LICs) and need to boost incomes in order to meet the MDGs.”
Alhaji Mumuni added that whereas there were sufficient resources, inequality remained an issue that could contribute to political unrest and social instability which could in turn affect the people’s livelihood and their capacity to contribute to development.
The UN Resident Co-ordinator, Ms Ruby Sandhu-Rojon, observed that although Ghana might have graduated from a low income status, the change might not be significant, as effects might unfold to threaten expectations.
She indicated that while many attributed the recent status to oil discovery and exploration, the reality was that much work needed to be done to raise average incomes through agriculture, mining, industry and services.
She called for a shift in policy direction to fully comprehend what it meant to reach a middle-income status, as the resultant increase in Gross Domestic Product (GDP) might change rankings of all sectors.
A former Deputy Minister of Finance and Economic Planning, Professor Gyan Baffour, who spoke on macro economy and economic growth, resisted to be drawn into an argument over a middle-income status.
He stated that poverty levels and non-accessibility of road infrastructure clearly called for a shift in policy to reduce the adverse effects of the factors that were retarding growth and development. Earlier in his welcoming address, a Senior Economist with the IEA, Dr John Kwakye, had reiterated the need for the provision of social protection interventions and strengthening institutional capacities.
Present at the ceremony were the Chief Director of the Ministry of Finance and Economic Planning, Professor Newman Kusi; the Executive Secretary of the National Identification Authority (NIA), Dr William Ahadzie, and the President of the AGI, Nana Owusu Afari.
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