Economic Development of the Ghana
Ghana had faced many economic breakdowns. Meanwhile, it initiated the economic recovery program (ERP) in 1983 that aimed to reverse the economy to the stable condition. Because, the economy had been facing serious decline, characterized by the tax financial management, inflation rate, and the involvement of the government in the economy.
The ERP aimed at reducing macroeconomic imbalances and liberalizing the external sectors. The economy of Ghana had been dependent on the foreign aid, debt or support that had driven the economy in these years. Furthermore, the overall strategy of the government was to inspire confidence in the investors and public to increase investment in the country through some structural reforms to thestable macroeconomic environment.
Hence, the macroeconomic policies and framework helped to restore the economy a little by restoring financial discipline and bringing the inflation under control to ensure the economy grows at the sustainable growth rate. Highinflation is due to the supply and demand that drives the prices of goods low or high. When demand for something increases and supply remains constant, it results in inflation in the country.
On the other hand, everything was due to the financial indiscipline in the country that led to theunstablemacro-economic environment. Thus, thegovernment took initiatives to ensure thatmacroeconomic factors are stable to make the economy free to fly because an open economy would help thecountry in controlling factors, and also enable thegovernment to acquire the confidence of the investors to bring the investment in the country.
Furthermore, prior tax reforms in the country also increased the revenues of the government, so the total tax contribution to the GDP was 1.3%. However due to many ofgovernments’ initiatives in the country, had given an average GDP growth rate of 5%. However, the increasing microeconomic problems were also to be resolved. So, the government announced the deregulation of thepetroleum industry to let industry reflect the international market pricing structure.
National Economic Strategy of Kufuor
The Country under the leadership of the John Kufuor made many economic, and political developments from 2001 to 2009.Since he was the only president in the history of Ghana who had won presidential elections twice.Kufuor had been an economy oriented person with avision for the future economic developments in the country. He had experienced a long-term military rule in the country, which made him a witness to the worst economic decline of his country.
Meanwhile, the John Kufuor was a straight forward person who opted for the Highly Indebted Poor Countries (HIPC) initiative that seeks to provide debt relief to the cash-strappedcountries but based on the poverty alleviation strategies described by the IMF and World Bank. Practically declaring oneself poorwas a very difficult task, especially for the Ghana. Furthermore, he focused on the good governance, and law and order.
With these initiatives, the government maintained theconfidence of the UN agencies. Furthermore, it also implemented the prescribed rules of the IMF and World Bank, and gained the trust of the investors, and supported the private sector to make investments in the country………………..
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