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The 2012 Vice Presidential Candidate of the New Patriotic Party (NPP), Dr. Mahamudu Bawumia, has described the path and manner in which the Ghanaian economy is being managed as unsustainable. In an article first published on his facebook page, Dr. Bawumia, a former Deputy Governor of the Bank of Ghana indicated that the NDC government had made economic history by recording the highest budget deficit in the history of the country in 2012 and noted that the record deficit was an indicator of how poor the economy had been managed in the past four years. Sounding a notice of hard times ahead, the renowned economist stated that the consequences of the poor management of Ghana�s finance, mounting public debt and record borrowing would fall disproportionately on Ghana�s already suffering poor with cost of living expected to rise sharply. READ THE FULL ARTICLE BELOW.... THE ECONOMY IS ON AN UNSUSTAINABLE PATH WITH THE HIGHEST BUDGET DEFICIT IN GHANA�S HISTORY. DR. MAHAMUDU BAWUMIA The data coming in on Ghana�s economic performance in 2012 indicates quite simply that public finances are out of control and the economy is in trouble. At the end of 2012, Ghana�s budget deficit was a whopping Ghc 8.7 billion, amounting to 12.1% of GDP using the rebased GDP numbers (or some 20% of GDP in terms of the old GDP series). This is the highest recorded budget deficit in Ghana�s history. From Nkrumah through Acheampong, Rawlings and Kufuor, no government has incurred this level of budget deficit. What is more worrying is that this provisional deficit figure excludes some Ghc 4.0 billion in commitments and arrears yet to be paid to contractors and other service providers. If we include these arrears the deficit for 2012 would be some 23% of GDP using rebased numbers (or some 35% of GDP using the old GDP series). These are mindboggling numbers. The crux of the problem is that government spending increased astronomically to 34.5% of GDP even though government revenues amounted to 16.1% of GDP (a gap of over 100%) for the year. The provisional 2012 budget deficit of 12.1% of GDP is almost double the budget deficit of 6.5% in 2008 using the rebased GDP numbers (or 11.2% of GDP using the old GDP series) notwithstanding the fact that Ghana enjoyed more favorable economic circumstances in 2012. In 2008, Ghana was not an oil producer and the global economy was in crisis. In 2012 on the other hand, Ghana was an oil producer facing a favorable external environment for its exports and yet managed to double the 2008 budget (which this government described at the time as �reckless�) and in the process achieve what is a truly unprecedented budget deficit in Ghana�s history. The government promised last year that its management of the economy would be more prudent than that of other governments in previous election years. Despite all the favorable opportunities at its disposal, 2012 has turned out to be the worst election year outcome in Ghana�s history in terms of the management of public finances. This is also yet another failed NDC promise.