Former ambassador under the Mahama administration Dr. Tony Aidoo has said President Akufo-Addo must not look up to the private sector if government truly wants to move Ghana beyond aid.
While the suggestion might appear to be an ideological heresy to a party of laid-back government and free-roaming businessmen, Tony Aidoo explained, the investment needed to develop the country will not come from private investors.
" What we need is a strong government that leads rather than a government that repose trust in a private sector that is essentially parasitic", he said last Saturday on Newsfile.
The former Head of Policy Oversight and Evaluation unit at the Presidency was weighing in on a tough-talking speech by President Nana Akufo-Addo who repeated to his French counterpart Emmanuel Macron his tagline of free trade and not aid. The ex tempore comments have made rounds on social media collecting applause and comparisons to Kwame Nkrumah who was known for his fierce views on economic exploitation and neo-colonialism.
Joining in tacit applause, Tony Aidoo who was a former speech writer to President Rawlings observed that similar presidents have made the same point.
"I recall when I was one of the speech writers of Rawlings, every state visit we made a point of putting it in that what Ghana and other countries require is not aid but fair trade", he said on Saturday.
He observed that there is a deliberate agenda within the global economic structure to keep Ghana and third world countries playing insignificant economic roles by providing simple raw materials.
They do this by making inaccessible, the capital needed to finance serious development. By serious development, Tony Aidoo said he meant industrialisation.
"There is no country in the world that has developed without industrialisation and there is no country in the world that has industrialised without the development of indigenous appropriate technology".
Ghana's problem therefore is about where to find the capital to develop and which activity can best raise this capital, Tony Aidoo who hold an Msc. in International Affairs said.
He pointed out that to industrialise, Ghana must play to its strength - agriculture.
"What we need is an agricultural system that adds value... we need to process". He said this requires government to make focused investment in agriculture instead of spending monies across several sectors of the economy.
"So far we have been spreading ourselves so thin because we have been caught up in a vice..the vice is that you have a large infrastructural deficit that you need to bridge".
The challenge is therefore how to raise huge funds for development financing.
"Your people don't pay the necessary taxes and therefore you have no choice but to go out and borrow", he said.
Applying this background to President Akufo-Addo's economic plans which include setting up 216 factories and a strong push to encourage agriculture and promote irrigation, Tony Aidoo said, the plans need enormous funding.
The plans are "strategic so longs as you have the capital to support it. But where is the capital? The only source of the capital is borrowing" he said.
He lamented that over the years, governments have failed to widen the tax net to capture the contributions of the bigger economic sector - the informal businesses.
"If you can persuade your citizens to pay the tax that is needed to support these projects that's fine. But you cannot", he despaired.
Tony Aidoo wants government to "promote this informal sector to a formal position whereby they can be caught in the tax net".
One of the ways government can do this is to encourage the private sector to focus on Small and Medium scale Enterprises(SMEs) instead of attempting to do big projects with government when they lack the capital.
"Look at Mills, Mahama Private-Public Partnerships(PPP). I was critical of those because I felt the PPP should concentrate on indigenous SMEs..so you can catch them in the taxable net"
"The PPPs seem to be concentrating on businesses that are only looking for loans and government support. If they were good, they wouldn't be looking for that" he shared an observation.
Tony Aidoo indicated that government must learn from economic history and heavily move into state industrialisation.
He pointed to Japan's industrialisation led by its emperors to help set up Toyota.
"And yet the modern economic books will tells us it was private capital. What private capital that led to British industrialisation? What private capital led to German industrialisation? It is state. It is state", he emphasised.
"There are so many areas of the Ghanaian economy that are virgin that the private sector won't go and therefore it is the duty of the government to go there but this is not what we want to do".
Source: myjoyonline.com
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Tony Aidoo may have a point worth considering and let's not white wash it. The salient point on agriculture is apt. A word to a wise is enough
This communist ideology of yesteryears has not stood the test of time. Nkrumah and his CPP practiced it with disastrous consequences; the Workers Brigade, GIHOC, State Housing Corporation, State Farms, State Hotels all this ***barred word***. It is said that when Queen Elizabeth visited Ghana in the early 1960s, and she went to Kumasi (that is when Kumasi was named the Garden City), the Queen asked who owned all those beautiful storey buildings. And when President Nkrumah answered that they belonged to individuals, she advised Nkrumah that communism would not work in Ghana. But Nkrumah nonetheless stuck to his communist ideology and the rest is now history. People like Tony Aidoo have no idea how to run a private business that is why they think everything must be state owned. The duty of the state is to provide the enabling business environment for private businesses to thrive. And that is what npp government is doing now.
I think, we are in different era unlike what NDC's Tony Aidoo wants us to believe. Capital will move in terms of Joint venture, to where profit can be made, other things being equal. Today we speak of global world, technological and IT dominated era which does not shy away from free movemrent of capital to favorable business-friendly economies. I pose a fundamental question, which is: what are the factors of production which are combined to establish factories? And the answer is fundamentally : capital, land and labour, and these are Inputs used to produce goods and Services. I believe Ghana has a lot of Capital in terms of land rich in mineral resources and arability. And we need Partners who have the other factors or Inputs which Ghana does not have, so that we can mutually partner and negotiate to come into business, process the inputs into goods and sevices so as to grow our economy.By so doing, we add value to our raw materials to effect multiple Outputs. We must appreciate that we cannot solely have all the Inputs, and that is why we need partners or investors both foreign and local to complement our efforts to creat wealth.We can site China example which has comperative advantage in Labor as a factor of production and huge market. And what China did, was to open up to foreign Investments and it worked. Indeed,I was disappointed that, Dr. Aidoo did not reflect on that as a socialist. Unproductive borrowing and handouts is not the way foward but mutual and fair partnership should be welcomed. And Nana made that clearer and unambiguous.
I think, we are in different era. Today we speak of global world and technological and IT dominated era. I pose a fundamental question, which is-what are the factors of production which are combined to establish factories? And the answer is fundamentally : capital, land and labour, and these are Inputs used to produce goods and Services. I believe Ghana has the Capital in terms of land rich in mineral resources. And we need a Partner who has the other factors or Inputs which Ghana lacks so that we can mutually negotiate to come into business, to combine the inputs into goods and sevices to grow our economy.By so doing, we add value to our raw materials to effect mutiple Outputs. We must accept that we cannot have all the iputs alone and that is why we need partnes or investors both foreign and local to complement our efforts to creat wealth.We can also speak of China example which has comperative advantage in Labor as a factor of production and huge market. And so China opened up to foreign Investments and it worked.
I think, we are in different era. Today we speak of global world and technological and IT dominated era. I pose a fundamental question, which is-what are the factors of production which are combined to establish factories? And the answer is fundamentally : capital, land and labour, and these are Inputs used to produce goods and Services. I believe Ghana has the Capital in terms of land rich in mineral resources. And we need a Partner who has the other factors or Inputs which Ghana lacks so that we can mutually negotiate to come into business, to combine the inputs into goods and sevices to grow our economy.By so doing, we add value to our raw materials to effect mutiple Outputs. We must accept that we cannot have all the iputs alone and that is why we need partnes or investors both foreign and local to complement our efforts to creat weaith.We can also speak of China eample which has comperative in Labor as a factor production and huge market. And so Cina opened up foreign Investment and it worked.
somehow i agree with him but is this the same way he advised mahama. well i believed he did so but that man was a ***barred word*** who doesnt listen to anyone as he rightly said "y3nti obiaa". the private sector that is part of the problem we have. they are the reason there is soo much corruption in the system.
***barred word*** ***barred word*** is back in town
If we dont put down our political specs which doesn't enable us to think and see far and which also blindfolds our passion to seek wisdom instead of greed, we ll not be able to leap forward from where we are. The man has spoken, he brings out food for thought and suggestions worth considering to move Ghana forward. we must listen and and subject his thinking to the microscope and see what we can all do to lift Ghana from stagnation. after all, who in this current government aside the president qualifies to hold political office than Tony Aidoo?
DR J TONY AIDOO , DO U TAKE ADVICE ? ***barred word***
Tony, your point on agriculture is particularly apt. I think the state should find a legitimate way to create African industrial giants particularly in the agri-food processing sector. It is a multi-billion dollar sleeping giant and before long the Chinese and Indians may come and capture that as well.