Amend Current Assets Declaration Act to Fight Corruption Effectively
Prof. Edward Dua Agyeman
Feb 2017
Assets Declaration Regime has been generally utilised since the 1970s as one of the most effective compliance mechanisms adopted by nations to prevent or cure the incidence of conflict of interest and corruption. It acquired renewed international focus since the passage of the UN Convention Against Corruption (UNCAC), which was adopted by the UN General Assembly in 2003. The Convention’s articles specifically require countries to adopt legislation for public officials to declare their assets. ...
Dr. Michael Ofori-Mensah, Senior Research Fellow - IEA
Dec 2016
Once again, Ghana has underscored her reputation as a model African democracy – a standing which owes much to the peaceful change of governments through the ballot box. It is, however, ironic that previous changes in government through the democratic process have exposed serious shortcoming in our country’s governance institutional framework. ...
The Presidential (Transition) (Amendment) Bill: A Move From Diagnosis to Prescription
Oct 2016
The post-2012 election period presented the first test for implementing major aspects of the Presidential (Transition) Act. Following the transition, the Institute of Economic Affairs (IEA) initiated research to critically evaluate the process. The findings provided encouraging evidence of the Act being put into practice. However, challenges were highlighted and recommendations were outlined. The IEA's proposed reforms were presented to Government - in the form of a draft Bill to fine-tune the Transition Act. This is what forms the crux of the Presidential (Transition) (Amendment) Bill, 2016 currently before Parliament. ...
Aug 2016
Political parties are the heart and soul of a democracy. In the case of Ghana’s budding multi-party democracy, political parties perform key roles such as the formation of the government, grooming leaders at the national and sub-national levels and holding government accountable (when they are in opposition) among others. Yet, political parties are among the most neglected of the political institutions of state. They are made to operate as if they are purely private organisations with no state or national interest in their establishment, maintenance, well-being and extinction. By their very nature, poorly established and poorly maintained political parties produce poor quality leadership, both at the party level and at the government level. For these reasons, it is important to ensure that political parties are not just electoral machines for achieving electoral victories but also function effectively as vehicles for public education, leadership training, national integration and skills acquisition during interelection years. ...
Budget Discipline Should Be Entrenched in Ghana as a Policy Priority
Dr. J.K. Kwakye
Nov 2014
Perennial fiscal deficit overruns in Ghana and their adverse effects on the economy have attracted widespread concern. Motivated by this concern, IEA carried out research to assess the processes, arrangements and the legal framework for budget preparation, implementation and oversight. The study included a survey of selected MDAs and relevant Parliamentary Committees. The study found that budget preparation is largely in conformity with international practice. However, there are severe implementation and monitoring deficiencies, including laxities in spending overruns with no sanctions. The paper makes wide-ranging recommendations for entrenching budget discipline in Ghana. ...
Urgent Policy Interventions are needed to foster financial intermediation and reduce the high cost of credit in Ghana
Dr. J. K. Kwakye
Apr 2014
The Ghanaian financial sector has been growing rapidly in terms of the number of institutions and products offered. Financial institutions contribute to economic growth by channeling surplus resources from savers to borrowers/investors. With the rapid growth of the financial sector, an important question to ask is how “financial intermediation” and “financial deepening” in terms of access to financial services and the use of financial resources in the economy have been evolving. The higher the level of financial intermediation/financial deepening, the greater is the contribution of the financial sector to economic growth. This is because high financial intermediation and financial deepening increase the scope and pace of turning financial resources into real resources. There is not enough empirical evidence on this evolution. Meanwhile, it is known that the cost of credit has been persistently high. In fact, the cost of credit is placed high in the World Competitive Index Reports and Survey by the Ghana Association of Industries among the obstacles to doing business in Ghana and it is considered to be a major impediment to investment and economic growth. This problem has also not been fully investigated. ...
Improving fiscal management in Ghana: The role of fiscal policy rules
Dr. Charles Amo-Yartey
Feb 2014
This paper discusses the role of fiscal policy rules in promoting fiscal discipline and transparency in Ghana. It investigates whether the adoption of fiscal policy rules and independent fiscal policy councils can help improve fiscal performance in Ghana based on international evidence. The results show that fiscal rules, particularly budget balance and debt rules are strongly associated with a higher probability of reducing the public debt to GDP ratio. The paper then calibrates an illustrative simple fiscal rule for Ghana based on the debt sustainability approach with a debt to GDP target of 50 percent of GDP by 2020. Achieving this target requires an average fiscal deficit of about 4 percent of GDP. The paper argues that fiscal rules do not operate in isolation and require supporting institutions and reforms to deliver the anticipated outcome. Key reforms to make fiscal rules effective in Ghana include strengthening budget preparation, appointment and execution; establishing an independent fiscal policy council to provide independent assessment of macroeconomic and revenue forecasts; monitoring and enforcement procedures, and legislative changes to make the fiscal rule legally binding. ...
Dr. J. K. Kwakye
Dec 2013
The Ghanaian Cedi has been on the decline for the better part of its history, apparently with no end in sight. An IEA study has determined that the long-run decline of the Cedi is influenced by economic fundamentals that drive the real rate towards its equilibrium level. Further, despite the recent sharp depreciation of the currency, there is no clear evidence of misalignment. In particular, contrary to expectation, the study did not find any significant "overshooting" of the equilibrium value or "real undervaluation." The results of the study suggest that to stem the tide of depreciation, policy strategy must focus on strengthening the economy's fundamentals, with sustained macroeconomic stability and growth being at the center. ...
Dr. J. K. Kwakye
Feb 2013
After achieving political independence in 1957, Ghana set up its own central bank to conduct independent monetary policy among other functions. Since then, various frameworks have been adopted to deliver price stability as the principal goal of monetary policy. Evidence shows that Ghana has had higher rates of inflation compared to most of its African peers during its history. This unenviable record can be attributed to both the causes and management of inflation. The causes have received considerable attention in the literature. High domestic demand fuelled by expansionary fiscal policies and accommodating monetary policies and the high proclivity of the economy to supply shocks particularly with respect to food, which commands a large weight in the consumption basket have been identified as the principal causes of the high rates of inflation. The effectiveness of monetary management, has, however, not been sufficiently investigated. The effectiveness of monetary policy depends to a large extent on the framework chosen to conduct it. A critical analysis of the monetary policy frameworks used in Ghana has been undertaken from which important lessons for the future have been drawn. ...
Dr. J. K. Kwakye
Sep 2012
After rebasing in 2010, Ghana's per capita GDP rose to Middle-Income Country (MIC) level as defined by the World Bank. The per capita income measure is, however, seen to be too narrow as it does not even include key economic indicators let alone important social and development indicators. The IEA has assessed Ghana's MI status in comparison with Malaysia and South Africa based on wide-ranging economic and social indicators, including: the domestic macroeconomy, real economy, financial sector, external sector, infrastructure, competitiveness, education, health, and poverty. It is found that Ghana trails these two major MICs on almost all the economic and social indicators investigated. The paper recommends some of the policy interventions that would be needed to improve Ghana's economic performance and social indicators to the levels commensurate with its new MIC status. ...