By: Chief Obosu Mohammed
LL.M MA ACIarb LL.B DPA
19/09/2022
Whereas I have underscored some of Dr Mahamudu Bawumia’s significant contributions while working in various capacities at the Bank of Ghana with other distinguished members of the erstwhile Kufuor government in my preceding article, there are still other impacts he made that are deserving of notice. However, I will strive to highlight only a handful. The sedulous Dr Bawumia’s technical influence on several of President Kufuor’s major accomplishments cannot escape our microscopic lenses.
The Millennium Challenge Account
The Millennium Challenge Account was one of the primary programmes that spiralled economic growth and poverty alleviation under President Kufuor’s NPP government. Dr Bawumia was a part of the Government Team that negotiated the Millennium Challenge Account Compact with the US Government, which was signed on August 1, 2006. In the first instance, the program raked in $547 million for the nation. These funds benefited the Ghanaian people in a variety of ways since they were used in critical sectors of national development. For example, the rural economy was bolstered by agricultural modernization, as well as the expansion and rehabilitation of roadways throughout the country, most notably amongst them was the George Bush Highway. All of this was primarily aimed at pulling many of our people out of poverty through increased production. Today, the Millennium Challenge Account continues to have a significant impact on our national economy.
GhIPSS and E-Zwich Initiative
Dr Bawumia was involved in the conception and realisation of the E-Zwich common platform for all banks, savings and loans businesses, and rural banks, which allows for interoperability across financial institutions in Ghana. While in charge of the Bank of Ghana’s digitalisation programme, he spearheaded the establishment of the Ghana Interbank Payment and Settlement Systems Limited (GhIPSS), a wholly-owned subsidiary of the Bank of Ghana which seamlessly connected all the financial institutions in Ghana. This project was a watershed moment for Ghana’s financial and banking sectors. The E-Zwich provided significant assistance to those involved in various financial activities and enhanced the rate of financial inclusion among Ghanaians.
The Redenomination of the Cedi
We cannot do justice to this topic without considering the redenomination of the Ghanaian Cedi. Again, as a member of the team, Dr Bawumia played an important role in the design and implementation of the Ghanaian Cedi redenomination through his technical expertise. This singular height saved the economy from the excessive cost of printing money and strengthened the cedis. At one point, the Cedi equalised with the dollar.
The Inflation Targeting Framework
Dr Bawumia was instrumental in the formulation and implementation of the inflation targeting framework, which notably decreased inflation to 10.2% by 2007 from 40% in 2000 while preserving relative exchange rate stability during his time as Head of Monetary Policy and Financial Stability. This inflation targeting framework continues to act as a reference for the Bank of Ghana’s Monetary Policy Committee.
Conclusion
These are just a few of Dr Mahamudu Bawumia’s contributions to the NPP government from 2001 to 2008. Quite frankly, Dr Bawumia did not just appear on the scene from nowhere in 2008 to be a Running Mate to Nana Akufo Addo (as he then was) as his detractors would have us to believe. His selection as a Running Mate was purely on merit and the solid credentials he demonstrated while serving under President Kufuor’s NPP government in diverse positions at the Bank of Ghana.
The government’s current fiscal and monetary policies will, without a doubt, restore macroeconomic stability and instil confidence in the Ghanaian economy in the medium term. It has been done before, and it will be done again.
Hasta La Vista!