The second correction which I would like to make is in relation to debt. Mr Speaker, right on this floor, the figure of GH¢9.5 billion was quoted. That figure is often quoted without an exchange rate, but when the 2009 figure of GH¢13.2billion was used, it starts a series of GH¢1.92 to
Mr Speaker, it is granted that we have a base of one and therefore, 9.5 equals to one. This is in calculating the debt stock at 2015 and this is the point the President was making; one can look at the debt stock, or look at disbursements.
If one is looking at the debt stock, which is 99 at an exchange rate of GH¢3.8, which is an increment from GH¢1.42, at least, all or a part of the GH¢9.5 billion is in that debt stock; therefore, to keep the debt in 2008 at a constant GH¢9.5 billion is erroneous Mr Speaker -- that GH¢9.5 even at GH¢1.2 gives us something close to US$7 billion.
If we were therefore to take that amount in the base of the 99, Mr Speaker, that is close to GH¢28 billion and it is about close to the 40 per cent even on a stock basis.
The President's point was that, on a disbursement basis, which is therefore credible, the debt, being serviced, include approximately 41 per cent. Mr Speaker, it is only when we hold the exchange rate constantly, as has been done at GH¢1.42, which follows the principle of the value being the same, that we can keep 9.5 constant and not multiply it at GH¢3.8 when we are looking at the cumulative figure.
Mr Speaker, the statements that have been made on the floor and in public discourse, definitely exclude the global context, which is very important. It is important because a critical observation is made on this floor and elsewhere, that the sturdy growth that was observed in
the era of the NPP Government, which occurred without revenues from crude oil and in periods where the world was seeing the worst economic crises in decades -- Mr Speaker, first of all, the global economic crises started in 2007, and definitely, not in the decade when we observed buoyant commodity prices.
Mr Speaker, but even if we set that aside, then in coming to 2015, one cannot ignore global crises in making one's debate. There has been silence on the fact that even as we speak, commodity prices have fallen -- gold, cocoa, which has rebound somewhat, and lately, crude oil.
This has affected, for the first time -- even the brick countries and the European market, as well as even the United States of America's economy, which is just recovering. Mr Speaker, that is being conveniently ignored in evaluating the performance of the NDC Government.
Mr Speaker, in West Africa, Ghana's growth rate, even at its worst point, is higher than the sub-Saharan African average. [Hear! Hear!] Mr Speaker, Ghana's growth rate at its worst point is definitely higher than the global average. Mr Speaker, Ghana's growth rate at its worst point is higher than most of the advanced countries; but we know that the structures of economies differ. Mr Speaker, this is the context that has been ignored.
Also, for the first time, Mr Speaker, even though we have faced these crises and these challenges, the progress towards consolidation has never been reversed. On the contrary, the deficit as well as the debt -- I would return to it -- have either plateaued or kept improving. This is the context in which the Budget Statement's theme talks about the prospects for the economy -- and we would return to that.
Mr Speaker, on the other hand, if one fast track to 2015, which is the focus, yes, we do admit that the debt has been increasing, and in 2012 it was 51.7 per cent. Mr Speaker, however, it declined to 47.4 per cent and then went up to 50 per cent in 2014. Therefore, for the first time, something is happening. As of the end of 2015, the increase in debt is 16 per cent. [Hear! Hear!] Mr Speaker, this is the first time our debt has substantially declined or tapered since the HIPC era. [Hear! Hear!]
Mr Speaker, there is no doubt the discussion so far in the document I am referring to and in the debate on the floor do not refer to our debt management initiatives. This is because to talk about these initiatives is to prove that they are working. There are initiatives such as the Sinking Fund, which this House approved after placing a cap on the Stabilisation Fund; the on-lending policy; as well as the establishment of escrows. Yes, we do admit that they have had a slow start, but Mr Speaker, they are taking root.
The moratorium on debts which we have discussed on the floor of this House, all are the results and that is why we are seeing the decline.
Mr Speaker, if you take external debts -- For the first time, the external debts
rate of increase is moving into the negatives. (Interruptions.] I can see Prof Gyan-Baffour pointing to that decline.
Mr Speaker, the point I am making is that, the policies of the Government are beginning to work -- they are working and they would work.
Mr Speaker, I am gratified that at least, the 1billion bond that we issued this year is no longer added to the debts and therefore, the projection is that our debts would be about 90 per cent.
Mr Speaker, that is another proof that our re-financing policy is working. When we re-finance a debt, particularly one which is short ended, it does not increase debt. I am therefore very glad that this is no longer going to be repeated.
Mr Speaker, indeed, another error that we need to correct, which has been pointed out by the public radio stations, is the notion that somehow, we did not meet any of the West African Monetary Zone's criteria.
Mr Speaker, again, as has been pointed out, Ghana has met two of the criteria and it also shows a positive trend that we are moving in the right direction.
Mr Speaker, the Hon Majority Leader already spoke about the essence of borrowing and the importance of projects. We have seen a lot of projects.
Mr Speaker, the inconsistency in the presentation is quite obvious. While we are being accused of accumulating debts and whiles we make the efforts to show that when we borrow, we often use it for projects, we would be gracious enough to point out that in the very document I am referring to from page 22 to 27, a long list of projects, have been listed, which
Mr Speaker, on the occasion that an attempt is made to put significant projects on public debts, we see the results. The results is the gang of six and the gang of five as well as many unfinanced projects for which we had to issue the domestic bonds to complete. I must point out that they are the debt stock base.
Mr Speaker, but the lesson for the country is that no Government, indeed, not even the advanced countries are able to develop without borrowing. I am happy also to note that unlike the categorical statements that have been made in the past, the document refers to as a policy, a slowing down in the rate of borrowing, not an absolute stoppage of borrowing. That is what is in the document.
Mr Speaker, therefore, it is important for us and that is a lesson for the nation, that to the extent that both advanced countries and middle-income countries -- the big countries and developing countries borrow to develop, the essence of what we have to do, is to change the way we borrow. That is more credible than a promise that we are not going to borrow.
Mr Speaker, we do have other initiatives which in the interest of time, I would like to summarize. We have also noted, as a solution, oriented Government -- we do not look at the problem and shy away from it.
Mr Speaker, as we have been saying, the basis for the depreciation of the cedi, is the narrow base of our exports. This is the reason we are launching the Smart Borrowing Concept, the EXIM Bank and other export-led initiatives.
Mr Speaker, just as it had been done in the past I would urge the House to deal expeditiously with the EXIM Bill that is before this House in order to sharpen our ability to provide guarantees for exports and provide export credits.
Mr Speaker, these are the things that make an economy healthy and we can learn from the BRICS, particularly China and Brazil about their export-led strategy.
Mr Speaker, if there is any doubt about what I am saying, let it be clear that for the period when we got HIPC and we had borrowing space, we have had a number of EXIM Banks either promoting exports or giving us loans and when they give us loans, we have to use their goods or even their personnel.
Therefore, the point I am making is that just as we borrowed for the Bui Dam, [Interruption] -- Let us note. I am talking about the Bui Dam. It is an export strategy