To improve debate, dialogue and hold politicians accountable, GhanaFact, an IFCN verified fact-checking project and Ghana’s leading news portal – GhanaWeb, are collaborating to fact-check claims being made by Vice President Mahamudu Bawumia during his address on the economy.
The West African nation has seen a surge in the prices of petroleum products at the pumps amidst increases in the cost of consumables and non-consumables on the market – while the local currency, Ghana Cedi has come under enormous pressure from the dollar and other foreign currencies – depreciating in value considerably in the last couple of months.
Vice President Mahamudu Bawumia who is the head of the government’s Economic Management Team is addressing Ghanaians to share perspectives on how the economy has been managed so far.
BAWUMIA: “In the first quarter of this year, we’ve also suffered a sovereign credit ratings downgrade by two rating agencies (Fitch&Moodys)…”
BAWUMIA: “Food prices have also not been left out. The FAO Global Food Price Index increased from 95.1 at the end of 2019 to 140.7 in February 2022…”
CHECKED: TRUE (here)
BAWUMIA: “The increase in commodity prices has been exacerbated by the Russia- Ukraine conflict. Russia and Ukraine together account for 30% of global wheat exports…”
CHECKED: TRUE (here)
BAWUMIA: “Inflation had declined from an average of 17.5% in 2016 to an average of 7.2% in 2020.”
CHECKED: MISLEADING (Inflation basket was different in these two periods and so are not comparable. In 2020, average Inflation was also 9.88%)
BAWUMIA: “Since the pandemic, inflation has increased to an average of 10% in 2021.”
CHECKED: TRUE (here)
BAWUMIA: “Based on World Bank data, the average unemployment rate in Ghana between 2014 to 2016 which stood at 6.29% declined to an average of 4.37% between 2017 to 2020.”
CHECKED: TRUE (here)
BAWUMIA: “Fiscal deficit between 2013 & 2016 averaged about 7% of GDP.Between 2017 & 2019 it declined to an average of 4.5%…“
CHECKED: MISLEADING (Since 2017 gov’t omits energy and financial service clean-up costs in computing fiscal deficit figures)
BAWUMIA: “Provided free water for households for a year during COVID…”
CHECKED: MISLEADING ( Gov’t absorbed the water bills for all Ghanaians. But later imposed a 1% Covid-19 health levy to recover the money spent.)
BAWUMIA: “The average rate of GDP growth for 2017-2021 (including COVID-19 period) was 5.3%, compared to an average rate of growth of 3.0% between 2013 and 2016. “
CHECKED: MISLEADING ( Compared 5-year average to 4-year average)
BAWUMIA: “In response to the recent increase in inflation, the Bank of Ghana has increased the policy rate by 2.5% from 14.5% to 17.0%.”
CHECKED: TRUE (here)
BAWUMIA: “The economy was on the verge of collapse and a legacy of take or pay contracts saddled our economy with annual excess capacity charges of close to $1 billion…”
CHECKED: FALSE (According to Finance Minister Ken Ofori-Atta, Independent Power Producers (IPPs) have received payments for excess capacity charges for the period under review (2017-2020) totalling US$937.50 million.)
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Editor’s Note: (The rating for claim 4 has been updated from partly true to misleading.)
