Ten years of politics of intellectualism: The Bawumia journey so far
Today marks exactly 10 years of Vice President Dr. Bawumia’s journey in the politics of Ghana. This piece is therefore an overview of his politics thus far.
The contention on who would partner the then NPP Presidential candidate, Nana Akufo-Addo for the 2008 General Elections had reached the rooftop. Prominent NPP politicians from the North were tipped for the second most coveted office in the party. It is the norm in the NPP to keep a North/South ticket.
Bawumia surprisingly emerged as Running Mate:
Admittedly, very little was heard in the media space of the distinguished academic, reputed economist cum banker and an accomplished technocrat, Dr. MahamuduBawumia. However, few days to the public announcement of the would-be running mate, Dr. Bawumia, then 44 years old, emerged strongly, displacing the notable political heavyweights from the North and eventually winning the nomination to partner the celebrated Ghanaian lawyer, Nana Akufo-Addo for the crucial election of 2008.
For many political pundits, it was a shock that Nana Akufo-Addo favored a politically unknown Deputy Governor of the Central Bank at that time, over political heavyweights in the North. Dr. Bawumia’s selection conformed to the unwritten maxim of the NPP Constitution and by extension the Daquah-Busia- Dombo tradition. That is, whenever the NPP elects a Southern Christian as Presidential candidate, that candidate is obliged by traditions of the party to choose a Northern Muslim as running-mate and vice versa! More importantly, he had the combined traits of all the names which were speculated as potential partners to Nana Akufo-Addo. Charismatic, eloquent, intelligent and very gentle!
At the then running mate’s outdooring in Takoradi in August of 2008, the highly respected economist admitted, in his acceptance speech, to his newness to the politics of Ghana. Dr. MahamuduBawumia confessed thus Mr. Chairman, my professional and career circumstances over the years have confined me to matters of economic and financial governance of our country. Naturally, in these circumstances, my open participation in partisan politics had been virtually foreclosed.
However, even though I may not be known on the political platform, I have been very active at the apex of the economic platform. I am proud to say that I have contributed to the economic achievements of the NPP under the leadership of His Excellency President J.A. Kufuor.
In fact, many political analysts wondered if the young Central Bank Deputy Governor, considering his humble nature, would survive the adversarial nature of our politics and be able to contribute to making Nana Akufo-Addo the President of Ghana. But Dr. Bawumia had signalled the country that even though he was new to partisan politics, he had unblemished professional credentials to rely on to help the NPP ticket.
The NPP lost Election 2008 to the NDC with the slimmest of margins in the history of modern democratic elections in Africa. After the election loss Dr. Bawumia returned to academia as a visiting professor at the University of British Columbia, Canada and then as a visiting scholar at the Center for the Study of African Economies, Oxford University where he authored a book on Monetary Policy in Africa. He was subsequently appointed by the African Development Bank as its Resident Representative in Zimbabwe.
In the meantime, the NPP selected Nana Akufo-Addo again to contest the 2012 presidential elections. Many stalwarts publicly counselled Nana Akufo-Addo to change a running mate for the 2012 election. However, President Akufo-Addo had undoubted belief in the ability of Dr. MahamuduBawumia and in a demonstration of loyalty settled on him again for 2012 elections. By 2012, Dr. Bawumia had undoubtedly attained a greater mastery of the political terrain and was increasingly becoming a torn in the flesh of the NDC. He had hijacked the debate on the economy and was critical of the NDCs mismanagement of the economy. He was rapidly gaining fame amongst voters. To curtail his rapid rise to political stardom, the NDC strategists advised the NDC presidential candidate, John Mahama to pick the late Mr. Amissah Arthur, an economist and the Bank of Ghana Governor at that time, as the NDC running mate. John Mahama heeded the advice and chose the gentle Amissah Arthur. The choice of Amissah Arthur excited the NDC support base. For they hoped, the late Amissah Arthur would rival the NPP’s Dr. Bawumia and possibly defeat him in any economic debate. For the former was the Governor and the latter was the Deputy Governor, the NDC bragged!
Thriller in Manilla as Bawumia clashed with Amissah Arthur:
The Institute of Economic Affairs, a Civil Society Organization, which has been instrumental in organizing Presidential Election debates for parties with representation in parliament, since the country’s return to multi-party democracy in 1992, for the first time, organized a Vice Presidential debate. It is not in doubt that the choice of running mates by the two major political parties with its attendant public excitement may have prompted this debate. For many Ghanaians, it was an opportunity to settle who amongst the two, Dr. MahamuduBawumia or Mr. Amissah Arthur, may be regarded as the Adam Smith of the Ghanaian economic system. For a clash between a Governor and a Deputy Governor was the ‘Thriller in Manila’ of our time!
Dr. MahamuduBawumia had another opportunity to return to Takoradi. But this time, not to accept an invitation to be running-mate but to prove to his party that they made a right choice in him!
On the night of debate, every Ghanaian glued to his/her TV set to watch the two economists’ battled it out. In introducing himself to the moderators, Dr. MahamuduBawumia threw the first punch by referring to a book he had authored the previous year on Ghana’s monetary policy and remarked That is what the NDC running mate was using at the Bank of Ghana.
Many Ghanaians who watched the Thriller in Takoradi called the debate in favor of the NPP running mate, Dr. MahamuduBawumia. Franklin Cudjoe of policy Think Tank Imani Ghana, in a Facebook post eulogized Dr. Bawumia for outperforming his NDC counterpart. The NDC officials and their supporters left Takoradi heavily disappointed and the NPP left feeling so proud of the man whom many had doubted would be politically useful to the NPP ticket.
However, the NPP lost the 2012 elections to the NDC ticket with an increased margin! But the NPP rejected the results of the election on grounds of widespread irregularity and promised to challenge the validity of the election results in the Supreme Court.
Dr. Bawumia’s First Prophecy before the Witness Box:
The NDC’s politics of attrition against the intelligent Dr. Bawumia, rather than being the latter’s waterloo, has rather blossomed his integrity in the eyes of right thinking Ghanaians. For whatever he says, which his opponents would roundly ridicule and reject, usually comes to pass!
While the NPP was making preparations to challenge the validity of the election of former President John Mahama, Dr. Bawumia released his first prophetic epistle on the economy post the 2012 polls. In February, 2013 the celebrated economist wrote that terrible economic conditions were to befall Ghana. He argued thus,The data coming in on Ghana’s economic performance in 2012 indicates quite simply that public finances are out of control and the economy is in trouble. At the end of 2012, Ghana’s budget deficit was a whopping Ghc8.7 billion, amounting to 12.1% of GDP using the rebased GDP numbers (or some 20% of GDP in terms of the old GDP series).
The widely respected economist made worrying predictions in the concluding part of the article which came to pass. He wrote prophetically Poor economic management has consequences. Unfortunately, the burden of the inevitable consequences of the NDC’s management of the economy is bound to fall disproportionately on the segments of society which are least able to afford it, as prices for petroleum products (whatever happened to the oil hedging policy?), transportation, water, electricity (in the face of water and power shortages), school fees, tax increases, expenditure cuts, unemployment, wage pressures, inflation, interest rates etc. shoot up and non-oil GDP growth slows down. This reality is already being felt and will soon be patently obvious for all to see.
Leading members of the NDC descended heavily on Dr. Bawumia. They vehemently rejected this prophecy on rather frivolous grounds.
As time remains the best ally, Dr. Bawumia’s warnings of dire economic consequences soon became patently obvious to see. The high cost of living, expensive yet unreliable power supply pervaded the Ghanaian economy. Even known sympathizers of the NDC begun to loudly complain of unbearable economic conditions.
Petitioner Dr. Bawumia chases Mr. Mahama in the Witness Box:
True to the NPP’s publicly declared intention to challenge the validity of the election of President Mahama, on 28th December, 2012, the NPP through three named petitioners filed a petition in the Supreme Court in accordance with Article 64 of the Constitution, 1992.
The petitioners were Nana Akufo-Addo, Dr. MahamuduBawumia and the late Jake O. Lamptey and the overall effect of their reliefs was that John Mahama had not been validly elected and that the first petitioner, Nana Akufo-Addo was validly elected President of Ghana.
To defend the claims of the petitioners, Dr. Bawumia accepted to enter the witness box. It was a decision which could either terminate his nascent political career or blossom him into a consummate politician. In effect, it was a tricky risky decision!
But this was a man the petitioners and their lawyers believed could do a good job in the witness box. It was a case involving not just law but also statistics. Who else was better placed than a man who made a living analyzing statistics?
From the witness box, Dr. Bawumia’s fame in the politics of Ghana exploded to the high heavens. He was hugely admired by both the bench and the bar and the generality of Ghanaians for his sharp memory, his eloquence and his extreme brilliance. His favorite refrain You and I were not there found a prominent place in the Ghanaian lexicon. As expected from his co-petitioners and party, Dr. Bawumia defended their claims with sheer brilliance. That decision to enter the witness box catapulted him into political stardom and made him an imperative factor for the NPP’s future battles.
In spite of his remarkable performance in the witness box, the petition was dismissed by a majority of 5-4 and the validity of the election of Mr. John Mahama was affirmed by the Supreme Court. Clearly, it was a huge disappointment to a man who fought bravely and brilliantly in the witness box in defense of democracy.
The Prophecies through Economic Analysis, 2014-2016:
The legitimate expectation of Dr. Bawumia and his fellow petitioners was to step out of the witness box and step into the Jubilee House. It did not happen!
President Akufo-Addo in 2014 decided to a make third attempt at the Presidency. He run and won the Presidential nomination of his party for the third time and immediately announced Dr. MahamuduBawumia as his running mate for the third time! On the third occasion, there was no single dissenting opinion to the nomination of Dr. Bawumia as compared to 2008 and 2012. The party unanimously clamoured for his return as running mate!
Dr. Bawumia’s approach to the 2016 election saw a quick gravitation towards economic analysis and proposing alternative policy solutions to the many problems confronting the country. As stated earlier in this piece, the first prophetic epistle was released in February, 2013 in which he warned of dire economic consequences as a result of the poor management of the economy.
His appointment as a Visiting Professor of Economic Governance in Central University afforded him a platform to deploy his very accomplished academic credentials and to offer policy prescriptions in response to the economic malaise witnessed under Mr. Mahama.
In 2014, the highly respected Dr. Bawumia at a maiden lecture organized by Central University on the theme Restoring the Value of the Cedi declared In conclusion, I would like to repeat without exaggeration that the Ghanaian economy is in a crisis. It is time for serious action. If government does not take the right decisions and soon, then Ghana would likely have to approach the IMF for a bail out before the end of the year. At the end of the day, the obvious lesson is that, we cannot run away from fiscal and monetary discipline no matter how hard we try.
The chorus by the Bawumia critics, on this occasion, was led by the then President himself, supported heavily by other sharp tongued loyalists, called Dr. Bawumia names! The discordant tunes in their chorus produced a lot of noise rather than solid rebuttals. On this prophecy too, Dr. Bawumia was waiting for time to polish or perish him! More especially, the then President had responded publicly that Ghana was not IMF bound!
Five months down the prophecy, the Government which previously rained insults on Dr. Bawumia over his prophecy, issued a statement signed by Dr. OmaneBoamah stating as follow: the President directed that immediate initiatives be taken to open discussions with the IMF and other development partners in support of our programme for stabilisation. President Mahama received rotten eggs on his face in consequence of the announcement. Dr. Bawumia on the other hand, received thunderous applause across Ghana, which cemented his acclaimed reputation as a man of honor, truth, integrity and knowledge.
It is important to submit that the prediction was not just about IMF. Around that time, Government through Central Bank announced that dollarization was responsible for the alarming depreciation of the Ghanaian cedi and took several steps to control that. Dr. Bawumia contended that Dollarization’ is the replacement of a country’s legal tender with another currency e.g. the US dollar. This happens in countries with a history of high inflation and exchange rate instability. The resort to dollars for savings is essentially a risk mitigation measure. There is a vast empirical literature that supports the view that dollarization is a reaction by rational economic players to expected depreciation of a currency. It is not the cause of depreciation. Ghanaians have over the years learnt the hard way that they cannot trust governments to keep the cedi stable. Cedi depreciation has become a fact of life and therefore Ghanaians have come up with coping strategies to deal with exchange rate depreciation, including the holding of foreign currency. The eminent economist went on to argue So if for whatever reason the value of the cedi declines, example because of high inflation, we can expect, other things being equal that its value relative to other currencies would fall. There is no requirement that these other currencies be even present in the country for such an exchange rate depreciation to take place. This is why the cedi has been depreciating recently against the Hong Kong dollar, East Caribbean Dollar, Korean Won and the Chinese Yuan recently even though there is very little trading of these currencies on the Ghanaian market. In fact, I am sure very few people in this hall tonight have seen the Chinese Yuan or Hong Kong dollar even though the cedi has been depreciating at similar rates against these currencies as it has been against the US dollar.
Dr. Bawumia observed that as long as the economic fundamentals are weak, there is no law that can stop any firm or individual from wanting to hold dollars as a store of value or thinking in dollar terms even though they price in cedis. Shakespeare said in Macbeth that There is no art to find the mind’s construction on the face. So if a trader thinks in dollars and prices in cedis, how would you know? Once they receive the cedi equivalent of the dollar price they would immediately buy dollars to save either from forex bureau or black market. People will buy dollars if they want dollars. There is not much a government can do about this once people lose confidence in the cedi
Again, he predicted that BOG’s policy was not going to work and therefore, should be reversed immediately. The then Governor of the Central Bank, Dr. Wampah disagreed with Dr. Bawumia’s suggestion to scrap the policy. Few weeks after the disagreement with Dr. Bawumia, the BOG announced a reversal of the policy!!!!
In that same lecture, he declared Ghana as a Highly Indebted Middle Income Economy or what he called HIMIC! He cited an African Development Bank report to support his conclusions. The IMF came to support the conclusion that Ghana was a debt distressed economy and a letter from the AfDB validated same! Dr. Bawumia was basking in the glory of economic prophecy!
On dumsor, he contended that the problem of dumsor was more financial than technical! He submitted that Ghana Gas owed Nigeria a lot of money which was affecting the supply of Gas to power plants in Ghana. Then the Deputy Minister of Power later came to confirm that the problem was more financial.
On the same platform at Central University, Prof. KwesiBotchwey, a former Finance Minister under Rawlings and NDC’s leading authority on economics and finance was invited to offer a contrary diagnosis of the economy from the perspective of the left. It heightened the hopes of NDC fanatics as they found in Prof Botchwey a worthy ambassador to demolish the assertions by Dr. Bawumia.
When he eventually mounted the podium, the good old Prof said of Dr. Bawumia’s previous analysis, Mahamudu is a young man whose professional credentials I particularly respect; I offer no rebuttals [to his lecture]. On the contrary, I do agree with much of what he said? This concession by such a colossus in the NDC completely robbed critics of Dr. Bawumia of any credibility left. The concession also affirmed the already established credibility of Dr. Bawumia.
As the arrowhead of the NPP campaign for 2016, Dr. Bawumia continued his economic analysis and accurate predictions. For instance, at a lecture in September 2016 which was themed ‘The State of the Ghanaian Economy � A Foundation of Concrete or Straw’, he predicted the imminent collapse of eight local banks in Ghana which was rubbished by the then Government. He stated The asset quality review of banks, conducted in 2015, shows significant vulnerability of banks to current economic conditions and that if the affected banks were to fully provision for all the bad loans, a significant number of them will collapse. In fact eight banks were identified to exhibit significant weaknesses with capital adequacy ratios of below 10 percent and some below 5 percent and nearing collapse so it is a real problem. The country has so far witnessed the collapse of seven banks!
These predictions, inter alia, prompted Constitutional law Professor, Kwasi H Prempeh to examine the Bawumia factor in the 2016 elections and made projections of the future of Dr. Bawumia in the politics of Ghana. In his article ‘The Bawumia Factor in the 2016 Elections: Why It Presents a Mortal Threat to the NDC and An Opportunity to Transform the Basis of Party Politics in Ghana, the legal luminary lamented the NDC’s incompetent approach in dealing with the Bawumia factor. He submitted the rival attacks on the NPP’s Bawumia have not focused on his suitability or qualification for the high office he seeks. In fact, the attacks have not even focused mainly on his claims and message in the areas of the economy and economic management, many of which have gone unanswered. Rather unusually, the aspect of Bawumia’s candidacy that has earned him the ire and disproportionate attention of the NDC is his ethno-regional identity�his identity as a Northerner.
The learned Professor went on to argue In the current campaign, Bawumia’s unprecedented visibility in the NPP campaign, his strong command of issues, as well as his cross-party appeal and likeability have cemented his status as a star politician both in the NPP and on the national political scene more broadly. Added to his relative youth, this makes Bawumia the politician to watch�not only within the NPP, but also (and more importantly) from the perspective of the NDC. The reason is not hard to fathom.
As December 7 drew closer, the pens of notable scholars continued to fill the pages as far as the Bawumia factor was concerned. His rise to stardom, his extreme brilliance coupled with his hard work rendered the NDC machinery helpless. He was simply unstoppable! In this enterprise, he was heavily supported by his equally brilliant and beautiful wife, Samira Bawumia. The couple punched Mr. Mahama from every angle.
The NDC lost the election by almost a million votes! It was a devastating defeat and it was unprecedented! A sitting President lost his second term bid! It was the first of its kind since 1992!
Confessions of NDC gurus post December 7, 2016:
Following the heavy defeat the NDC suffered at the polls, some leading members of the party begun to publicly concede that Dr. Bawumia denied them a second term. Dr. Tony Aidoo, an Ambassador under the Mahama Government in an interview with TV3 confessed to how the NDC became incapable of containing the Bawumia factor in the elections. In his candid view Dr. Bawumia was the Achilles heel of the NDC not only for the 2016 elections but he started way back in 2012.
Dr. Bawumia turned Vice President of Ghana:
On 7th January, 2017, Dr. Bawumia took the oath of office to become the Vice President of the Republic of Ghana after two previously failed attempts. As Vice President, became the automatic chairman of the Economic Management Team tasked with the responsibility of growing the economy, improving the macroeconomic indicators while creating good paying jobs to deal with the crisis of unemployment they inherited from the Mahama Government.
In respect of Dr. Bawumia, public expectations were high. They were wondering how he would turn around growth, cut down deficit, reduced debt to GDP ratio, bring down inflation down, reduce interest rates, remove the nuisance taxes while fulfilling major election promises.
In one year, the Government managed to achieve this! On January 15, 2018, the Vice President at the University of Ghana New Year School observed The question that we should ask is how can you inherit a budget deficit of 9.3% of GDP, proceed to reduce taxes, bring down inflation, bring down interest rates, increase economic growth, increase your international reserves, maintain relative exchange rate stability, reduce the debt to GDP ratio and the rate of debt accumulation, pay almost half of arrears inherited, stay current on obligations to statutory funds, restore teacher and nursing training allowances, double the capitation grant, implement free senior high school education and yet still be able to reduce the fiscal deficit from 9.3% to an estimated 5.6% of GDP? Quite simple, this is a remarkable achievement and this is what we mean by competent economic management
The performance of the Ghanaian economy under the NPP’s watch has received praise from global economic players such as the IMF and the World Bank.
It is important to add that Vice President Bawumia has been instrumental in leading the agenda of the transformation of the economy. The Government introduced the National Digital Property Addressing System, the National ID Cards, and the Paperless System at the ports to ensure port efficiency and enhanced revenue and many other important initiatives.
Undoubtedly, his performance as Vice President in the last 19 months has been remarkable. For his admirers and neutral commentators, he is the best Vice President so far!
Source: Ghana News Agency