1. NS4960 Spring Term 2018 Ghana 2017 Update
Ghana New President will face key economic tests, Oxford analytica December 12, 2016

2. Overview
Ghana had election on December 9, 2016, peaceful change in government from the National Democratic Congress (NDC) replaced by the New Patriotic Party (NPP)
Reasons
Country's poor economic performance in recent years hurt living standards
High youth unemployment (48%)
Number of high profile NDC corruption cases
Time for a change -- governments usually change every 8 years and NPP in office since 2009

3. Expenditure Plans I
Having lost last two elections Akufo-Addo (NPP) candidate overpromised during the campaign, committing himself to far reaching program of economic transformation including
Create an annual development fund of $ 1 million for every constituency
Build an industrial factory in every district as part of broader program to industrialize country
Establish an integrated aluminum industry in Ghana
Revive the National Health Insurance Scheme and
Create large number of jobs, particularly for youth

4. Expenditure Plans II Keeping these promises will be costly.
There are 275 constituencies, so the constituency development funds alone will take $275 million out of government coffers
There are only slightly fewer districts (216) so even if each factory costs a conservative $500,000 to build this promise costs an extra $130 million
Bill for thee two promises alone likely to exceed the infrastructure budget
Roads, highways, water and housing and communications was set at $335 million in 2016

5. Expenditure Plans III
Economic growth is expected to increase from 3.3% in 2016 to 7.4% in 2017 which is good news for the NPP government
However previous efforts to force industrialization have repeatedly failed as a result of
High production costs
Lack of comparative advantages and
Absence of suitable markets
If the NPP goes ahead with the plan to build a factory in every district this unnecessary duplication will make it impossible to generate economies of scale for a competitive industry

6. Assessment
Devolution of development funds to the constituency level have not worked well in the African context and have proved to be an inefficient way to drive development.
In short, significant barriers to budget implementation
Sluggish growth and low price of oil mean prospects for economic recovery limited
Will make it difficult to deliver on election promises
May lead to popular unrest.