It was a nice moment with Bernard Avle on Citi TV yesterday and monitored by Awake News when Prof John Gatsi provided a practical appreciation of what is meant by fundamentals of the economy.
He demonstrated a deep understanding of the purpose of economic management which gave erosion to the pillars of Dr Bawumia such that Dr. Gideon Boako virtually agreed with all the points made by Prof Gatsi.
Unknown to Prof Gatsi, his explanations were creating pain and distress at the seat of government, the Jubilee House.
Dr. Gideon Boako created the impression that it was IMF that caused the 13% depreciation in 2019. But Prof. Gatsi explained that the truth was that the IMF monitored the international reserve of the country and realized the government was fast depleting the reserves and exposing the weakness of the economy so the IMF press its conditionality on the managers of the economy. When people thought Dr Boako will say no, he again agreed to the explanation given by Prof Gatsi.
Infact, the confusion as demonstrated and confirmed by Dr Boako, made Prof Gatsi to express his sincere sympathy to the Government for being entangled by currency management confusion. The only point of disagreement, was when Prof Gatsi made reference to an exchange rate of GHc3.90 to the dollar in 2016 when Dr. Boako, maintained it was rather GHc4.20. But this did not change the argument Prof Gatsi made that the movement of the exchange rate from either 3.90 or 4.20 to 5.80 eroded incomes, made many young people who entered into mortgage arrangements to become defaulters because mortgages are denominated in foreign currency.
Citi TV viewers worldwide were so happy with the discussion that some took to Facebook to ask for more. Some viewers also took to Facebook to laugh at Dr Boako for not believing in economic principles of his boss, Dr Bawumia when he disagreed with Dr Bawumia on whether or not Exchange rate is the most important indicator of strong fundamentals.
The good thing is Prof Gatsi provided a lot of counsel that the government should take.