Verifiable literature has shown that Vice President Dr. Mahamudu Bawumia has demonstrated transformational leadership ahead of his competitors in the 2024 presidential race on how to structurally transform Ghana’s economy.
In his 2010 bestseller, ‘Monetary Policy and Financial Sector Reform in Africa – Ghana’s Experience’, Dr. Bawumia comprehensively examined the monetary policy on the African continent and the need for reforms to ensure economic transformation through digitalisation.
It is therefore not surprising that the Vice President is a firm believer of putting in place digital structures to drive the economic transformation of Ghana.
In the review of the seminal book, Dr. Bawumia recommended reforms, after critically touching on all inhibiting issues, focused on digitalisation of African economies, which he said will be achieved on three main pillars.
He mentioned the three pillars as unique and verifiable national identification numbers, digital address systems and financial inclusion, which he pointed out, would bring on board the unbanked members of the informal sector.
All these are currently being implemented in Ghana by Government of President Nana Addo Dankwa Akufo-Addo under incisive supervision of Vice Bawumia.
Unique national ID numbers
According to Dr. Bawumia, a key component which underpins financial transaction in any society is trust.
However, his book revealed that trust was very low in Ghana’s financial transactions due to lack of database to properly identify people.
This is contrary to developed countries where every individual is identified with a unique national identification number.
Dr. Bawumia therefore suggested that the only way to curb this is to have a unique national identification number for the people, which can be easily authenticated both “online and offline.”
Address system
Writing about the importance of a system of property addresses, Dr. Bawumia noted that it “is probably one of the most underestimated requirements for the development of an economy and its financial sector.”
Reiterating the importance of the system in an economy, Dr Bawumia stated, “one can imagine what would happen if for example, the address system in the United States, United Kingdom, South Korea or Japan disappeared overnight. These economies would basically grind to a halt because so much depends on residential or business addresses.”
Dr. Bawumia also argued that the absence of address system also “increases the risk premium bankers attach to a loan.”
He accordingly recommended that countries like Ghana, should, as a matter of priority, put in place a comprehensive address system.
Financial inclusion
In the 2010 bestseller, Dr Bawumia called financial inclusion, “banking the unbanked”.
He noted that “the financial system cannot develop to its potential and monetary policy cannot be effective if the majority of the population continues to be excluded from access to financial services.”
Acknowledging the role the Bank of Ghana[AM1] ’s e-switch platform was playing in bridging the financial gap as far as banking was concerned, Dr Bawumia recommended the use of mobile phones to deliver mobile banking service within Bank of Ghana’s regulatory framework.
Unwritten rules
In the concluding parts of the book, Dr Bawumia wrote that the recommendations he outlined were some of the unwritten rules for effective fiscal policy and financial management, as well as for general development.
“A unique identification number, an address system and financial inclusion (banking the unbanked) are basically some of the key unwritten rules for effective monetary policy and financial sector development in particular and over all development.
“Without these systems and institutions in place, no monetary policy framework will be sufficient in the long run to engender the type of financial sector that will be critical in the growth process. No donors have thus far required that countries put in place address systems, unique IDs, etc. in place as conditions for aid for example.”
Walking the talk as Vice President
Just as he recommended in his highly revered book, Dr Bawumia, as vice president and head of Ghana’s Economic Management Team, has followed to the letter the principles he preached, leading to the massive digital transformation of the Ghanaian economy.
Within four years of the NPP administration between 2017 and 2021, Ghana has a unique and verifiable national identification card, a digital property address system and financial inclusion of the unbanked through mobile money interoperability.
Through these pillars, just as Bawumia predicted in his book 11 years ago, there has been a digital transformation with many government services going online.
This is bringing relief to people in accessing services, and also helping in the fight against corruption.
