Chancellor Sajid Javid at UK’s Spending Review in 2019 said: “High-quality and reliable infrastructure are essential for how we live, work and travel. But the truth is, across many decades governments of all colours have under-invested in infrastructure.”
The above, while a sad reality, requires sincere policy prescription and urgency to reverse the observed trend.
The need for infrastructure permeates across the various sub-sectors which includes, roads, aviation, electricity, telecommunications, water supply, and transportation. For decades, infrastructure development in Ghana has lagged behind, although Ghana brands itself as a middle-income country. Regrettably, Ghana epitomizes a middle-income country with a low-income infrastructure.
The Approach- Infrastructure
The problem lies in the fact that many successive governments have approached the acquisition of infrastructure in the wrong way. The Ghanaian construction industry is riddled with many failed projects mostly because all such projects have been politicized. Hard as it may seem and evasive as we have made it, that is our problem. We have failed to openly come to terms with the truth, that politicizing every project ultimately leads to poorly delivered, unplanned and abandoned projects digging deep into the tax payer’s pockets.
Most infrastructure in Ghana are at least more than fifty years old. Road networks, bridges, water systems (dams and the like), electrical grids, etc. were constructed for a nation at the time when the population was tiny, and with antiquated technology.
Presently, our international and regional airports are ranked among the lowest and this is most embarrassing. Clogged drainage systems, failing water systems (characterized by constantly breaking pipes), and haphazard transportation systems a much-needed infrastructure revolution must surely be underway.
Infrastructure in a Growing Economy.
Macro-level economic studies in recent decades have reported a strong positive correlation between high levels of infrastructural investments and economic growth. By and large, infrastructure is known to fuel economic growth by increasing productivity of input factors, reducing the cost of transportation of goods and services, and the creation of positive externalities.
Such externalities can be seen in the construction of rural roads that would ultimately benefit agriculture by allowing farmers the access to towns and cities to sell their products. Again, these farmers are able to obtain farm inputs such as fertilizers, pesticides and other industrial products at relatively cheaper prices due to the reduction of costs of transport. Another instance is seen in the construction of power plants that produces electricity for commercial and domestic use thus accelerating economic growth.
In growing economies such as that present in Ghana, infrastructure is also needed to ensure inclusive growth. Inclusive growth is that which occurs when the benefits of growth are shared and experienced by a majority of people in a country. This inclusive growth leads to poverty alleviation and ultimately the reduction of income inequalities existing within the country.
For instance, the existence of widely dispersed Micro, Small and Medium Scale Enterprises (MSME’s) thought the economy and by their production through access to quality infrastructure would allow them to compete efficiently with the large-scale enterprises and can more often than not allow these MSMEs to build and install their own smaller infrastructure such as generators. Again, the large scale enterprises can locate to ports and city hubs where infrastructure promotes their businesses and allows for higher employment rates, increased profit margins and overall productivity rippling into overall economic growth within the country.
The Key To Full Economic Recovery
The success and growth of MSMEs are dependent heavily on the availability of infrastructure and by being labour -intensive, they generate large employment opportunities for the working class thus helping to alleviate poverty in developing countries.
The lack of infrastructure not only holds back economic development but also causes additional costs in time, efforts and money of nationals who have to access essential services such as healthcare, education and other commercial activities. Unless critically scrutinized and improved, infrastructure would continue to be a bottleneck for growth and an obstacle to development within developing nations such as Ghana.
The World Bank in 2008 estimated that developing countries made around $500 billion annually in infrastructural investments. This summed up to 20% of GDP yet still need for increased and planned infrastructural investments is at large.
Investments in transportation, public buildings, water treatment and distribution systems and other vital forms of infrastructure is key to a full economic recovery. Over one billion people still lack access to clean water, while more than two billion people lack access to sanitation, electricity and adequate transport facilities in developing countries all over the world.
Best Time To Make Investments in infrastructure
In Ghana, this is the best time to make investments in infrastructure. With policies such as the free S.H.S education and the influx of students into the tertiary system coupled with the job creation policies, there is no better time than now to make those huge and positive investments in infrastructure for the nation. The poor conditions of the roads, bridges, schools, water plants, electric plants, etc. is nothing to write home about.
The focus on agriculture over the past few years needs to be supported with good rural roads that would allow the farm produce to reach markets and ports for export in time. The need for locally produced and patronized goods, is only possible with better power plants and industrial facilities. Our physical assets invariably affect our overall economic growth and it is important that the country takes the needed steps to curb our stagnating economic growth through planned Infrastructural investments.