The ongoing debate surrounding Vice President Dr Mahamudu Bawumia’s proposal to provide smartphones to the youth on credit using a National Credit Scoring System has intensified, drawing divergent views from members of both the ruling New Patriotic Party (NPP) and the opposition National Democratic Congress (NDC).
The proposal, which aims to bridge the digital divide among Ghanaian youth, has faced significant scrutiny and sparked discussions about its feasibility and priorities amidst Ghana’s economic challenges.
Dr. Kwame Asiedu Sarpong, Democracy and Development Fellow at the Ghana Centre for Democratic Development (CDD-Ghana), previously critiqued the proposal, raising concerns about its relevance and timing.
He questioned the Vice President’s priorities, emphasizing the stark realities faced by millions of Ghanaians, citing a significant portion of the population that lives in abject poverty, grappling with limited access to education, employment, and quality healthcare according to the Ghana Statistical Service latest report.
Dr. Sarpong argued that addressing these fundamental issues should take precedence over distributing mobile phones on credit.
Selorm Branttie, Policy Analyst and Vice President of IMANI Centre for Policy and Education adding to the criticism, challenged the practicality of Dr. Bawumia’s proposal.
In a detailed analysis, Mr Branttie outlined the economic implications of providing smartphones on credit, highlighting the potential financial burden on the youth.
“Let’s all assume that a new smartphone that is a value buy from now till 2026 December is worth GHC 5000, which puts it smack between a Samsung Galaxy A35 or an iPhone 12 pro. Let us assume you earn 2000 cedis a month. Let us assume a payment period of 2 years.
“At no interest, you will pay 208.33GHC which is just about 10% of your salary. With a good credit score, that is actually not bad at all! However, nobody selling a phone for you will do that”.
Selorm Branttie, Policy Analyst and Vice President of IMANI Centre for Policy and Education
Taking inflation into account, which he estimated at 25% annually, Mr Branttie pointed out that the monthly payment would rise to GHC 325, representing 16% of the individual’s salary.
However, Mr Branttie emphasized that this figure still underestimates the true cost due to the need to factor in currency depreciation.
According to him, with an estimated depreciation rate of 30%, the monthly payment could soar to GHC 550, constituting 25% of the individual’s salary over two years.
Ghana’s Poor Economic Fundamentals
The Vice President of the leading and renowned policy think-tank, IMANI Centre for Policy and Education asserted that the additional financial burden is a direct consequence of Ghana’s poor economic fundamentals, which a credit score system alone cannot mitigate.
“The truth is, we are facing an approximately 15% premium for the way our economy has been handled. This 15% extra cost is the cost of the poor fundamentals that a credit score system cannot handle and requires the one who sets 170 questions to FIX”.
Selorm Branttie, Policy Analyst and Vice President of IMANI Centre for Policy and Education
Consequently, Mr Branttie indicated that a GHC 5000 smartphone today could cost over GHC 13,000 in just two years due to inflation and depreciation, underscoring the broader economic challenges facing Ghana, and questioning the viability of the Vice President’s proposal.
He called for a focus on addressing the underlying economic issues, rather than introducing initiatives that may inadvertently burden the youth further.
“Whether you are an NPP Footsoldier ready to forward this to your bosses for a rebuttal, or an NDC Footsoldier ready to share this with your friends, the truth is very simple. The fundamentals will expose you regardless of how you want to decorate the monkey!”
Selorm Branttie, Policy Analyst and Vice President of IMANI Centre for Policy and Education
As the debate continues, the divergent views from members of the ruling and opposition parties, along with insights from civil society leaders like Dr Kwame Asiedu Sarpong and policy analysts like Selorm Branttie, highlight the need for a comprehensive assessment of the proposal’s practicality and its alignment with Ghana’s broader economic and social priorities.
While the intention to bridge the digital divide is commendable, the feasibility and sustainability of such initiatives must be thoroughly evaluated to ensure they do not exacerbate existing economic challenges.
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