Friday, July 24, 2015

The economics and the politics of the prisoner release

The Gambia is on the brink of a financial meltdown.  Thanks to the inappropriate policies of a dictatorship that is known more for its incompetence and high level corruption than prudent management of Gambia's fiscal and monetary affairs.

The country's import cover is estimated at less than two months cover which spells hardship for ordinary Gambians because basic staples like rice and flour will be in short supplies in the weeks and months ahead.

An under-performing agriculture sector, the main foreign exchange earner can only add to the problems of a contracting economy that is registering the highest youth unemployment - a major constituent of the regime - in the 21-year history of the regime.

Fiscal indiscipline is the primary cause of the macroeconomic imbalances that have plagued the Gambian economy for close to a decade, attested to by numerous IMF mission reports warning government of out-of-control spending.

Government's refusal to heed the warnings led to the ballooning of the domestic debt beyond sustainable levels which eventually led to the Fund proposing a "voluntary" staff monitored program (SMP) in exchange for a bail out, effectively putting The Gambia on a short leash.  Expenditures of a certain level will now have to be pre-approved from Fund headquarters in Washington.

The SMP did come at a steep cost to government because in exchange for the $ 10 million bail out loan from the Fund, they promised to live within their means, limiting domestic borrowing -  used to finance Jammeh's pet projects that will not pass muster with external donors -  to 1% of GDP from the pre-SMP levels that fluctuated between 5% - 10% of GDP.   2016 being an election year, it will be the biggest challenge the regime will face - assuming he runs - because it will not be able to borrow domestically to finance projects and other election-related expenditures from the public trough.  

The regime's money worries was made worse by the European Union's suspension of aid because of the country's poor human rights record where close to $ 36 million has been blocked contingent upon Gambia fulfilling the 17- points demands relating to improvements of its human right record.

The United Nations Human Rights Commission and its Rapporteurs who were denied access to the Mile II prison facilities resulted in a scathing report to the Commission that continues to call for substantive reforms of the penal system, the judiciary and the legislative agenda of the National Assembly among other vexing issues.

Indeed, speculation is rife that the pardoning of over two hundred prisoners - ongoing as we go to press - by Yaya Jammeh is directly linked to the demands of the EU and the UN Human Rights Commission.  By pardoning prisoners, most of whom are military personnel accused of trying to topple the regime, Jammeh is hoping the gesture would have earned him sufficient brownie points for the EU to release some of the development aid.

The release of the parents and relatives of the alleged attackers of State House on the 30th December is seen as relenting to international outcry over their incommunicado detention of women and children whose only crime was to have been related to the accused.

The decision of the EU to withhold development assistance did expose the soft underbelly of a regime that is famous for spewing anti-Western rhetoric that is, at the same time, dependent on the same West for its development program.  With the prisoner release, it is presumed it will free the Mile II prisons facilities, one of the worst in the world, for extensive renovation to humane standards.