A resilient macroeconomic environment that translates into livelihood improvement and less cost of doing business is what Ghana needs to overcome periodic economic hardships.
Dr Patrick Asuming and Dr Daniel Amateye Anim-Prempeh, Economists, said this on the back of President Nana Addo Dankwa Akufo-Addo’s message on the State of the Nation, delivered to Parliament on Tuesday, February 26.
The President stated that the country’s macroeconomic indicators were pointing in the right direction as the performance of the economy was much stronger at the end of 2023 than in 2022.
Nonetheless, the Economists noted that the gains made were not reflective of the high cost of living and overall hardship in the economy, as ‘deep-rooted’ challenges persisted.
They, therefore, encouraged the government to ensure that policies and programmes were streamlined to produce outcomes that would make Ghanaians see tangible impacts in their lives.
Figures from the Ghana Statistical Service (GSS) indicate that the country’s inf
lation has dropped from 54.1 per cent in December 2022 to 23.2 per cent in 2023.
Gross Domestic Product (GDP) growth for the first three quarters of 2023 though lower than that of 2022, averaged 2.8 per cent, which was higher than the targeted growth rate of 1.5 per cent for the year.
Dr Asuming, a Senior Lecturer at the University of Ghana Business School (UGBS), noted that despite those macroeconomic gains, things were still difficult for businesses and individuals in the country.
He explained that high interest rates and taxes, inflationary pressures, depreciation of the Cedi against the Dollar, as well as the impact of the Domestic Debt Exchange Programme (DDEP) were indications of those economic difficulties.
Dr Asuming said this in an interview with the Ghana News Agency, saying, ‘We’ve implemented many taxes, which have made the business environment extremely difficult, and the hikes in the monetary policy rate have also made interest rate high and cost of credit has come up substantially.’
‘We mu
st urgently invest more and wisely in the agriculture value chain; not just providing seedlings, extension support, and fertilizer to farmers, but in the road and distribution network, cold storage and warehouse,’ he recommended.
The Economist expressed confidence that doing so would help improve food production significantly, leading to a reduction in inflation and its attendant hardships on Ghanaians.
Dr Anim-Prempeh, Chief Economist with the Policy Initiative for Economic Development (PIED), said: ‘We’re not completely out of the hardship yet; the cost of living is still high, and the policies are not responding sharply to it. Unemployment is also a time bomb.’
‘We must implement the Planting for Food and Jobs (PFJ) programme effectively and show commitment in coordinating related policies and have the right mix of investment to make these programmes bring relief to Ghanaians,’ he said.
‘In the months ahead, the government must occupy itself with sustaining the macroeconomic stability, ensure that reso
urces are expended judiciously, and create more opportunities for the youth,’ he said.
Ghana is implementing a three-year US$3 billion loan-support programme with the International Monetary Fund (IMF) to restore macroeconomic stability and debt sustainability, build resilience, and lay the foundation for stronger and more inclusive growth.
The country has received the sum of US$1.bn in two tranches from the IMF for the implementation of the Extended Credit Facility (ECF) plan, backed by the country’s Post-COVID-19 Programme for Economic Growth (PC-PEG).
Source: Ghana News Agency