Minority Spokesperson on Finance, Dr. Anthony Akoto Osei has downplayed Finance Minister, Seth Tekper’s claim that the economy is on the path of recovery.
Making a presentation on the state of the economy in Accra on Wednesday, the Finance Minister stated that growth is expected to pick up over the medium-term because of the dividends from the International Monetary Fund (IMF) programme and the implementation of home grown policies to ensure macroeconomic stability and address the causes of fiscal overruns.
In an exclusive interview, former Finance Minister, Dr. Akoto Osei insisted that it is too early for such conclusions to be drawn.
“I’m not that optimistic. The IMF programme was only signed and approved in April. This year so far, the cedi has depreciated by close to 20%, inflation is still hovering around 17% because of that the Bank of Ghana told us that it has raised the policy rate to 22%. The total debt in three months has been risen to GHc88 billion. GDP for this year is expected to be revised downwards to 8.5. The power outages and its recurrent effect on households is not good. So I don’t see how one can call this optimism,” he added.
But senior lecturer at the University of Cape Coast Dr. John Gatsi disagreed with the minority spokesperson.
For him, the Finance Minister clearly detailed the progress made so far, the evidence of which he believes is there for all to see.
“The signs you need to see to assure yourself that we are on the path of recovery is apparent now. Basically you need to re-position your reserve to be able to control your currency. And all these things depend on inflow of foreign money.”
He added that “the money from the IMF is not sufficient to do that, he noted that “If we put together accumulatively, the monies that will come from the donors who have assured of resuming support for the country together, is likely to support the currency thereby reducing the volatility of the currency.”
“We do know that the volatility of the currency has contributed hugely to the development of the inflation. So if this is able to control the currency, then there is likelihood that inflation can also go down for which interest rate can also see a downward trend in the future. But those things have not changed but the signs for those change are apparent.”
Source: citifmonline