Economy won’t struggle next year – Gov’t

Government has dispelled assertions that 2021 will be a difficult year for the Ghanaian economy.

It follows warnings from economists for Ghanaians to brace themselves for a difficult year due to the rise in debt levels and the impact of government’s freebies to mitigate the effect of the Covid-19 pandemic.

An economist and Lecturer at the University of Ghana Business School Dr Lord Mensah told Starr News “we should expect more tax increments and some freebies that we are enjoying are not going to be there. So citizens should expect a tough 2021. I was expecting that at the point that we had COVID-19, we would have cut down some expenditure where we had control but we kept spending…you can’t eat your cake and have it.”

However, speaking to Starr Business government spokesperson on finance Daniel Okyem Aboagye said the economy will be fine adding that economists are entitled to their opinions,

He said “wHat the Governor of the Bank of Ghana was saying, yes 71%, the debt to GDP ratio is high, maybe, if he claims it’s unsustainable. The point I’m just making is that there are other opportunities to raise the bar. We are creating economic activities where revenue can also come in for the government to tap so that in time, even before the productive activities or investment that the government is doing begin to pay for itself, we will be fine. This NPP government is not a government that will just borrow anyhow, no way.”



He went on “when you go to the world market to borrow, you are dealing with investors. They do their due diligence because they lend to you. In Africa for instance, we NPP government is the only government that has been given a loan of about 40 years. Meaning they have trust, they know we gonna use the money wisely. So, dont just think you can go to the world market and you can get money anyhow.”

“So, I just want to say we will watch it, yes, it’s a concern no problem, but we are gonna manage it because we are doing other things that must come together to take care of all of these things. During the covid, we said that the growth rate was going to be about 0.9%. When the minister came back to parliament to bring the three months budget for 2021, the growth rate had been projected to about 9.7. It’s good. We are going to do well, Ghana is going to do very okay,” he added.

Source:Starrfm.com.gh