Ghana’s economic future remains uncertain as the country grapples with a high public debt, estimated to be GHC576 billion as of November 2022, and an economic downturn caused by the slump in global commodity prices.
Former finance minister Seth Terkper has criticized President Nana Akufo-Addo for failing to give a true picture of the Ghanaian economy during the State of the Nation Address, claiming that the economy is currently in a bad state due to the poor performance of the current government.
According to him, the president during the State of the Nation Address only painted a gloomy picture of the economy he inherited, instead of telling Ghanaians about the sorry state of the economy he has supervised.
Speaking to journalists on Thursday, Mr. Terkper noted he was surprised about the optimism expressed about the economy by the President given the dire state of the Ghanaian economy.
Adding that there was no sense of urgency in the President’s State of the Nation Address.
“I think we need to be realistic with Ghanaians and not make them think that everything is fine and going well,” he added.
Government is seeking to secure an IMF bailout by the end of March with the support of its biggest bilateral lender, China, through a debt restructuring of its debts to the Asian giant.
A successful restructuring of the country’s external debts will also be a major boost to securing the $3bn IMF bailout.
Meanwhile, President Akufo-Addo has defended his government’s borrowing and spending practices, stating that they have spent prudently on urgent needs of the country.
Ghana’s reliance on commodity exports, such as gold and oil, has made it vulnerable to global commodity price fluctuations. The recent slump in commodity prices has hit the country hard, exacerbating its economic challenges.
Furthermore, the country has been struggling to repay its debt obligations, and its government has been trying to restructure its debt by asking local bondholders to exchange old debt for new bonds that pay lower interest rates. This move is expected to provide some relief to the government’s strained finances and help the country save money on debt servicing.
Despite President Akufo-Addo’s defense of his government’s borrowing and spending practices, concerns about Ghana’s economic future persist. The country’s public debt has been rising steadily over the past decade, and the recent economic downturn has only made the situation worse. The government will need to take decisive action to address its economic challenges and ensure sustainable economic growth and development.
One area that the government could focus on is diversifying the economy away from commodity exports. This would reduce the country’s vulnerability to commodity price fluctuations and provide a more stable source of economic growth. The government could also work to improve the country’s infrastructure, including roads, bridges, and schools, to attract foreign investment and create jobs. Additionally, the government could prioritize social protection programs to support the country’s most vulnerable populations.
Ghana’s economic future is uncertain, and the government will need to take decisive action to address its economic challenges and ensure sustainable economic growth and development. While Akufo-Addo has defended his government’s borrowing and spending practices, concerns about the country’s high public debt and reliance on commodity exports persist.
The government could focus on diversifying the economy, improving infrastructure, and prioritizing social protection programs to support the country’s most vulnerable populations.