It Is Too Early To Predict Such A Failure – Economist To Gov’t

An Associate Professor at the Department of Finance of the University of Ghana Business School, Legon. Prof. Lord Mensah has said that it is too early for the government to predict a failure of policies put in place to stabilize the economy to ease the hardship in the country.

Speaking on Planb FM Nkosuonsem with Ohene Addo on 15 June 2022, prof said, explained that the government has increased the tax net by introducing Electronic Transaction Levy E-Levy and also cutting down on government spending/expenditure, how effective will it be is a key.

“We know how to mobilise the money but how to use it to make the economy strong is where the problem is, so effectively if such signal is been given it means the expenditure cutting is not effective,” he said

Prof. Lord Mensah stressed that, if E-levy is been charged but couldn’t be utilize but rather going back to IMF then it could have been proper if we don’t have E-levy or cutting down expenditure but we still end up going IMF again will tell us that expenditure cutting is not effective and making the economy suffer.

Earlier, the Deputy Minister of Finance, Dr John Kumah says government will consider returning to the International Monetary Fund (IMF) if the current domestic program fails to provide the needed economic stability and restore investor confidence.

According to him, an IMF Programme will be pursued if the need arises.

This comes at a time the government has been heavily criticized for failing to take the courageous step of subscribing to a World Bank program to address the economic hardship in the country.

“If it [bringing the economy back to life] becomes impossible, then it is the only alternative to salvage our economy. But where we are now, we think we are in the position to salvage the economy or to try the homegrown policy we are adopting.”

“If our programmes fail us and we are not able to get the confidence and the results in the fiscal space discipline, which we have to impose on ourselves, then we don’t have a choice,” the Deputy Minister on Accra-base radio station.

“It is not about politics when it comes to the economy. But for COVID-19, there is no way we should be discussing IMF by this time,” he explained.

“When President Akufo Addo picked this economy and started growing it with an average of 7%, we saw how the economy was doing so well.”