Gabby Asare Otchere-Darko
A leading member of the NPP, Gabby Asare Otchere-Darko, has proposed a national debate on the way forward for the economy, given the current deadlock on the controversial Electronic Transactions Levy (E-Levy).
He tweeted yesterday: “2022 began without the usual $3 billion injections of Eurobond cash. Government’s post-COVID recovery GhanaCARES programme hinged partly on an E-levy which Parliament may not even OK. There should be a national debate: do we want IMF or E-Levy or both or none? Tough decisions confront Ghana”.
Meanwhile, an economist and former Board Chairman of the Ghana Revenue Authority (GRA), Prof Stephen Adei, has refuted claims that Ghana’s economy is on the verge of collapse.
“The economy is not collapsing but we are in difficult times,” he said this in an interview on JoyNews.
His comment comes after an economist with the University of Ghana Business School, Prof. Godfred Alufar Bokpin, warned of possible collapse of the economy.
Debt stock
Prof. Bokpin said as the country’s debt stock hits high distress levels, the current debt situation could get worse by the end of September, if proper interventions are not implemented.
“Ghana’s current public debt stock stands at a staggering Gh¢341.8 billion with a corresponding debt to GDP ratio of more than 77% as of September ending 2021. This means if the country should share this amount across the country’s 30.8 million population, everyone will owe approximately Gh¢11,000,” he said.
Touching on the country’s debt stock, Prof Adei proposed that the country’s expenditure be reduced.
“If you are exceeding your income, then you must accept to live below your income, which is the easy way, otherwise if you are earning Gh¢3,000 and you are in debt of Gh¢10,000, you cannot day to day spend Gh¢3,000. For you to get out of the rag, you will have to cut your expenditure to Gh¢2,000 because you must service your debt. So, we are in that situation as a country,” he said.
He explained that although cutting expenditure might be difficult for the government, especially nearing an election period, that is the right way to go.
“… And they must thank God that this crisis has come now and not 2023, because if they don’t go for the hard one now, which normally will take about 18 months to go over this type of hunch, then they have a good chance by the middle of 2023 to see some good results in 2024,” Prof Adei added.
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