An Economist, Professor Lord Mensah says government’s latest expenditure-cutting measures will amount to zilch because Ghana lacks self-discipline to yield the anticipated results in reversing the economic downturn.
He simply puts it as that, the country will be better off returning to the International Monetary Fund (IMF) rather than pushing through what he feels are the unmeasurable steps taken by the government.
Government earlier in the week outlined various interventions to salvage the country’s ailing economy.
These new measures will be in addition to the ongoing 20 percent expenditure cut as part of fiscal stabilization and debt sustainability measures, with the aim of ensuring the 7.4% deficit target set in the 2022 budget is met.
But contributing to discussions on The Big Issue, Professor Lord Mensah argued that the government’s expectation will be difficult to meet as it will even have little bearing on savings.
“Clearly, I will not tow that line of the expenditure cutting measures as announced by the Finance Minister; introducing our own measures and self-discipline towards expenditure. I will also not go in that line of expenditure self-discipline, because how are we going to measure them in terms of benchmarks to determine whether we are following it or not. I cannot guarantee that, so effectively, I am not for the self-discipline. Even the savings we are going to make as a result of these measures are peanuts; they are not enough.”
The Finance Minister, Ken Ofori-Atta, highlighted twelve points for cutting down public expenditure including a moratorium on the purchase of imported vehicles and foreign travels by public officials.
He also indicated plans to generate more revenue including impressing on parliament to pass the E-levy adding that there are also plans to inject $2 billion into the economy in the next 2 to 6 weeks.
Government says it has strengthened its Expenditure Monitoring systems to achieve success.
Professor Lord Mensah is however pessimistic. He believes Ghana’s history with the management of the economy is proof the government is on the wrong path in ensuring effective implementation of these measures.
“With these self-discipline measures that we are trying to put across, we have done it before, so we don’t go to the IMF again, but we never followed through, so what shows that this time around, we are going to follow them? I don’t think things will work. If we were to go IMF, I will say the benefits would have been better compared to disciplining ourselves. With the IMF, we would have had that discipline being enforced by the IMF itself.”
