Minority Leader, Dr. Cassiel Ato Forson, has refuted Finance Minister Ken Ofori-Atta’s claims of economic recovery and argued the country’s economic woes have worsened.
Ato Forson contends that the relatively stable cedi was a result of the government’s failure to service its debts, a situation that will eventually lead to further economic turmoil.
He said, “For the Finance Minister to claim that Ghana has ‘turned the corner’ and heading for economic recovery is false. In reality, the government’s actions have deepened the economic woes of the country.”
Speaking during an interview after the presentation of the 2023 mid-year budget review on Monday, July 31, the Minority leader pointed out that the country’s default on payments to Euro bond lenders, including countries like China, Saudi Arabia, India, UK, France, and the Czech Republic, has resulted in a temporary stabilization of the cedi.
He pointed out that as early as January 2024, the government will have to start servicing this debt and warned this will lead to steep depreciation of the cedi again.
Ato Forson questioned the economic growth projections of the Finance Minister, citing the revised figures.
“He has revised economic growth from 2.8% of GDP to 1.5% of GDP. This clearly shows that the economy is contracting and declining,” Forson stated, expressing concerns about the implications on jobs and the welfare of ordinary citizens.
He also expressed skepticism about the Finance Minister’s borrowing decisions and their impact on inflation and lending rates.
“No wonder inflation is still going up and rising. No wonder the central bank is busily increasing the monetary policy rate. No wonder lending rates are still going up,” he said, stressing that the government’s excessive borrowing has contributed to the worsening economic situation.
The Minority leader lamented a missed opportunity for Ghana to reduce lending rates below 15% and slammed the Finance Minister’s over-borrowing and overspending for the persistently high market rates.
He further warned that the government t’s borrowing spree, including GH¢5.5 billion from the T-bill market, without parliamentary approval and further plans to borrow another GH¢41.3 billion before the year ends, will exacerbate the inflationary pressures and could push lending rates even higher, possibly reaching over 30%.