FLASHBACK: No magic wand to turnaround debt-ridden economy - Economist

In 2017, an Economics lecturer at the Kumasi Technical University, Kusi Boafo projected that the country may be stabilized by 2020, looking at the policies being implemented by President Nana Addo Dankwa Akufo-Addo and his economic management team.

“I can say that this government has demonstrated the attempt that it has the ideas, but the problem is still

Read full articleunsolved. The government is making an effort but the problem is still there. If huge debts precede a country, it will be naturally difficult for any government to govern. You have to work harder before you can gain feet to stabilize the economic situation,” he asserted.

The economist also noted that the Akufo-Addo-led administration had inherited huge debts from the previous government including GH¢10billion public debt which will make it a daunting hurdle for it to stabilize the economy.

Read the full story originally published on June 14,2017 by peacefmonline

An Economics Lecturer at the Kumasi Technical University, Mr. Kusi Boafo has predicted that the current economic situation in the country will be stabilized in three (3) years due to better economic measures being put in place by the economic team of President Akufo-Addo.

According to him, it will take proper planning and calculated steps by the new government to bring back the economy unto the right track as huge debts have preceded the country by the previous government before Nana Addo took over power.

Speaking on Okay FM’s 'Ade Akye Abia' Morning Show, Mr. Kusi Boafo averred that if NDC had won the 2016 elections, they would have inherited a difficult economy due to the economic malfeasance which transpired over the years.

He added that hardships and difficulties are inevitable looking at the economy unless proper measures are put in place; thus it will be wrong on his part to say that Akufo-Addo’s government has done nothing to curtail the economic challenge, though it is not enough.

“I can say that this government has demonstrated the attempt that it has the ideas, but the problem is still unsolved. The government is making an effort but the problem is still there. If huge debts precede a country, it will be naturally difficult for any government to govern. You have to work harder before you can gain feet to stabilize the economic situation,” he asserted.

Highlighting the economic challenges Akufo-Addo’s government inherited, the Economic lecturer mentioned that the total debt the new government inherited was 72.9 percent GDP, and again 33 percent of the loans the previous government took were used to settle interest on loans the government had borrowed.

“Our loan interest has reached Ghc10 billion Cedis and our currency was low. Inflation was very high when compared to neighboring countries. Irregular power supply also contributed to the economic difficulties as businesses incur additional avoidable costs as they took loans to buy generators,” he highlighted.

He stressed that “it was an economy which was under serious threat and so most of the social intervention programs like the NHIS owed a lot and Nursing and Teacher Trainee allowances were withdrawn.”

He reiterated that the economic situation was so bad that workers Second Tier Pension was pending as close to 71 months.

“Contractors have not been paid for their work and all these have been piled up waiting for the next government. This government cannot use magic means to solve our economic challenges overnight; it will take a process and proper planning,” he averred.

He therefore cautioned the new government to ‘dismantle’ all the institutions and restructure by introducing a system which will eliminate corruption in the state institutions; adding that it will take more than one year to purge the institutions.

He indicated that even though the economic wounds of the country is still fresh, he has seen Ghanaians giving the new government ‘honeymoon’ with the anticipation that the government’s programs will meet their expectations.

“Ghanaians are working hard with the hope of receiving help from the government. For the first time in 5 months, the profits repatriated through our exports have beaten those which are imported into the country. It will help stabilize the currency,” he revealed.

“Our exchange rate is getting better. Our debt to GDP which was 72.9 percent has dropped to 63 percent; this is not a small achievement, but with general turn around for the country, it will take 2 to 3 years before we can see it completely,” he predicted.