SOURCE: Al Jazeera
President John Dramani has rejected suggestions by economists and analysts that
Ghana’s economy is in crisis.
The country is battling with managing the economy; budget deficit, rising debts,
public sector wage bill among others; but President Mahama insists that the
country’s economy is not in turmoil as analysts are purporting.
“…I wouldn’t say so [economy is in crises]. Yes we have experienced some
challenges with the economy in respect of the deficit to GDP. We currently are in
talks with the IMF and I believe those talks have been going very well and it gives
more confidence in what we are doing with regards to turning the economy,” the
President told Al Jazeera.
Government has faced intense criticism for various economic challenges
bedeviling the country.
A series of demonstrations have been staged by various civil society groups,
political opponents and pressure groups, to protest what they believe is
government’s lack of ideas to solve the problems.
Government in a bid to resolve the challenges initiated talks with the (IMF) in
August for a possible bailout.
The IMF team is currently asking government to adopt policies such as cleaning
up the payroll system among others, to support the programme.
Asked whether the demand of cleaning up the payroll system was feasible,
President Mahama responded in the affirmative, saying “Well it is something that
has come up because the increase in the payroll has been one of the factors that
have brought us where we are and so over the three years it is not more about a
freeze, it is about making the pay rise predictable over the years and so we are
looking to negotiate what those increases will be, so that it makes it more
predictable how government expenditure is going to go; but I think it is something
that we can deal with.”
“We had a problem with the wage bill, we had a problem with reducing
government expenditures and increasing revenues. Those are things that we have
identified ourselves so indeed we are speaking the same language in terms of
agreeing what the benchmarks that we must meet are because we believe that it
is healthy for our own economy. It is not the IMF [that] is forcing us to do what
we have to do.”
The IMF after its first round of discussions on a possible programme for Ghana
announced some targeted key areas it will push government to bring the
country’s economy back on track.
The Fund has also targeted a drastic review of the Single Spine Salary Structure
(SSSS) which according to government drains more than 50% of its revenue.
It also said the costly and untargeted subsidies for energy and petroleum
products must be eliminated, with a better prioritization of capital spending.