Seth Terkper
A Former Finance Minister, Seth Terkper, has blown hot and cold over the recent measures announced by the government in response to the ailing economy.
Speaking on Newsfile last weekend, he said while the measures are not substantive and effective in lessening the economic hardships being endured by the citizenry, they would nonetheless increase the numbers.
It was a subtle and measured reaction which stands apart from previous scathing remarks about actions.
“It is not a matter of one or two measures; it is positive in one sense even if it is not substantive because much of the expenditure is not going in that area. By the way, we have to borrow to refinance [and] we have to borrow to repay old loan. That is the situation that is facing us.
“Is our domestic market that big, and if we are blocked from going to the external markets, then I’m afraid; the problems GUTA is raising are going to be worse because government is coming straight into the domestic markets to borrow and it will increase interest rates, and that is why Bank of Ghana (BoG) is increasing the policy rate as a signal,” he said.
A possible government borrowing to service existing debts, the former minister said, would lead to an increase in the deficit.
Government response to the global economic challenges being witnessed in the country include among others a 50% cut in fuel coupon allocations for all political appointees and heads of government institutions, including SOEs, a 15% reduction in fuel prices and a 30% cut in salaries for all Cabinet Ministers and heads of State-Owned Enterprises, amongst others to cushion Ghanaians.
The measures nonetheless, Mr. Terkper wondered how in the face of revenue shortfall government was going to raise additional revenue to boost the country’s economic fortunes.
“It is a signal that the ministers themselves, the President himself, and others are part of the sacrifice. As we go through these items, give us numbers; hopefully, by the mid-year review, we’d get the numbers,” he added.
Ranking Member on Parliament’s Finance Committee, Cassiel Ato Forson, on his part described the measures as lacking substance in the recovery process.
For him, the measures will only exacerbate the worrying situation in which the country finds itself in currently.
In an earlier March 24 tweet, he had suggested a moratorium on new loans, a cut in the 2022 foreign financed projects by at least 50% and the fulfillment of the promise to review all flagship programmes.
Minority Leader Haruna Iddrisu rubbished the measures shortly after the Finance Minister’s presentation.
Earlier, Mubarak Muntaka, MP for Asawase had taken a swipe at the Finance Minister for not obliging Parliament’s request to make an appearance before the House to address some questions pertaining to the economy.
BY Samuel Boadi