Government's GDP Target Is Unachievable - Report

The country's current economy structure would not be able to support government's vision to double the Gross Domestic Product by the year 2010. According to the Director of the Institute of Statistics, Social and Economic Research, (ISSER), the government's vision is ambitious, taking into account the economy's growth rate, which had averaged less than five per cent in the last decade.

"As much as it is desirable to have a higher growth rate, the current structure of the Ghanaian economy is not poised to achieve that," he said at the Launch of the State of the Ghanaian Economy Report, 2001 in Accra.

The ISSER Director said to put the country on the path of growth, government needs as a first step, to transform the economy from reliance on few export commodities to enable it achieve growth rates of between eight to 10 per cent.

The report reviewed the performance of the economy against the backdrop of the decision to opt for Highly Indebted Poor Countries (HIPC) initiative, the introduction of the Ghana Government Index-Linked Bonds and the passage by Parliament of the new Bank of Ghana Act as well as the significant events for economic management last year and also made projections for 2002.

The report said all key macro-economic measures were stabilised last year despite a fall in the prices of the country's major export commodities. It said the results were achieved because of government's fiscal discipline and less reliance on the banking sector for funds.

Prof Asenso-Okyere said the greatest challenge that faced the economy now is how to sustain and deepen the macroeconomic stability that was achieved in 2001 as well as create the environment to mobilise both domestic and international resources to create wealth. He said for the government's declaration of “Golden Age of Business” to succeed there was the need to establish a link between the agricultural and industrial sectors to obtain the desired multiplier effects.

“There is the need to target some products and provide the required support to move them through the supply chain."

The ISSER Director also called for a regular review of the tariff structure so that tariff levels did not discriminate against local industry and urged Parliament to pass the competition bill to ensure fair competition. Prof Asenso-Okyere said integration into the global economy was important for realising the objectives of the golden age of business and called for efforts to develop consistent sectoral policies in line with the rules of the World Trade Organisation (WTO) for Ghana to take advantage of the new multilateral trading system.

The report also asked government to take into account the dynamics of the country's increasing population in planning development programmes, saying without it there would not be any substantial improvements in the people's living standards.