Ghanaian economy has shown toughness despite global economic meltdown - Prof. Quartey

Professor Peter Quartey, the Director at the Institute of Statistical, Social and Economic Research (ISSER), University of Ghana, says the Akufo-Addo’s administration deserves plaudit for good management of the economy.

He gave the government 68 per cent for its performance so far.

He said although there was global decline of economic output that could have negative repercussions on the Ghanaian economy, the nation had witnessed Gross Domestic Product (GDP) growth of about 6.2 per cent in 2018 and seven per cent in 2019, indicating the government has managed the economy quite well.

For instance, he said, the non-oil sector experienced 5.2 per cent GDP growth in 2019, which shows that the economy was diversifying, implying that, should the oil prices decline or fluctuate on the world market, the local economy would not suffer too much losses.

He lauded Government for keeping the budget deficit below five per cent and maintaining inflation under a single digit while the exchange rate depreciation was relatively stable despite the turbulence the cedi experienced in 2017 and 2018, saying that, there is more room for improvement.

Prof. Quartey, who is also a Senior Economist, made this analysis in an interview with the Ghana News Agency in Accra, ahead of the presentation of the State of the Nation Address (SONA) by President Akufo-Addo to Parliament on Thursday, February 20.

Touching on other sectors of the economy, Prof. Quartey acknowledged Government’s efforts for keeping the manufacturing and agriculture sectors on positive growth rates.

However, he expressed worry over government’s failure to translate the positive economic fundamentals into job creation, noting that, there was no available data, indicating how much jobs had been created.

Prof. Quartey said it was imperative for the government or the Ghana Statistical Service to provide up-to-date data on the number of jobs created so that when anyone is analysing the performance of the economy, he/she can do a holistic analysis.

For instance, he said, inflation was at a single digit, but that doesn’t mean prices of goods and services were not increasing, saying, “Prices of goods are still increasing but the rate at which they change is slower”.

Responding to concerns that the positive economic fundamentals are not being felt in the pockets of Ghanaians, Prof. Quartey said it depends on the sector the person making the analysis works or draws his/her incomes from, explaining that, persons working in the manufacturing, agriculture, mining and industry sectors were making a lot of gains.

Additionally, persons benefiting from the government’s social intervention programmes like the Free Senior High School Policy, Planting for Food and Jobs, One District, One Factory and others, could better tell how they were experiencing the impact in their pockets or livelihoods.

In the same vein, those who lost their jobs and deposits in the financial clean-up as well as the unemployed would definitely complain about the bad state of the economy, he added.

For instance, in 2018, the growth rate in the financial sector was negative and in 2019, it grew by 1.2 per cent and so the growth in the financial and insurance sector was very marginal therefore, anyone at the receiving end would not feel the positive economic impact.

However, in spite of how anyone would look at the economy, Prof. Quartey was of the conviction that, the energy sector had remained relatively stable, saying,” For me, we have experienced stable power supply since 2017 and I can feel it in my life”.

He recalled the power crisis, otherwise known as “Dumsor” in 2012, 2013, 2015 and 2016, which affected a lot of businesses.

“In fact, one of the main causes of the banking sector crisis was the energy crisis because companies were not producing, cost of operation of banks was sky rocketing and bad debt increased,” Prof. Quartey pointed out.

He thus, commended the Government and Bank of Ghana (BoG) for taking a bold decision to liquidate insolvent banks and microfinance houses, adding that, no wonder the international community continued to praise the Central Bank for that audacious step.

The presentation of SONA is in compliance with Article 67 of the 1992 Constitution and the Standing Orders of Parliament, which stipulates that the “President shall, at the beginning of each session of Parliament and before dissolution of Parliament, deliver to Parliament a message on the State of the Nation”.