Seth Terkper envisages severe economic impact after Coronavirus

Former Finance Minister, Seth Terkper, says the Coronavirus pandemic will have dire effects on Ghana’s economyc.

Seth Terkper, who made this statement on Atinka TV’s 'Ghana Nie', noted that the impact will range from unemployment, businesses as well as revenues.

According to him, the lockdown has affected most businesses including government operations which have currently been halted.

He noted that after the pandemic, government would have to find a solution to the loss of revenues which means the deficits of the country will become bigger.

“The impact on the aftermath of covid-19 is severe and it is important that we take it seriously, it will affect employees, businesses, you know…. affecting even the government itself, it revenue.”

“Because if we don’t not get enough aid, what will happen is that government will definitely have to find a solution to the problems and the deficits will become bigger, we shall borrow more among other things. When things settle again, it is time for us to put mechanism in place, not to solve every problem because it will take time but to begin to build the structures for future occurrences ”, he said.

Speaking on the banks readjustment of interest rates by 1.5%; from 16% to 14.5%, Seth Terkper explained that the drop is meant to reduce interest rate and cushion banks to be able to work especially in this era.

Banks are expected to readjust their interest rates after the Monetary Policy Committee of the Bank of Ghana reduced the rate at which it lends to commercial banks by 1.5%; from 16% to 14.5%.

The Bank of Ghana (BoG) explained that the 150-basis points reduction in the rate which had been kept unchanged at 16% for at least five consecutive times, was because of global developments due to the COVID-19 pandemic.

The drop is expected to lead to a drop-in lending rates by all commercial banks.