We may not be ready for next economic crisis if fiscal reforms are not made - Seth Terkper

A former finance minister, Seth Terkper, has intimated that the country may not be prepared for the next economic crisis if it does not make the necessary fiscal adjustments now.

He stated that the country may not be able to survive the next economic crisis if matters of the economy are left to chance.

Seth Terkper whiles speaking during an economic dialogue on Ghana’s debt restructuring and the IMF programme noted that there is an urgent need for the country

Speaking to the media, Mr. Terkper, also called for the restoration of links in the fiscal framework such as deficits, fiscal balances, borrowing, and financing.

“There is the need to address the following fiscal structures; restore fiscal reforms, improve on accounting and fiscal standards, and restore the credibility of the Public Revenue Management Act and Public Financial Management Act with tightening of provisions. That is what I think needs to be selected and also improve on in the country. We cannot operate in an environment where every minister will have a discretion spending as to what to include and what not to include.”

“So, we see credibility as a piece to a structural way of stabilising the economy. If we keep depleting and then using those funds, we will not be prepared for the next crisis [economic]. And we can’t manage an economy without facing crises,” he was quoted by myjoyonline.com.

He also noted that the government must be cautious about spending whiles ensuring the independence of the Central Bank.

“And then we need to restore the links in the fiscal frameworks [deficits, fiscal balances, borrowing, financing]. These are principles, they are in the IMF, the Ghana Fiscal Stabilisation Act, and the public accounting standards,” he added.

He further said “We also need to clarify the rule and independence of the Bank of Ghana. I believe strongly that accountability has happened even in the mighty USA, UK where their Governors go to congress -their parliament – to be accountable. We need not threaten the independence of the central bank.”

SSD/FNOQ